Healthcare IPO Activity Past $10B Mark In 3Q20

0
Healthcare IPO Activity Past $10B Mark In 3Q20

New S&P Analysis: Telehealth companies push healthcare IPO activity past $10B mark in Q3’20

Get The Full Ray Dalio Series in PDF

Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

Q3 2020 hedge fund letters, conferences and more

Healthcare IPO Activity Crossed The $10 Billion Mark

IPO activity in the healthcare industry crossed the $10 billion mark for the second time in a row this year after companies attracted $13.44 billion in investment during the third quarter of 2020, data from S&P Global Market Intelligence showed.

Here Are Bill Ackman’s Favorite Hedge Funds

Bill AckmanMany of the most well-known hedge fund managers in the world engage in philanthropy, and in doing so, they often reveal their favorite hedge funds through a review of their foundation's public filings. Bill Ackman's Pershing Square Foundation invested in several hedge funds during the fiscal years that ended in September 2019 and September 2020.

Healthcare IPO Activity

A total of 82 companies went public during the three months ending Sept. 30, with one coming close to raising nearly $1 billion. Most companies going public were based in the U.S., with a handful headquartered in Asia.

Key highlights from the analysis include:

  • Healthcare companies have raised about $29.45 billion from IPO activity this year alone, the most in at least the past five years.
  • Third-quarter IPO proceeds were also the most for any single quarter of 2020.
  • Third-quarter IPO activity was dominated by U.S. telehealth companies GoodRx Holdings Inc. and Amwell, which raised about $944.3 million and $853.3 million, respectively.

Healthcare IPO Activity

Healthcare companies have raised about $29.45 billion from IPO activity this year alone, the most in at least the past five years. Third-quarter IPO proceeds were also the most for any single quarter of 2020.

U.S. Telehealth Companies Dominate 3Q IPOs

Third-quarter IPO activity was dominated by U.S. telehealth companies GoodRx Holdings Inc. and Amwell, which raised about $944.3 million and $853.3 million, respectively. GoodRx is the sixth digital health company to go public so far in 2020, according to digital health investment firm Rock Health, trailing telehealth provider Amwell and healthcare IT company Accolade, Inc., which also went public during the quarter.

While only 14 digital health companies went public between 2012 and 2016, Rock Health estimates that if all goes as planned, there will be 13 digital health IPOs in the past two years alone.

Healthcare IPO Activity

The COVID-19 pandemic has caused telehealth and digital health usage to increase significantly as people have been staying at home. "When you take a step back, across the space there's a bit of an arms race happening. There [are] lots of small Teladoc and Livongo look-alikes out right now raising money as fast as they can to broaden their platforms and scale-up," RBC Capital analyst Sean Dodge said in a interview with S&P Global Market Intelligence earlier this year.

Read the full analysis here by S&P Global Market Intelligence

Updated on

Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
Previous article Proxy Fights Continue To Be A Minority Of Activist Campaigns
Next article Price, Value and Sources of Returns

No posts to display