Global healthcare private equity deal value surged to an estimated $115 billion in 2024, marking the second-highest total on record. The surge in value was driven by an increase in large-scale transactions, with five deals exceeding $5 billion, compared to two in 2023 and just one in 2022.
The latest report from Bain & Company highlights the rebound in dealmaking across the sector, emphasizing the vital role of biopharma and healthcare IT in this resurgence.
Europe activity hits record highs
The report revealed that North America retained its position as the largest market, accounting for 65 percent of global deal value, while Europe and Asia-Pacific contributed 22 percent and 12 percent, respectively.
In Europe, healthcare private equity activity reached record highs, with deal volumes surpassing the peak of 2021. This was driven by smaller transactions in the year’s first half and a focus on scalable assets in biopharma and medtech. A stabilizing macroeconomic environment has also created optimism for continued momentum in the region.
Meanwhile, Asia-Pacific saw a 49 percent decline in deal volume since 2023, largely attributed to a slowdown in China. However, investments are shifting to other regional powerhouses such as India, Japan and South Korea, where economic growth and demographic shifts are driving healthcare demand.
Biopharma and Healthcare IT drive growth
The biopharma sector emerged as a leader in healthcare private equity deal value, bolstered by several megadeals in 2024. While the sector saw impressive buyout figures, overall volume declined due to challenges like misaligned sale price expectations and reduced spending in pharma services.
In addition, Healthcare IT, another strong performer, experienced a significant resurgence in dealmaking. This was driven by providers aiming to enhance efficiency amid financial pressures, payers investing in advanced analytics and biopharma companies upgrading clinical trial IT infrastructure to meet tighter funding and regulatory demands.
Middle Eastern SWFs propel biopharma growth
Notably, the biopharma sector’s scalability and alignment with national health agendas have also made it a focal point for Middle Eastern sovereign wealth funds, as highlighted by Gregory Garnier, Bain’s Middle East Head of Private Equity.
“In Saudi Arabia, we anticipate growing demand for private healthcare services due to population expansion and the evolution of the health insurance sector. Additionally, ongoing efforts to achieve Vision 2030 objectives—such as enhancing healthcare infrastructure and modernizing hospitals and medical centers—will play a key role,” said Hatim Jamal, chief financial officer of Bupa Arabia for Cooperative Insurance.
Emerging trends in healthcare private equity
The report identified five key trends shaping the future of healthcare private equity. This includes the outperformance of mid-market healthcare-focused funds which have raised $59 billion since 2022—a 40 percent increase compared to the prior three years. These funds have diversified their focus, investing in healthcare IT and provider services while maintaining strongholds in biopharma and medtech.
The rise of carve-outs since 2010 has also accelerated, with private equity firms capitalizing on public companies divesting assets to improve shareholder value. This trend has offered a compelling opportunity to acquire overlooked assets with significant value-creation potential.
In addition, exit deal volumes fell 41 percent from their 2021 high, reflecting challenges such as prolonged hold periods and high interest rates. Private equity firms are increasingly embedding value-creation strategies into their diligence to maximize returns in a challenging exit environment.
Finally, investment focus in Asia-Pacific has moved beyond China, with India emerging as a preferred destination due to its growing middle class and healthcare needs. In addition, Japan and South Korea are gaining attention due to their aging populations and favorable macroeconomic trends.
Healthcare private equity to grow further in 2025
Experts predict sustained growth in healthcare private equity, driven by continued investor interest in scalable assets and opportunities in biopharma, healthcare IT and carve-outs.
“The healthcare private equity market roared back in 2024, and we anticipate strong activity in the coming year, particularly in mid-market funds and European markets,” said Kara Murphy, Bain’s co-leader of Healthcare Private Equity.
As the industry evolves, the ability to identify high-value opportunities and strategically manage assets will remain critical for maintaining momentum in the healthcare private equity sector.
