By Sabrina Valle
NEW YORK (Reuters) – Healthcare dealmakers gathering in San Francisco for the industry’s premier annual conference this week say they expect a resurgence of deals exceeding $10 billion due to the potential for less antitrust scrutiny under President-elect Donald Trump.
About 8,000 executives, bankers and lawyers are due at the JPMorgan Healthcare Conference, which begins on Monday under heavier than usual security following the December murder of a UnitedHealth Group executive in New York outside the company’s annual investor meeting.
Seventeen healthcare dealmakers who spoke with Reuters were unanimously optimistic about a M&A recovery after last year seeing no transactions above $5 billion close in the sector for the first time in at least a decade.
Following Trump’s election to a second term in November, deals that had been shelved due to antitrust risk, high interest rates, or the decline in share values after the COVID-19 pandemic were getting a second look, bankers and lawyers said.
“Eventually the dam starts to break,” said Ben Carpenter, JPMorgan’s global co-head of healthcare investment banking. “I would expect to see at least a few deals that rise above $10 billion.”
While Trump’s healthcare policies are still uncertain, his nomination of a less stringent chair for the Federal Trade Commission was welcomed by dealmakers.
“What policy is ultimately going to be is unknown,” said Jeremy Meilman, who co-heads JPMorgan’s healthcare investment banking group. “What we do know is that the incoming administration does have a generally more pro-business stance.”
Yet, 14 out of the 17 bankers, lawyers and financial advisers consulted caution it may take more than a year for activity to return to its heyday of 2019 or 2021, when healthcare deals totaled half a trillion dollars, according to LSEG data. The market is waiting to see how a Trump administration will act towards healthcare, given his untraditional nominees for top positions.
“It’s not like the floodgates are back open,” said Shayne Kennedy, global chair of law firm Latham & Watkins’ Healthcare & Life Sciences Industry Group. “What we expect is that the tide is going to start to shift.”
Mergers and acquisitions activity in healthcare fell by about half in the past three years to $257 billion in 2024, according to LSEG data.
Of the $3.2 trillion in deals closed last year globally, the healthcare sector accounted for only 8%, with M&A partially discouraged by a tougher antitrust stance from the Biden administration, as well as companies reluctant to sell at depressed valuations.