Healthcare & Life Sciences Industry Overview

Our Latest Insights | Fertility Services: Strong Demand with Room to Grow

Several long-term trends are fostering strong growth in the large and fragmented fertility services segment. In this new article, Andy Dixon, a managing director in the Harris Williams Healthcare & Life Sciences Group, explains the forces behind this emerging opportunity and three key considerations for buyers looking to participate in it.

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M&A Environment1

There have been a little over 793 M&A transactions in the healthcare & life sciences (HCLS) industry since the beginning of 2019, worth roughly $188.1 billion, compared to $241.7 billion for all of 2018. 153 of these deals were executed by private equity groups.

Notable recent transactions include the acquisition of the Worldwide Rights to Otezla Celgene Corporation by Amgen, Inc. (NasdaqGS: AMGN), Takeda Pharmaceutical – Xiidra Business by Permira Advisors, BlueROck Therapeutics by Bayer Aktiengesellschaft (DB: BAYN), and Cavion LLC by Jazz Pharmaceuticals (NasdaqGS: JAZZ).

Public Company Performance1

Stock prices increased for many HCLS companies during the past three months. In fact, the Harris Williams HCLS Composite Index increased 6.9%, while the S&P increased 4.9%. Notable sector increases include contract pharma manufacturing (increased 37.7%), assisted living (increased 30.2%), and specialty pharmacy (increased 26.9%).

Over the past 12 months industry-wide stock prices have experienced slight decreases as a whole, however the HCLS Composite Index shows a mild decrease of 10.8%. At the category level, products and devices grew by 8.2% on average over the past 12 months, followed by provider-based services declining 8.0%, and payor, provider and pharmacy support stock prices declining 9.6%. Specific stock price growth leaders over the past year include medical devices and products (24.4%), specialty managed care (20.6%), and home care, hospice, and home infusion (20.4%).

Industry News

The autism sector is still at the forefront of investors’ minds as 1 in 59 children are on the autism spectrum, according to the latest Centers for Disease Control and Prevention figures from 2014. Lately, however, more attention is on identifying autism in children as early as possible and support for the health and well-being of autistic adults, as opposed to finding a cure. Researchers already are seeing positive results with interventions such as behavioral treatments and speech therapy in toddlers.

OxyContin maker Purdue Pharma filed for Chapter 11 bankruptcy protection, collapsing under the weight of thousands of lawsuits from states and individuals seeking damages stemming from the opioid crisis. As part of the deal, Purdue would be restructured into a public benefit trust and will cost the company and its billionaire owners, the Sackler family, about $10 billion. The Stamford, Connecticut-based company has been accused by nearly every U.S. state of downplaying how dangerously addictive its blockbuster pain killer is while exaggerating its benefits. From 1999 to 2017, nearly 218,000 people died in the United States from overdoses related to prescription opioids, according to the U.S. Centers for Disease Control and Prevention.

M&A Overview1

Announced Healthcare & Life Sciences M&A

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Healthcare & Life Sciences M&A Trends

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Announced Private Equity M&A Activity

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Debt Markets Overview

Key Credit Statistics2

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Select Healthcare & Life Sciences Debt Offerings3

(by deal amount)

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Public Markets Overview1

Key Trading Statistics

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Public Company Sector Performance

(12-month % change in stock price)

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Equity Markets Overview

Healthcare & Life Sciences Industry Stock Performance1

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Top Equity Offerings4

(by proceeds)

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M&A Transactions

Announced U.S. Healthcare & Life Sciences M&A1

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What We’ve Been Reading

Health | Why the Focus of Autism Research is Shifting Away From Searching for a ‘Cure’

More attention is on identifying autism in children as early as possible and support for the health and well-being of autistic adults. When autism research started to really accelerate a couple decades ago, many scientists thought finding a cure might be easier. Today, the latest science points away from a single cure, but there are ways to help autistic people lead healthier, happier lives and more that can be done to help. Now, researchers have turned much of their attention to identifying autism in children as early as possible in hopes of intervening sooner with therapies to try to alter the developmental trajectory of their young brains. Katarzyna Chawarska, a professor of child psychiatry who leads Yale University’s Autism Center of Excellence in New Haven, Connecticut, is studying signs of autism in babies. “The reason why we are focusing so much on early diagnosis is that it is our hope that by intervening early, we can capitalize on still tremendous brain plasticity that is present in the first, second, third year of life,” she said. Researchers are already seeing positive results with interventions such as behavioral treatments and speech therapy in toddlers..

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Health & Science | Oxycontin Maker Purdue Pharma Files for Bankruptcy Protection

OxyContin maker Purdue Pharma filed for Chapter 11 bankruptcy protection, collapsing under the weight of thousands of lawsuits from states and individuals seeking damages stemming from the opioid crisis. Purdue’s board approved the much-anticipated bankruptcy filing, days after reaching a tentative deal to settle some 2,000 opioid lawsuits filed by local governments, Native American tribes and half the states suing the company over the toll of opioids. As part of the deal, Purdue would be restructured into a public benefit trust. The Stamford, Connecticut-based company has been accused by nearly every U.S. state of downplaying how dangerously addictive its blockbuster pain killer is while exaggerating its benefits. Prosecutors say the company’s marketing practices encouraged doctors to push higher doses of the narcotic and contributed to a public health crisis that has caused thousands of overdoses in the U.S. each year. From 1999 to 2017, nearly 218,000 people died in the United States from overdoses related to prescription opioids, according to the U.S. Centers for Disease Control and Prevention.

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Public Comparables

Payor, Provider, & Pharmacy Support Services1

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Products & Devices1

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Provider-Based Services1

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1. FactSet

2. S&P

3. PNC Debt Capital Markets

4. Company Filings

 

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