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Join Glenn Hunzinger, PwC’s US Health Industries Leader, and James Woods, PwC’s US Med Tech Leader, as they discuss the outlook for med tech dealmaking in 2026 and the strategies companies are using to drive growth amid market uncertainty. They explore how organizations are navigating capital market pressures, supply chain challenges, tariffs, and geopolitical risks while continuing to invest in innovation, connected care, and portfolio transformation. The conversation highlights the growing role of strategic acquisitions, divestitures, and private equity investment, as well as what leaders should prioritize to create value and maintain a competitive edge in an evolving healthcare landscape.
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We’ve summarized the full discussion in a short Q&A format so you can get the highlights in minutes.
What is keeping MedTech deal activity moving?
Q. Glenn Hunzinger
MedTech companies continue to face supply chain challenges, capital market pressures, and geopolitical uncertainty. What's keeping deal activity active?
A. James Woods
Despite a complex operating environment, MedTech deal activity remains strong and is tracking at a pace similar to last year. Companies continue to pursue tuck-in acquisitions, expand into adjacent markets, and invest in new business models that can support long-term growth.
Organizations remain focused on strengthening portfolios, enhancing competitiveness, and positioning themselves for future opportunities, even amid ongoing market uncertainty.
Where are companies placing their bets?
Q. Glenn Hunzinger
What types of assets and opportunities are attracting the most investment?
A. James Woods
Companies are prioritizing assets that can accelerate organic growth and strengthen portfolio performance. Areas attracting significant interest include cardiovascular technologies, robotics, connected care, and ecosystem-enabling solutions.
These sectors offer strong innovation pipelines and opportunities to create sustainable competitive advantages while addressing broader challenges across the healthcare ecosystem.
How are companies approaching portfolio transformation?
Q. Glenn Hunzinger
Portfolio management continues to be a major focus. How are leaders thinking about capital allocation?
A. James Woods
Organizations are taking a more disciplined approach to portfolio management. Many are evaluating which businesses support future growth strategies and which may be better positioned under different ownership.
Companies are increasingly divesting non-core assets while investing more aggressively in higher-growth opportunities that can improve organic growth and drive shareholder returns.
Why is connected care becoming a strategic priority?
Q. Glenn Hunzinger
Connected care continues to receive significant attention across the industry. What is driving that trend?
A. James Woods
Healthcare systems are facing growing pressures related to cost, workforce shortages, and an aging population. MedTech companies are uniquely positioned to help address these challenges by connecting data, devices, and care settings.
Connected care solutions can improve efficiency, enhance patient outcomes, and create new opportunities for growth beyond traditional device offerings. They also position MedTech companies to play a larger role across the healthcare continuum.
What role is private equity playing in the market?
Q. Glenn Hunzinger
Private equity remains active in MedTech. How are financial sponsors approaching the market today?
A. James Woods
Private equity continues to see attractive opportunities across the sector, particularly given current valuation levels. Sponsors are pursuing take-private transactions and carve-outs where they believe operational improvements, portfolio reshaping, and strategic repositioning can unlock additional value.
Private ownership can also provide companies with greater flexibility to transform business models and pursue growth strategies outside the pressures of the public markets.
What gives you confidence in the market outlook?
Q. Glenn Hunzinger
Despite ongoing uncertainty, what supports a positive outlook for the remainder of the year?
A. James Woods
Companies remain committed to investing in innovation and growth. Strategic buyers and financial sponsors continue to pursue opportunities that strengthen portfolios, improve competitive positioning, and support long-term value creation.
While market conditions remain challenging, the level of deal activity demonstrates continued confidence in the sector's growth potential and the opportunities created by ongoing portfolio transformation.
What should dealmakers focus on over the next six to twelve months?
Q. Glenn Hunzinger
As organizations evaluate future growth opportunities, what should leaders prioritize?
A. James Woods
Leaders should remain focused on disciplined portfolio management and growth-oriented capital allocation. The most successful organizations will proactively evaluate their portfolios, invest behind differentiated growth assets, and use M&A strategically to strengthen competitive advantages.
A balanced approach to organic and inorganic growth, combined with a clear focus on long-term value creation, will be critical to driving shareholder returns in the years ahead.
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Episode transcript
Find episode transcript below.
00:00:03:05 Welcome to PwC’s Next in Health. I'm Glenn Hunzinger, PwC’s US Health Industries Leader. Today, we're talking about MedTech deal making and how companies have positioned themselves for growth in a pretty complicated environment. On one hand, leaders are dealing with tariffs, supply-chain challenges, geopolitical uncertainty, and continued pressure from the capital's markets.
00:00:24:10 n the other hand, deal activity remains active and companies continue to make significant investments in innovation, new technologies and higher growth markets and adjacencies. So, what's driving that confidence? What are companies doing to place their bets? How are they thinking about things more broadly, both from a strategic buyer perspective and private equity and what leads to the next phase of growth for this sector? Joining me today is James Woods, PwC’s US med-tech leader. James, welcome back.
JAMES WOODS:
00:00:51:07 Glenn, great to be here. Thanks for having me.
GLENN HUNZINGER:
00:00:53:05 So James, interesting first half of the year. Maybe just give us the background. What are you seeing, what's driving some of the med-tech deal activity in this first half?
JAMES WOODS:
00:01:02:10 Well, I think, Glenn, as you said, it's a pretty complicated environment. So maybe taking a quick step back, we finished 2025 with some of the highest deal activity that we've seen in a decade. We had almost a hundred billion dollars’ worth of deal value over 55 deals led by a number of very significant mega deals in the industry.
00:01:21:06 And as we look at where we are at about the mid-year for 2026, we are seeing that level of activity continue. We've had $37 billion worth of deals through May, over 29 transactions putting us on a pretty similar pace for last year. I would say all of that activity is happening against the complicated backdrop that you described. Obviously, there are the geopolitical and macroeconomic considerations.
00:01:42:05 Supply-chain challenges are very complicated and particularly for the med-tech sector, the capital markets have been extraordinarily difficult over the last six months or so. That's driven by a few factors. Some of it is the AI trade and interest in other high-growth markets that have led to capital rotation out of med-tech.
00:02:03:10 Some of it is concerns around the growth profile and the sustainability of growth rates that we've seen over recent years. So, against that backdrop, I would say we have seen and are encouraged by the level of activity in the market that's really centering around a few different types of deals and motivations for deals.
00:02:22:50 We're seeing a continued steady diet of tuck-in acquisitions, companies looking to increase their depth in particular categories and add innovative assets to their bag. We're seeing increased focus around adjacencies and companies looking to expand their portfolios into new businesses to drive durable growth rates.
00:02:41:05 And we are seeing increased plays amongst companies into new types of business models around ecosystem enablement and connected care. All of those trends we think are likely to persist as we look out through the rest of 2026.
GLENN HUNZINGER:
00:02:55:02 Yeah, and I think you raised a good point around just where the med-tech capital markets is and sort of how it's trading as a discount to the overall market. Obviously, some of those factors is topline growth and that's obviously a big thing for the industry is the portfolio, the portfolio optimization, the pruning, and the reinvesting around areas of growth for the med-tech market.
00:03:17:10 So, with that as backdrop, James, I know you spent a lot of time from the value-creation lens and helping people look at that deployment of capital to create value. Could you talk a little bit about where are people investing, what types of assets and what adjacencies?
JAMES WOODS:
00:03:33:10 Sure. I agree with your point there. Certainly, the focus on portfolio management has never been higher. Companies are taking hard looks at their portfolios and looking for those avenues of durable growth and looking to divest those businesses that may no longer be fit with their portfolio or maybe a drag on their topline growth.
00:03:53:07 We've seen persistently that organic growth really is the driver of valuation and shareholder return in the med-tech industry, and companies are orienting their portfolios around that. I would say that trend is also being enabled by the capital market position that we're currently in. The depressed valuations that we're seeing now are creating opportunities for investments into assets that previously may have been unattainable and are drawing interest
00:04:17:09 from private equity and financial sponsors back into the med-tech market where they may see opportunity to create value operationally. In terms of where companies are investing their capital in some of those growth opportunities, we see continued investment into cardiovascular as a sector. There's a tremendous amount of innovation that exists within the structure of heart,
00:04:38:09 within intravascular lithotripsy, within electrophysiology, all of which are enabling those growth trajectories that are drying investor interest. We've seen increasing advancements in the technology around robotics, also enabling that ecosystem business model reinvention that I mentioned before.
00:04:57:05 And we are seeing continued interest in connected care and the opportunity for med-tech companies to position themselves at the middle of the care continuum and create linkages between disparate systems, enabling greater efficiency and improved patient outcomes across settings of care.
GLENN HUNZINGER:
00:05:14:02 Yeah, and I think you've raised some good points, which is the investments of previous years versus the future years. This idea of connected care and kind of moving beyond the device, and obviously you need capital to do that. So maybe James, as you think about that, why are they doing that? What are they looking to accomplish? How are they looking to create value?
JAMES WOODS:
00:05:33:11 Well, I think that opportunity really sits at the center of the broader transformation that we're seeing in the healthcare ecosystem. As we've talked about in the past, there are some real challenges facing the healthcare ecosystem, whether it's the aging population, whether it's the cost of care, whether it's shortage of practitioners, all of those are creating opportunity for the medical device industry to help solve those broader challenges.
00:05:59:40 Med-tech is uniquely positioned to capitalize on that opportunity based on the data that they collect or could collect by thinking differently about their position and their proximity relative to patients and across the site of care, as well as their ability to connect disparate systems within the site of care. All of those trends are creating opportunities for med-tech companies to unlock new and different profit pools that really can deliver a sustainable benefit both to patients and to the healthcare ecosystem.
GLENN HUNZINGER:
00:06:29:02 eah, I think you captured it well in the future of med-tech on this idea that med-tech can really drive the overall change in the market. When we think about the $5 trillion to spend in the US and how much of that is really within the health services and the provider and how med-tech can really enable those efficiencies to drive cost out of the equation.
00:06:49:50 So certainly, connected care in that aspect is so important and it's great to see the investments continuing to pour into this. This way you don't need intervention from nurses. Things can happen in sort of a simultaneous autonomous way. So that's great to see. Just the, along the lens of portfolio re-evaluation and redeploying capital and being able to invest in these connected care future and technology assets.
00:07:15:06 Can you just talk a little bit about like where do you see that portfolio reshaping and how has private equity played today? They've been quite active and we're continuing here at private equity being hacked around med-tech, but just talk a little bit about that, Jay.
JAMES WOODS:
00:07:28:03 Yeah, sure. I mean, private equity has long been an active investor in the med-tech industry and I think that's a trend that we expect to see. Again, in part opportunistic relative to current valuations and some of the capital market pressures that we're seeing. We've seen private equity active both in take privates of strategic players in the industry,
00:07:47:07 as well as acquiring carve outs of broader diversified portfolios. And in each of those cases, I think private equity is well positioned to drive operational value creation and to help position those businesses for growth outside the eye of the public investor. And I think there's real opportunity in that process to also reposition business models around different means of competition in the future.
00:08:12:01 Those transitions can be very challenging to navigate as a publicly traded company, but under the ownership of private equity, it does create that opportunity to reshape and reposition the business.
GLENN HUNZINGER:
00:08:22:11 Yeah, and certainly we've seen take privates, what's your view on that? Do you think that's a trend that's here to stay?
JAMES WOODS:
00:08:30:05 Certainly, Glenn. I think that there will be a continued opportunity for private equity to take private publicly traded med-tech companies. As we look at valuations across the industry, there is a clear delineation between those that are trading still at a relative premium to the rest of the industry and those that are not.
00:08:46:50 So I think there is opportunity to drive that type of operational value creation, improve the performance of those businesses, and then whether it be through portfolio shaping, under private ownership, or returning those assets to the capital market over time, I think that is a trend that we expect to see.
GLENN HUNZINGER:
00:09:03:14 Yeah, and it's certainly interesting to see where, call it smart money or otherwise is looking to invest, which may indicate sort of arbitrage in the market. So James, you obviously spent a lot of time with exec teams just from a strategic value lens, how to deploy capital, that's obviously going to create value.
00:09:22:30 Can you just talk about what you think is ahead for the remainder of 2026 and how you're having those discussions with deal makers to kind of shape that and how do they stay competitive in a market like this?
JAMES WOODS:
00:09:35:16 Yeah, I think it really comes down to some of those key themes that we talked about, right? We expect that organic growth will continue to be the primary driver valuation and shareholder return in the med-tech industry. And the companies that are able to align their algorithm around that growth through a balance of organic and inorganic investment into the business and careful management of their portfolios will be best positioned to drive that type of performance.
00:10:02:06 M&A will continue to be a critical part of that algorithm, whether it's on the buy side or the sell side. And we think that companies are very disciplined around proactively evaluating their portfolios, identifying opportunities to improve performance, identifying opportunities to invest more aggressively into growth assets, opportunities to invest in moats to protect those growth businesses
00:10:26:09 for a more durable weighted average market growth rate and opportunities to find a better owner for businesses that may no longer be fit for purpose within their portfolio where another owner may be able to unlock additional value. That type of discipline around the portfolio management is going to be critical to driving shareholder return in the future for med-tech.
GLENN HUNZINGER:
00:10:46:13 Well, listen, James, I think you set the scene well, which is from a broader shareholder value lens, certainly some challenges in the sub-sector, but obviously this idea of portfolio and investing and divesting to continue to create value is here and the speed of change, obviously moving exceptionally fast because it needs to be just given where the underlying sort of landscape is.
00:11:09:40 So you really gave our listeners a lot to think about, a lot to what we're seeing in the market, a lot of what you're doing to advise our clients. So, thank you for joining us today, James, and for constantly continuing to move this sector forward.
JAMES WOODS:
00:11:22:10 Glenn, great to speak, as always. Look forward to the next one.
GLENN HUNZINGER:
00:11:25:06 To learn more, check out our med-tech deals mid-year 2026 Outlook report now available and linked in the show notes. And thank you all for tuning in to PwC’s Next in Health. 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:
00:11:55:06 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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