Armed with anywhere between $2 trillion and $4 trillion of “dry powder”—with about half of that targeted to healthcare—private equity firms have a lot of capital to put to work. One area receiving interest is the ear, nose, and throat and allergy field.
For the past several decades, at least, the general trend in many industries has been toward consolidation into larger operating units, and private equity has been a driving force to accomplish that. The prevailing feeling in many industries is that you must get bigger to survive, and healthcare is no exception.
Dentistry, dermatology, and ophthalmology were among the first healthcare fields targeted by PE firms. Those specialties each have many small and independent practices, are largely hospital independent, and benefit from supply and demand tailwinds. Other fields soon followed, including oncology and orthopedics. ENT and allergy is relatively new to private equity investment, with approximately ten major platforms currently operating. Overall transaction count to date is very small compared to ophthalmology and dermatology, and there is a lot of room to run, notes Focus Investment Banking. Read more.
