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    Healthcare Q3 2022

    Q3 2022 Healthcare

    Industry Trends

    Small Businesses to Feel Biggest Hit from Rising Premiums

    As high prices for medical services surge through the healthcare economy, insurers are proposing a median monthly premium increase of 10%, according to Kaiser Family Foundation, with some insurers seeking rate hikes as high as 20%. The increased premium comes as hospitals and healthcare providers seek to cover their growing expenses. Enhanced federal assistance will protect consumers from price hikes but does not include small employers, which are expected to experience the biggest hit.1

    CVS Pursues Home Care with Planned Acquisition

    CVS announced its plan to acquire Signify's healthcare platform for $8 billion as the company sets its eyes on home health. The acquisition follows a massive push to become a vertically integrated medical services provider, most notably acquiring Aetna for $69 billion in 2018. The all-cash deal is expected to close in the first half of 2023 and will add 10,000 clinicians and technology to support providers, plans, and employers for in-home care.2

    Amazon Ends Virtual Health Service

    Amazon is shutting down its expansion of Amazon Care, its virtual health service they announced earlier this year. The shutdown, set to cease at year-end, comes after finding long-term challenges with the service, according to a company email. While Amazon is shutting down the service, the company remains focused on building out its healthcare, most recently acquiring primary care provider One Medical for $3.9 billion and bidding for home health services provider Signify.3

    House Proposes New Bill in the of Wake of Increasing Cyberattacks

    Following a nearly threefold increase in sensitive health data breaches over the last three years, the House proposed a new bill to tighten healthcare cybersecurity. The Healthcare Cybersecurity Act of 2022 would direct the Cybersecurity and Infrastructure Security Agency to collaborate with Health and Human Services in completing a detailed study and address recommendations for cybersecurity workforce training, recruitment, and retention. The legislation also authorizes cybersecurity training for healthcare providers on risks and mitigation strategies.4

    Largest Transactions Closed

    • Target
    • Buyer
    • Value($mm)
    • Turning Point Therapeutics, Inc.
    • Bristol-Myers Squibb Company
    • $3,975.80
    • Affinivax, Inc.
    • GSK plc
    • $3,300.00
    • Hospice and Personal Care Divisions of Kindred at Home
    • Clayton, Dubilier & Rice, LLC
    • $2,800.00
    • Sierra Oncology, Inc.
    • GSK plc
    • $1,930.68
    • Parata Systems, LLC
    • Becton, Dickinson and Company
    • $1,525.00
    • TeneoTwo, Inc.
    • AstraZeneca PLC
    • $1,265.00
    • Natus Medical Incorporated
    • ArchiMed SAS
    • $1,206.64
    • Affera, Inc.
    • Medtronic plc
    • $925.00
    • Radius Health, Inc.
    • Gurnet Point Capital Limited; Patient Square Capital, LP
    • $893.05
    • GI Alliance
    • Apollo Global Management, Inc.
    • $785.00

    Other Financial Buyer Transactions Closed

    • Target
    • Buyer
    • Value($mm)
    • Sharps Compliance Corp.
    • Aurora Capital Partners
    • $191.89
    • Calko Medical Center
    • MedProperties Holdings, LLC; Physicians Realty Trust
    • $81.50
    • Ardenwood Portfolio
    • JLL Income Property Trust, Inc.
    • $80.50

    Other Strategic Buyer Transactions Closed

    • Target
    • Buyer
    • Value($mm)
    • Epizyme, Inc.
    • Ipsen Biopharmaceuticals, Inc.
    • $707.11
    • 50 Skilled Nursing Facility Portfolio in Texas
    • The Jack and Nancy Dwyer Workforce Development Center, Inc.
    • $590.00
    • OpenEye Scientific Software, Inc.
    • Cadence Design Systems, Inc.
    • $500.00

     

    Source S&P Capital IQ as of 10/13/2022 and PCE Proprietary Data

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    Data Assumptions

    This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

    Glossary

    EBIT - Earnings Before Interest and Taxes
    EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
    LTM - Last Twelve Months
    TEV - Total Enterprise Value

    Sources:

    1. Armour, Stephanie & Mathews, Anna. "Affordable Care Act Health-Plan Premiums Set to Rise." The Wall Street Journal, 9 September 2022.
    2. Pifer, Rebecca. "CVS nabs home healthcare company Signify for $8B following bidding war." Healthcare Dive, 6 September 2022.
    3. Palmer, Annie. "Amazon is shutting down its telehealth service, Amazon Care." CNBC, 24 August 2022.
    4. Fox, Andrea. "House bill proposes a new strategy to protect patient data." Healthcare IT News, 27 September 2022.

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