New Report: Private Equity is a Partner to Health Care Across America
Featuring Gastro Health and WCG Clinical Services – two companies that are stronger after private equity investment
Washington, D.C. – The American Investment Council (AIC) released a report today, in collaboration with PitchBook, highlighting the nearly $73 billion private equity has raised to improve health care companies. Private equity serves as a critical source of capital supporting hospital systems, outpatient clinics, pharmaceutical manufacturers, medical device innovation, and countless other life-saving initiatives that improve patients’ lives and quality of care.
“Health care programs and facilities across America need private capital to treat patients and develop cures in local communities. Our new report shows how specific private equity investments are increasing access and improving lives. Companies like MedExpress, WCG Clinical Services, and ev3 are all stronger today because of private equity investment,” said AIC President & CEO Drew Maloney.
Key Insights from the Report:
- Hospitals: According to a 2021 study authored by professors at Georgetown and the University of Indiana, “private equity acquirers improve hospitals’ operational efficiency without compromising healthcare quality.”
- Urgent Care Centers: A 2017 study done by West Virginia University looked at MedExpress, a chain of Appalachian urgent care centers that has been heavily supported by private equity. With private equity capital, MedExpress was able to open new locations in more rural areas throughout the region, where hospital closures have become common.
- Investing in Innovation: Private equity firms have invested over $125 billion into medical device manufacturers over the past decade, and over the same time, more than 870 manufacturers have partnered with private equity sponsors to grow and expand their business. These investments have helped support doctors as they provide lifesaving care and address patient needs.
- Health Care-focused Investors: Patient Square Capital, a member of AIC, employs multiple Ph.D. holders and former doctors. Its investments span the health care industry, including late-stage investments in clinical-trial drug platforms, multiple behavioral health practices, prosthetics services, therapeutic device manufacturers, and telehealth providers.
- Physician Groups: Through private equity investment, Gastro Health, a Miami-based gastrointestinal group, was able to expand to over 150 locations across Florida, Alabama, and Virginia, and to new regions in Ohio, Maryland, and Washington.
- Medical Devices: Manufacturer ev3, who produces stents, catheters, and other specialized medical devices, was able to launch seven new products in 2004 and six more in 2005. Through private equity investment, the company quickly became an important player in the market, producing critical devices for vascular surgery.
- Clinical Trial Services: Based in Princeton, New Jersey, WCG Clinical Services is the first clinical services organization that serves the pharmaceuticals industry. It was first sponsored by AIC member Arsenal Capital Partners in 2012, who helped identify a significant bottleneck in the sector and has enabled WCG to better serve its clients by reducing their wait times during review by the Institutional Review Board.
The full report can be found here.
