GENERAL TRENDS
Healthcare IT Industry Outlook & Observations
The global healthcare IT market reached a value of $323.8 billion in 2021 and is expected to grow at a CAGR of 18.7% to reach $493.5 billion by 2028, according to Vantage Market Research
Growth is being driven by an explosion in the development and adoption of digital health technologies, pressures stemming from the global COVID-19 pandemic, empowered and better-informed consumers and government entities, and a fundamental shift in focus from disease care to prevention and overall well-being
IT infrastructure within healthcare is undergoing a transformation due to smarter implementations of digital technologies such as AI, improved data collection and access with IoT devices and big data algorithms, and operational advancements within the mobile health, telehealth, and remote patient monitoring submarkets
Other drivers of activity include high returns on investment within the HCIT category as well as rapid advances in medical science
2022 marks the beginning of the third year of the COVID-19 pandemic, which continues to dominate healthcare organizations’ attention and resources worldwide and accelerate transformations across the health industry
Deal volume and transaction value reached an all-time high in 2021, and while the momentum is unlikely to be sustained at this breakneck pace, M&A activity in the healthcare sector remains strong
Industry Insight: The Future of Health Begins Now
Despite COVID-19’s devastating impacts on numerous fronts, it has thrust healthcare systems across the globe into a digital transformation and created a powerful opportunity for technological innovation and growth. Consumer preferences, workforce management, care delivery, and clinical development are all undergoing fundamental shifts towards a holistic approach that combines life sciences, overall well-being, and tech-enabled health care.
Telehealth has been embraced by health care providers, insurers, and governments alike, as COVID-19 prompted many practices to rapidly adopt virtual care delivery models
Medicare telehealth utilization increased 63-fold during the pandemic according to the U.S. Department of Health and Human Services
Patient satisfaction with telehealth systems has also been high, with many praising the convenience and swift access of services
However, there is still significant opportunity for refinement with some patients reporting inconsistent or limited care and unintuitive technology platforms
Medical science, often fraught with long, expensive, and high-risk discovery processes, stands to be transformed by technological advancements that will dramatically change the way diseases are diagnosed and treated
AI software solutions supported by big data are poised to propel medical research to new drug discoveries at an unprecedented pace, with new candidate medicines delivered in months rather than years
The study of genomics is another disruptive force with the potential to redefine health care and offer consumers personalized and more effective care, with a patient’s DNA now able to be sequenced for a few hundred dollars in as little as one day
The proliferation of digital medicine products and devices has combined software and hardware to grant unparalleled insights to patients and care providers alike, improving treatment experiences, knowledge and outcomes of drug therapies
Overall preferences have shifted from disease care towards holistic well-being and disease prevention, with governments and regulatory bodies expected to spend heavily in 2022 on introducing initiatives to promote public health
M&A ACTIVITY
Healthcare IT M&A Activity Continues at a Solid Pace
DEAL SPOTLIGHT
SELECTED 555 HEALTHCARE IT TRANSACTIONS
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The opinions expressed herein are those of 555 Capital Advisors. There is no guarantee that any predictions/projections as to certain market activity or events will come to fruition or past market or transaction performance referenced within will yield the same results as transactions previously conducted by 555 Capital Advisors.
