Skip to main content

As economic headwinds continue to impact the healthcare sector, experts predict that 2023 will be another slow year for the IPO market. However, consolidation deals will continue, according to a new report from Health Tech Nerds, an informational platform focusing on healthcare business.

To garner expert predictions about what this year will look like for the healthcare sector, Health Tech Nerds surveyed 90 digital health startup executives and investors. Nearly two-thirds of respondents said they thought that two or fewer health tech companies would go public in 2023.

The survey showed that there were a handful of companies that participants think have the potential to go public this year — 11% betted on virtual care company Included Health and 10% said chronic care management startup Omada Health. Participants mentioned a few other startups, including Ro, Sword Health, Hinge Health and Aledade

What’s noteworthy is that most of the companies that respondents thought might go public in 2023 are focused on enabling people to receive care and manage their conditions from their homes. That underscores the rise of the home health movement in the industry.

On the consolidation side of things, respondents predicted that CVS will make the most notable acquisition in the healthcare sector this year. When participants were asked what they think the most signficant acquisition deals will be in 2023, CVS was mentioned in about 29% of responses. For the retail health giant, respondents identified the following primary care-focused companies as acquisition targets: Privia Health, Aledade, Agilon Health, Cano Health, Oak Street Health and Carbon Health

Survey participants predicted that Amazon and Optum would be the healthcare sector’s other two top acquirers, with 10% and 8% of respondents mentioning these companies in potential deals, respectively. Amazon’s acquisition targets include Color, Walgreens and Smile Digital Health, and Optum’s targets are Headspace Health, Dispatch Health and Turquoise Health, according to the report.

In addition to the digital health companies Amazon might buy, some respondents also predicted that the tech giant will buy a payer in 2023. There was speculation about Amazon one day acquiring an insurer when the company announced its $4 billion purchase of One Medical last year, and 32% of survey participants said that type of deal could materialize this year.

As for newer startups that require further development before they can think about going public or getting acquired, the year ahead will likely be a financially challenging one from a fundraising perspective, according to the report. However, survey participants did predict that startups focused on care delivery would still see substantial investments from venture capitalists this year. Among care delivery startups, respondents said specialty care and virtual care would likely garner the most investment.

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Related

Schädelwunde

Trends That Life Science Experts Are Watching in 2023

BCG, Goldman Sachs and others weigh in on what to expect this year.

NYSE tumbleweed

Biotech IPO Freeze Continues As Second Quarter Is Slowest In More Than A Decade

Summer weather is heating up but the market for IPOs remains cold.

dumpster fire ornament

Worst Year In At Least A Century No Reason Not To Go Public

The SPAC-and-IPO party on Wall Street will have to stand in for the traditional holiday festivities this year.

shaq

Shaquille O’Neal Is Taking WeWork Public Via SPAC And Other Tales Of Finance In 2021

Like another company going public via SPAC giving you access to the IPOs it’s choosing to shun.

Screen Shot 2018-01-30 at 9.58.57 AM

Whoever Could Have Foreseen This?

Jamie Dimon, Jeff Bezos and Warren Buffett give up on revolutionizing the American healthcare industry.

Dell's Tab For Big Data Relevancy Comes To About $67 Billion

Why be nimble when you can be historically huge?

Getty Images

Warren Buffett Has No Idea What His Revolutionary Healthcare Initiative Is Doing

But he’s sure it’ll all work out in the end, or something.