Welcome to the Q2 2019 HealthTech Heartbeat – Results International’s quarterly market update of the global healthtech sector covering both biopharma and healthcare IT.
Highlights in the quarter:
- Veeva Systems continued its impressive performance, now trading at nearly 24x CY2019 revenue (more than double any revenue multiple in the public biopharma IT and healthcare IT market) reflecting its leading market position in the biopharma CRM space.
- After previous rumours of IPO, Change Healthcare (healthcare revenue cycle management and analytics) began trading on Nasdaq – the first meaningful healthtech IPO since September 2016. The immediate market reaction was very positive, with the stock up 12.3% over four days of trading to the end of June.
- M&A activity across the sector remains buoyant – deal volume has surpassed that seen in the last four quarters, with several notable transactions across both biopharma IT and healthcare IT:
- In biopharma IT, Dassault Systemes, a product lifecycle management company, agreed to buy US-based Medidata Solutions $5.8bn (8.8x LTM revenue) to gain a foothold in the fast-growing clinical trial and medical research life sciences market – one of the largest biopharma IT transactions in recent years.
- In healthcare IT, UnitedHealth Group is set to bolster its capability through the acquisitions of Equian, a US-based medical claims billing, payments and error detection company for a reported $3.2bn and PatientsLikeMe, a US-based patient network and real-time research platform.
- There were also a number of buyers who made their first move for many years – namely CPSI’s acquisition of Get Real Health, a US-based patient outcome and engagement solutions provider (its first since November 2015) and also JP Morgan’s first ever foray into the market with its largest acquisition since the 2008 financial crisis, a $500m acquisition of InstaMed Communications, a US-based provider of healthcare payment transaction and management solutions.
The outlook for 2019 remains positive with M&A and fundraising activity very healthy. As a result, now is an excellent time to be contemplating fundraising, exit or growth through acquisition in the space – if you are, please do get in touch.