September 9, 2013 HEALTHCARE IT CONTINUES TO DRIVE DEAL VOLUME

Berkery Noyes has issued its Healthcare/Pharma Information and Technology report for half year 2013. According to the firm’s research, deal volume decreased 16 percent since second half 2012. However, the number of deals was close to the industry’s historical average for 2011 when examined on a half year basis. The median revenue multiple over the past six months declined from 2.2x to 1.9x, while the median EBITDA multiple moved slightly from 9.8x to 10.2x.

Roper Industries was responsible for the second highest value transaction in first half 2013 with the acquisition of Managed Healthcare Associates for $1 billion. Managed Healthcare Associates offers software and data analytics to pharmacies and long-term healthcare providers, amongst many other services. Roper Industries also completed the largest deal in full year 2012, acquiring Sunquest Information Systems for $1.39 billion.

Healthcare IT remained the most active market segment in first half 2013, representing 40 percent of the industry’s aggregate volume year-to-date. Moreover, acquirers are showing strong interest in companies that facilitate healthcare information sharing and interoperability. Allscript’s acquisition of medical software provider dbMotion for $188 million was one such example in first half 2013.

As for other notable deals in the report, athenahealth acquired Epocrates, a provider of point-of-care medical software applications, for $214 million. This was the highest value mobile-based healthcare deal throughout the past two-and-a half years. Meanwhile, the largest Pharma IT transaction backed by a financial sponsor in first half 2013 was JLL Partners’ acquisition of BioClinica, a provider of clinical trial management solutions, for $105 million.