Funding Women’s Healthcare: From IVF to Menopause
An ACG Chicago panel examined M&A in women-focused healthcare services
Women’s care is an underfunded category of healthcare, yet it’s starting to get attention from financiers, policymakers and patients themselves. A panel hosted by ACG Chicago, “Investing in the Next Generation: Women’s Health Innovation,” on Aug. 1 explored trends in women’s healthcare, including the dynamics underpinning M&A. Springboard’s executive in residence for women’s health moderated.
Panelist Aaron Newman, director with investment bank DC Advisory, cited fertility services as an area of women’s healthcare with a notable supply and demand imbalance. Increasing maternal age, a growing number of same-sex couples and a rise in chronic health conditions that complicate pregnancy are prompting more people to seek in-vitro fertilization services, he said. Meanwhile, advances in technology have improved the success rate of IVF procedures and more employers are adding IVF to their employee benefits.
The number of IVF physicians, however, hasn’t kept up with demand, and that mismatch has resulted in high valuations for IVF specialty practices. “From a supply-demand perspective, private equity in particular is very, very interested in this space,” said Newman.
ACG Event Recap
WHAT: Investing in the Next Generation: Women’s Health, hosted by ACG Chicago
WHERE: Offices of Much Shelist, P.C., in downtown Chicago
WHEN: Aug. 1, 2024
THE TAKEAWAY: IVF services and menopause-related care are among the areas of women’s healthcare attracting investor interest as they grow in demand and require additional funding.
Women nearing or experiencing menopause make up another group that has been underserved by the healthcare system historically. “That’s the population that really gets forgotten about, right? You come in, you have your babies, maybe you have your hysterectomy or something, and then nobody really wants to talk to you so much anymore,” said Dr. Robert Harris, founder of Southeast Urogyn, which focuses on urogynecology, women’s pelvic health, and sexual and mental health for men and women.
Dr. Harris estimates there are 52 million women between ages 40 and 65. “You’ve got all these women suffering out there, and then you’ve got the younger women coming into menopause who are demanding something,” he added.
Menopause and incontinence are among the verticals that Dr. Harris’ practice—now part of the Shore Capital-backed network Together Women’s Health—is expanding into. “These verticals that we’re going to be adding to Urogyn practices are really what are going to drive revenue and drive patient satisfaction and improve the quality of life for women throughout their lives. And that’s the goal behind all of this,” said Dr. Harris.
Uncertainty & Complexity
As with other healthcare verticals, women-focused services require investors to understand the complex regulations that govern the sector. “If you approach investing in healthcare the same as you would in many other organizations, you are going to come face to face with regulatory issues,” noted Ann Ford, a partner at Malecki Brooks Ford Law Group, who provides strategic, business and legal advice to clients in the healthcare industry.
She cited the “post-Dobbs landscape” and uncertainty about the future of reproductive rights after the November election as an area that investors should be watching closely. She also pointed to digital innovations, such as period-tracking apps, and the questions they raise around data privacy compliance—and their impact, in turn, on investment decisions.
As an investor, I just want to make sure that the companies are developing and utilizing technology for a patient’s health—I want to make sure that the data is protected and well-guarded.
Jennifer Lee
JLC Life Sciences
Jennifer Lee, board member, investor and CEO of consulting firm JLC Life Sciences, underscored the importance of understanding the handling of data when considering an investment. “As an investor, my first question is: Where is the data going? Who’s keeping it? Who owns it at the end?” Technology in healthcare is something to embrace but with caution, she added. “As an investor, I just want to make sure that the companies are developing and utilizing technology for a patient’s health—I want to make sure that the data is protected and well-guarded.”
M&A professionals involved in healthcare will be closely watching the U.S. elections in November. Before the panel discussion, Liz Wroe, principal at healthcare policy consultancy Leavitt Partners, presented her firm’s election outlook and the implications for healthcare investors. Antitrust enforcement, Affordable Care Act tax credits and issues related to reproductive care access are among the issues whose future hinges on the election outcome. Still, Wroe doesn’t expect the 2024 elections to usher in a sea change for healthcare policy, since neither party stands to win the necessary numbers across the House, Senate and White House.
“We’re not seeing such historic margins that would allow you to do something completely structural in healthcare,” Wroe noted. “If one party takes everything, they’ll still lack a sweeping mandate.”
The event was hosted at the offices of law firm Much Shelist in downtown Chicago and was sponsored by BDO.
Look out for a transcript of the panel in the next edition of ACG’s Middle Market Executive magazine, mailed to all ACG members. Not yet a member? Join today.
Katie Maloney is Vice President of ACG Media.
Middle Market Growth is produced by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.
