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A presentação sobre o mercado da saúde Ignacio Riesgo PwC Spain
www.pwc.com/es
2º Health Open Day 26 de Outubro de 2011
PwC 2
Table of contents
1. Healthcare systems megatrends
2. European healthcare public systems overview
3. Main issues of European private healthcare sector
4. New players: private equity companies
5. Challenges of European health systems
6. Main trends of healthcare systems in Europe
PwC 3
Healthcare systems megatrends
1
PwC 4
Ten major forces are driving change in the health sector
1. Healthcare is expected to be the sector with the highest growth in the future.
2. Changes in disease patterns and demography.
3. Great impact of new medical technologies.
4. Great impact of ICT.
5. Concerns about quality.
6. Appearance of the “new consumer“.
7. Revolution in the way of providing services.
8. Changes in the paradigm of the biomedical model.
9. The emerging “new health economy”.
10. A place for global players?
PwC 5
1. Healthcare is expected to be the sector with the highest growth in the future
Healthcare cost growth over GDP estimations
Source: WHO, PwC Analysis
20,6%
20,3%
20,0%
19,5%
19,1%
18,7%
18,3%
17 ,9%
17 ,5%
17 ,2%16,6%
16,3%
16,0%
21,0%
14,5%
14,0%
13,5%
13,0%
12,5%
12,0%
11,5%
11,0%
10,5%
10,0%
9,5%
9,0%
16,0%
6%
8%
10%
12%
14%
16%
18%
20%
22%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
15,5% 15,0% 16,9%
OECD w/o US US
PwC 6
2. Changes in disease patterns and demography
• Ageing population.
• More chronic diseases burden.
• More mental diseases burden.
2000 2020 (projected)
0
80
120
160
40
Millions of American affected
PwC 7
3. Great impact of new medical technologies
Design drugs
Diagnostic imaging
Minimally invasive surgery
Test and genetic maps
Gene therapy
Vaccine
Artificial blood
Xenotransplantation
Manufactured by identifying the physical structure and chemical composition of the target and designing molecules that act on it.
Progress in all areas: energy source, technology of detection, image analysis and visualization technologies.
Advance in optical fiber technology, miniaturization of instruments and navigation systems at catheters.
The detection of genetic predisposition offers the basis to begin preventive measures. The test has been developed to detect almost 500 diseases.
The artificial introduction of genetic equipments to replace defective or eliminated genes. There are over 2.000 patients at clinical trials worldwide.
This avoid the organ limitation and treat other diseases such as diabetes and Parkinson.
Stem cells utilization The magnitude and impact of the use of stem cells will be huge in the coming years. The first successful will come with skin and bones and then with organs and tissues.
New uses of vaccines for non-infectious disease. It´s expected a great potential to prevent cancers that it´s related with virus.
The FDA has recently approved products with synthetic hemoglobin, which can be an ideal replacement for blood transfusions.
PwC 8
4. Great impact of ICT
Patient
Physician
Information and clinical decisions
Medical knowledge
Medical History
PwC 9
5. Concern about quality
Number of deaths per year
Sources: National Vital Statistics Report, Institute of Medicine
Deaths from medical errors compared to other common causes of death
Medical errors
44.000-98.000
Motor vehicle
accidents 47.000
Breast cancer 41.000 HIV
14.000
PwC 10
6. Appearance of the “new consumer”
We define new consumers as people who have al least two of the following three characteristics:
• Discretionary household income of $53.000 or more (in constant 2998 dollars).
• At least 1 year of college education. • Experience with information technology (e.g. owns a PC).
Description of new consumer attributes in 2005
Source: US Department of Labor.
PwC 11
7. Revolution in the way of providing services
Revolution in care delivery
New drivers… • Connectivity and new care/disease
management models
• Telemedicine
• Electronic Health Record (EHR) / Personal Health Record (PHR)
• Health 2.0
• Disruptive innovation through new entrants (ie: Google, Microsoft, etc.)
PwC 12
8. Changes in the paradigm of the biomedical model
Biomedical model Future
Episodic care Chronic disease management
Goal: recovery Control and adaptation to the disease, when recovery is not possible
Fee for service Subscription
Process led by the supplier Process led by the consumer
Curative medicine Predictive medicine
PwC 13
9. The emerging “new health economy”
Cosmeceuticals
Foods and supplements
Dietetic treatments
Alternative medicine
Functional foods
Well-being
Traditional Healthcare
PwC 14
USA, Hong Kong, India, Malaysia, Filipinas, Portugal
Sweden, Denmark, Finland, Norway, France, Germany, UK, Spain
UK, Australia, Ireland, Saudi Arabia, Spain, Thailand, Hong Kong
Germany, Belgium, Netherlands, Luxemburg, Portugal, Czech Republic, Norway, Sweden, Spain and China
10. A place for global payers?
PwC 15
European healthcare public systems overview
2
PwC 16
Countries in Europe have tended to adopt versions of the three main models of health care
• Tax-based systems in western Europe.
• Social health insurance countries in western Europe.
• Central and Eastern Europe.
PwC 17
The Bismark model prevails in Continental Europe
PwC 18
Main characteristics of the Bismark model
Contribution collector: Third-party payer
Population Providers
= sickness funds
bipartite self-government
Public-private mix Mandatory insurance
Usually wage-related contribution
Contracts
Limited government
control
Free access
Choice of fund
PwC 19
The Beveridge model prevails in Britain, the nordic countries and some southern European countries
PwC 20
Classical integrated NHS- type system
Central government
Population
General taxation NHS = payer & provider
Limited choice Public providers
Main characteristics of the Beveridge model
PwC 21
Traditional CEE model
Nikolai Aleksandrovich Semashko
PwC 22
Main characteristics of the CEE model
The healthcare systems in 1990
Central government
Population
General taxation
Hierarchical subordination & limited resource allocation
Limited choice Public providers (hospital be numbers high, provider incentives low)
PwC 23
Regarding to the previous models and the relative position of the European countries in relation to public and private expenditure on healthcare, does countries can be positioned as follows
Source: Mercer Pan-European Health Care Survey 2008.
Social insurance model Tax-funded model
PwC 24
Healthcare reforms have been a constant phenomena in Europe over the last years
Controlling the cost of health
care
Improving coverage and
access
• Broadening the population that receives health care coverage, through either public-sector insurance programs or private-sector insurance companies.
• Expanding the array of health care providers for more consumer choice.
• Improving access to health care specialists.
• Improving the quality of health care.
• Shifting cost from the state to employers and individuals.
• Seeking to reduce the costs of delivering health care – restructuring service provisions and negotiating terms with health system providers such as private hospitals and pharmacies.
Reforms typically focus in two broad areas:
PwC 25
Main reforms in European bismarckian countries
• Social security reimbursement has fallen from 80% to 78%.
• In January 2011, a new 3,5% tax and increase on the private health insurance premium tax were introduced.
France
• The Health Insurance Act that came into effect in 2006 has the following key elements:
o Citizens can change insurers every year.
o People with low incomes receive compensation for care.
o Customers and insurers stimulate suppliers to provide better quality.
The Netherlands
• In 2010, Germany´s cabinet approved a controversial health reform bill that raised employer and employee contributions rates as of 1 Jan 2011 and allows insurers to increase employee premiums as needed.
Germany
• Healthcare reform is planned, the key goals will include: o Development of national goals. o Focus on prevention an
promotion. o Restructuring of hospitals. o Tools to measure the quality of
the health system.
Austria
Source: Healthcare reform in Europe. Paul Ashcroft, 23 March 2011.
PwC 26
Main reforms in European beveridgian countries
• In 2011, the main government-run insurer announce the single biggest price increase in the history of the market, premiums for employers and individuals using the Voluntary Health Insurance program will rise by up to 45%.
Ireland
• Tax deductions for health care costs have been limited.
• The NHS budget decreased by 12%, and reduced NHS expenses are being sought through 10 measures, such as a 6% decrease in prescription prices, cost controls, improved management and shared services.
Portugal
• Under the reform plans of 2011, family doctors are being given much more responsibility for health spending because the government wants groups of general practitioners to replace primary care trust.
United Kingdom
• Budget reduction in all autonomous regions due to the crisis.
• Important control measures of pharmaceutical expenditure.
Spain
Source: Healthcare reform in Europe. Paul Ashcroft, 23 March 2011.
PwC 27
Main reforms in European CEE countries
• In 1993/94, the Czech Republic moved to a multiple insurance system.
• High rates of economic growth permitted the establishment of a generous statutory health car system in 1997.
• In 2008, the Civic Democratic Party introduced user fees with the aim of limiting consumption of medical services.
Czech Republic
• Poland split its national health service into several provincial health services. It was only in 1999 that funding and provision were separated by establishing one health fund for each province.
• In 2003 all health funds were merged into a single national insurance fund.
• The provider side is very concentrated and possibly over-integrated.
Poland
• Since 2000, privatization of GP surgeries is encouraged.
• In 2007, members if the governing coalition reached a compromise on a multiple insurance system. The arrangement, called for the compulsory health insurance to be managed by 22 health insurance funds with joint public-private ownership.
Hungary
• In 1992 Romania began to slowly decentralize public administration.
• Romania has faces issues such as an underfunded National Health Insurance Fund, migration of medical staff and high out of pocket payments.
Romania
Source: Healthcare reform in Europe. Paul Ashcroft, 23 March 2011.
PwC 28
There are new phenomena in the public sector in Europe
1. Competition among insurers: Germany, Netherlands and Switzerland.
2. Hospital privatization in Germany.
3. Hospital privatization in Netherlands.
4. The Nordic case: redesign of the classical Welfare State.
5. PPPs in Spain.
PwC 29
Only three countries in Europe allows citizens to acquire private health insurance without still having to pay premiums or taxes to cover health risks under the official system
• Germany has a sickness fund system. People who earn more than a certain income are allow to leave the funds and buy healthcare insurance on the market.
• About 10% of the Germans have done so.
• Is the only country in Europe with a healthcare system more akin to private than a social insurance.
• All health insurance is private. • The Health insurance Law defines the
catalogue of benefits to which all Swiss insurance members are entitled. However, individual insurance funds can offer additional benefits over and above this basic package.
• There is a compulsory government-regulated, single-payer system for the expensive health risks and a sickness fund system for the other risks.
• One third of the population is privately insured. Once the Dutch have an income above a certain threshold, they have to leave the sickness fund and are supposed to provide for themselves.
1. Competition among insurers: Germany, Netherlands and Switzerland.
PwC 30
In relation to the hospital privatisation, a clear trend to privatization is perfectly obvious in Germany
Hospital ownership 1991-2008
• Between 1991 and 2008 the proportion of for-profit hospitals in Germany increased from 15% to 30%.
• Next to purchase hospitals completely, new forms of public-private partnerships have evolved. One of the trends is to contract out the management of public hospitals to private companies.
2. Hospital privatization in Germany.
Source: Statistisches Bundesmat 2008.
Nº of hospitals
PwC 31
In Netherlands, for-profit hospitals will be permitted
• Healthcare legislation traditionally contained a formal ban on for-profit hospitals.
Traditionally
Nowadays
• For-profit hospitals will be permitted in order to make it easier for hospitals to attract capital resources on investment.
• However, there will be restrictions to the extend hospitals can pay their shareholders a return on investment.
• The basic principle is that profits must be reinvested in hospital care.
• According to a survey carried out for the Institute of Health Policy and Management, the Dutch are not opposed to the introduction of private capital into healthcare.
3. Hospital privatization in Netherlands.
PwC 32
The concept of Nordic welfare state model being redefined
4. The Nordic case: redesign of classical welfare state.
• By 1994, more than half of the 26 Swedish county councils al the time had introduced some form of purchaser-provider model.
• The number of people purchasing supplementary private insurance is rapidly increasing, from 2,3% of the population in 2004 to 4,6% in 2008.
• When St. Göran Hospital was sold to a private corporation in 2000, it became the largest privately owned hospital in the Nordic region.
• The so-called Stockholm model was based on using the DRG system as a basis for payment. The use of ABF was introduced in Swedish health care in combination with other management reforms.
• A purchaser-provider separation was first introduced for nursing and care services in the early 1990.
• The first private commercial hospital was established in 1985.
• Norway implemented ABF for somatic hospital services based in the DRG system.
• No major efforts have been made to introduce purchaser-provider models in Denmark.
• The first for-profit hospital was establish in 1989.
• The pharmacy monopoly was changed, allowing a small, but gradually increasing, number of over-the-counter drugs to be sold by, for example, supermarkets.
• In the early 1990s, the municipalities allowed more freedom in terms of purchasing services from public, non-profit and for-profit providers.
• Private health insurance plays a modest role. • No national financing model has been
introduced.
PwC 33
In Spain, the NHS collaborates with the private sector by three means: Public contracts, Public Private Partnerships and Muface System
5. PPPs in Spain.
Public Contracts
Public Private Partnerships
Muface System for state employees
The NHS assigned in 2009 3,570€M to agreements with for profit (2,030€M) and not for profit (1,540€M) private hospitals • Singular contracts:. e.g. POVISA (Vigo), Fundación Jiménez Díaz (Madrid), various hospitals of the Orden de San Juan de Dios, various hospitals in Catalonia, etc. • Contracts for specific healthcare services. e,g. ambulance services, home oxygen services, dialysis, rehabilitation, physical therapy, etc. • Contracts for specific diagnostic tests or therapies in order to reduce waiting lists. e.g. diagnostic imaging (MRI, CAT scans, PET, mammograms, etc), and surgical procedures amongst others. Usually these contracts have very different durations, from months to 4 or 5 years.
• Spain currently has 6 hospitals operating under the PPP model (5 in Valencia and 1 in Madrid) with the opening in the next few months of three new hospitals in Madrid (Móstoles, Torrejón y Collado), in addition to a new Radiation Therapy center in the Canary Islands.
• The healthcare company Ribera Salud, the private hospital group Capio Sanidad and private insurance companies (Adeslas, Asisa, Sanitas y DKV) are the key players.
• In addition, Madrid has entered in a PPP with Ribera Salud for a Central Laboratory that provides services to 7 public hospitals and is looking to expand service to other hospital.
• The public administration provides health care coverage for approximately 2 million civil servants: MUFACE, MUGEJU and ISFAS through Muface System.
3,570€M
586€M
1,400€M
PwC 34
In Spain, PPP models are transforming hospital market. Only in Madrid, there will be in 2013, 11 hospitals built or managed under this type of contract
Source: DBK, PwC Analysis
7 hospitals in Madrid (PFI) 4 hospitals in Madrid (PPP)
3 hospitales in Alicante 2 in Valencia ( PPP)
1 hospital in Burgos (PFI)
1 hospital in Mallorca (PFI)
1 hospital in Salamanca (PFI)
1 hospital in Baix Llobregat
(PFI)
Public-private partnership hospitals in Spain
Private financing initiatives (PFI) Public-private partnership (PPP)
1
2
Hospital Nº Beds Participants Oppening Awarding (€m) De la Ribera 301 Adeslas 1999 63
Ribera SaludACSLubasa
Denia 132 DKV 2008 97 Ribera Salud
Torrevieja 250 Ribera Salud 2006 80 AsisaAcciona
Infanta Elena 106 Capio Sanidad 2007 ndElche-Crevillente 273 Ribera Salud 2009 146
AsisaL'Horta-Manises 319 Sanitas 2009 137
Ribera SaludH. de Torrejón 250 Ribera Salud 2011 n.d.
AsisaConcesiaFCC
H. de Móstoles 260 Capio Sanidad n.d. ndH. Collado Villalba 150 Capio Sanidad n.d. nd
Hospital Nº Beds Participants Oppening Awarding (€m) Son Dureta 900 Dragados, FCC Under constr. 635 Baix Llobregat 238 Emte, Teyco, Acsa, La Caixa 2009 ndBurgos 678 Grupo Norte, OHL, cajas ahorros Under constr. 242 Salamanca 912 nd nd ndHenares 194 Sacyr Vallehermoso, Testa y Valoriza 2008 93 Infanta Sofia 283 Acciona y Crespo y Blaco 2008 98 Sureste 125 FCC, OHL y Cajamadrid 2008 49
PPP hospitals
PFI hospitals
5. PPPs in Spain.
PwC 35
Main European Healthcare PPPs since 1997
6. PPPs in Europe.
PwC 36
Main European Healthcare Privatizations since 1999
6. PPPs in Europe.
PwC 37
Hospital privatization drivers
• The cost pressure on market participants in the hospital sector is intensifying.
• Inefficient hospitals and facilities under a structural handicap will increasingly be unable to cope with that pressure.
• But the populations demands on the state are increasing.
• This means that the state must be very careful in allocating its limited financial resources as these are urgently needed for a variety of other public tasks besides healthcare, such as education and unemployment relief.
• Against this background, the number of public hospital owners who wish to sell their hospitals will continue to rise. For example in Germany the number of public hospital owners is predicted to fall by 25% over the next 15 years, from the current total of 2,258 to 1,700, with most of them being owned either by private companies or by non-profit organizations (Source: British Medical Journal, 2004).
6. PPPs in Europe.
PwC 38
Hospital privatization options
• Governments exploring hospital privatization have several options, depending upon the nature of the region's present system and the external market area. They might:
o Sell the hospital asset to a private company;
o Lease it to a private management firm;
o Enter into a joint operating agreement (whereby the government relinquishes direct management of the hospital but maintains a presence via board members);
o Begin a joint venture, where both private and public sector partners maintain ownership of the hospital;
o Start a public private partnership (where government sells the hospital, but purchases back bed space); or
o Engage in comprehensive outsourcing of hospital duties.
6. PPPs in Europe.
PwC 39
Hospital privatization pros and cons
• Privatization of public hospitals can sometimes be daunting:
o It involves crossing a minefield of regulations;
o Selecting the best structural arrangement to meet local goals;
o Negotiating the best deal possible; and
o Handling union and sometimes public opposition.
• But done correctly, privatization has proven it is worth the effort.
o It can eliminate waste;
o Save resources;
o Reduce debt; and
o Create a better healthcare system for those who need it most.
6. PPPs in Europe.
PwC 40
Main issues of European private healthcare sector
3
PwC 41
The European Union consists of 27 member states, varying in size and purchasing power
Source: OECD Health Data 2010
In red the countries with more purchasing power.
PwC 42
Various differences exist between European countries
• Market size. • Buying power. • Growth/outlook. • Innovation.
• Corporate taxation.
• Currencies. • Subsidies/
incentives. • Etc.
• Labor laws. • Intellectual
property. • Patents. • Export/import. • Etc.
• Language. • International
orientation. • Business
practices. • Etc.
Economics Finance Legislation Culture
PwC 43
Total healthcare expenditures are greater in those countries with a healthcare model different from the NHS (universal coverage), such as France, Switzerland or Germany
0
1
2
3
4
5
6
7
8
9
10
11
12
7.0%
2.1%
9.0%
6.5%
2.5%
Nether.
9.0%
7.4%
1.6%
Iceland
9.1%
7.6%
1.5%
Italy
9.1%
9.9%
7.1%
2.8%
Sweden
9.4%
7.7%
1.7%
Greece
9.6%
5.8%
3.8%
Denmark
9.7%
8.2%
1.5%
Portugal
Ø 9.4
Czech Republic
7.1%
5.9%
1.2%
Luxemb.
7.2%
6.5%
0.7%
United Kingdom
8.7%
7.2%
1.5%
Ireland
8.7%
6.7%
2.0%
OECD
8.9%
6.5%
2.4%
Spain Belgium
10.2%
7.4%
2.8%
Austria
10.5%
8.1%
2.4%
Germany
10.6%
8.1%
2.5%
Switz.
10.7%
6.3%
4.4%
France
11.2%
8.7%
2.5%
Public healthcare expense Private healthcare expense
Healthcare expense as % GDP, 2008
Source: OECD Health Data 2010
PwC 44
The role of the private insurance varies according to the country
Source: OECD. * Portugal: 2008 data.:** Netherlands: 2007 data.
Current expenditure on health (%), 2009
20%19%
7% 13% 12%20%
6% 15%
27%20% 17%
30%10%
1%
0%
5%6%4%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
United Kingdom
84%
1%
Switzerland
19%
41%
9%
1%
Sweden
81%
0%
2%
Spain
69%
5% 5%
1%
Portugal*
64%
5%
3%
Norway
72%
12%
1%
Italy
78%
1%
1%
Ireland
74%
1% 11%
2%
Germany
9%
68%
9%
1%
France
5%
72%
13%
1%
Finland
60%
15%
2%
Belgium
11%
64%
5%
0%
Netherlands**
5%
77%
6%
General government Social security funds Private insurance Private households out-of-pocket exp. Other
PwC 45
Private hospital groups continue to grow and play a larger role in the provision of care to a varying degree in different countries
32374053
6267
100110111
0
20
40
60
80
100
120
Nuffied Hospitals
Spire Healthcare
Sana Rhön- Klinikum
Helios Kliniken
General Healthcare
Capio Générale de Santé
Asklepios
(1) Data from 2010 (2) Helios Kliniken average size per hospital is not representative as the specialize in small hospitals including specialty hospitals for rehabilitation and elderly care. (3) Total revenues include revenues from all sources (inpatient and outpatient) and therefore varies across companies depending on the mix of inpatient and outpatient services and impacts revenue per bed calculations. Source: MSI Data Report Hospitals: Europe (2011); Companies' websites
Number of Hospitals by Major Private European Hospital Groups
Headquarters
Turnover € million FY09 2,163 2,046 1,650(1) 935 1,200 2,320 1,254 696 617
# beds FY09 18,030 16,000 n/a 2,907 1,400 n/a n/a 1,779 n/a
Beds/Hospital 162.4 145.5 n/a 43.4 22.6(2) n/a n/a 48.1 n/a
Revenue/Bed (€K)(3) 120.0 127.9 n/a 321.6 857.1 n/a n/a 391.2 n/a
PwC 46
Some of the main companies involved in the healthcare sector in Europe are the follows
Company Major presence in Europe Type
Alliance Medical Group Germany, Ireland, Italy, Netherland, Poland, Spain, UK
Provider of outsourced diagnostic imaging services
Ambea Sweden, Finland, Norway Provider of healthcare and care services
BUPA UK, Spain Private medical health insurance plans
Diaverum Estonia, France, Croatia, Czech Republic,
Greece, Hungary, Ireland, Portugal, Poland, Romania, Russia
Renal healthcare company
Euromedic International Bosnia, Bulgaria, Croatia, Czech Republic,
Greece, Hungary, Ireland, Portugal, Poland, Romania, Russia, Turkey, UK
Medical service provider
Fresenius Austria, Belgium France, Germany, Italy, Sweden, UK, Spain Renal care company
Labco France, Italy, Germany, Spain, Portugal, Belgium Medical diagnostic group
Generale de Sante France, Italy Provider of private hospital healthcare services
Jose de Mello Saude Portugal, Spain Provider of health services
PwC 47
New players: private equity companies
4
PwC 48
There are some drivers that govern the focused of the private equity companies in the European sector
Market fragmentation (hospitals, long-term care, diagnostic)
Changing regulatory environment
Improving infrastructure in CEE
Increase in the number of private operators
Consolidation opportunities
PwC 49
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDA
Jul-10 Centro Medico Teknon Health and allied services, nec Magnum Capital Industrial
SP F 100 140,0 9,3 x
May-09 USP Spain Hospital operator Barclays and RBS UK F 65 n.a.
Jul-07 USP Spain Hospital operator Cinven Group UK F 100 675,0 18,1 x
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDA
Feb-10 Southmead Hospital It owns and operates hospital. Investor Group UK F 100 497,2
Mar-08 Cromwell Health Group Ltd It owns and operates hospital.British United Provident Assoc UK I 100 114,4
Apr-08 Classic Hospitals Ltd Owner and operator of hospitals. Spire Healthcare Ltd
UK I 100 192,5
Dec-07 Nuffield Hospitals-Hospitals Nine hospitals around UK.General Healthcare Group UK I 100 195,7 12,7 x
Nov-07 Capio Healthcare UK Owner and operates hospital Ramsay Health Care Ltd
AU I 100 285,2 7,9 x
Sep-07Spire Healthcare (BUPA Hospitals) Owner and operator of hospitals. Cinven Group Ltd UK F 100 2458,0
May-06 General Healthcare Group PLC
Own and operate medical and surgical hospitals.
London & Regional Properties
UK F 100 3162,6 12,0 x
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDA
Mar-10 Groupe Proclif SAS It owns and operates private hospitals. Ramsay Health Care Ltd
AU I 57 87,0
Oct-09 Cliniques Privees Associees French hospital management company. Vivalto Sante (Credit Agricole)
FR F 100 63,0 5,8 x
Jul-09 Groupe Proclif SAS Owns and operates private hospitals. Predica SA FR F 43 70,0
Sep-08 Generale de Sante SA-Hospitals
It owns and operate hospitals & specialty hospitals.
ICADE SA FR I 100 201,7
Nov-06 Tonkin Investissements SA It owns and operates private hospitals. Capio AB SE I 100 146,0 10,4 x
Jan-06 Arvita SA Private hospital operator. Capio AB SE I 100 71,0 7,1 x
Source: Thomson, Merger Market
Spain Sweden
France
United Kingdom
Switzerland
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDAMar-10 Ambea Health and allied services, nec Triton SE F 75 850,0
Sep-06 Capio AB Diagnostic services, healthcare servicesOpica AB (Apax Partners) SE F 100 2460,0 13,8 x
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDA
Oct-07 Klinik Hirslanden AG Owner and operator ofhospitals.
Medi-Clinic Luxembourg Sarl
LU I 100 1724,9
Date Target Description Bidder Country Type %Deal Value
(€ M) EV/EBITDA
Mar-10 Krankenhaus Siegburg It owns and operates a hospital. HELIOS Kliniken GmbH
DE I 100 22,0
Nov-09 MEDIGREIF Five clinics as well as two medical care centers.Rhoen-Klinikum AG DE I 94 106,0
Sep-06 Klinikum Uckermark GmbH Own and operate a hospitalAsklepios Kliniken Verwaltungs DE I 94 20,0
Germany
F: Financial; I: Industrial.
*
• Few cross-border deals • Few international hospital networks groups • Recent trend towards the acquisition of individual assets
Relevant comparable deals by country
PwC 50
0,00x
2,00x
4,00x
6,00x
8,00x
10,00x
12,00x
14,00x
16,00x
18,00x
20,00x
ene-06
mar-06
may-06
jul-06
sep-06
nov-06
ene-07
mar-07
may-07
jul-07
sep-07
nov-07
ene-08
mar-08
may-08
jul-08
sep-08
nov-08
ene-09
mar-09
may-09
jul-09
sep-09
nov-09
ene-10
mar-10
may-10
jul-10
31
Capio acquired Arvita
(7,01x EBITDA)
Bain Capital, KKR & Merrill Linch acquired Hospital Corporation of America
(12,10x EBITDA)
Opica (Apax Partners) acquired Capio
(13,80x EBITDA)
UNCN acquired USP International
(8,90x EBITDA)
Crestview Partners acquired Symbion
Healthcare
(8,90x EBITDA)
Community Health Systems acquired
Triad Hospitals
(10,56x EBITDA)
Ramsay Healthcare acquired Capio UK
(7,90x EBITDA)
Primary Healthcare acquired 80% of Symbion Health
(10,26x EBITDA)
Star Healthcare acquired Terveystalo
(12,48x EBITDA)
Vivalto Sante acquired Cliniques Privees Associees
(5,75x EBITDA)
RehabCare acquired Triumph Healthcare
(6,36x EBITDA)
Cinven Group acquired USP Hospitales
(18,10x EBITDA)
General Healthcare Group acquired Nuffield (9 hospitals)
(12,7x EBITDA) Magnum Capital acquired
Centro Médico Tekon
(9,33x EBITDA)
EV/ EBITDA
Relevant transactions in Europe
PwC 51
Challenges of European health systems
5
PwC 52
Healthcare sector is facing some challenges that will condition its future evolution
Ageing
Increase in healthcare expenses
Chronic illness in a system designed for acute diseases
European economic recession
Legacy healthcare structure
IT interoperability
Changing legal environment
PwC 53
Main trends of healthcare systems in Europe
6
PwC 54
Main trends of the healthcare in Europe
Development of healthcare to prevention-promotion
Personalized services - personalized medicine
Deep impact of information and communication technologies and exponential growth of health information
Changes in patient role
Regulatory changes and healthcare reforms
Public private partnership
Primary care will become more important
Appearance of global or transnational players (healthcare insurance and providers)
PwC 55
SWOT Analysis
Strengths Weaknesses
Opportunities Threats
• Improving healthcare awareness.
• Availability of skilled workforce.
• Government´s commitment to healthcare industry improvements.
• High dependence on the import of hi-tech technology.
• Manufacturing and R&D activities looking for other areas (US, Asia,..).
• Harmonization with the EU. • Healthcare reforms. • Public private partnership. • PE are very interested in the healthcare
industry. • New global or transnational players. • Advances towards IT interoperability.
• Negative effect of government prices controls/reimbursement lists on market attractiveness.
• Slow pace of the reforms.
56
Obrigado
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