Why MedTech Businesses Are Looking to Sell Now

The MedTech M&A market is running hot right now. Based on monthly volume to date that doesn’t appear to be slowing down, the medical device industry could see 100 total transactions this calendar year.

Some sectors would be concerned about excess available inventory making it more difficult for sellers to attract buyers — but that challenge isn’t a concern to MedTech companies. For many reasons, it’s a seller’s market right now. CEO Florence Joffroy-Black and Managing Director Dave Sheppard discussed some of the main causes of this in a recent column for Medical Product Outsourcing Magazine.

1. Selling to Avoid Higher Corporate Taxes

The Biden administration is proposing sweeping changes in both tax rates and structure. If passed, these changes will lead to new levies that will impact corporate finances, operations, executive teams (including owners), and sellers/shareholders.

In addition to these proposed tax changes, the industry should be on alert for the possible re-introduction of the 2.3 percent Medical Device Tax.

2. Economic Outlook Matters

Not surprisingly, buyers are more willing to invest and spend money when they have confidence in the economy and financial markets. The good news is the global gross domestic product (GDP) is expected to grow more than 6 percent this year.

Moreover, the financial markets have been on a tear. In early April, the Dow Jones Industrial Average was at 33,153; the NASDAQ Composite shot up to 13,480; and the S&P 500 topped 4,000—all historical highs for these Wall Street indexes.

Click below to read the full article about why now could be a great time for MedTech companies to seek a sale.