1st Half 2023 Healthcare Industry Trends

1ST HALF 2023 KEY HIGHLIGHTS

The largest transaction in 1st Half 2023 was BioNTech’s announced acquisition of InstaDeep, a global provider of decision-making AI systems which allows enterprises to unlock data insights, realize value, increasing efficiency and speed across organizations, for $437 million.

1ST HALF 2023 KEY TRENDS

Total transaction volume in 1st Half 2023 declined by ten percent over 2nd Half 2022, from 221 to 199.

In terms of acquirer type, strategic volume decreased five percent on a half year basis, from 151 to 143. Private equity volume decreased 20 percent, from 70 to 56.

Total transaction value in 1st Half 2023 fell by 68 percent over 2nd Half 2022, from $10.9 billion to $3.51 billion.

The segment with the largest rise in volume in 1st Half 2023 over 2nd Half 2022 was Pharma IT with a 71 percent gain, from 17 to 29 transactions, returning to 1st Half 2022 volume.

The median revenue multiple increased from 1.6x in 2nd Half 2022 to 2.8x in 1st Half 2023.

M&A MARKET OVERVIEW

Berkery Noyes tracked 1,203 Healthcare/Pharma Information and Technology transactions between 2021 and 1st Half 2023, of which 222 disclosed financial terms, and calculated the aggregate transaction value to be $112.15 billion. Based on known transaction values, we project values of 981 undisclosed transactions to be $14.36 billion, totaling $126.52 billion worth of transactions tracked over the past two and a half years.

Transactions from 1st Half 2021 to 1st Half 2023 with enterprise values in the $10-$40 million range had a median revenue multiple of 3.3x, whereas those above $40 million garnered a median revenue multiple of 6.1x.

Disclosed median enterprise value multiples for all segments combined in this report during the last 30 months were 3.4x revenue and 13.1x EBITDA.