July 2021 M&A activity consisted of several compelling themes:
- Consumer & Employer Healthcare Takes on the Public Markets: July saw a number of well-known consumer and employer healthcare businesses file or begin trading in long awaited public debuts. Everside Health Group, an onsite and near-site direct primary health care platform, filed with the SEC for an Initial Public Offering (IPO). Everside is capitalizing on employers’ interest in providing access to high quality care to employees in lower cost settings, and has successfully created a model that provides both physical and virtual care to meet the needs of a changing workplace environment. July also saw the successful public debut of two long awaited healthcare SPACs in Alight and Sharecare. Both companies have historically been active acquirers in the market and now have a public currency to aggressively expand their reach and capabilities. Alight Solutions utilized these proceeds immediately by recently acquiring ConsumerMedical. ConsumerMedical is a leading clinical advocacy and expert medical opinion company, aiming to help employers simplify and improve the way employees make medical decisions. TripleTree acted as the exclusive financial advisor on this transaction.
- Pharmacy Benefit Management: Controlling significant increases in drug spending has been a critical focus for plan sponsors as prescription drugs in the U.S. remain the fastest growing area of medical trend. This reality, and the growing impact of specialty drugs within it, has given rise to a number of vendors seeking to increase transparency in this market and help guide consumers into making the right choices based on both cost and appropriateness of drug utilization. This is leading to a very active M&A environment. The last twelve months have seen recapitalizations and buyouts for companies including Advent International’s recapitalization of RxBenefits, Parthenon Capital’s investment in RxSense, Advanced Medical Pricing Solutions' (AMPS) acquisition of Drexi, Water Street Health Partners' investment in Southern Scripts, and Nautic’s investment in EmpiRx. The most notable acquisition in July can be highlighted by RxBenefits' acquisition of Confidio. Confidio is a provider of pharmacy consulting services, offering a variety of solutions including drug price inflation tracking, pharmacy audit, and procurement services that enable clients to reduce healthcare costs. Additionally, GoodRx, a digital healthcare platform that aims to provide proscription drugs at affordable prices, announced an agreement with Surescripts to deliver real-time discount price information for prescribers utilizing Surescripts' network. Surescripts provides health information networking services with the intention of turning health data into actionable intelligence. We expect to see businesses specializing in management drug spending for plan sponsors to attract a lot of attention as companies try to create a controlled environment when it comes to spend management, in turn improving overall health outcomes.
Several transactions in July aligned with these themes:
- Foley Trasimene Acquisition Corp. ("FTAC") announced that its stockholders voted to adopt the Business Combination Agreement for FTAC’s proposed business combination with Alight Solutions and approved all other stockholder proposals in connection with the business combination. FTAC will deliver at least $2.68 billion, representing the second largest completed common equity raise in a SPAC transaction over the past several years.
- Sharecare, the digital health company that helps consumers manage all their health in one place, completed its business combination with Falcon Capital Acquisition Corp. (NASDAQ: FCAC), a special purpose acquisition company. As a result of the business combination, Sharecare will receive gross proceeds of over $571 million, prior to transaction expenses.
- Everside Health Group, a provider of in-person and virtual primary healthcare, filed with the SEC in July to raise up to $100M in an initial public offering. Everside Health is a technology-driven primary care platform that seeks to address the unmet needs of patients, providers, and clients, primarily self-funded employers, and labor unions.
- Lionheart Acquisition Corp. II a SPAC, announced a definitive agreement for a business combination that would result in MSP Recovery, a Medicare, Medicaid, commercial, and secondary payer reimbursement recovery provider becoming a publicly listed company. The transaction is anticipated to generate gross proceeds of ~$230M of cash, assuming no redemptions by Lionheart's public stockholders.
- RxBenefits, a technology-enabled pharmacy benefits optimizer, announced an agreement to acquire pharmacy benefits consulting firm, Confidio, which offers customized strategies and a robust suite of pharmacy benefit procurement, consulting, audit, and analytic solutions aimed at controling costs, improving outcomes, and preserving the integrity of clients' prescription drug benefits. The deal helps advance the organizations' strategic vision to deliver an affordable prescription benefit to both plan sponsors and healthcare consumers.
- GoodRx , a resource for healthcare savings, announced that it has entered into an agreement with Surescripts, a health information network, to deliver drug discount price information to prescribers using Surescripts' Real-Time Prescription Benefit when prescribing medications for uninsured patients and patients whose price information isn’t already available from their PBM or health plan.
- RazorMetrics, a provider of drug cost savings through a proprietary SaaS-based platform that offers cost control to self-funded employers and health plans, transparency for physicians, and affordable prescriptions for employees and members, launched The Partnership Collective. Partners in the Collective are benefit management platforms and other types of application providers that count large employers and health plans as clients.
- RxRevu, a provider of integrated decision support tools which improve patient access to care, and First Databank, a provider of drug and medical device knowledge that helps healthcare professionals make decisions, announced a partnership to bring prescription cost and coverage data to hospitals, health systems, and electronic health record vendors across the United States.
- Navitus Health Solutions, a full pass-through pharmacy benefit manager, announced that it has acquired EpiphanyRx, a PBM solution headquartered in Brentwood, TN, strengthening Navitus’ ability to serve the unique needs of employers. Lumicera Health Services, Navitus’ wholly-owned specialty pharmacy, has also purchased Quality Drug Clinical Care, a specialty pharmacy serving patients with HIV in Irvine, CA, to better serve patients located in the western United States.
TripleTree and TT Capital Partners continuously monitor the market to identify the forces and themes impacting the healthcare industry. Thanks for reading and, as always, let us know what you think!