Market Research Report
Strategic Trends in Private Equity and Venture Capital Funding for Healthcare
|Published by||CBR Pharma Insights||Product code||406642|
|Published||Content info||78 Pages
|Strategic Trends in Private Equity and Venture Capital Funding for Healthcare|
|Published: November 1, 2016||Content info: 78 Pages||
Private Equity is a term used to refer to money invested in private companies, and those companies become private through investment. However, in the financial industry the term is used to refer to firms that buy companies through leveraged buyouts (LBO) - the acquisition of another company using a significant amount of borrowed money to meet the cost of acquisition (Agres, 2005).
More specifically, Private Equity companies take existing companies with existing products and existing cash flows, and restructure them in order to enhance the financial performance. Success for PE investors lies in generating higher returns by pursuing opportunities with target companies that have significant growth potential, by adding value to the company while it is owned, and by executing a successful exit strategy.
PE and VC funds have been important participants in a wide range of industries for many decades. This is particularly true in the healthcare industry and, although to a much lesser extent than previously, they remain one of the few sources of funding for start-up companies, which can that often bring disruptive and life-saving medical interventions and technologies to the marketplace (NVCA, 2016a).
In 2007, the total value of completed global healthcare Private Equity deals was USD 66.2Billion. This plummeted by 81% to USD 12.6Billion in 2008. In 2010, the market showed signs of recovery when deal values reached an aggregate of USD 33.9Billion, an increase of 170.3% from 2008. However, recent years have witnessed a steady decline, with 2015 and 2014 being the exception. Deal values exhibited a negative compound annual growth rate (CAGR) of 11.8% from 2010 to 2015, with 2015 recording a total of USD 18.1Billion. Despite the recent uptick, 2015 values were nowhere near pre-crash levels. For example, PE deal values recorded totals of USD 53.6Billion and USD 66.2Billion in 2006 and 2007, respectively.
In terms of deal volume, North America and Europe continue to be the main focus for Private Equity investments in healthcare. The North American region has witnessed a decline in deal activity in recent years, however. From 2010 to 2015, the deal activity in the region exhibited a negative CAGR of 4.1%.
The report "Strategic Trends in Private Equity and Venture Capital Funding for Healthcare" provides a comprehensive analysis on emerging investment trends within the healthcare industry. Private equity (PE) and venture capital (VC) funds have been important participants in a wide range of industries for many decades - particularly the healthcare industry.
Companies mentioned in this report: Axovant Sciences, NantKwest, Adaptimmune Therapeutics, Spark Therapeutics, Aimmune Therapeutics, Blueprint Medicines, RegenxBio, ProNAi Therapeutics, Seres Therapeutics, Global Blood Therapeutics.