2008 Key Highlights
- Transaction volume in 2008 increased by
16 percent over 2007 from 134 in 2007
to 156 in 2008
- Transaction values in 2008 decreased by
9 percent over 2007, from $9.75 billion
in 2007 to $8.89 billion in 2008
- Private equity activity increased in both
volume and value over 2007 levels;
however, we did observe a notable
decrease in PE activity during the 2nd
half of the year
2008 vs. 2007 Key Trends
- Healthcare M&A will remain active
- Healthcare IT will continue to lead the
way with strong deal volume
- Private equity will continue to close deals
even in the current credit environment
but will need to be more creative
- Strategic acquirers will continue to acquire selectively
Market Overview 2006-2008
Despite a weakening economy, 2008 was a solid year for M&A in the pharma and healthcare
information and technology industry. The total volume of M&A transactions in the pharma and
healthcare information and technology market
for 2008 increased to 156 transactions, an
increase of 16% over the previous year;
however, the total value decreased to just
below $9 billion, a decrease of 9%.
The most active segment for 2008 by
volume was Healthcare IT, with a total of
75 transactions, or 48% of the total volume.
Healthcare IT has been the most active
segment for the past several years and we do
not expect this to change in the upcoming
year.
We observed a decrease in financial
acquisitions during the second half of 2008,
even though overall activity in the market
as a whole remained solid throughout the
year. The industry ended the year on a
strong note - Q4 2008 was more active in
terms of deal volume than it had been for
the previous 5 years.
A notable trend for 2008 is that while the aggregate value of the industry’s top 10 deals
and the ratio of transaction value/volume decreased from previous years, we observed
an increase in 2008 median enterprise value. This suggests an overall increase in buyer
selectivity as well as increasing activity and interest in the middle market.
Looking Ahead
We expect to see continued deal activity in the pharma and healthcare information and technology
markets. These markets are less impacted by the economic downturn and may benefit from increased interest in healthcare.