The global IVF market is ripe for consolidation

It is expected that the global IVF market will reach an estimated value of $36.2bn by 2026, growing at a CAGR of 10.2%1.

According to the World Health Organisation, one in every six couples suffer from issues with infertility. Drivers of infertility include lifestyle and behavioural changes which reflects an increasing number of working women, advanced maternal and paternal age, lower marriage rates, and delaying marriages. Obesity is another factor leading to an increase in infertility. The fat deposited on women’s abdomen prevents follicular stimulation and produces male hormones. For males, rising fat deposits decrease testosterone levels and can result in lowered sperm production1.

In the UK changes in government policies means that in certain areas Clinical Commissioning Groups no longer offer fertility treatments to couples over 342. Therefore, we are seeing an increase in private treatments as an alternative to NHS led treatments. Private IVF providers are also benefitting from less strenuous government rulings over fertility tourism, where couples travel internationally in search for IVF treatments. In some cases, this is for cheaper treatments and in some cases this is to access higher rates of success. Interestingly, Australasian companies like Virtus Health Limited continue to make a splash into the European IVF market with acquisitions in the UK and Scandinavia. In a market that has a strong emotional connection when purchasing such services – marketing these services in an ethical way is paramount and is highly regulated.

Currently the global market is very fragmented with plenty of opportunity for consolidation. As a result we expect to see acquisition activity increase over the next few years.

1Grand View Research - IVF Market Size Worth $36.2 Billion By 2026 | CAGR: 10.2%

2BBC News - Women over 34 are being refused IVF treatment.

We have seen a number of transactions in the IVF market since 2018, including:

Impilo AB, the Sweden based private equity firm has acquired The Fertility Partnership Ltd, the UK based operator of reproductive health clinics.

CARE Fertility Group Limited, the UK based fertility treatment provider, has acquired Bath Fertility Centre Limited, the UK based company that operates IVF centres.

Universal Clinics S.L.U, the Spain based provider of reproductive services, has agreed to acquire GINEFIV SL, the Spain based fertility clinic.

EUVITRO S.L.U., the fertility treatments provider has acquired AVA Clinic SIA, the Latvia based operator of infertility treatment clinics.

Ovation Fertility, the US based IVF laboratory services provider, has agreed to acquire Midwest Fertility Specialists, the US based provider of fertility care services.

Virtus Health Limited, the listed Australia based fertility care services provider, has acquired Fertilitetsklinikken Trianglen Aps, the Denmark based fertility clinic operator for €27.1m.

Virtus Health Limited, the listed Australia based fertility care services provider, has acquired Complete Fertility Ltd, the UK based fertility care centre operator for €6.2m.

NL Holding GmbH, the Germany based healthcare services provider, has acquired ProCrea Lab SA, the Switzerland based fertility centre operator.

Below are a selection of the deals that we have been tracking during the first quarter of 2019.

Medical Equipment & Supplies

Brainlab AG, the Germany based medical technology manufacturer, has acquired Medineering GmbH, the Germany based developer of surgical robotic systems.

Alcon Laboratories Inc, the US based manufacturer of eye care devices, has acquired PowerVision Inc, the US based developer of intraocular lens technology for €251.4m.

Corin Group plc, the UK based producer of orthopaedic devices, has acquired OMNI Orthopaedics Inc, the US based manufacturer of orthopaedic medical devices.

Smith & Nephew plc, the UK based manufacturer of healthcare equipment, has acquired Ceterix Orthopaedics, the US based developer of surgical tools for arthroscopic procedures for €92.4m.

Nordic Capital, the Sweden based private equity firm, has agreed to acquire Orchid Orthopedic Solutions LL, the US based orthopaedic and medical device contract design and manufacturing business.

OPHTECS Europe B.V, the Netherlands based contact lens manufacturer, has acquired Microlens Contactlens Technolgy bv, the Netherlands based manufacturer of ophthalmic lenses.

Mölnlycke Health Care AB, the Sweden based manufacturer of single-use surgical and wound care products, has acquired M&J Airlaid Products A/S, the Denmark based manufacturer of nonwoven materials and absorbent airlaid products. Clearwater International advised M&J on this deal.

Straumann Holding AG, Switzerland based dental implant manufacturer, has agreed to acquire Anthogyr SAS, the France based manufacturer of dental products.

Pharmaceuticals & Biotechnology

Clean Cells, the France based developer of viral vaccines for measles, has acquired BE Vaccines SAS, the France based developer of viral vaccines.

Xenetic Biosciences Inc, the US based clinical-stage biopharmaceutical company, has agreed to acquire Hesperix SA, the pharmaceuticals manufacturing business.

GHO Capital, the UK based private equity firm, has acquired Sterling Pharma Solutions Ltd, the UK based API development and manufacturing business.

Sarepta Therapeutics Inc, the US based gene therapy business has agreed to acquire Myonexus Therapeutics Inc, the US based clinical-stage biotechnology company for €145.1m.

Cares Pharma NV, the Belgium based developer of medical products and food supplements, has acquired 2Pharma nv, the Belgium based manufacturer of raw pharmaceuticals.

Hitachi Chemical Advanced Therapeutics Solutions LLC, the US based life sciences business, has agreed to acquire Apceth Biopharma GmbH, the Germany based manufacturer of cell-based gene therapy products for €75.5m.

Adaptive Health LLC, the US based manufacturer of nutritional health supplements, has acquired Biovation Labs LLC, the US based manufacturer of supplement products.

Dermapharm Holding SE, the Germany based pharmaceutical business, has acquired Euromed S.A., the Spain based producer of natural active substances for €200m.

Health & Social Care

Polaris Capital Group Co Ltd, the Japan based investment group, has acquired HITOWA Holdings Co Ltd, the Japan based nursing care services provider.

Apila Terveys Oy, the Finland based health services business, has acquired Jyväskylän Työterveys Oy, the Finland based provider of occupation health services.

CARTERA VIVANTA SLU, the Spain based online dental care platform, has acquired Vera Dental SL, the Spain based operator of dental clinic.

Medicover AB, the Sweden based healthcare and diagnostics services provider, has agreed to acquire NEOMEDIC Sp. z o.o., the Poland based provider of obstetrics, neonatology and gynaecology care services for €70.5m.

An investor group including Bain Capital Private Equity, Summit Partners and Revelstoke Capital Partners has acquired US Renal Care Inc, the US based business that operates a network of dialysis clinics.

Kenedix Residential Next Investment Corporation, the Japan based Real Estate Investment Trust, has acquired Tsukui-Sunshine Machida, the Japan based nursing care facility for €55.1m.

Levin Eye Care LLC, the US based eye care facility, has acquired Total Vision Eye Care, the US based business offering ophthalmology and optometry services.

Core Assets Group Limited, the UK based provider of social care services has acquired Partnerships in Children’s Services, the UK based provider of fostering services, Clearwater International advised PICs on this deal.

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