Medical Design Briefs - April 2021 - 4

FROM

THE EDITOR

How COVID-19 'Turbocharged' an
Industry Already 'Riding High'

OVID-19 undoubtedly unleashed a
flurry of innovation in the healthcare
industry. A recent report from Evaluate
Vantage looks back at 2020 and reviews
the short-term and long-term effects the
pandemic had on the industry.
" In many ways, COVID-19 turbocharged an industry that was already rid-

ing fairly high, " the report points out.
" The financing climate had been strong
for a few years, but 2020 saw records broken in the venture and IPO worlds. With
the spotlight on biopharma, which made
remarkably swift progress on a pipeline of
pandemic therapies, investors rushed to
inject money into the [biopharm] sector. "
However, the report's findings present
mixed results for the medtech sector.
" The more established end of the med-

tech sector is in a better position than it
was in the summer, with the most successful big-cap companies seeing their share
prices more than double. Even greater
gains were seen among smaller companies - but so were greater losses. "
In the medtech arena, the report
notes that diagnostics companies - both
those developing tests for COVID-19 and
those working on liquid biopsy cancer
tests - saw a surge in revenues during
the pandemic. According to the report,
these diagnostic tests " appealed hugely
to investors in publicly traded companies
and to venture backers alike. "
M&A activity was strong in all sectors,
and the pandemic provided the impetus
for the biggest deal in medtech last year
- the $18.5 billion merger of the telehealth groups Teladoc and Livongo. The
report notes that so-called " heady valuations " did not necessarily diminish deals
in 2020 but it cautions that this may be a
concern in 2021. " When preclinical companies can easily achieve the sort of market cap more typically associated with
later-stage developers, some big and expensive disappointments seem inevitable, " the report says. It also notes, however, that medtech M&A " has kicked off in
spectacular fashion with deals worth more
than $10 billion already arranged. " Remote patient monitoring has emerged as
a major trend to watch in the coming year.
Evaluate says the main COVID-19
focus in 2021 will shift from tests for the
disease to the progress of vaccines and
therapeutics against the pandemic.
Although medical device stocks did not
show the gains companies saw in prepandemic 2019, the second half of 2020
showed improvement. " The remarkable
thing about medtech business development trends across 2020 is how resilient
deal values have been under truly extraordinary circumstances. Transactions
worth a total of $27.3 billion were completed last year, scarcely behind the $29
billion figure for 2018. "
A return to M&A deal-making is predicted for 2021. " The groups negatively
affected by hospitals prioritizing COVID19 patients, such as those active in the
orthopaedics and cardiology arenas, will
be keen to catch up by buying highgrowth businesses. "
Sherrie Trigg
Editor and Director of Medical Content
For a copy of the report, go to http://bit.ly/
evaluate-2020-in-review.

Free Info at http://info.hotims.com/79412-750

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Medical Design Briefs, April 2021

http://info.hotims.com/79412-750 http://www.bit.ly/evaluate-2020-in-review

Medical Design Briefs - April 2021

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