Introduction
We are excited to release the fourth (and first of 2024) issue of our monthly newsletter Sector Spotlight
This is a comprehensive newsletter coupled with decks for the current or aspiring investment banker/PE investor, diving deep into the qualitative and quantitative nature of transactions, businesses, and trends across sectors, from the POV of an investment banker/PE investor. The groups are led by incoming investment banking summer analysts & analysts across a range of bulge bracket, elite boutique, and middle market banks.
Unlike other finance newsletters, this will not just simply mention or briefly summarize deals and news but will link to decks that include in depth analysis on a given topic. As this is the first issuance, we’ll be covering three sectors: 1.) Media & Entertainment, 2.) , and 3.) Healthcare. We hope you enjoy this month’s edition and look forward to bringing you monthly updates moving forward. Enjoy!
Best,
Jagger Lambert lambertjagger@gmail.com
James Concepcion jamesconcepcion217@gmail.com
Healthcare
Trends
- The pharmaceutical industry experienced major increases in FDA approvals in January and February, encompassing sectors in the cervical cancer, surgical procedures, and behavioral health
- The JP Morgan Healthcare conference took place in San Francisco this month, with over 8,000 top industry players speaking on pharma advancements. The conference included major deals announced, updates on GLP-1s, the market for COVID vaccines, and CNS disorder therapies.
- Economic landscape and private equity within healthcare, including changes to capital markets and financings, as well as the increased involvement of private equity-backed healthcare companies. Overall, the private equity sector experienced notable major increase in 2022, and with expectations of slow increment, as market expectations of steady interest rates and possible cuts create major dealflow.
- AI Market experiencing a 29.3% CAGR, as AI is more commonly implemented in the healthcare industry, aiding with providing better healthcare, minimizing fraud, and cutting administrative costs. Also, included are major players and direct sub verticals of impact within healthcare
- Eli Lilly’s dtc push via LillyDirect for easily accessible services such as telehealth and more online presence, creating an impact on the company’s recent stock performance, with a 12% surge
- Cigna updates following their deal fall through with Humana as the company now turns to sell their Medicare Advantage business, with a valuation between $3bn to $4bn
- Brightspring, a company that focuses on home and community-based care, behavioral health, pharmacy, and career development services filed for IPO following over two years of waiting on the sidelines with a proposed valuation of $3bn
- Major disruption within consumer-centric healthcare including everyday brands such as Walmart, Walgrens, Amazon, CVS, and Costco capitalizing on healthcare switching to easily accessible services
- JNJ’s acquisition of oncology specialist Ambrx, with a price set at $2bn, making it a 105% premium to acquire Ambryx and the arms race for life science acquisition fueling big pharma in the new IRA-induced price-negotiation environment
M&A/Investments
- PE firm GPB Capital Holdings, which faces civil fraud charges, sold a majority stake in medical billing services provider HealthPrime International for $190M cash
- Health insurance company Health Care Service Corp. will acquire Cigna Group’s Medicare business for $3.3B
- Drug distributor Cardinal Health will acquire private tech company Specialty Networks for $1.2B cash to expand its services in the specialty drug space
- Muscle disease drug developer Dyne Therapeutics, which has a $1.7B market cap, is considering options amid takeover interest from larger pharmaceutical companies
- The FTC sued to block Novant Health’s $320M acquisition of two North Carolina hospitals from Community Health Systems
- Walgreens is exploring options including a sale of specialty pharmacy business Shields Health Solutions, which could be valued at over $4B in a sale
- French pharmaceutical company Sanofi agreed to buy the clinical-stage US biotech Inhibrx for as much as $2.2B
- Sandoz, a pharmaceutical company specializing in generics, will acquire Cimerli, a biosimilar drug to treat vision impairment and loss, from Coherus BioSciences for $170M
- GI Partners and TA Associates, the PE owners of Netsmart Technologies, are exploring a sale of the US healthcare software firm, hoping to value the company at over $5B, including debt
- British drugmaker GSK raised $1.2B through a discounted stake sale in consumer healthcare company Haleon
- India’s Sun Pharmaceutical Industries, which owns ~78.5% of Taro Pharmaceutical Industries, will acquire all remaining shares of the Israeli pharmaceutical manufacturer for $348M
- American pharmaceutical distributor McKesson is planning to sell Canadian drugstore chain Rexall Pharmacy Group seven years after it bought the business for $2.2B
- CVC Capital Partners agreed to buy vitamin and supplement maker Sunday Natural in an $876M deal
