Private equity injects fresh capital into healthcare
December 6, 2018

Healthcare-focussed private equity is on the brink of a record year, according to data specialist Preqin. Capital has flowed into the sector, with healthcare-focussed private equity-backed buyout deals seeing year-on-year increases in aggregate deal value since 2015.

As at November, 585 healthcare-focussed deals have been announced in 2018 to date, worth a total of US$56 billion – putting the year on track to surpass the 619 deals worth a record $57 billion seen in 2017.

Preqin says that deal activity looks set to increase, as the industry holds $56 billion in dry powder, pushing total assets under management to $199 billion.

Although just 84 healthcare-focussed private equity funds have held a final close as of November, they have raised $22 billion, making this year the fourth consecutive year in which the industry has raised over $20 billion. This also puts the year on track to hit similar levels to those seen in 2017, when 140 funds raised $26 billion.

Christopher Elvin, Preqin Head of Private Equity, said: "The private equity healthcare industry is booming, with strong fundraising, record levels of dry powder available to invest, and record numbers of deals in the sector.

"It is a testament to the healthcare industry's growing importance for private equity: having once been a sector with few dedicated players, it is now an integral part of the buyout deal making ecosystem. It'll be interesting to keep an eye on the US market in particular, as the country is experiencing fast-paced regulatory changes in its healthcare coverage, which may provide further opportunities for investment."





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Healthcare-focussed private equity is on the brink of a record year, according to data specialist Preqin. Capital has flowed into the sector, with healthcare-focussed private equity-backed buyout deals seeing year-on-year increases in aggregate deal value since 2015.

As at November, 585 healthcare-focussed deals have been announced in 2018 to date, worth a total of US$56 billion – putting the year on track to surpass the 619 deals worth a record $57 billion seen in 2017.

Preqin says that deal activity looks set to increase, as the industry holds $56 billion in dry powder, pushing total assets under management to $199 billion.

Although just 84 healthcare-focussed private equity funds have held a final close as of November, they have raised $22 billion, making this year the fourth consecutive year in which the industry has raised over $20 billion. This also puts the year on track to hit similar levels to those seen in 2017, when 140 funds raised $26 billion.

Christopher Elvin, Preqin Head of Private Equity, said: "The private equity healthcare industry is booming, with strong fundraising, record levels of dry powder available to invest, and record numbers of deals in the sector.

"It is a testament to the healthcare industry's growing importance for private equity: having once been a sector with few dedicated players, it is now an integral part of the buyout deal making ecosystem. It'll be interesting to keep an eye on the US market in particular, as the country is experiencing fast-paced regulatory changes in its healthcare coverage, which may provide further opportunities for investment."



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