Healthcare Investment Index 2022

BRG’s fifth-annual Healthcare Investment Index reviews recent healthcare investment activity and prospectively surveys investors about future areas of interest in the year ahead.

The index is based on an assessment of recent deal activity collected and tracked annually each fall since 2017. Two sets of information provide a sense of trends in private equity (PE) healthcare investment:

• A review of recent transaction data based on an assessment of recent deal activity and inquiries.
• Healthcare investor survey data based on responses from 127 US healthcare investment professionals representing eighty-eight unique PE funds.
• All healthcare investors surveyed are in senior positions, with an average of twenty-three years in healthcare-related investment, and 65 percent have over twenty-five years of experience.

When investors were polled in October 2021, 77 percent said they expected 2022 to be a potentially more pivotal year for investors given the lows and highs of the prior two years. A majority correctly predicted a more competitive deal environment and that they would be “more circumspect” around physician practice management companies (PPMs). Nearly 60 percent said 2022 would be an important “reset” given what lies ahead in the next five-plus years, like the potential effects of federal deficit reduction, physician shortages, and the potential downsides of a value-based contract. “Many see the safety of investing in the industry for the long haul, but some don’t know the risks they are taking,” one thirty-year industry veteran said.