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Join Glenn Hunzinger, US Health Industries Leader, and James Woods, Principal and Medtech Deals Leader, as they discuss what’s ahead for medtech dealmaking in 2026. They explore why buyers are expected to return to the market, how capital is being deployed, and how technology enabled innovation is reshaping portfolios across the sector.
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We’ve summarized the full discussion in a short Q&A format so you can get the highlights in minutes.
Why this moment, and what’s driving renewed deal momentum
Q. Glenn Hunzinger
Why is 2026 shaping up as an important year for medtech dealmaking?
A. James Woods
We’re optimistic about medtech M&A heading into 2026. While 2025 saw some of the highest deal values in more than a decade, overall deal volume lagged historical norms. Looking ahead, we expect buyers to return to the market. Medtech companies have strong balance sheets, healthy cash flows, and access to capital, and there is continued investor demand for growth. Buyers will remain selective, but the conditions supporting deal activity are firmly in place.
How capital availability is shaping deal strategy
Q. Glenn Hunzinger
How are capital availability and market dynamics influencing deal activity?
A. James Woods
Capital access is a major driver. Medtech companies are well positioned from a balance sheet and cash flow perspective, and M&A has long been a priority use of capital in the sector. It’s also a core part of how companies fuel R&D and portfolio growth. As capital markets stabilize, we expect companies to continue using M&A to reshape portfolios and invest in future growth opportunities.
Technology and innovation as catalysts for M&A
Q. Glenn Hunzinger
Technology is a recurring theme in your outlook. How is it influencing deals?
A. James Woods
The industry is going through a real shift toward data enabled solutions and connected care, both inside and outside the hospital. That innovation is driving investment and deal activity across the sector. We’re seeing tuck in acquisitions remain the primary deal type as companies fill portfolio gaps and scale capabilities, along with bolt on transactions that help build new platforms. There is also still room for more transformational deals as portfolios continue to evolve.
The role of private equity in medtech deals
Q. Glenn Hunzinger
What role is private equity playing in today’s medtech deal environment?
A. James Woods
Private equity has been very active in medtech and continues to play an important role. As incumbents reshape their portfolios, that creates opportunities for private equity to acquire assets, improve operations, and create value. Those assets can then be repositioned for future growth or become attractive targets for strategic buyers, making private equity a key participant across the medtech deal ecosystem.
Where investors are focusing growth investments
Q. Glenn Hunzinger
Which segments and technologies are attracting the most attention?
A. James Woods
We continue to see strong interest in established categories like cardiovascular and diagnostics, but there’s also growing activity in surgical robotics and more innovative areas such as neurostimulation and brain computer interfaces. AI and data are becoming critical enablers of medtech business models and are serving as important catalysts for deal activity, particularly where companies can demonstrate measurable clinical value.
Funding challenges and evolving deal structures
Q. Glenn Hunzinger
Funding and reimbursement headwinds remain. How are companies navigating those challenges?
A. James Woods
Early stage innovation funding has been constrained by an uneven IPO market and mixed capital markets performance. In response, we’re seeing more innovative deal structures, including build to buy and option based arrangements, as well as non-traditional sources of capital. Strategic buyers are stepping in earlier to help fund innovation, recognizing the importance of supporting new technologies that drive better outcomes for patients.
The key watchout for 2026
Q. Glenn Hunzinger
What’s the most important trend for leaders to watch as they plan for 2026?
A. James Woods
Surgical robotics is one area to watch closely. The technology has matured and is delivering real clinical and operational benefits, including improved efficiency in the hospital setting. More broadly, leaders should focus on how innovation, capital deployment, and portfolio reshaping intersect. Companies that invest thoughtfully in high growth areas and use M&A strategically will be best positioned as deal activity accelerates.
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Episode transcript
Find episode transcript below.
00:00:04:03 Welcome to PwC’s Next in Health. I'm Glenn Hunzinger, PwC’s US Health Industries Leader. Today, we're talking about what's ahead for Medtech deal making in 2026, how the market's evolving, where capital is flowing, and what leaders should be thinking about as they reshape their portfolios for growth.
00:00:25:10 Joining me today is James Woods. James is a Principal in our Deals practice and leads our Medtech team. James and his team have just released our latest Medtech Deals Outlook offering a grounded view of the trends, pressures, and opportunities shaping Medtech. James, thanks for being here.
JAMES WOODS:
00:00:40:05 Glenn, thanks for having me. Great to be back on the podcast.
GLENN HUNZINGER:
00:00:43:10 James, great report, really pointed. Good to see that a lot of the trends will continue and likely accelerate, but let's get right to it. 2026, what do you expect? What do you think is going to happen? Let's just summarize it for everybody.
JAMES WOODS:
00:00:56:10 Yeah, so we are pretty bullish about the forecast for M&A activity in 2026 in contrast to what we saw in 2025 where there were the highest deal values in over a decade. But, deal volume lagged historical norms. We expect buyers to return to the market in the upcoming year. We expect buyers will continue to be selective, but the catalysts for deal activity are very strong.
00:01:19:04 Medtech companies have ready access to capital both through their balance sheets, through strong cash flow and access to capital markets. There's strong demand amongst investors for growth and there's a wave of technological innovation coming that we think will spur continued investment into the sector.
00:01:35:08 M&A has always been a priority use of capital for Medtech companies and is really part of their R&D engine. And we think that that will spur further portfolio moves as companies look for those growth avenues in the future.
GLENN HUNZINGER:
00:01:49:10 Yeah, thanks James. And I love how your report really captured, reshaping with just generally the industry changing — everything connected, tech-enabled and this idea of we're going to continue to divest, raise capital to reinvest, and the connection around private equity, which I think continues to play a valuable role in the world of Medtech
00:02:10:15 to operate those businesses better. And we're seeing private equity yield some of those returns and those investments they're making. So, that's tremendous. Talk a little bit about that and just talk about the capital that's being raised and where we expect to see it. You hit a little bit on robotics, but that technology area is so broad. Just maybe hone in a little bit on that if you could.
JAMES WOODS:
00:02:30:12 Absolutely. I think we're in a bit of a sea change as it relates to Medtech. As you said, the industry is really evolving around a new wave of innovation focused on data-enabled solutions and connected care both in the hospital and outside.
00:02:44:10 And that technological innovation I think will really spur further investment into the sector at large and M&A activity going forward. We can see M&A activity taking form in a couple of different ways. Tuck-ins, we think will continue to be the primary form of deal activity as companies seek to fill gaps in their portfolios and drive value through commercial scale.
00:03:05:44 We've also seen an increasing frequency of bolt-on type transactions as companies look for new avenues for growth and to build into new businesses. Those types of transactions really give companies the scale to build a platform going forward. And I think as we've seen over the course of the year, there are still opportunities for more transformational deals.
00:03:23:12 We really think that across that continuum, the sector will be pretty active in the upcoming year. And as you mentioned, private equity has been very active in the industry over the last year. Private equity buyers have seen traditionally great opportunity to create value through Medtech, both in terms of helping shape portfolios and drive value creation through improving operations of Medtech companies.
00:03:46:04 As the incumbents in the industry look to reshape their portfolios, we think that will create some really interesting opportunities for private equity buyers to come to the market, take those assets, create value and then help leverage them into future growth opportunities for other buyers in the future.
GLENN HUNZINGER:
00:04:01:10 And James, I always love the insight you bring when we think about capital markets and being rewarded for growth and hey, what does a hundred basis points of growth mean versus margin? I've always heard you say at 2x or some number there. Just talk a little bit about your view of that and why that leads to the investments we need to see in order to sort of continue to grow that top line.
JAMES WOODS:
00:04:22:15 It is an interesting dynamic within Medtech. One of the things that we do see is that companies that are able to generate durable above-market growth in their categories are increasingly rewarded by investors in the capital markets. So that is really where the industry has focused in the past, how to drive that category leadership across the portfolio.
00:04:43:10 We do think that that dynamic will continue and as I said, as we see the market evolving and moving towards these new categories, there will be new avenues for companies to invest and create those durable growth trajectories over the mid-to-long term.
GLENN HUNZINGER:
00:04:57:11 And James, when you think about what areas you think will be hot because you're right, those that have invested prudently, wisely in high-growth adjacencies, it's clear their shareholder returns are growing, can you just talk about how you think going forward, where there's high growth and where you expect some of those investments from sort of a domain or sort of a category if you will?
JAMES WOODS:
00:05:18:07 Absolutely, Glenn. I think we will continue to see strong deal flow in some of the categories where we've seen traditional investment, cardiovascular and diagnostics, but also an emergence of deal activity in surgical robotics and more innovative categories such as brain-computer interfaces and neurostimulation.
00:05:36:08 AI and the emergence of data as a critical enabler of business models in Medtech are going to serve as major catalysts for deals. And we see that buyers are really looking for technologies to extend those growth trajectories and help demonstrate measurable clinical value to patients.
GLENN HUNZINGER:
00:05:53:05 Hey, James. We've been to a lot of clients’ conferences and otherwise, and there are some interesting headwinds that we continue to hear about around funding and certainly reimbursement. Let's talk a little bit about that and just how to think about that as an investor and what it means for deals.
JAMES WOODS:
00:06:09:10 Yeah, it's a really interesting point, Glenn. One of the things that we see the industry challenged with is the ability to fund early-stage innovation in Medtech. We've seen an extended period where the IPO market just really hasn't been stable for Medtech companies. We've seen some capital-market transactions over the year, but performance has been mixed.
00:06:28:08 So that's created a bit of a headwind as companies seek to go out and raise capital or venture funds, seek to raise capital to deploy into Medtech. So, what we're seeing is an emergence of more innovative deal structures, opportunities for non-traditional sources of capital to come to the table or for corporate participants in the industry,
00:06:48:13 for the strategic buyers in the industry to invest in earlier stage transactions through build-to-buy or option-type deals. I think we definitely will see that trend continue. Buyers have traditionally been able to create tremendous shareholder value through M&A, and I think everyone recognizes the need to fund that innovation early in the industry to continue to drive the types of outcomes and benefits to patients that we need going forward.
GLENN HUNZINGER:
00:07:12:06 Yeah, that's interesting. So much great innovation going on. It's hard to think about these continued sorts of headwinds and yet the industry continues to operate around it or figure out ways around it, which I think shows how innovative and entrepreneurial everybody is.
00:07:29:12 So James, like your passion for this and the amount of time you spend thinking about Medtech and thinking about unique areas, maybe just leave the audience with what's the one or a couple of interesting things maybe to keep an eye on when you think about 2026?
JAMES WOODS:
00:07:50:15 Well, Glenn, I think one of the things that's most exciting in the industry is the maturity of surgical robotics. We've seen a wave of clinical advancements in that space over the last couple of months, and I think we will continue to see buyers coming into that space with greater intention.
00:08:05:12 The capacity for surgical robotics to unlock clinical benefit as well as alleviate some of the pressures on our broader health system around clinician capacity and operational efficiency in the hospital can really help revolutionize and address some of those big system challenges that we've been talking about over the last year.
GLENN HUNZINGER:
00:08:22:14 James, thanks so much for sharing your insights on what to expect in Medtech deals in 2026. Appreciate you joining us. And thanks to all of you for tuning in to PwC’s Next in Health.
00:08:35:04 For more on these topics and other insights across health industries, please subscribe to our podcast at pwc.com/US/Next in Health podcast. Until next time, this has been Next in Health.
FEMALE VOICEOVER:
00:08:56:30 This podcast is brought to you by PwC, all rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This podcast is for general information purposes only and should not be used as a substitute for consultation with professional advisors.
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