Mergers and Acquisitions of 2021 in the Healthcare Sector
January 18. 2022
Every year, merger and acquisition activity significantly influences sectors, ranging from multibillion-dollar mergers that can fundamentally transform a company’s economic environment to smaller purchases that help big companies stay competitive. Significant private equity acquisitions in healthcare, cybersecurity, semiconductor chips, microprocessors, cloud computing, food delivery, and other industries were among the biggest mega M&A deals in 2021. The healthcare industry’s M&A activity has been better than expected, with over 3,000 acquisitions expected by the end of the year. This is a more than 25% increase over 2020, according to law firm Epstein Becker & Green.
Here are some notable mergers and acquisitions in the healthcare sector that dominated the news in 2021:
Acadia Healthcare Company, Inc. (NASDAQ: ACHC), a mental health services company, declared a merger with Fairview Health Services, one of Minnesota’s most prominent healthcare institutions. Acadia and Fairview are working on a new comprehensive plan to manage 144 inpatient mental health beds in the Twin Cities’ East Metro and surrounding areas to improve mental health care services.
“This joint venture expands our acute service line into Minnesota, providing care for patients across the region who struggle with acute symptoms of mental health and substance use disorders,” said Acadia CEO Debbie Osteen in a statement.
Oracle Corporation (NYSE: ORCL) agreed to pay $28 billion for Cerner Corporation. Cerner Corporation is a provider of health information technology services, systems, and hardware in the United States. Oracle intends to expand its foothold in the healthcare business by acquiring Cerner, a digital health provider.
“Working together, Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information—enabling them to make better treatment decisions resulting in better patient outcomes,” said Larry Ellison, Chairman and Chief Technology Officer, Oracle.
Cerner and Oracle, working together, can address these difficulties and alter healthcare delivery by giving better information to medical practitioners, allowing them to make better treatment decisions and improve patient outcomes.
Bain Capital and Hellman & Friedman affiliates bought Athenahealth, a Watertown, Massachusetts-based producer of healthcare software, for $17 billion. Bain Capital and Hellman & Friedman will buy the cloud-based electronic medical record company from current private equity owners Veritas Capital and Evergreen Coast Capital.
Athenahealth works with almost 140,000 ambulatory care providers in all 50 states, covering more than 120 specialties.
There were even more multibillion-dollar acquisitions in 2021. Headspace, a meditation and mindfulness startup, and Ginger, an on-demand mental health app, have merged to form Headspace Health, a $3 billion mental health corporation.
“The thesis going in was that we had a great culture fit and are very mission-aligned, and, so far, it’s played out,” Russell Glass, formerly the CEO of Ginger and now Headspace Health CEO, told Fierce Healthcare. “We are excited to start to bring the promise of the two companies together.”
Each mental health and wellness firm has garnered more than $200 million in venture capital from investors. As Headspace Health, the two companies will sell directly to customers and businesses and health plans, delivering relief from mental health symptoms such as anxiety, depression, and more severe disorders.
Carbon Health paid an unknown price for Alertive Healthcare, a remote patient monitoring firm. Alertive’s remote monitoring software was designed to help clinicians in various fields. Carbon’s business strategy was expanded into the remote monitoring domain due to this acquisition. Both firms intend to use remote monitoring technologies like wearables and sensors to extend their home-based care.
“Carbon Health has already seen the power of RPM tools throughout the COVID pandemic in enabling better care for patients remotely with blood pressure cuffs, glucometers and scales,” said Myoung Cha, chief strategy officer and president of Home-Based Care at Carbon Health.
Molina Healthcare Inc., located in Long Beach, is expanding its presence in New York, the country’s largest metro health market. Molina paid $110 million for the Medicaid long-term care business of AgeWell New York, situated on Long Island.
Molina Healthcare is a managed-care organization that offers health insurance via government programs like Medicaid and Medicare. Patients who are chronically sick or disabled in the New York City boroughs of Brooklyn, the Bronx, Manhattan, Queens, and surrounding Nassau, Suffolk, and Westchester counties can get long-term treatments at home or home in the community through the specialist managed care insurer.
This purchase aims to provide exceptional care and compassion to all Molina members, and the companies anticipate a seamless integration.
TransUnion, a credit reporting corporation, sold its healthcare data and analytics business to nThrive and its financial backer Clearlake Capital Group for $1.74 billion in cash. The acquisition will give nThrive, an RCM platform and software company, an end-to-end healthcare RCM software and technology platform with patient monetary clearance and eligibility capabilities that will reduce complexity and drive profitability, allowing suppliers and payers to provide better care.
Intelerad Medical Systems purchased cloud-based medical imaging startup Ambra Health in a significant radiology software acquisition on October 15, 2021, becoming a $1.7 billion corporate imaging behemoth.
Following the acquisitions of clinical workflow automation company Heart Imaging Technologies (HeartIT), Lumedx, a cardiovascular analytics company based in Oakland, California, and Digisonics, specializes in obstetric and cardiovascular reporting systems, Intelerad made its fourth acquisition in 2021.
According to the firms, the acquisition combines Intelerad’s picture archiving and communications system (PACS), which archives pictures and reports electronically, with Ambra’s comprehensive cloud VNA, image interchange features, and research and pathology capabilities. As a result, according to the merged firm, it now handles over 10 billion medical photos and reads more than 130 million tests each year.
In April, Microsoft agreed to pay $19.7 billion for Nuance Communications, voice recognition, and artificial intelligence business. By bridging the gap between physicians and Microsoft Cloud for Healthcare, the purchase places Microsoft as a prominent participant in healthcare technology. This would be Microsoft’s second-largest acquisition ever, after only the $26.2 billion it spent for LinkedIn in 2016.
“With this sale, we will reach an important milestone in our journey towards a more focused strategy of advancing our Conversational AI, natural language understanding and ambient clinical intelligence solutions,” Nuance CEO Mark Benjamin said in a statement. Nuance’s products include Dragon Ambient eXperience, Dragon Medical One, and PowerScribe One for radiological reporting.
23andMe, a consumer genetic testing firm, paid $400 million in cash and shares for Lemonaid Health, a virtual care and pharmacy provider, better incorporate its customized genetics service into primary care. Lemonaid Health’s telemedicine and prescription drug delivery services were added to 23andMe’s consumer business as part of the deal.
“Our vision is to provide consumers convenient access to personalized, proactive and genetically based primary care,” said Anne Wojcicki, CEO, and co-founder of 23andMe, during a conference call with investors.
To understand the current healthcare trends MarketCurrents is coming up with an event on Healthcare Sector on January 27, 2022, 11am -12pm EST. CIO of McGeever Family Office, Kevin Schimelfenig and Sanjay Mehta of the Mehta Ventures Family Office have been confirmed as panel speakers.
The event will focus on the following aspects:
· Co-investing In Healthcare products with world leading companies via Joint-Ventures
· Understanding product portfolio rationalization dogma.
· Creating capital efficiency, controlling assets vs ownership
· Mega mergers have created opportunities
To register for the event you may click here.
Related Links:
Why Investors Should Pay Attention to Metaverse Assets
Real Estate Market Outlook From the Perspective of Family Offices
