Welcome to the Mergermarket Healthcare M&A Forum
Registration and Breakfast
Keynote Address: Cybersecurity’s Role in Value Creation (or Erosion)
For years, investors and consumers have hauled in enormous bounties harvested from the cost savings, innovations and efficiencies intrinsic to business digitization. Yet, across this open stretch of digital terrain cybersecurity risks manage to march unchecked, representing potential losses in the billions of dollars. In a recent joint survey produced by West Monroe and Mergermarket, 58% of executives and private equity investors in the healthcare industry said they discovered cybersecurity flaws following an M&A transaction. It’s no wonder 49% of respondents said they were dissatisfied with cybersecurity due diligence protocols.
Delegates will have the opportunity to hear from cybersecurity specialist Keith Swiat of West Monroe Partners review the findings of the joint survey and discuss the finer points on how organizations can strengthen their cybersecurity procedures during M&A due diligence and negotiations.
- What red flags should executives and investors look for during due diligence?
- How to quantify and mitigate cybersecurity risks.
- How to put safeguards in place post-close to ensure proper governance.
Latest Practices in Sourcing and Closing Deals
A Mergermarket survey found that 41% of potential acquirers feel revenues and profit growth is the most important operational metric to assess during due diligence. Generally, healthcare and life sciences companies have seen robust increases in profitability recently, yet significant variance in margins and buyout multiples exists across subsectors, prompting investors to conduct careful due diligence into the whys and wherefores of an individual company's financial performance. According to New York University Stern School of Business healthcare information and technology firms – 112 sampled – registered a five-year CAGR in net income of 17.27% and in revenue of 6.68% - numbers that stand out compared to other healthcare subsectors and which make a compelling case for sourcing deals among these businesses.
Panelists will also discuss other matters related to sourcing and closing deals throughout the healthcare industry.
- How are financial buyers of healthcare companies viewing reimbursement risk while assessing a potential target?
- How are mega deals, especially within a vertical integration context such as CVS Health's acquisition of Aetna and Cigna's purchase of Express Scripts, influencing middle market investment and M&A?
- What are some of the greatest regulatory risks that may encumber potential tie-ups? What are the common work-arounds?
- How are PE firms utilizing tech consultants in post-acquisition scenarios to gain an edge over strategics? How are PE firms competing with strategics for healthcare companies?
- What opportunities persist throughout the market after many established healthcare companies have divested various assets over the last few years?
- How are tighter due diligence timelines affecting deal processes?
Coffee Networking Break
Beyond drug development and medical devices, the healthcare industry is embracing other facets of technology to improve operational efficiencies and patient outcomes. Despite the industry facing pricing pressures and limited reimbursement potential, the higher care costs of such technologies are expected to be mitigated through improved outcome measures evidenced through long-term data. Healthcare economics are also propelling providers and payers to vertically integrate, which will enable cost containment while meeting consumer and patient needs.
Delegates will have an opportunity to hear panelists discuss how recent developments, both exogenous and endogenous to healthcare businesses, are driving sector-wide transformation.
- How are private equity "buy-and-build" strategies shaping healthcare M&A trends?
- Assessment of US demographic trends that will rattle the healthcare industry in the coming decades.
- How are financial sponsors and consultants advising companies with their own respective legacy IT systems during the due diligence period and ensuing integration?
- How are acquirers and sponsors utilizing technology, i.e. cybersecurity protocols, during M&A deals?
- How is the transition to "value-based care" affecting utilization of technology and contributing to balance sheet health?
- What recent technologies are showing promise for improving patient outcomes, slashing operating costs, restraining cybersecurity threats and creating efficiencies?
Conclusion of Event