Acquisition activity among medical device companies surged some 200% by value and 111% by volume during the 1st quarter compared with the same period last year, with medtech firms seeking both tuck-ins and more transformative deals aimed at navigating the new healthcare landscape, according to a PricewaterhouseCoopers report.
There were 19 acquisition deals worth roughly $2 billion during the quarter, according to the PwC report, "Pharmaceutical and Life Sciences Deals Insights Quarterly."
"Acquirers in the medical device sector have largely sought out mid-size, tuck-in acquisitions to complement existing product portfolios, but they are also evaluating opportunities to make an even more dramatic impact on their businesses," according to the report. "Medical device companies are facing demands to adopt new technologies to improve patient experiences and outcomes. These trends may drive acquisitions designed to innovate and transform business models."
Current trends indicate that the strong finish last year carried through to the beginning of this year and should continue in coming quarters, according to PwC. And companies are re-evaluating their positions in light of the new healthcare landscape, PwC said.
"Deal activity in the first quarter revealed a continuing trend of companies reassessing and realigning their portfolios in light of evolving industry dynamics. Thirteen divestitures were completed in the first quarter of 2014 with a total value of $10.1 billion. This trend may accelerate in the coming quarters as multinationals continue to seek opportunities to unlock shareholder value and develop new business models," according to the report.