Of all medtech company buys over the last two years, private equity firms accounted for just 8%, as the sector is buffeted by a range of pressures amid steep profit falls says an EY report.
Growth and defensive characteristics mark healthcare out as an attractive sector for investment as high prices and lower debt multiples hit private equity returns, says alternatives manager Partners Group.
Baker & McKenzie’s report also highlights that Asia’s middle classes are expected to spend $2trn a year on healthcare by 2018.
Private equity made up just 8% of the healthcare deals completed in the $500m-$5bn range last year according to Bain & Co.
Healthcare-focused funds are seeing increased interest from investors and the number failing to hit target continues to fall.
In 2015, the average size of healthcare-specific funds fell for the first time since 2012, according to PEI data.
PEI data reveals that North America receives almost three times the private healthcare capital raised for healthcare-specific funds than its nearest competitor region.
PEI data for 2015 reveals that healthcare-specific capital raises continued to rise, while healthcare generalist fundraising dropped for the third consecutive year.
The venture capital arm of the US health insurance company will seek investments in companies at seed to growth stages in the healthcare sector.
Healthcare provided the highest returns for private equity in 2014, according to a new analysis from Cambridge Associates.