Healthcare Industry Report - Q4 2025

Notable Trends

Healthcare M&A transaction volume increased from Q3 2025, with activity remaining particularly strong in the Biotechnology sector.

Activity in both biotech and pharmaceuticals was supported by continued consolidation of healthcare service systems and pharmaceutical pipeline diversification.

Overall Healthcare transaction volume remains below pandemic-driven levels, though activity began to show an uptick in Q4 2025.

Market Dynamics

• The Healthcare Services sector saw outpatient and behavioral health volumes strengthen, helping offset persistent staffing constraints.
• The Medical Devices & Equipment sector experienced a rebound in procedure-linked demand as elective surgical volumes normalized ahead of expectations.
• The IT & Digital Health segment saw broader rollout of AI-driven claims automation and clinical documentation tools as providers shifted from pilots to enterprise adoption.
• The Pharmaceuticals sector faced increased pricing pressure as CMS advanced additional IRA negotiation rounds, pushing manufacturers toward higher-margin specialty assets.
• The Managed Healthcare & Insurance sector tightened utilization controls as Medicare Advantage margins compressed on higher inpatient acuity.¹
• The Biotechnology sector benefited from improved capital access late in Q4, with several mid-cap biotech companies completing follow-on acquisitions ahead of key 2026 readouts.²
• The Life Sciences Tools & Services sector improved late in the quarter, driven by stronger sequencing consumable demand and renewed CRO activity.³

Learn More

Reach out to Dinan Capital Advisors Managing Directors Rob Ullman or Will Downing for more report insights.