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HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
www.harriswilliams.com
PAGE |
www.harriswilliams.com
WHATWE’RE READING
1
CONTENTS
PUBLIC MARKETS OVERVIEW
EQUITY MARKETS OVERVIEW
M&A OVERVIEW
DEBT MARKETS OVERVIEW
HEALTHCARE & LIFE SCIENCESPUBLIC COMPARABLES
M&A TRANSACTIONS
CONTACTSTurner BredrupManaging Directortbredrup@harriswilliams.com+1 (804) 915-0110
James ClarkManaging Directorjclark@harriswilliams.com+1 (804) 915-0119
Andy DixonManaging Directoradixon@harriswilliams.com+1 (415) 217-3419
Cheairs PorterManaging Directorcporter@harriswilliams.com+1 (804) 915-0130
Geoff SmithManaging Directorgsmith@harriswilliams.com+1 (804) 915-0195
Paul HepperDirectorphepper@harriswilliams.com+1 (804) 932-1326
Whit KnierDirectorwknier@harriswilliams.com+1 (804) 932-1321
Eugene BordVice Presidentebord@harriswilliams.com+1 (804) 915-0180
Tyler BradshawVice Presidenttbradshaw@harriswilliams.com+1 (804) 887-6121
Mervyn HanVice Presidentmhan@harriswilliams.com+1 (804) 887-6087
Andy HewlettVice Presidentahewlett@harriswilliams.com+1 (415) 217-3427
Ricky NgVice Presidentrng@harriswilliams.com+1 (415) 217-3437
Nick OwensVice Presidentnowens@harriswilliams.com+1 (804) 887-6027
HOME HEALTH | LHC GROUP, ALMOST FAMILY MERGER HIGHLIGHTS INDUSTRYGROWTH
LHC Group and Almost Family agreed to a merger that would create the second-
largest home health provider in the country with 781 locations in 36 states, more than
31,000 employees and revenue of $1.8 billion.
The deal highlights the growing stature of the post-acute and home health space as
many organizations aim to capitalize on population health and payment initiatives
that emphasize reducing unnecessary care, shift care to lower-cost care delivery
settings, improving patient satisfaction and outcomes.
The LHC Group and Almost Family all-stock deal will combine two major players in
that segment of the industry that is expected to grow along with the aging baby-
boom population, longer life expectancies, growing rates of chronic conditions and
the shift to move care from the hospital.
The deal will put the combined entity behind Kindred Healthcare and its $2.5 billion in
annual home health revenue and would produce ~$25 million in cost savings that will
allow them to pursue other partnerships and acquisitions and expand their
geographic footprint and service portfolio, executives said.
"The push to value-based care, which requires care coordination, cost tracking and
outcomes management across the continuum, in many cases requires significant
resources and investment," said Christopher Donovan, partner at Foley & Lardner."Most of the time, this can only be accessed with a large scale and size."
A link to the original article can be found here.
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
BEHAVIORAL HEALTH | NEW “PSYCHIATRIC ER”
A “psychiatric emergency room” is planned to open in Metro Center Nashville next
year, with the goal of getting people connected to help faster.
There is often a wait in a traditional emergency room for a mental health clinician to
complete a psychiatric evaluation and transfer to an in-patient or community-based
facility. The wait can range from hours to days, according to a white paper by
TeamHealth, and the patient is "boarded" in an ER room.
It's important to get people into treatment faster because the longer they are with a
police officer the more agitated they become and the "higher your odds of doing
something that gets (them) on the wrong side of the law," said Dr. Bill Paul, director of
the Metro Public Health Department. The facility will also cut down on time spent by
police officers who are not trained in behavioral health. A recent study determined
that police spend at least 5,000 hours a year — that's between two and three full-
time police officers — responding to someone in crisis.
The $3.5 million Nashville facility will be open to anyone who walks in, or is dropped
off, and needs help. It will connect to an existing facility and will make it easier for
police to drop someone off and return to work, while acting as a resource for any
other member of the community suffering from a mental health crisis.
Additionally, the new facility will allow the health and police departments to track
whether treatments are working or if people are recurring through the system.
A link to the original article can be found here.
PAGE |
Physician Practice Management
Assisted Living
Retail Pharmacy
Behavioral Health / Management
Acute-Care Hospitals
Specialty Pharmacy
Medical / Surgical / Dental Supplies & Distribution
Long-Term Care
Emergency Services
Dialysis Services
S&P 500
HW&Co. HCLS Composite Index
Clinical Laboratories
Contract Pharma Manufacturing
Surgicenters / Rehabilitation
Dental Products
Medical Devices and Products
Healthcare Staffing
Life Sciences Tools
Diagnostic Imaging
Durable Medical Equipment
Home Care, Hospice, and Home Infusion
Specialty Managed Care
Contract Research Organizations
HMO - Medical
Disease Management
(50.0%) (40.0%) (30.0%) (20.0%) (10.0%) 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%
PUBLICMARKETS OVERVIEW(1)
2
Key Trading Statistics (detail begins on page 6)
Public Company Sector Performance
(12-month % change in stock price)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Change in Stock Price
3 mos. 12 mos. Revenue EBITDA Revenue EBITDA
Clinical Laboratories 2 $39,431 (8.3%) 18.9% 2.2x 11.2x 2.1x 10.5x
Contract Pharma Manufacturing 2 8,988 (7.4%) 20.3% 3.7x 15.7x 3.4x 13.8x
Contract Research Organizations 6 66,956 15.8% 51.8% 3.5x 17.4x 3.2x 14.6x
Disease Management 1 1,991 16.6% 86.5% 3.7x 15.9x 3.3x 14.5x
Healthcare Staffing 4 18,906 17.5% 28.0% 1.4x 12.3x 1.3x 10.3x
HMO - Medical 8 460,393 10.8% 55.2% 1.0x 12.4x 0.9x 10.1x
Information Serv ices 11 47,142 1.4% 15.7% 4.4x 17.4x 4.0x 12.9x
Specialty Managed Care 3 9,554 9.5% 51.1% 2.1x 14.8x 5.9x 29.0x
Specialty Pharmacy 1 1,569 32.6% (9.1%) 0.4x 18.6x 0.3x 13.9x
Retail Pharmacy 3 183,512 (17.9%) (19.9%) 0.5x 9.6x 0.5x 8.4x
Specialty Pharmacy Management 2 48,114 7.2% 7.0% 0.5x 8.3x 0.5x 7.6x
Dental Products 2 164,839 6.4% 22.7% 4.4x 18.3x 4.2x 15.7x
Durable Medical Equipment 3 20,390 8.3% 45.7% 2.7x 17.2x 2.6x 15.0x
Life Sciences Tools 4 178,034 7.0% 28.1% 4.5x 17.5x 4.2x 14.6x
Medical Devices and Products 13 908,510 5.3% 27.9% 4.5x 18.9x 4.2x 15.0x
Medical / Surgical / Dental Supplies & Distribution 6 104,704 (16.4%) (2.3%) 0.2x 9.2x 0.2x 8.4x
Acute-Care Hospitals 4 99,763 (17.6%) (10.3%) 0.9x 7.9x 1.0x 7.3x
Assisted Liv ing 2 8,176 (16.5%) (23.6%) 2.2x 13.3x 2.1x 11.8x
Diagnostic Imaging 2 10,487 24.7% 43.6% 2.4x 13.3x 2.3x 11.6x
Dialysis Serv ices 3 61,084 (6.2%) 3.6% 1.6x 8.6x 1.4x 9.5x
Home Care, Hospice, and Home Infusion 6 8,870 7.7% 46.9% 1.7x 14.4x 1.6x 12.6x
Long-Term Care 3 6,206 (1.8%) (1.1%) 0.8x 9.1x 0.7x 7.8x
Physician Practice Management 1 5,834 (6.8%) (28.5%) 1.7x 9.7x 1.6x 9.6x
Behavioral Health / Management 5 23,562 4.5% (12.8%) 1.3x 8.8x 1.2x 7.4x
Surgicenters / Rehabilitation 4 17,255 8.0% 22.2% 1.8x 11.0x 1.7x 9.9x
Payor, Provider, & Pharmacy Support Serv ices 43 $886,556 4.3% 33.7% 1.4x 12.4x 1.3x 10.2x
Products & Devices 28 $1,376,476 5.0% 24.4% 4.6x 16.8x 4.3x 14.3x
Provider-Based Serv ices 30 $241,237 (1.7%) 7.6% 1.7x 10.0x 1.6x 9.3x
HW&Co. HCLS Composite Index 101 $2,504,269 3.4% 18.7% 3.3x 14.8x 3.0x 12.5x
S&P 500 4.1% 17.1%
Pro
du
cts
&
De
vic
es
Pro
vid
er-
Ba
sed
Se
rvic
es
Median TEV/
Forward MulitplesSectorNumber of
Companies
Aggregate
Enterprise Value
($ mm)
Median TEV/
LTM Multiples
Pa
yo
r, P
rov
ide
r, &
Ph
arm
ac
y
Su
pp
ort
Se
rvic
es
PAGE |
124.7%119.4%
138.3%
40%
60%
80%
100%
120%
140%
160%
180%
Nov-14 Feb-15 May-15 Aug-15 Nov-15 Feb-16 May-16 Aug-16 Nov-16 Feb-17 May-17 Aug-17 Nov-17
S&P 500 Dow Jones U.S. Healthcare Index HW&Co. HCLS Index
EQUITYMARKETS OVERVIEW
3
Healthcare & Life Sciences Industry Stock Performance(1)
Top Equity Offerings(2)
(by proceeds)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Closing Date Issuer Ticker Transaction Type Gross Proceeds ($ mm)
10/26/17 National Vision Holdings NASDAQ:EYE Initial Public Offering $347.6
10/13/17 Anaptysbio Inc. NASDAQ:ANAB Follow-On 205.5
10/25/17 Ablynx NV NASDAQ:ABLX Initial Public Offering 199.5
10/02/17 Zogenix, Inc. NASDAQ:ZGNX Follow-On 150.7
10/18/17 Ignyta, Inc. NASDAQ:RXDX Follow-On 124.8
10/05/17 Rhythm Pharmaceuticals NASDAQ:RYTM Initial Public Offering 120.7
10/13/17 OptiNose NASDAQ:OPTN Initial Public Offering 120.0
10/10/17 Flexion Therapeutics NASDAQ:FLXN Follow-On 113.0
10/04/17 Immunogen Inc. NASDAQ:IMGN Follow-On 99.5
10/24/17 Uniqure N.V. NASDAQ:QURE Follow-On 96.4
10/13/17 Protagonist Therapeutics, Inc. NASDAQ:PTGX Follow-On 60.0
10/24/17 Idera Pharmaceuticals NASDAQ:IDRA Follow-On 60.0
10/12/17 OrthoPediatrics NASDAQ:KIDS Initial Public Offering 52.0
10/04/17 NewLink Genetics Corp. NASDAQ:NLNK Follow-On 51.3
10/25/17 Corbus Pharmaceutical Holdings NASDAQ:CRBP Follow-On 32.6
10/12/17 Restoration Robotics NASDAQ:HAIR Initial Public Offering 25.2
10/13/17 BioTime Inc. NYSE:BTX Follow-On 25.0
10/27/17 VBI Vaccines Inc. NASDAQ:VBIV Follow-On 22.8
10/05/17 CareDx, Inc. NASDAQ:CDNA Follow-On 17.4
10/31/17 Pluristem Therapeutics Inc. NASDAQ: PSTI Follow-On 15.0
10/02/17 Ritter Pharmaceuticals NASDAQ:RTTR Follow-On 13.8
10/13/17 Asterias Biotherapeutics NYSE:AST Follow-On 10.4
PAGE |
HC&LS Industry Number of
Segment Companies
Healthcare Facilities 26
Healthcare Serv ices 160
Healthcare Equipment 43
Pharmaceuticals 24
Healthcare Technology 9
Life Sciences Tools & Serv ices 3
Healthcare Supplies 13
Healthcare Distributors 5
Biotechnology 30
Managed Healthcare 8
M&A OVERVIEW(1)
4
Announced Healthcare & Life Sciences M&A
Healthcare & Life Sciences M&A Trends
Announced Private Equity M&A Activity
QUARTERLY M&A ACTIVITY
HEALTHCARE TRANSACTION HIGHLIGHTS
ANNOUNCED HEALTHCARE & LIFE SCIENCES TRANSACTIONS
MEDIAN HEALTHCARE & LIFE SCIENCES TRANSACTION MULTIPLES
PEG INVESTMENTS BY SEGMENT (LAST 3 YEARS) PEG INVESTMENTS AND EXITS
Note: Transactions based on publicly available information
LTM DEAL STATISTICS
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
$101.6 $108.2
$236.6
$576.0
$277.9
$146.5
0
200
400
600
800
1,000
1,200
1,400
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
$550
$600
2012 2013 2014 2015 2016 2017YTD
Nu
mb
er o
f Tran
sac
tion
sAg
gre
ga
te T
ran
sac
tio
n V
alu
e
($ in
billio
ns)
Volume Total Deals
10.9x 10.0x
13.6x 14.2x
13.0x 13.1x
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
4.5x
5.0x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
16.0x
18.0x
2012 2013 2014 2015 2016 2017YTD
EV
/ LTM S
ale
s Mu
ltiple
EV
/ L
TM E
BIT
DA
Mu
ltip
le
EBITDA Multiple Revenue Multip le
280 291 303 313
368
309 306
250225
182 175152
186
1016
1112
15
18 21
48
49
45 52
34
58
0
50
100
150
200
250
300
350
400
3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17
Nu
mb
er o
f Tra
nsa
ctio
ns
PE Buyer Strategic Buyer
116
77
44
68 67 6661 62
56
163171
93
52 48
78
124
139 143 144
130
41
20
20
40
60
80
100
120
140
160
180
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017YTD
Nu
mb
er o
f Tra
nsa
ctio
ns
Number of Investments Number of Exits
Announced Target Buyer
10/30/2017 South Shore Hand Therapy / Occupational Therapy Thomas H. Lee Partners LP
10/23/2017 Exactech, Inc. TPG Capital LLC
10/23/2017 U.S. HealthWorks, Inc. Concentra, Inc.; Welsh, Carson, Anderson & Stowe; Cressey & Co.
10/18/2017 Clinical Innov ations LLC EQT Partners AB
10/18/2017 Gorman Health Group LLC New Mountain Capital LLC; Conv ey Health Solutions, Inc.
10/16/2017 Autism Home Support Serv ices, Inc. The Jordan Co. LP; The Wicks Group of Cos. LLC
10/16/2017 Medical Center Dermatology, PA ABRY Partners LLC; Dermatology Associates of Tyler
10/11/2017 Ecolab, Inc /Equipment Care Business/ Audax Priv ate Equity
10/11/2017 Summit Healthcare Management LLC FFL Partners LP; Lee Equity Partners LLC
10/10/2017 Carecore National Group LLC Express Scripts Holding Co.
10/6/2017 Women's Care Florida LLC Lindsay Goldberg & Co. LLC
10/5/2017 S&G Properties LLC TSG Consumer Partners LLC
Aggregate Number Median Transaction Multiples
Value ($bn) of Deals TEV/Rev TEV/EBITDA
$169.5 876 2.8x 13.1x
PAGE |
DEBTMARKETS OVERVIEW
Key Credit Statistics(3)
QUARTERLY HEALTHCARE LOAN VOLUME AVERAGE SPREAD ON HEALTHCARE LOANS
Select Healthcare & Life Sciences Debt Offerings(4)
(by deal amount)
CREDIT METRICS AVERAGE SECONDARY SPREAD
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
$0
$3
$6
$9
$12
$15
$18
$21
$24
2Q12 4Q12 2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 2Q16 4Q16 2Q17
Loa
n V
olu
me
by
Qu
art
er
($ in
billio
ns)
Pro Rata Institutional
L + 0
L + 100
L + 200
L + 300
L + 400
L + 500
2011 2012 2013 2014 2015 2016 1H17
Av
era
ge
Sp
rea
d O
ve
r LI
BO
RRevolving Credit / Term Loan A Weighted-Average Institutional
L + 0
L + 200
L + 400
L + 600
2Q12 4Q12 2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 2Q16 4Q16 2Q17
Av
era
ge
Sp
rea
d O
ve
r LI
BO
R
0.0x
2.0x
4.0x
6.0x
Debt/EBITDA Senior Debt/EBITDA EBITDA/Cash
Interest
EBITDA -
Capex/Cash
Interest
EB
ITD
A M
ultip
le
2011 2012 2013 2014 2015 2016 1H17
5
Date Effective Borrower Name Description Amount ($ mm) Tranche Rating Spread
10/10/17 Cooper Cos Ophthalmic goods $1,100.0 Bridge Loan NR / NR L+ 150
10/24/17 Alliance HealthCare Serv ices Inc Medical laboratories 650.0 Term Loan B3 / B- L+ 1000
10/12/17 Paradigm Acquisition Corp Specialty hospitals not psych'ric 455.0 Term Loan Caa2 / CCC+ L+ 850
10/27/17 Argon Medical Devices Inc Surgical appliances and supplies 435.0 Term Loan Caa2 / B- L+ 800
10/06/17 Quidel Corp Surgical and medical instruments 270.0 Term Loan A NR / NR L+ 350
10/04/17 Covenant Surgical Partners Inc Health and allied serv ices 220.0 Term Loan B B3 / B- L+ 475
10/31/17 Sucampo Pharmaceuticals Inc Pharmaceutical preparations 100.0 Revolver/Line >= 1 Yr. NR / NR L+ 300
10/20/17 Z-Medica Medical and hospital equipment 90.0 Term Loan B NR / NR L+ 550
PAGE |
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
Clinical Laboratories
Laboratory Corporation of America Holdings $153.71 (3.3%) 22.6% $164.22 $119.51 $15,648 $7,218 $409 $22,776 $10,074 $1,965 $1,447 Sep-17 Dec-16 $10,838 $2,154 $1,811 2.3x 11.6x 2.1x 10.6x
Quest Diagnostics Incorporated 93.78 (13.4%) 15.2% 112.97 79.28 12,782 3,764 350 16,655 7,634 1,532 1,272 Sep-17 Dec-16 7,873 1,602 1,336 2.2x 10.9x 2.1x 10.4x
Number of Companies 2 Median: (8.3%) 18.9% Total $28,430 $39,431 $17,708 $18,711 2.2x 11.2x 2.1x 10.5x
Market Cap. Weighted Average: (7.8%) 19.3% 2.2x 11.3x 2.1x 10.5x
Contract Pharma Manufacturing
Cambrex Corporation $43.25 (29.1%) 7.3% $62.95 $38.30 $1,416 $0 $118 $1,331 $530 $175 $145 Sep-17 Dec-16 $563 $169 $141 2.5x 7.6x 2.4x 7.9x
West Pharmaceutical Serv ices, Inc. 101.40 14.3% 33.4% 103.36 73.69 7,504 230 269 7,657 1,567 321 227 Sep-17 Dec-16 1,708 388 281 4.9x 23.8x 4.5x 19.7x
Number of Companies 2 Median: (7.4%) 20.3% Total $8,919 $8,988 $2,097 $2,271 3.7x 15.7x 3.4x 13.8x
Market Cap. Weighted Average: 7.4% 29.2% 4.5x 21.3x 4.1x 17.8x
Contract Research Organizations
Catalent Inc 42.59 22.7% 86.7% 43.39 21.83 5,617 2,107 615 6,934 2,177 421 271 Sep-17 Jun-17 2,434 552 314 3.2x 16.5x 2.8x 12.6x
Charles River Laboratories International, Inc. 116.29 18.4% 53.3% 118.66 67.20 5,535 1,183 155 6,675 1,846 435 301 Sep-17 Dec-16 1,954 473 393 3.6x 15.4x 3.4x 14.1x
ICON Plc 118.86 13.3% 48.1% 123.53 73.76 6,437 349 292 6,565 1,738 396 335 Sep-17 Dec-16 1,864 435 372 3.8x 16.6x 3.5x 15.1x
INC Research Holdings, Inc. 57.15 3.9% 25.1% 61.10 40.65 5,917 3,058 306 7,733 2,001 266 154 Sep-17 Dec-16 3,168 656 571 3.9x 29.0x 2.4x 11.8x
PRA Health Sciences, Inc. 81.43 9.4% 53.0% 84.38 51.16 5,160 1,350 194 6,526 2,080 317 249 Sep-17 Dec-16 2,250 428 383 3.1x 20.6x 2.9x 15.3x
IQVIA Holdings Inc 108.10 19.4% 50.7% 108.81 70.10 22,843 9,754 1,147 32,524 9,508 1,787 864 Sep-17 Dec-16 8,454 2,167 1,386 3.4x 18.2x 3.8x 15.0x
Number of Companies 6 Median: 15.8% 51.8% Total $51,508 $66,956 $19,351 $20,124 3.5x 17.4x 3.2x 14.6x
Market Cap. Weighted Average: 16.1% 51.8% 3.5x 19.0x 3.4x 14.3x
Disease Management
Tiv ity Health, Inc. 46.25 16.6% 86.5% 47.90 19.25 1,829 149 171 1,991 543 125 124 Sep-17 Dec-16 606 137 133 3.7x 15.9x 3.3x 14.5x
Number of Companies 1 Median: 16.6% 86.5% Total $1,829 $1,991 $543 $606 3.7x 15.9x 3.3x 14.5x
Market Cap. Weighted Average: 16.6% 86.5% 3.7x 15.9x 3.3x 14.5x
Emergency Services
Air Methods Corporation(**) $0.00 0.0% 0.0% $43.95 $23.75 $0 $0 $0 $0 $0 $0 $0 Dec-16 Dec-16 NA NA NA #DIV/0! #DIV/0! NA NA
Number of Companies 1 Median: 0.0% 0.0% Total $0 $0 $0 $0 #DIV/0! #DIV/0! #NUM! #NUM!
Market Cap. Weighted Average: #DIV/0! #DIV/0! NM NM NM NM
Healthcare Staffing
AMN Healthcare Serv ices, Inc. $43.90 19.0% 33.8% $46.60 $26.00 $2,105 $320 $20 $2,471 $1,967 $241 $209 Sep-17 Dec-16 $2,101 $270 $231 1.3x 10.3x 1.2x 9.2x
Envision Healthcare Holdings, Inc. 42.60 (24.5%) (28.7%) 74.75 39.66 5,147 6,323 381 12,021 7,207 1,144 869 Sep-17 Dec-16 8,515 1,134 935 1.7x 10.5x 1.4x 10.6x
Cross Country Healthcare, Inc. 13.65 16.1% 22.2% 16.38 10.93 498 95 11 577 868 39 30 Sep-17 Dec-16 960 58 45 0.7x 14.7x 0.6x 9.9x
On Assignment, Inc. 61.22 24.3% 77.9% 61.88 33.93 3,233 610 28 3,837 2,568 272 213 Sep-17 Dec-16 2,765 329 252 1.5x 14.1x 1.4x 11.7x
Number of Companies 4 Median: 17.5% 28.0% Total $10,983 $18,906 $12,610 $14,340 1.4x 12.3x 1.3x 10.3x
Market Cap. Weighted Average: 0.0% 17.0% 1.5x 11.7x 10.6x
TEV/ Fwd MultiplesForward Twelve Month
EstimateCompany NameLTM
Period
Latest
FYE Date
TEV/ LTM MultiplesEquity
Mkt.
Value
Total DebtCash and
Equiv.
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)
PUBLIC COMPARABLES
6
Payor, Provider, & Pharmacy Support Services(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
PAGE |
PUBLIC COMPARABLES
7
Payor, Provider, & Pharmacy Support Services(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
HMO - Medical
Commercial:
Aetna Inc. $170.03 10.2% 58.4% $184.98 $104.59 $56,399 $10,159 $17,996 $60,916 $61,435 $3,948 $3,888 Sep-17 Dec-16 $61,766 $6,278 $5,661 1.0x 15.4x 1.0x 9.7x
Anthem, Inc. 209.21 12.4% 71.7% 212.07 114.85 53,717 16,231 4,075 65,993 89,123 5,996 5,322 Sep-17 Dec-16 91,281 6,494 5,962 0.7x 11.0x 0.7x 10.2x
Cigna Corporation 197.22 13.6% 66.0% 202.50 115.03 49,656 5,348 3,185 51,722 41,025 4,274 3,880 Sep-17 Dec-16 43,801 5,074 4,392 1.3x 12.1x 1.2x 10.2x
Humana Inc. 255.35 10.4% 48.9% 264.56 165.03 36,479 5,101 3,877 32,354 53,456 3,732 2,388 Sep-17 Dec-16 56,193 4,032 3,633 0.6x 8.7x 0.6x 8.0x
UnitedHealth Group Incorporated 210.22 9.6% 48.7% 212.77 136.22 203,253 29,262 10,430 225,083 196,621 16,963 14,421 Sep-17 Dec-16 215,927 20,214 17,744 1.1x 13.3x 1.0x 11.1x
Number of Companies 5 Median: 10.4% 58.4% Total $399,504 $436,066 $441,659 $468,967 1.0x 12.1x 1.0x 10.2x
Market Cap. Weighted Average: 10.6% 55.3% 1.0x 12.7x 1.0x 10.4x
Government:
Centene Corporation $93.67 17.9% 49.9% $98.72 $50.00 $16,156 $4,721 $4,068 $16,907 $47,487 $2,063 $1,590 Sep-17 Dec-16 $51,201 $2,394 $1,935 0.4x 8.2x 0.3x 7.1x
Molina Healthcare, Inc. 67.83 1.5% 24.7% 72.79 42.56 3,874 2,297 2,819 2,229 19,468 (31) 70 Sep-17 Dec-16 20,608 553 363 0.1x NM 0.1x 4.0x
WellCare Health Plans, Inc. 197.74 11.7% 74.2% 201.37 114.41 8,801 1,182 4,054 5,191 16,180 707 662 Sep-17 Dec-16 18,725 894 799 0.3x 7.3x 0.3x 5.8x
Number of Companies 3 Median: 11.7% 49.9% Total $28,831 $24,327 $83,135 $90,534 0.3x 7.8x 0.3x 5.8x
Market Cap. Weighted Average: 13.8% 53.9% 0.3x 7.9x 0.3x 6.3x
8 10.8% 55.2% Total 428335.51 460392.92 524794.7 559501.26 1.0x 12.4x 0.9x 10.1x
Information Services
Data/Analytics:
Castlight Health, Inc. $3.85 (10.5%) (11.5%) $5.50 $3.05 $311 $6 $87 $428 $124 ($53) ($58) Sep-17 Dec-16 $160 ($13) ($16) 3.4x NM 2.7x NM
Inovalon Holdings, Inc. 16.75 31.9% 23.2% 17.80 8.60 1,083 244 526 2,092 431 79 28 Sep-17 Dec-16 485 123 80 4.9x 26.4x 4.3x 17.1x
National Research Corporation 53.93 6.9% 45.1% 57.21 36.67 976 2 36 1,598 116 39 34 Sep-17 Dec-16 126 43 39 13.8x NM 12.6x NM
Number of Companies 3 Median: 6.9% 23.2% Total $2,370 $1,598 $671 $772 4.9x 26.4x 4.3x 17.1x
Market Cap. Weighted Average: 16.1% 27.7% 8.3x 26.4x 7.5x 17.1x
eHealth:
Number of Companies Median:
Market Cap. Weighted Average: NM NM NM NM
Hospital/Physician:
Allscripts Healthcare Solutions, Inc. $13.48 9.5% 12.2% $14.45 $9.80 $2,435 $1,416 $109 $4,204 $1,714 $275 $68 Sep-17 Dec-16 $2,081 $409 $301 2.5x 15.3x 2.0x 10.3x
Athenahealth, Inc. 127.88 (7.5%) 23.8% 158.66 90.11 5,118 276 123 5,358 1,179 200 52 Sep-17 Dec-16 1,324 331 194 4.5x 26.8x 4.0x 16.2x
Cerner Corporation 67.52 4.9% 15.3% 73.86 47.01 22,445 535 852 22,557 5,086 1,548 989 Sep-17 Dec-16 5,509 1,811 1,258 4.4x 14.6x 4.1x 12.5x
Computer Programs and Systems, Inc. 30.15 (1.6%) 15.5% 36.15 18.25 415 144 1 548 263 30 17 Sep-17 Dec-16 282 53 29 2.1x 18.1x 1.9x 10.4x
HMS Holdings Corp. 19.24 (4.2%) (8.7%) 21.83 15.94 1,617 240 79 1,810 501 111 54 Sep-17 Dec-16 620 152 84 3.6x 16.4x 2.9x 11.9x
Premier Inc. 32.67 (6.4%) 2.6% 36.50 28.27 1,750 179 132 7,422 1,532 441 327 Sep-17 Jun-17 1,659 558 436 4.8x 16.8x 4.5x 13.3x
Quality Systems, Inc. 14.07 (17.7%) 9.2% 17.74 12.38 896 55 33 916 524 81 43 Sep-17 Mar-17 535 85 38 1.7x 11.3x 1.7x 10.8x
Advisory Board Company(**) 53.93 (4.0%) 35.5% 59.50 24.85 2,198 635 151 2,729 782 105 21 Sep-17 Dec-16 837 208 81 3.5x 26.1x 3.3x 13.1x
Number of Companies 8 Median: (4.1%) 13.8% Total $36,872 $45,544 $11,582 $12,848 3.6x 16.6x 3.1x 12.2x
Market Cap. Weighted Average: 1.4% 15.7% 4.2x 17.2x 3.8x 12.8x
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)LTM
Period
Latest
FYE DateCompany Name
Equity
Mkt.
Value
Total DebtCash and
Equiv.
Forward Twelve Month
EstimateTEV/ LTM Multiples TEV/ Fwd Multiples
** Healthcare consultancy division to be acquired by UnitedHealth and education services division to be acquired by Vista Equity Partners in a two-part split announced July 6th, 2017.
PAGE |
PUBLIC COMPARABLES
8
Payor, Provider, & Pharmacy Support Services(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
Specialty Managed Care
Assurant, Inc. $100.65 (4.4%) 25.0% $106.99 $78.50 $5,416 $1,068 $0 $5,563 $6,329 $392 $0 Sep-17 Dec-16 $6,461 NA $635 0.9x 14.2x 0.9x NA
CorVel Corporation 60.00 26.2% 73.7% 61.20 31.00 1,125 0 38 1,100 536 72 51 Sep-17 Mar-17 NA NA NA 2.1x 15.3x NA NA
HealthEquity Inc 50.22 9.5% 51.1% 54.95 30.34 3,038 0 210 2,892 202 62 48 Jul-17 Jan-17 266 100 67 14.3x NM 10.9x 29.0x
Number of Companies 3 Median: 9.5% 51.1% Total $9,579 $9,554 $7,068 $6,727 2.1x 14.8x 5.9x 29.0x
Market Cap. Weighted Average: 3.6% 39.0% 5.3x 14.4x 4.5x 29.0x
Retail Pharmacy
CVS Health Corporation $68.53 (14.3%) (18.5%) $84.89 $68.01 $69,665 $25,789 $2,560 $93,135 $182,351 $12,390 $9,905 Sep-17 Dec-16 $191,230 $12,931 $10,304 0.5x 7.5x 0.5x 7.2x
Walgreens Boots Alliance Inc 66.27 (17.9%) (19.9%) 88.00 63.82 66,903 12,935 3,503 81,712 118,214 7,312 5,658 Aug-17 Aug-17 130,773 9,707 8,144 0.7x 11.2x 0.6x 8.4x
Rite Aid Corporation(*) 1.65 (26.3%) (75.4%) 8.77 1.54 1,756 7,143 239 8,665 32,091 904 343 Sep-17 Mar-17 26,757 723 210 0.3x 9.6x 0.3x 12.0x
Number of Companies 3 Median: (17.9%) (19.9%) Total $138,324 $183,512 $332,656 $348,760 0.5x 9.6x 0.5x 8.4x
Market Cap. Weighted Average: (18.5%) (36.7%) 0.9x 9.5x 0.8x 8.3x
Specialty Pharmacy
Diplomat Pharmacy, Inc. $21.05 32.6% (9.1%) $23.26 $12.25 $1,438 $149 $27 $1,569 $4,475 $84 $22 Sep-17 Dec-16 $5,022 $113 $90 0.4x 18.6x 0.3x 13.9x
Number of Companies 1 Median: 32.6% (9.1%) Total $1,438 $1,569 $4,475 $5,022 0.4x 18.6x 0.3x 13.9x
Market Cap. Weighted Average: 32.6% NM 0.4x 18.6x 0.3x 13.9x
Specialty Pharmacy Management
Express Scripts Holding Company $61.29 (2.2%) (9.1%) $77.50 $55.80 $34,713 $14,908 $3,396 $46,741 $99,605 $7,274 $5,386 Sep-17 Dec-16 $100,948 $7,434 $7,172 0.5x 6.4x 0.5x 6.3x
PharMerica Corporation(**) 29.30 16.5% 23.1% 29.50 19.20 912 460 8 1,372 2,288 135 70 Sep-17 Dec-16 2,555 154 125 0.6x 10.2x 0.5x 8.9x
Number of Companies 2 Median: 7.2% 7.0% Total $35,625 $48,114 $101,893 $103,503 0.5x 8.3x 0.5x 7.6x
Market Cap. Weighted Average: (1.7%) (8.2%) 0.5x 6.5x 0.5x 6.4x
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)LTM
Period
Latest
FYE Date
Forward Twelve Month
EstimateCompany Name
Equity
Mkt.
Value
Total DebtCash and
Equiv.
TEV/ LTM Multiples TEV/ Fwd Multiples
*40% of Rite Aid’s stores to be acquired by Walgreens in a $4.4 billion transaction announced June 29th, 2017.
**To be acquired by KKR and Walgreens Boots Alliance in deal valued at $1.4 billion, following announcement on August 2nd, 2017.
PAGE |
PUBLIC COMPARABLES
9
Products & Devices(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
Dental Products
3M Company $230.19 14.4% 39.3% $238.90 $163.85 $137,370 $11,663 $3,417 $149,339 $30,996 $8,746 $7,167 Sep-17 Dec-16 $32,677 $9,542 $8,029 4.8x 17.1x 4.6x 15.7x
DENTSPLY SIRONA, Inc. 61.07 (1.5%) 6.1% 65.68 52.54 14,016 1,622 370 15,500 3,899 795 486 Sep-17 Dec-16 4,140 979 861 4.0x 19.5x 3.7x 15.8x
Number of Companies 2 Median: 6.4% 22.7% Total $151,385 $164,839 $34,895 $36,816 4.4x 18.3x 4.2x 15.7x
Market Cap. Weighted Average: 12.9% 36.2% 4.7x 17.3x 4.5x 15.7x
Durable Medical Equipment
Hill-Rom Holdings, Inc. $80.71 8.3% 45.7% $84.65 $50.50 $5,317 $2,309 $232 $7,511 $2,744 $546 $335 Sep-17 Sep-17 $2,877 $622 $507 2.7x 13.8x 2.6x 12.1x
Invacare Corporation 15.50 (1.0%) 69.4% 16.65 8.90 509 241 157 593 961 (15) (30) Sep-17 Dec-16 973 11 (6) 0.6x NM 0.6x NM
ResMed Inc. 84.18 9.2% 40.8% 87.81 56.59 11,945 1,019 811 12,286 2,125 594 480 Sep-17 Jun-17 2,344 684 562 5.8x 20.7x 5.2x 18.0x
Number of Companies 3 Median: 8.3% 45.7% Total $17,772 $20,390 $5,830 $6,194 2.7x 17.2x 2.6x 15.0x
Market Cap. Weighted Average: 8.6% 43.1% 4.7x 18.5x 4.3x 16.1x
Life Sciences Tools
Agilent Technologies, Inc. $68.03 13.8% 56.1% $68.52 $42.92 $21,894 $2,011 $2,678 $21,515 $4,472 $1,053 $841 Oct-17 Oct-17 $4,733 $1,175 $1,068 4.8x 20.4x 4.5x 18.3x
Becton, Dickinson and Company 208.67 3.6% 24.3% 214.72 161.29 47,486 18,870 14,200 51,326 12,093 3,331 2,243 Sep-17 Sep-17 12,748 4,500 3,522 4.2x 15.4x 4.0x 11.4x
Thermo Fisher Scientific Inc. 193.83 10.4% 31.8% 201.20 139.07 77,572 21,993 756 98,691 19,824 5,043 3,110 Sep-17 Dec-16 22,412 5,821 5,331 5.0x 19.6x 4.4x 17.0x
VWR Corp. 33.10 0.3% 20.3% 37.25 24.42 4,363 2,180 120 6,502 4,640 458 316 Sep-17 Dec-16 4,780 531 405 1.4x 14.2x 1.4x 12.2x
Number of Companies 4 Median: 7.0% 28.1% Total $151,315 $178,034 $41,029 $44,673 4.5x 17.5x 4.2x 14.6x
Market Cap. Weighted Average: 8.5% 32.6% 4.6x 18.2x 4.2x 15.3x
Medical Devices and Products
Abbott Laboratories $54.23 10.3% 38.2% $56.69 $37.38 $94,393 $24,025 $11,199 $108,140 $25,134 $4,756 $2,259 Sep-17 Dec-16 $29,652 $7,713 $6,609 4.3x 22.7x 3.6x 14.0x
Baxter International Inc. 64.47 6.6% 35.5% 65.70 43.13 35,128 3,498 3,517 35,884 10,432 2,091 1,359 Sep-17 Dec-16 10,948 2,623 1,887 3.4x 17.2x 3.3x 13.7x
Boston Scientific Corporation 28.14 5.7% 27.9% 29.93 19.67 38,612 5,682 659 44,253 8,830 2,234 1,397 Sep-17 Dec-16 9,540 2,759 1,906 5.0x 19.8x 4.6x 16.0x
ConforMIS Inc 3.54 (29.3%) (53.6%) 10.16 3.22 160 30 54 129 79 (54) (57) Sep-17 Dec-16 83 (50) (53) 1.6x NM 1.6x NM
C. R. Bard, Inc.(*) 327.07 2.0% 50.9% 330.31 203.63 23,841 1,643 1,301 24,906 3,875 1,218 1,010 Sep-17 Dec-16 4,129 1,377 1,272 6.4x 20.4x 6.0x 18.1x
Danaher Corporation 92.27 13.2% 17.5% 92.47 76.27 64,183 10,909 649 75,371 17,828 4,105 2,880 Sep-17 Dec-16 18,919 4,553 3,307 4.2x 18.4x 4.0x 16.6x
Hologic, Inc. 37.85 (14.4%) 5.1% 46.80 35.15 10,616 3,385 541 13,656 3,059 952 503 Sep-17 Sep-17 3,312 1,093 1,007 4.5x 14.3x 4.1x 12.5x
Johnson & Johnson 139.41 5.0% 20.2% 144.35 109.32 374,176 35,166 16,231 400,598 74,413 25,698 20,870 Oct-17 Jan-17 79,847 29,277 25,537 5.4x 15.6x 5.0x 13.7x
K2M Group Holdings, Inc. 19.69 (19.1%) 15.3% 25.99 16.39 853 74 34 887 252 (7) (34) Sep-17 Dec-16 283 15 (18) 3.5x NM 3.1x NM
Medtronic plc 80.52 (4.1%) (1.8%) 89.72 69.35 109,072 29,072 13,526 125,629 29,639 9,249 6,487 Oct-17 Apr-17 29,794 9,681 8,673 4.2x 13.6x 4.2x 13.0x
Penumbra, Inc. 100.55 23.1% 52.5% 101.15 56.05 3,396 0 219 3,367 311 (1) (4) Sep-17 Dec-16 371 5 3 10.8x NM 9.1x NM
Stryker Corporation 154.87 5.3% 34.3% 160.62 106.48 57,958 7,225 2,689 63,418 12,130 3,252 2,628 Sep-17 Dec-16 13,101 3,720 3,382 5.2x 19.5x 4.8x 17.0x
Teleflex Incorporated 236.98 14.4% 65.6% 248.68 139.15 10,673 2,250 1,018 12,273 2,065 569 433 Oct-17 Dec-16 2,279 723 624 5.9x 21.6x 5.4x 17.0x
Number of Companies 13 Median: 5.3% 27.9% Total $823,060 $908,510 $188,048 $202,256 4.5x 18.9x 4.2x 15.0x
Market Cap. Weighted Average: 5.0% 22.5% 5.0x 17.1x 4.6x 14.4x
Medical / Surgical / Dental Supplies & Distribution
AmerisourceBergen Corporation $76.95 (18.0%) 9.4% $97.85 $68.71 $16,861 $3,794 $2,435 $18,411 $153,144 $2,441 $2,018 Sep-17 Sep-17 $165,963 $2,377 $2,070 0.1x 7.5x 0.1x 7.7x
Cardinal Health, Inc. 61.90 (19.9%) (9.9%) 84.88 60.69 19,512 10,003 1,181 28,535 130,578 3,157 2,384 Sep-17 Jun-17 139,001 3,340 2,890 0.2x 9.0x 0.2x 8.5x
Henry Schein, Inc. 78.60 (13.7%) 5.4% 93.50 73.12 12,428 1,557 80 14,663 12,264 1,033 848 Sep-17 Dec-16 12,923 1,118 924 1.2x 14.2x 1.1x 13.1x
McKesson Corporation 137.88 (14.8%) 8.4% 169.29 126.30 28,744 8,321 2,563 36,355 201,955 4,039 3,125 Sep-17 Mar-17 207,972 4,352 3,750 0.2x 9.0x 0.2x 8.4x
Owens & Minor, Inc. 24.57 (23.8%) (24.3%) 37.02 24.24 1,504 917 98 2,289 9,306 243 188 Sep-17 Dec-16 9,991 285 240 0.2x 9.4x 0.2x 8.0x
Patterson Companies, Inc. 37.00 (11.3%) (13.4%) 49.26 35.93 3,544 1,098 101 4,451 5,532 391 308 Oct-17 Apr-17 5,750 426 375 0.8x 11.4x 0.8x 10.5x
Number of Companies 6 Median: (16.4%) (2.3%) Total $82,593 $104,704 $512,780 $541,599 0.2x 9.2x 0.2x 8.4x
Market Cap. Weighted Average: (16.5%) 2.3% 0.4x 9.6x 0.3x 9.1x
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)LTM
Period
Latest
FYE Date
Forward Twelve Month
EstimateCash and
Equiv.Company Name
Equity
Mkt.
Value
Total DebtTEV/ LTM Multiples TEV/ Fwd Multiples
*To be acquired by Becton Dickinson in deal valued at $24.0 billion, following announcement on August 28th 2017.
PAGE |
PUBLIC COMPARABLES
10
Provider-Based Services(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
Acute-Care Hospitals
Community Health Systems, Inc. $5.90 (17.5%) 11.7% $10.51 $4.15 $677 $13,941 $590 $14,637 $16,765 $1,797 $871 Sep-17 Dec-16 $14,752 $1,816 $945 0.9x 8.1x 1.0x 8.1x
HCA Healthcare Inc 75.65 (5.8%) (1.1%) 91.03 67.00 26,784 32,953 771 61,874 42,693 8,029 5,945 Sep-17 Dec-16 44,943 8,411 6,210 1.4x 7.7x 1.4x 7.4x
LifePoint Health, Inc. 48.15 (18.9%) (19.5%) 70.95 46.50 1,898 2,904 166 4,873 6,406 749 390 Sep-17 Dec-16 6,484 778 418 0.8x 6.5x 0.8x 6.3x
Tenet Healthcare Corporation 14.28 (17.7%) (27.5%) 22.72 12.25 1,440 14,881 429 18,379 19,061 2,018 1,138 Sep-17 Dec-16 19,195 2,510 1,637 1.0x 9.1x 1.0x 7.3x
Number of Companies 4 Median: (17.6%) (10.3%) Total $30,799 $99,763 $84,925 $85,373 0.9x 7.9x 1.0x 7.3x
Market Cap. Weighted Average: (7.5%) (3.2%) 1.4x 7.7x 1.3x 7.3x
Assisted Living
Brookdale Senior Liv ing Inc. $10.03 (29.4%) (30.5%) $16.31 $9.44 $1,868 $5,515 $582 $6,802 $4,790 $690 $200 Sep-17 Dec-16 $4,684 $683 $194 1.4x 9.9x 1.5x 10.0x
Capital Senior Liv ing Corporation 13.30 (3.6%) (16.7%) 17.89 11.60 405 1,004 23 1,374 466 82 14 Sep-17 Dec-16 496 100 22 3.0x 16.7x 2.8x 13.7x
Number of Companies 2 Median: (16.5%) (23.6%) Total $2,274 $8,176 $5,256 $5,181 2.2x 13.3x 2.1x 11.8x
Market Cap. Weighted Average: (24.8%) (28.0%) 1.7x 11.1x 1.7x 10.6x
Long-Term Care
Kindred Healthcare, Inc. $6.05 (32.4%) (38.6%) $11.90 $5.50 $526 $3,321 $228 $3,849 $6,524 $421 $298 Sep-17 Dec-16 $6,119 $496 $388 0.6x 9.1x 0.6x 7.8x
National HealthCare Corporation 64.00 (1.8%) (1.1%) 78.99 57.73 972 148 239 883 959 102 60 Sep-17 Dec-16 NA NA NA 0.9x 8.7x NA NA
Ensign Group, Inc. 23.08 3.2% 25.0% 23.81 16.51 1,174 296 49 1,473 1,795 130 88 Sep-17 Dec-16 1,853 187 137 0.8x 11.3x 0.8x 7.9x
Number of Companies 3 Median: (1.8%) (1.1%) Total $2,673 $6,206 $9,277 $7,972 0.8x 9.1x 0.7x 7.8x
Market Cap. Weighted Average: (5.6%) 3.0% 0.8x 9.9x 0.7x 7.8x
Diagnostic Imaging
RadNet, Inc. 10.95 42.2% 57.6% 11.90 5.25 518 618 8 1,139 912 117 50 Sep-17 Dec-16 950 150 63 1.2x 9.7x 1.2x 7.6x
Varian Medical Systems, Inc. 104.19 7.3% 29.7% 108.78 76.94 9,565 350 716 9,349 2,668 556 393 Sep-17 Sep-17 2,782 596 513 3.5x 16.8x 3.4x 15.7x
Number of Companies 2 Median: 24.7% 43.6% Total $10,082 $10,487 $3,580 $3,732 2.4x 13.3x 2.3x 11.6x
Market Cap. Weighted Average: 9.1% 31.1% 3.4x 16.4x 3.2x 15.3x
Dialysis Services
American Renal Associates Holdings, Inc. $12.13 (29.1%) (31.3%) $25.42 $12.08 $379 $559 $68 $1,189 $750 $150 $113 Sep-17 Dec-16 $827 $112 NA 1.6x 7.9x 1.4x 10.6x
DaVita Inc. 60.74 (6.2%) 3.6% 70.16 53.58 11,613 9,099 983 20,799 15,213 2,422 1,640 Sep-17 Dec-16 15,960 2,548 1,733 1.4x 8.6x 1.3x 8.2x
Fresenius Medical Care AG & Co. KGaA 96.71 4.0% 11.9% 100.81 75.71 29,784 8,926 850 39,096 20,812 3,833 2,960 Sep-17 Dec-16 21,926 4,112 3,166 1.9x 10.2x 1.8x 9.5x
Number of Companies 3 Median: (6.2%) 3.6% Total $41,777 $61,084 $36,775 $38,713 1.6x 8.6x 1.4x 9.5x
Market Cap. Weighted Average: 0.9% 2.9% 1.7x 9.7x 1.6x 9.1x
Home Care, Hospice, and Home Infusion
Home Care / Hospice:
Addus HomeCare Corporation $36.00 6.0% 42.3% $40.75 $24.40 $418 $44 $46 $417 $417 $33 $27 Sep-17 Dec-16 $448 $40 $32 1.0x 12.5x 0.9x 10.4x
Almost Family, Inc.(*) 44.25 (10.5%) 12.7% 62.95 38.05 618 133 19 767 750 59 53 Sep-17 Dec-16 842 76 68 1.0x 13.0x 0.9x 10.1x
Amedisys, Inc. 48.11 1.6% 11.2% 65.91 34.58 1,629 90 66 1,678 1,496 146 128 Sep-17 Dec-16 1,607 160 137 1.1x 11.5x 1.0x 10.5x
Chemed Corporation 223.43 13.1% 58.0% 233.50 132.92 3,567 83 19 3,790 1,642 247 211 Sep-17 Dec-16 1,714 277 228 2.3x 15.4x 2.2x 13.7x
LHC Group, Inc.(*) 66.81 15.4% 95.0% 73.85 32.04 1,221 119 17 1,376 1,015 94 81 Sep-17 Dec-16 1,117 99 96 1.4x 14.7x 1.2x 13.9x
Number of Companies 5 Median: 6.0% 42.3% Total $7,453 $8,027 $5,320 $5,728 1.1x 13.0x 1.0x 10.5x
Market Cap. Weighted Average: 8.6% 2.8% 1.7x 14.0x 1.6x 12.5x
Home Infusion:
BioScrip, Inc. $2.53 (12.5%) (5.9%) $3.39 $0.98 $323 $479 $38 $843 $875 $38 $9 Sep-17 Dec-16 $766 $63 $33 1.0x 22.4x 1.1x 13.3x
Number of Companies 1 Median: (12.5%) (5.9%) Total $323 $843 $875 $766 1.0x 22.4x 1.1x 13.3x
Market Cap. Weighted Average: (12.5%) (5.9%) 1.0x 22.4x 1.1x 13.3x
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)LTM
Period
Latest
FYE Date
Forward Twelve Month
EstimateCompany Name
Equity
Mkt.
Value
Total DebtCash and
Equiv.
TEV/ Fwd MultiplesTEV/ LTM Multiples
*To combine in an all-stock merger and will continue to trade on NASDAQ under the ticker “LHCG”
PAGE |
Stock Price
% Change 52 Week
10/31/2017 3 mos. 12 mos. High Low Revenue EBITDA EBIT Revenue EBITDA EBIT Revenue EBITDA Revenue EBITDA
Physician Practice Management
Specialty:
MEDNAX, Inc. $43.79 (6.8%) (28.5%) $72.13 $40.78 $4,097 $1,826 $59 $5,834 $3,378 $599 $497 Sep-17 Dec-16 $3,602 $609 $500 1.7x 9.7x 1.6x 9.6x
Number of Companies 1 Median: (6.8%) (28.5%) Total $4,097 $5,834 $3,378 $3,602 1.7x 9.7x 1.6x 9.6x
Market Cap. Weighted Average: (6.8%) (28.5%) 1.7x 9.7x 1.6x 9.6x
1 (6.8%) (28.5%) $4,097 $5,834 $3,378 $3,602 1.7x 9.7x 1.6x 9.6x
Behavioral Health / Management
AAC Holdings, Inc. $7.92 26.3% (51.7%) $16.72 $5.99 $191 $227 $16 $383 $304 $32 $11 Sep-17 Dec-16 $328 $61 $26 1.3x 12.1x 1.2x 6.3x
Acadia Healthcare Company, Inc. 31.36 (40.8%) (12.8%) 54.34 30.69 2,754 3,269 76 5,946 2,815 574 435 Sep-17 Dec-16 2,980 641 462 2.1x 10.4x 2.0x 9.3x
Civ itas Solutions, Inc. 18.65 4.5% 9.1% 20.98 15.40 697 633 26 1,306 1,456 149 75 Jun-17 Sep-16 1,591 176 86 0.9x 8.8x 0.8x 7.4x
Magellan Health, Inc. 85.30 14.4% 65.8% 88.10 49.50 2,020 765 841 2,024 5,408 271 160 Sep-17 Dec-16 6,919 407 243 0.4x 7.5x 0.3x 5.0x
Universal Health Serv ices, Inc. 102.70 (7.3%) (14.9%) 129.74 99.72 9,002 4,040 65 13,904 10,243 1,692 1,250 Sep-17 Dec-16 11,793 1,777 1,338 1.4x 8.2x 1.2x 7.8x
Number of Companies 5 Median: 4.5% (12.8%) Total $14,664 $23,562 $20,225 $23,611 1.3x 8.8x 1.2x 7.4x
Market Cap. Weighted Average: (9.6%) (2.7%) 1.3x 8.6x 1.2x 7.7x
Surgicenters / Rehabilitation
Surgery Centers(*):
Surgery Partners, Inc. $9.25 (53.4%) (42.5%) $24.05 $8.53 $451 $2,293 $204 $2,867 $1,187 $204 $160 Sep-17 Dec-16 $1,745 $263 NA 2.4x 14.0x 1.6x 10.9x
Number of Companies 1 Median: (53.4%) (42.5%) Total $451 $2,867 $1,187 $1,745 2.4x 14.0x 1.6x 10.9x
Market Cap. Weighted Average: (53.4%) (42.5%) 2.4x 14.0x 1.6x 10.9x
Rehabilitation:
HealthSouth Corporation $46.14 8.4% 14.9% $49.71 $36.97 $4,556 $2,622 $157 $7,491 $3,844 $825 $644 Sep-17 Dec-16 $4,147 $852 $671 1.9x 9.1x 1.8x 8.8x
Select Medical Holdings Corporation 19.15 18.2% 47.3% 19.78 10.20 2,563 2,809 107 5,899 4,375 492 335 Sep-17 Dec-16 4,694 595 427 1.3x 12.0x 1.3x 9.9x
U.S. Physical Therapy, Inc. 67.95 7.7% 19.4% 78.00 51.96 855 63 17 998 396 62 52 Sep-17 Dec-16 433 64 60 2.5x 16.2x 2.3x 15.6x
Number of Companies 3 Median: 8.4% 19.4% Total $7,973 $14,388 $8,616 $9,274 1.9x 12.0x 1.8x 9.9x
Market Cap. Weighted Average: 11.5% 25.8% 1.8x 10.8x 1.7x 9.9x
Company Name
Equity
Mkt.
Value
Total DebtCash and
Equiv.
Total Ent.
Value
(TEV)
Latest Twelve Months
(LTM)LTM
Period
Latest
FYE Date
Forward Twelve Month
EstimateTEV/ LTM Multiples TEV/ Fwd Multiples
PUBLIC COMPARABLES
11
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Provider-Based Services(1)
* Figures are adjusted for minority interest.
PAGE |
M&A TRANSACTIONS
12
Announced U.S. Healthcare & Life Sciences M&A(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Enterprise Enterprise Value / LTM Private Equity
Announced Target Seller Buyer Value ($mm) Sales EBITDA EBIT Involvement
10/2/2017 Palm Beach Pediatric Urology P.A - MEDNAX, Inc. - - - - No
10/2/2017 Apama Medical, Inc. - Boston Scientific Corp. $300.0 - - - No
10/2/2017 DRT Medical LLC DRT Holdings, Inc. NN, Inc. - - - - No
10/3/2017 ReShape Medical, Inc. - EnteroMedics, Inc. $9.2 - - - No
10/3/2017 Discover Biopharmaceutical Search & Placement - The Tolan Group LLC - - - - No
10/3/2017 The Pat Moore Foundation - D'Amore Health Care, Inc. - - - - No
10/3/2017 Strive Labs, Inc. - WebPT, Inc. - - - - No
10/3/2017 Holden Holdings, Inc. - Cross Insurance, Inc. - - - - No
10/3/2017 Expression Health Analytics LLC - Trilliant Health, Inc. - - - - No
10/4/2017 Crystal Bioscience, Inc. - Ligand Pharmaceuticals, Inc. $35.5 - - - No
10/4/2017 Pursuit Healthcare Advisors LLC - ATOS SE - - - - No
10/4/2017 Conduent, Inc. /Health Care Business/ Conduent, Inc. ATOS SE - - - - No
10/4/2017 Pain Specialists of Austin /Nonclinical Assets/ Pain Specialists of Austin CommonView Capital LLC; Pain
Specialists of America LLC
- - - - Yes
10/4/2017 Little Company of Mary Hospital & Health Care
Centers
- Rush System for Health - - - - No
10/4/2017 ECO Medical Waste Holdings, Inc. - Macau Capital Investments, Inc. - - - - Yes
10/4/2017 Adam Spence Corp. W. L. Gore & Associates, Inc. Vance Street Management LLC - - - - Yes
10/4/2017 Central Texas Pain Center North, PLCC
/Nonclinical Assets/
Central Texas Pain Center North PLCC CommonView Capital LLC; Pain
Specialists of America LLC
- - - - Yes
10/5/2017 Roxwood Medical, Inc. - BTG Plc $80.0 - - - No
10/5/2017 Cooper Design, Inc. - Wipro Digital $8.5 - - - No
10/5/2017 S&G Properties LLC GNC Holdings, Inc. TSG Consumer Partners LLC; S&G
Properties LLC /Private Group/
- - - - Yes
10/5/2017 Albensi Dental Laboratory, Inc. - National Dentex Corp.; Affinity Capital
Management; Welsh, Carson, Anderson
& Stowe
- - - - Yes
10/5/2017 Edgemark Innovation, Inc. - Nutriband, Inc. $0.0 - - - No
10/6/2017 Pharmacogenetics Diagnostic Laboratory LLC - Spencer Trask Ventures, Inc.; Prescient
Medical, Inc.
- - - - Yes
10/6/2017 Elite Medical Scribes LLC - HealthChannels, Inc. - - - - No
10/6/2017 South Palm Ambulatory Surgery Center LLC Envision Healthcare Corp. Baptist Health South Florida, Inc. - - - - No
10/6/2017 Women's Care Florida LLC - Lindsay Goldberg & Co. LLC - - - - Yes
10/9/2017 Saratoga Hair Transplant Center - Williams Center Plastic Surgery
Specialists
- - - - No
10/10/2017 Carecore National Group LLC - Express Scripts Holding Co. $3,600.0 - - - No
10/10/2017 Carena, Inc. - Avizia, Inc.; Healthquest Capital
Management CO. LLC; Northwell
Ventures
- - - - Yes
10/10/2017 Hospira, Inc. /API Manufacturing Facility/ Pfizer Inc. Corden Pharma SpA - - - - No
10/11/2017 Ganeden Biotech, Inc. - Kerry Group Plc - - - - No
10/11/2017 Symbiomix Therapeutics LLC - Lupin Pharmaceuticals, Inc. $150.0 - - - No
10/11/2017 Ecolab, Inc /Equipment Care Business/ Ecolab, Inc. Audax Private Equity; Audax Group LP - - - - Yes
10/11/2017 VHS of I llinois, Inc. Tenet Healthcare Corp. Loyola University Health System - - - - No
10/11/2017 Summit Healthcare Management LLC - FFL Partners LP; Lee Equity Partners LLC;
Summit Healthcare Management LLC
/Private Group/
- - - - Yes
10/12/2017 Telluride Health Co. - Priority Aviation, Inc. - - - - No
10/16/2017 Epicore BioNetworks, Inc. - NEOVIA SAS $23.3 2.0x 7.5x 7.5x No
10/16/2017 Autism Home Support Serv ices, Inc. - The Jordan Co. LP; The Wicks Group of
Cos. LLC; Post Capital Partners LLC; Invo
HealthCare Associates, Inc.
- - - - Yes
10/16/2017 Medical Center Dermatology, PA - ABRY Partners LLC; Dermatology
Associates of Tyler
- - - - Yes
10/16/2017 Lakeway Dermatology & Skin Cancer Center PA - Oliver Street Dermatology Holdings LLC;
ABRY Partners LLC
- - - - Yes
10/16/2017 DxT Medical LLC - Mobile Science Technologies, Inc. $0.5 - - - No
10/16/2017 Onepath Systems LLC - MSouth Equity Partners LLC - - - - Yes
10/17/2017 Amneal Pharmaceuticals LLC Amneal Enterprises LLC Impax Laboratories, Inc. $4,628.4 - - - No
10/17/2017 Evofem, Inc. - Neothetics, Inc. - - - - No
10/18/2017 Clinical Innovations LLC - EQT Partners AB $250.0 - - - Yes
10/18/2017 Synergy Radiology Associates, PA - MEDNAX, Inc. - - - - No
10/18/2017 Stockell Healthcare Systems, Inc. - Medsphere Systems Corp. - - - - No
10/18/2017 Gorman Health Group LLC - New Mountain Capital LLC; Convey
Health Solutions, Inc.
- - - - Yes
10/18/2017 Cleveland HeartLab, Inc. - Quest Diagnostics, Inc. - - - - No
10/20/2017 Revolutionary Medical Devices, Inc. - Vyaire Medical, Inc. - - - - No
10/20/2017 Cirrus Medical Staffing LLC A. Soriano Corp. Webster Capital Ltd. $39.4 - - - Yes
10/23/2017 Exactech, Inc. - TPG Capital LLC; TPG Capital Advisors
LLC
$612.5 2.3x 14.2x 14.2x Yes
10/23/2017 U.S. HealthWorks, Inc. Dignity Health Concentra, Inc.; Welsh, Carson,
Anderson & Stowe; Cressey & Co. LP
$753.0 - - - Yes
10/23/2017 Specialized Medical Serv ices, Inc. - Transition Capital Partners Ltd.; Hospice
Source LLC
- - - - Yes
PAGE |
M&A TRANSACTIONS
13
Announced U.S. Healthcare & Life Sciences M&A(1)
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
Enterprise Enterprise Value / LTM Private Equity
Announced Target Seller Buyer Value ($mm) Sales EBITDA EBIT Involvement
10/23/2017 Rotation Medical, Inc. - Smith & Nephew Plc $210.0 - - - No
10/23/2017 Crestovo LLC - Finch Therapeutics, Inc. - - - - No
10/23/2017 Rhein Medical, Inc. - Audax Private Equity; Katena Products,
Inc.
- - - - Yes
10/24/2017 America's 1st Choice - Anthem, Inc. - - - - No
10/25/2017 New Beginnings Minnesota LLC - Audax Private Equity; Meridian
Behavioral Health LLC
- - - - Yes
10/25/2017 Mentis Neuro Rehabilitation LLC - Civ itas Solutions, Inc. - - - - No
10/26/2017 Milestone Research Cro, Inc. - Kester Capital LLP; Factory CRO BV - - - - Yes
10/26/2017 Neos Therapeutics, Inc. - PDL BioPharma, Inc. $287.3 - - - No
10/26/2017 CORE Clinical, Inc. - Inv icro LLC - - - - No
10/26/2017 Microbiology & Quality Associates, Inc. - Fidus Investment Advisors LLC;
Thompson Street Capital Managers LLC;
Microbiology Research Associates, Inc.
- - - - Yes
10/26/2017 Health Integrated, Inc. - ExlServ ice Holdings, Inc. - - - - No
10/27/2017 Mergenet Solutions, Inc. /Subsidiaries 2/ Mergenet Solutions, Inc. Salter Labs Corp. - - - - No
10/30/2017 Cardiostaff Corp. - G Medical Innovations USA, Inc. $4.2 - - - No
10/30/2017 California Laboratory Associates - Quest Diagnostics, Inc. - - - - No
10/30/2017 Vaxart, Inc. - Aviragen Therapeutics, Inc. - - - - No
10/30/2017 Workforce Health (South Bend Clinic) Workforce Health U.S. HealthWorks, Inc. - - - - Yes
10/30/2017 Vivere Health LLC - Prelude Fertility, Inc. - - - - No
10/30/2017 Young Innovations, Inc. - The Jordan Co. LP; Young Innovations,
Inc. /Private Group/
- - - - Yes
10/30/2017 Kirin-Amgen, Inc. Kirin Holdings Co., Ltd. Amgen, Inc. $1,620.0 - - - No
10/30/2017 South Shore Hand Therapy / Occupational Therapy
PLLC
- Thomas H. Lee Partners LP; Professional
Orthopedic & Sports Physical Therapy
PC
- - - - Yes
10/31/2017 Clinical Support Serv ices, Inc. McKesson Corp. Medicine-On-Time LLC - - - - No
10/31/2017 Newcourtland Senior Serv ices /Senior Care
Business/
Newcourtland Senior Serv ices Total Community Options, Inc. - - - - No
10/31/2017 Hamburg Counseling Serv ice, Inc. - Community Concern of Western New
York, Inc.
- - - - No
10/31/2017 Xenometrics LLC - CIT SAS - - - - No
10/31/2017 Valley HealthCare Systems, Inc. - TotalMed Staffing, Inc. - - - - No
Energy, Power & Infrastructure
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Services
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Building Products & Materials
Technology, Media & Telecom
Specialty Distribution
Consumer
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HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
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DISCLOSURES
HEALTHCARE & LIFE SCIENCES
INDUSTRY UPDATE │ NOVEMBER 2017
1. FactSet.
2. Company Filings.
3. S&P.
4. PNC Debt Capital Markets.
5. Thomson Financial.
6. Bloomberg.