To make it easier for you to stay on top of key healthcare sectors, the Bourne Partners team generates an ongoing series of comprehensive market analyses, covering macro industry trends, financial performance, deal activity, and other relevant topics.
Despite the recent decline in M&A transactions in Q1 2018, activity is expected to ramp up in the second half of 2018. After two years of intense consolidation in the CDMO industry, companies are finding that in order to be successful, they must find new ways to add value. In an attempt to stand out against competition, CDMOs are evolving their businesses to expand beyond core capabilities while moving into adjacent categories.
This report examines the dynamic CDMO market landscape and recent M&A activity in the sector.Click here to view this sector report in its entirety.
As more pricing pressure builds, PBMS have maneuvered toward more transparent pricing models to appease regulators and customers despite IQVIA data proving that net brand price growth didn’t match the CPI for the first time in years. Of all PBM services, Medicare Part D and Medicaid have realized significant growth. Sharp increases in specialty drug prices should pay dividends to the greater specialty pharmacy market. Specialty drug spend has materially grown in retail and mail-order channels.
The report also features relevant precedent transactions that have occurred in the recent past.Click here to view this sector report in its entirety.
The 2018 Q1 Pharma Services Sector Snapshot reports the latest industry trends for a wide range of Pharma Services. The report includes comparable trading multiples and recent transactions in the CMO, CRO, Distribution, and Clinical Labs spaces. The report provides insight into valuation trends and industry performance relative to the S&P 500.Click here to view this sector report in its entirety.
Both the livestock/farm animal and pet/companion animal segments of the industry have experienced tremendous growth in recent years. This market snapshot includes highlights of key trends and developments shaping the industry as well as an overview of capital markets activity.Click here to view this sector report in its entirety.
Sports nutrition has expanded well beyond the niche bodybuilder demographic to include a broad range of workout and wellness supplements for all ages – and both genders. With a growing population looking to stay fit and balance active lifestyles with healthy diets, this report examines the evolving sports nutrition market landscape and recent M&A transactions.Click here to view this sector report in its entirety.
The June 2017 Pharma Services Sector Snapshot reports the latest industry trends for a wide range of Pharma Services. The report includes recent transactions in the CMO, CRO, and Distribution spaces. The report provides insight into valuation trends and industry performance relative to the S&P 500.Click here to view this sector report in its entirety.
The pharmacy benefit manager sector remains highly fragmented with a few dominant players competing for the largest payers and the remainder of firms in the space battling for smaller health plans. Due to escalating healthcare costs, manufacturers and some regulators continually point a finger in PBMs direction despite evidence to the contrary.
Recent valuations for PBMs and related subsectors have diminished slightly in the last twelve months back to historic norms. Despite this decrease, these companies haven’t experienced the same levels of volatility as most pharmaceutical companies.
This industry snapshot includes both precedent transaction comps and public trading comps for PBMs and companies in tangential sub-sectors, as well as valuation and market trends in the overall PBM space.Click here to view this sector report in its entirety.
With the global market for consumer health products in excess of $200bn, the sector is expected to continue to grow at a rapid pace driven by increased awareness around personal health, growing preference for over the counter medical remedies over prescription drugs, and the potential for decreased regulation around consumer health products.
Consumer health companies are seeing high valuations in both the public markets and M&A markets. This is largely driven by 2 factors: scarcity of quality brands with a loyal customer base and increased interest from pharmaceutical companies to diversify product portfolios into the consumer health space. Given factors on both the supply of and demand for consumer health products, we expect valuations to remain healthy.
The sector snapshot includes additional information on both the public markets and recent transactions in the consumer health space.Click here to view this sector report in its entirety.
The specialty pharmaceutical sector continues to offer strong future growth as specialty pharmaceuticals become an ever increasing piece of the global healthcare puzzle. Worldwide Spec Pharma sales reached $655 billion in 2015. Prescription drug sales are expected to reach almost one trillion dollars by 2020 (CAGR: 4.8% between 2014 and 2020).
Despite a decrease in equity performance over the last twelve months, the Spec Pharma market has experienced high growth in the last five years. After a spike in M&A activity and record-high multiples in 2014 and 2015, the market has returned to normalized levels. The recent slowdown can also be attributed to the negative publicity surrounding pricing practices, which has become a political issue in the election year.
The full report includes a detailed market overview, current market trends, headwinds and tailwinds facing industry participants, industry trading and transaction comps, recent deal profiles, and a collection of future growth drivers within the space.Click here to view this sector report in its entirety.
The consumer health market is comprised of OTC products (48%), nutraceuticals (41%), weight management products and other (7%), and sports nutrition products (4%). Both the OTC market and nutraceuticals market are broken out individually throughout this report
Increases in global healthcare costs are leading more individuals to focus on preventative care, self diagnosis, and self medication. US households spend an average of $340 per year on Consumer Health products, and research shows that 81% of adults use Consumer Health products as a first response to minor ailments. Physicians say that 10% of visits to their offices – millions of unnecessary appointments – each year could be avoided by treating common ailments with OTC medicines.
The nutraceutical market is being utilized to augment an increasingly robust OTC market, and growing competition among market participants has led to industry consolidation and a frothy M&A environment. High growth rates and attractive margins have fueled interest from “Big Pharma/Food” companies, eager to enter the market through strategic acquisition. Recent years have seen acquisitions, joint ventures and partnerships between and among industry players accelerate, particularly in the Nutrition segment.Click here to view this sector report in its entirety.
The Pharmaceutical Services segment can be broadly segmented into three primary sections: Contract Research Organizations (CROs), Contract Manufacturing Organizations (CMOs), and Pharma Distribution Companies. All three segments, by nature of operating through outsourced contracts from pharmaceutical and biotechnology companies, are highly sensitive to factors affecting the pharmaceutical industry on the whole.
Surveys show that the use of outsourcing is steadily rising with an average of 6.4 services outsourced per firm in 2014, up from 4.7 in 2013 and 2.5 in 2012. Pricing pressures created through intensifying regulation and patent expiration have shifted demand toward more cost-efficient contract organizations.
North America and Western Europe dominate market share, currently accounting for 60% of global CRO and CMO business. The US remains a hotbed for innovation with a focus on innovative R&D; over 50% of recently performed Phase I clinical trials were conducted in the US. Non-western countries, such as China and India, have shown a potential for high growth due to the viability of their own emerging markets and their more competitive input costs, which have drawn international pharmaceutical companies seeking to reduce prices. China and India are projected to account for 19% and 21% of the CMO and CRO market in 2017, up from 12% and 8% in 2012, respectively.
Market share for all segments is increasingly dominated by larger companies able to take advantage of scale and access to global markets. However, small agile players have created significant opportunities by filling gaps in the rapidly changing pharmaceutical landscape
The full report includes a detailed market overview, current market trends, industry trading and transaction comps, recent deal profiles, and a collection of future growth drivers within the space.Click here to view this sector report in its entirety.
Publicly traded specialty pharmaceutical companies have seen dramatic growth both in values as well as trading multiples so far this year. Below is a link to our YTD analysis of publicly traded specialty pharmaceutical companies. We have included both branded and generic specialty pharmaceutical companies to provide a clearer picture of what is driving value within the space.
Specialty Pharmacy remains a sector with the potential for strong future growth as specialty pharmaceuticals become an ever increasing piece of the global healthcare puzzle. As a result of higher utilization owing to expanded indications and a strong pipeline, specialty pharmacy revenues are expected to grow rapidly over the next two decades.
Specialty pharmaceuticals are dominating development pipelines with sales predicted to grow at twice the rate of traditional products. This rapid development is expected to result in a global specialty drug spend in excess of $160 billion in 2013. The systems that create, harness, and deliver these high-touch pharmaceuticals, including manufacturers, payers, providers, and pharmacies in particular, are also in a state of rapid evolution.
Likewise, while traditional retail pharmacy margins continue to decline as cost pressures intensify; patient involvement in the healthcare process increases; and safety standards rise, specialty pharmacies (including retail specialty pharmacies, mail-order specialty pharmacies, and infusion specialty pharmacies) have positioned themselves as fast-growing, high-margin niche players in their competitive landscapes by expanding their business models to include a wide variety of value-added services.
The full report includes a detailed market overview, current market trends, headwinds and tailwinds facing specialty pharmacies,industry trading and transaction comps, recent deal profiles, and a collection of future growth drivers within the space.Click here to view this sector report in its entirety.
Latin America continues its staggering economic growth, and its various national healthcare industries are poised to capitalize on a growing middle class and increased access to quality care and medications.
Currently, Latin America accounts for one-third of emerging market pharmaceutical sales and we anticipate future growth throughout the remainder of the decade. There is still tremendous room for healthcare spending, as regional healthcare spend as a percentage of GDP is only 7.7% (a majority of which comes from out-of-pocket spending).
The full report includes detailed market dynamics for Latin American countries of interest, trading and transaction comps, deal profiles, and a collection of future growth drivers within the region.Click here to view this sector report in its entirety.
The nutraceutical industry has experienced rapid growth across the globe. This trend is anticipated to continue as disposable income in developing countries increases and the aging global population turns toward healthier living as a way to defray rising healthcare costs.
With the global nutraceutical market projected to exceed $204 billion by 2017, companies from throughout the global supply chain will see tremendous growth opportunities. The Asia/Pacific region is of particular interest as growth within the functional food and ingredients markets are currently outpacing the growth within the industry dominating U.S. In fact, China is expected to be the world’s largest consumer of nutraceuticals by 2020.
However, industry growth is not limited to Asia, as U.S. consumption of functional foods continues to increase with new product groups targeted at digestive and cardiovascular health providing strong near-term growth. M&A activity is expected to grow as traditional “Big Pharma” and global food manufacturers seek to enter this high-growth industry through acquisition.Click here to view this sector report in its entirety.