China M&A trends of Healthcare industry: 2022 Review and 2023 Outlook
Value rebounds: Digital and intelligent empowerment
September 2023
Total deal volume and deal size for healthcare service between 2019 and 2022 exceeded 1,200 and reached RMB250 billion. Deal volume decreased by less than 20% to 362 deals in 2022, while deal value decreased by less than half a billion RMB from 2021's total of nearly RMB50 billion. Key deal drivers include the scale-up of service capabilities, rising consumerism in health, the pressure of performance under Covid-19, and policy tailwind of digital health.
Disclosed deal size in hospitals and clinics remains high, while the polarity between hospital expansion and bail-out coexists. Mega-deals involving the acquisition of several medical institutions at once continue to take place, albeit at a slower pace. Digital health continued to dominate in 2022 in the number of transactions, having accounted for nearly 50% of the number of deals throughout the year.
“With the advancement of high-quality development and the expansion of the healthcare business, technological innovation, and service competency have emerged as the primary factors driving investment in medical value. Both In-hospital and out-of-hospital institutions are leveraging diverse digital technologies to achieve cost reduction, efficiency enhancement, and quality improvement, as value-based payment continues to drive innovation and healthcare payment reform. Investors are accelerating the integration of healthcare resources through investments in the digital health ecosystem while developing technological and business-model innovation.”
