Category: MedDevNews

Q3 2024 saw the organ transplant market thriving, driven by rising demand and advanced preservation technologies, and the IPO market rebounded, reflecting investor enthusiasm for AI-enabled diagnostics. M&A activity is recovering, with OEM transaction volumes increasing year-over-year and CMO transactions gradually improving despite declining investment activity. England also attended the Women’s Health Innovation Summit in September and has launched a new Women’s Health sector breakout for market performance analyses. This edition also offers insights on the upcoming election and its potential impacts on medical device markets.

England also announced the strategic sale of Collagen Solutions,  a leader in medical-grade collagen and tissue-based biomaterials, to RTI Surgical, a leading tissue engineering CDMO.

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Medtech valuations decreased in Q2 2024, and while investments in the medical device sector have been under pressure since 2021, Q2 U.S. private financing trends indicate a promising path toward sustained growth. U.S. private financing exhibited a notable recovery, seeing a 10.2% increase from the previous quarter. The average amount of capital raised stood at $10.3 million, marking a substantial 70% surge from Q2 2023. Read the full report here.

The first quarter of 2024 showed continued softness across the MedTech M&A and private financing market, with a decline across all categories compared to 2023. However, the industry is gearing up for an increase in activity in late 2024 and 2025, especially with technology-driven, highly differentiated OEMs and PE-backed CMOs that emerged from the post-pandemic slump as stronger organizations. Read the full report here.

For more insights on sector trends or to discuss your strategic priorities, contact one of our healthcare experts.

Ending 2023, economic uncertainty, declining reimbursement rates, cybersecurity, and talent scarcity have been identified as the industry’s biggest risk factors, leaving some parties less optimistic about this year’s financial outlook. However, England has been hearing an increase in discussions related to M&A and capital raises and is optimistic that 2024 will not be as slow as 2023. In addition, budget increases will come for line items such as transformative technologies such as AI, leaving industry leaders more optimistic for 2025.

England & Company Healthcare Investment Banking team closed multiple transactions in Q4 2023 in the orthopedic medical device and extremity markets. Notably, England facilitated the strategic relationship between Extremity Medical and Henry Schein, with Henry Schein being a significant new entrant in the orthopedic extremities market. The England team completed four orthopedic transactions in 2023 and tops the global rankings in investment banking for orthopedic companies.

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Q3 showed a continued decrease in the number of OEM transactions, while a few larger transactions brought up the overall transaction value. Enovis was particularly active in M&A, making or announcing four other acquisitions so far this year.

This quarter, England closed the sale of SEAL to Enovis, representing our 11th transaction in orthopedics and 18th in Medtech more broadly. Read the full report here.

Q2 showed a decrease in OEM transactions and private financings, but the bright spot was the increase in the number of contract manufacturing transactions compared to Q1. There were some notable transactions, including the spinout of assets from Olympus and BD, and interesting financings in orthopedics, including Onkos Surgical. England completed two transactions this quarter, even given the macroeconomic headwinds.

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Market indicators were generally positive in Q4 2022, despite recession concerns. The number of financings, OEM M&A transactions, and CMO M&A transactions increased to highs for the year. Additionally, disclosed value for these deals remained substantial in the case of OEM M&A hitting a new high. Public market returns were mostly negative but improved relative to Q3, with two verticals -CMO and Organ & Tissue Transplant -showing positive returns. CMOs were a clear winner in Q4, doubling in the number of M&A transactions relative to Q3.

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The effects of the market-wide contraction continued to be seen across multiple metrics in Q3 2022. Public market returns were again negative across all verticals, with the best performing sector of large diversified still down 11.9% for the year. Most sectors again underperformed the S&P 500, though Spine Orthopedics, CMOs, Large Diversified, and Lab Diagnostics exceeded the index. OEM M&A transaction activity was down relative to Q2 2022 and Q3 2021, while CMO M&A remained flat versus Q2 2022, at a level down significantly versus prior year numbers. Private financings rose for the quarter after over a year of declines. OEM disclosed value increased slightly but did not approach the highs of 2020 or 2021.

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The effects of the market-wide contraction were seen across multiple metrics in Q2 2022. Public market returns were negative across all verticals, with valuations falling sharply. Most sectors, with the exception oflab diagnostics, infection control & reprocessing, and large diversified, underperformed the S&P 500. CMO M&A transaction activity was down, as were private financings and OEM disclosed value. The number of OEM M&A transactions, however, did manage to increase despite market concerns.

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