1ST HALF 2020 KEY HIGHLIGHTS
The largest strategic deal in 1st Half 2020 was Clarivate Analytics’ acquisition of Decision Resources Group, a provider of data, analytics and insights products and services used by pharma, biotech and medical technology companies, for $950 million.
Six of the industry’s top ten largest transactions year-to-date occurred in the Healthcare IT segment, making it the best represented sector in the top ten list.
1ST HALF 2020 KEY TRENDS
Total transaction volume in 1st Half 2020 decreased by eight percent over 2nd Half 2019, from 276 to 254. However, strategic volume remained nearly constant during this timeframe.
Total transaction value in 1st Half 2020 declined by 20 percent over 2nd Half 2019, from $16.11 billion to $12.82 billion.
The median revenue multiple rose from 2.4x in 2nd Half 2019 to 3.0x in 1st Half 2020. The median EBITDA multiple stayed about the same at 14.0x.
Both the Pharma IT and Medical Information segments saw increases in volume during the half year period. Pharma IT volume gained 41 percent, from 17 to 24 deals. Medical Information volume rose 44 percent, from 9 to 13 transactions.
M&A MARKET OVERVIEW
Berkery Noyes tracked 1,260 Healthcare/Pharma Information and Technology transactions between 2018 and 1st Half 2020, of which 246 disclosed financial terms, and calculated the aggregate transaction value to be $70.58 billion. Based on known transaction values, we project values of 1,014 undisclosed transactions to be $13.33 billion, totaling $83.91 billion worth of transactions tracked over the past two and a half years.
Transactions from 1st Half 2018 to 1st Half 2020 with enterprise values in the $10-$20 million range had a median revenue multiple of 1.7x, whereas those above $20 million garnered a median revenue multiple of 3.4x.
Disclosed median enterprise value multiples for all segments combined in this report during the last 30 months were 2.5x revenue and 12.2x EBITDA.