Healthcare M&A activity continued to cool through Q3 2025, with 1,056 closed transactions over the last twelve months (LTM), down from 1,200 last quarter. Despite reduced volume, valuations remained healthy, with a median TEV/EBITDA multiple of 12.77x and TEV/Revenue multiple of 3.54x, underscoring investor confidence in the sector’s long-term outlook. Strategic buyers drove over 86% of deal flow, targeting specialized assets in biotech, life sciences, and healthcare services. While financing conditions remained tight, strong corporate balance sheets and renewed momentum in elective care supported ongoing consolidation and investment in innovation across the industry.1
Valuations in healthcare stabilized in Q3 2025 as buyers adjusted to a normalized rate environment and selective dealmaking. Revenue multiples held at 3.63x, while EBITDA multiples eased to 12.77x down from 16.02x last quarter, reflecting discipline across large-cap and mid-market transactions. Activity concentrated in segments with durable demand—biotech, medtech, and digital health—while growth-stage firms faced pressure from slower funding cycles and higher diligence requirements.
Strategic Acquirers: Strategic buyers dominated Q3 2025 activity, representing 910 deals (86%) in the LTM period. Consolidation was led by global pharma, medtech, and integrated health systems pursuing scale and innovation pipelines. Notable deals included Sanofi’s $9.9B acquisition of Blueprint Medicines and Optum’s $3.9B purchase of Amedisys, reinforcing continued alignment between pharmaceutical discovery and care delivery.1
Financial Buyers: Financial sponsors accounted for 128 deals (12%) in the LTM period, maintaining a selective focus on specialty providers and healthcare IT platforms. Representative activity included Battery Ventures’ acquisition of Enzo Biochem and Keensight Capital’s investment in Isto Biologics, reflecting investor appetite for recurring revenue and contract manufacturing opportunities.1
Healthcare M&A remained more resilient than cyclical sectors like retail and industrials, buoyed by its recession-resistant fundamentals and recurring revenue base. However, it lagged high-growth technology segments in valuation expansion. Global healthcare M&A volume is projected to decline slightly (~3–5% YoY) in 2025 before stabilizing as macroeconomic pressures ease and strategic acquirers re-engage. With strong fundamentals and innovation momentum, the sector is positioned for a moderate rebound in 2026, supported by ongoing consolidation across biotech, services, and digital health.
Top U.S. States: Deal flow remained geographically diversified across major healthcare and life sciences hubs. California led all states with 159 transactions, followed by Florida (74), Texas (66), Massachusetts (63), and New York (63).1
Cross-Border Trends: Cross-border M&A activity in Q3 2025 was driven by major European acquirers such as Sanofi, Merck KGaA, and GSK, which pursued U.S. biotech and therapeutic assets to expand global pipelines and strengthen specialty drug portfolios.
| Target | Buyer | Value ($mm) |
| Blueprint Medicines Corporation | Sanofi | $9,903.60 |
| Amedisys, Inc. | Optum, Inc. | $3,903.98 |
| SpringWorks Therapeutics, Inc. | Merck KGaA |
$3,788.97 |
| AmWiner & Raphe Holdings, LLC | Bachem Americas, Inc. | $2,300.00 |
| Nova Biomedical Corporation | Advanced Instruments, LLC | $2,200.00 |
| Capstan Therapeutics, Inc. | AbbVie Inc. | $2,100.00 |
| Efimosfermin alfa drug of Boston Pharmaceuticals | GSK plc | $2,000.00 |
| Verve Therapeutics, Inc. | Ridgeway Acquisition Corporation | $1,379.28 |
| SiteOne Therapeutics, Inc. | Eli Lilly and Company | $1,000.00 |
| Sage Therapeutics, Inc. | Saphire, Inc. | $804.81 |
| Target | Buyer | Value ($mm) |
| Prospect Medical Systems, Inc. | Astrana Health, Inc. | $707.90 |
| Vigil Neuroscience, Inc. | Sanofi | $605.91 |
| DURECT Corporation | Bausch Health Americas, Inc. | $407.25 |
| Y-mAbs Therapeutics, Inc. | SERB S.A.S. | $403.12 |
| iTeos Therapeutics, Inc. | Concentra Biosciences, LLC | $338.89 |
| Target | Buyer | Value ($mm) |
| Enzo Biochem, Inc. | Battery Ventures L.P. | $40.15 |
| Clearwater Security & Compliance LLC | Sunstone Partners Management, LLC | n/a |
| Isto Biologics | Keensight Capital | n/a |
| West-Star Physical Therapy, INC. | Accord Asset Partners, LLC; Paras Capital Partners | n/a |
| OrthoNOW Doral, LLC | Redwood Growth Partners | n/a |
Source S&P Capital IQ as of 10/6/2025 and PCE Proprietary Data
Opportunities: Buyers that can demonstrate tech-enabled labor productivity, robust care coordination, or scale in outpatient/post-acute channels are likely to command premium valuations. Digital health rollouts, AI-enabled platforms, and strategic pharma/GLP-1 initiatives remain areas of high interest.4
Risks: Rising wage inflation and operating-cost pressures may compress margins, lengthen earn-out periods, and tighten financing for leverage-heavy deals. Heightened regulatory scrutiny of hospital/system consolidation and private equity-backed acquisitions could increase transaction friction and legal risk.6
Predicted Activity: Healthcare M&A is expected to remain selective but steady, with continued platform investments and tuck-in acquisitions in home health, behavioral health, and Health tech. Opportunistic hospital and post-acute asset sales will lift regional deal counts, especially among distressed or underperforming operators.3
David Jasmund |
Jon Gogolak |
Bradley Scharfenberg |
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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 Sources:
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