Noteworthy M&A Transactions - August 2022

OCT 24
        This is our last monthly Noteworthy Healthcare M&A Transactions blog as we shift to a new weekly format later this fall. Keep an eye on your inbox in November for our new Healthcare M&A Weekly!

August 2022 M&A activity highlighted several compelling themes:
  1. Real-World Data (RWD) and Real-World Evidence (RWE) Continue to Fundamentally Change How Healthcare Constituents Make Decisions: Healthcare continues to produce massive amounts of data across a multitude of different vectors and settings. However, up to 80% of this data remains unstructured and unused after creation. The creation of RWE / RWD involves assembling, validating, and aggregating a multitude of disparate and siloed sources of available healthcare data, particularly data derived outside of the traditional four walls (commonly referred to as RWD), into a common, usable framework. These frameworks are leveraged to derive prescriptive analytics and AI for the benefit of payers, providers, pharma / biotech, and other healthcare constituents. This data is filling the gaps between clinical research and everyday healthcare practices, providing fundamental intelligent insights that capture the true analytical benefits and risks of any healthcare decision. Most commonly today, RWD and RWE are driving drug commercialization strategies in the forms of post-approval studies, health economic and outcomes research (HEOR) to maximize a drug’s economic return. But as healthcare continues to lean more heavily on data and analytics to drive decisions across the healthcare provider, pharma and payer ecosystems, expect companies that provide highly valuable data and corresponding analytics to remain highly sought after.
  2. Differentiated Revenue Cycle Management (RCM) Platforms Remain in High Demand: Declining provider margins due to a shift in payer mix as well as increased payer scrutiny on payments has caused providers to rethink their RCM strategies. Providers continue to look to outsource certain portions, if not the entirety, of their revenue cycle across various functions including patient intake, scheduling, accounts receivable, and denials management. M&A activity has remained robust for technology platforms or technology enabled services that provide strong and measurable ROI for providers. Expect market consolidation to continue as commercial-claims focused RCM companies look to add new service lines or technologies, and private equity buyers continue to stitch together point solutions to consolidate highly attractive end-market niches. 
  3. Increased Awareness in Mental Health and Applied Behavior Analysis (ABA): Following the COVID-19 pandemic, mental health problems have continued to rise in prominence, with a 25% increase in anxiety and depression worldwide. This, along with increased payer coverage for a variety of mental health conditions, has continued to drive buyer interest across the behavioral health continuum. In particular, ABA therapy, which has seen tremendous market activity in the past few years, continues to stay active as private equity buyers continue to make platform investments and roll up practices.
Several transactions in August align with the highlighted themes:
  • Coronis, a provider of RCM services, acquired MiraMed Global Services, a provider of business process outsourcing solutions, via its financial sponsor Veritas Capital. The add-on acquisition creates a scaled RCM platform providing a diverse range of technology enabled solutions.
  • Linden Capital Partners, a healthcare focused private equity firm, acquired Aspirion, a leader in technology-enabled healthcare revenue cycle management.
  • Revecore, a provider of revenue integrity and complex claims solutions, announced its acquisitions of Kemberton and Cura Revenue Cycle Management. These acquisitions will help Revecore scale as one of the leading RCM platforms across the US. TripleTree acted as exclusive financial advisor to Revecor for this transaction.
  • PurpleLab, an operator of a healthcare data and analytics platform intended to simplify and enhance the lifecycle of discoveries from clinical and claims data, has announced it received $40M in Series B funding from Primus CapitalTripleTree acted as exclusive financial advisor to PurpleLab for this transaction.
  • Availity, the largest real-time health information network, announced its acquisition of Diameter Health, a clinical analytics platform intended to improve health care quality and efficiency through clinical intelligence. TripleTree acted as exclusive financial advisor to Diameter Health for this transaction.
  • Stepping Stones Group, an autism and behavioral health provider, announced its acquisition of the Center for Behavioral, Educational and Social Therapies (CBEST), a provider of applied behavior analysis (ABA) services, through its financial sponsors Five Arrows Capital Partners, Leonard Green & Partners and Florac. This transaction is in line with the Stepping Stones Group’s M&A expansion strategy and marks their 4th acquisition in the last year.
  • Annexus Health, a leading healthcare technology company focused on the patient access journey, announced its Series B financing of $33M by Transformation Capital, a digital health growth equity firm.
  • MindCare Solutions Group Inc., a leading telepsychiatry provider, announced its acquisition of Psych360, a provider of mental health solutions to long-term care facilities.
TripleTree continuously monitors the market to identify the forces and themes impacting the healthcare industry. Thanks for reading and, as always, let us know what you think!
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