Global M&A trends in health industries

Investors are rotating towards assets with resilient, recurring cash flows as a hedge against reimbursement uncertainty, geopolitical risk, and fluctuating interest rates. Health industries continue to navigate shifting payment and reimbursement rules, variable funding commitments, and evolving regulatory environments. With these dynamics, low-volatility platforms such as established generics, select hospital clusters, post-acute care platforms, and outpatient service networks, are attracting heightened attention from investors for their stability and predictable utilisation patterns. The occupational health and corporate well-being market provides an example of strong investor interest as healthcare funding shifts from the state to corporates, driven by rising consumer demand alongside tightening public budgets. Consolidation in this sector is under way across developed markets.

CapVest’s proposed acquisition of STADA, a German consumer healthcare, generics and specialty pharmaceuticals company, illustrates the sustained investor appetite for defensible assets with stable demand profiles, supported by essential medicines and consumer healthcare products that are less exposed to shifts in public reimbursement. Similar dynamics are playing out across healthcare services, where elderly care models and a recurring revenue outpatient network continue to draw interest from both strategic buyers and financial investors. 

Exit windows will remain narrow in 2026, constrained by volatile public market valuations, selective buyer appetite, and lingering uncertainty around regulatory, pricing and macroeconomic conditions. As issuers and investors grow more confident, we expect IPO markets to begin offering more viable exit opportunities for health industries companies, particularly those in categories such as AI-enabled care, digital platforms, and medtech, where sponsor and crossover investor interest has strengthened. Medline’s debut on the Nasdaq in mid-December 2025, which raised $7.26bn in the largest IPO in nearly five years, exemplifies this strengthening confidence. Biotech, however, remains uneven, and while public markets are opening for late-stage, data-rich, and derisked assets, much of the earlier-stage cohort remains constrained.

Given these dynamics, many sellers may pursue dual-track processes, exploring an IPO alongside a potential sale to a corporate or financial investor to preserve optionality and maximise their chances of success. This will increase pressure on companies to be well prepared ahead of process launch, with particular emphasis on articulating a clear, evidence-backed growth, and value creation story.

As more financial investors approach the end of holding periods, we expect a steady pipeline of divestitures and secondary transactions. Early examples of this trend include Thermo Fisher’s $8.9bn proposed acquisition of private-equity-backed clinical trial data analytics provider Clario and Abbott’s $21bn proposed purchase of cancer screening and diagnostic testing company Exact Sciences.

Looking ahead to 2026 and beyond, many assets are likely to come to market with strengthened operational narratives, cleaner data, and more explicit technology roadmaps, giving buyers greater confidence whether evaluating potential IPO prospects, strategic exits, or financial investor-led transactions.

Consumer expectations are reshaping health industries as patients demand more convenient, prevention-oriented, and tech-enabled care. Platforms that can deliver experiences such as virtual-first primary care, home diagnostics, remote patient monitoring, and wellness ecosystems are expected to command premium valuations. Recent deals such as Resmed’s acquisition of virtual diagnostics company VirtuOx and Samsung’s acquisition of digital health company Xealth illustrate how buyers are accelerating their shift towards virtual and care-anywhere platforms.

At the same time, GLP-1 therapies continue to influence demand patterns across biopharma, nutrition, retail, and chronic care. The intense competition for Metsera, which Pfizer ultimately acquired in November 2025, underscores the urgency with which buyers are looking to secure next-generation obesity and metabolic treatments. Ripple effects are expanding beyond obesity into cardiometabolic disease, nonalcoholic steatohepatitis, and adjunctive behavioural health support. This in turn is attracting interest from across the medtech, digital health, and retail ecosystem. Strategic buyers are also pursuing assets across the GLP-1 supply chain, including manufacturing capacity, formulation technologies, and delivery mechanism, as demand continues to outpace supply.

As consumer behaviour shifts and therapeutic markets evolve, investors are prioritising platforms that combine strong engagement, data-driven personalisation, and clear pathways to value-based growth. These factors will remain central to valuation and deal momentum in 2026.

Large pharmaceutical companies continue to face significant loss-of-exclusivity cliffs, increasing the pressure to replenish late-stage pipelines with assets that offer differentiated data, clear regulatory pathways, and commercial readiness. As a result, buyers are concentrating on derisked innovation such as programmes with proven biology, robust trial results, and well-defined routes to approval. Radiopharmaceuticals, RNA therapies, cardiometabolic drugs, immunology, vaccines, and antibody-drug conjugates are among the most active dealmaking hotspots. In addition, buyers are increasingly attracted to companies as potential M&A targets that are differentiated by emerging platform capabilities such as AI-enabled trial design, modern imaging modalities, real-world-evidence integration, and autonomous safety workflows.

Recent deals such as Novartis’s $12bn acquisition of Avidity Biosciences, Merck’s $10bn acquisition of Verona Pharma, Roche’s $3.5bn acquisition of 89bio, and Sanofi’s $2.2bn acquisition of Dynavax illustrate the size and scale of deals we expect to see in 2026. Activity is expected to remain focused on acquisitions that strengthen and complement treatment portfolios while accelerating innovation. 

Cross-border dealmaking is accelerating as innovation, talent, and capital flows become more globally distributed—driven in part by the growing healthcare needs of large, highly populated countries seeking higher-quality care at more affordable price points, as well as the ability to supply established markets more efficiently. As highlighted earlier, China’s rapidly advancing biopharma ecosystem continues to reshape global pipelines. India is also emerging as a strategic priority for both corporates and private equity.

In India, investor interest is increasingly focused on hospital platforms, such as KKR’s acquisition of oncology hospital chain Healthcare Global Enterprises, as well as scalable single-specialty networks, and complex contract development and manufacturing organisations that support global supply-chain diversification under “China+1” strategies. India’s national digital health infrastructure is enabling data-rich, AI-supported clinical workflows at scale, which is an important differentiator for cross-border partners seeking operational efficiency, cost-effective supply chains, and access to large patient populations.

As innovation globalises, new partnership structures including licensing, co-development, and NewCo models are creating fresh new pathways for global collaboration. These dynamics are expanding the opportunity set for investors while reinforcing Asia’s growing role as a driver of global biopharma and healthcare services M&A.

Medtech companies remain focused on sharpening their portfolios through divesting lower-growth or non-core assets and reinvesting in faster-growing categories. In 2025, BD’s announced sale of its advanced bioprocessing business and certain diagnostics assets to Waters Corporation for approximately $17.5bn exemplified this trend. Similar moves are underway across the sector, including carveouts in diabetes, surgical, and patient monitoring businesses, as companies concentrate on core platforms.

Financial investors are highly active, particularly in corporate carveouts, where operational efficiencies and technology enablement can unlock additional value. Many of these assets offer strong fundamentals, but greater autonomy enables clearer strategy and more targeted investment, allowing them to reach their full potential.

Across categories, next-generation technologies, such as robotics, AI-supported imaging, sensors, and home-based devices, are central to long-term strategies aligned to prevention and care-anywhere models. Medtech acquirers are prioritising targets that bring not only differentiated technology but also the data, software and service layers that support recurring revenue and stronger customer retention.

As portfolio optimisation continues and next-generation technologies scale, we expect medtech deal activity in 2026 to remain robust.