NEW YORK — July 7, 2020 — Berkery Noyes, an independent mid-market investment bank, today released its half year 2020 mergers and acquisitions trend report for the Healthcare/Pharma Information and Technology Industry.
The report analyzes M&A activity during the first half of 2020 and compares it with the four previous six-month periods from 2018 to 2019. This market includes information, technology, digital, and services companies utilized by the pharmaceutical, healthcare payer, and healthcare provider spaces.
Total transaction volume in first half 2020 decreased by eight percent on a half year basis. However, strategic volume remained nearly constant during this timeframe. Aggregate value declined by 20 percent, from $16.11 billion to $12.82 billion. The median revenue multiple rose from 2.4x to 3.0x, while the median EBITDA multiple stayed about the same at 14.0x.
The Healthcare IT segment saw volume remained about constant over the past six months. In terms of value, five of the overall 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. Notable segment deals year-to-date included TelaDoc’s announced acquisition of InTouch Health, a provider of enterprise telehealth solutions for hospitals and health systems, for $600 million; and Align Technology’s acquisition of exocad, which offers dental CAD/CAM software to dental labs and dental practices, for $412 million.
As for other select industry markets, M&A volume in the Healthcare Business Services segment decreased 27 percent on a half year basis, which was about the same as its first half 2019 level. Notable segment deals year-to-date included Clayton, Dubilier, & Rice’s acquisition of Huntsworth PLC, a healthcare communications and public relations company, for $665 million; and AMN Healthcare’s announced acquisition of Stratus Video Interpreting, which offers video remote language interpretation services for the healthcare industry, for $475 million.
Both the Pharma IT and Medical Information segments experienced 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. The largest deal in the Pharma related segments during first 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.
A copy of the HEALTHCARE/PHARMA INFORMATION AND TECHNOLOGY INDUSTRY M&A REPORT FOR HALF YEAR 2020 is available at the Berkery Noyes website.