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SOURCES: DEALOGIC; AVCJ; BAIN ANALYSIS
Additionally, India has consistently delivered favorable returns and has enabled a range of successful exits for PE firms through initial public offerings( boosted by strong public markets), strategic acquisitions( bolstered by acquirers’ strong balance sheets), and sponsor-to-sponsor deals( such as KKR’ s $ 839 million acquisition of Healthium Medtech from Apax Funds). With a proven track record, favorable macroeconomic conditions, and a diverse healthcare landscape, India is expected to remain a prime investment location for PE firms.
A strengthening Japanese market Healthcare PE investments in Japan are rising fast, growing at a 20 % CAGR since 2019. Improved corporate governance, including the increased focus on price-to-book ratios and recent M & A code revisions that emphasize“ market checks,” allows PE firms to find more opportunities for carve-outs and privatizations. As capital flows redirect as a result of China’ s economic slowdown, Japan’ s high returns are drawing in limited partners( LPs) and contributing to a wave of acquisitions across industries.
These dynamics, which have boosted PE activity overall, are pronounced in healthcare because of Japan’ s aging demographics and emphasis on pharmaceutical innovation. With nearly 30 % of the population aged 65 and older and 10 % over 80, demand for healthcare and senior-care services is soaring. This trend underpins J-STAR’ s 2024 investment in nursing home and home-care operator Caregiver Japan. At the same time, the focus on pharmaceutical innovation is propelling interest in Japanese biopharma and services assets. Looking ahead, Japan’ s stable market, demographic trends, and opportunities for partnering with large conglomerates to accelerate value creation will continue to attract healthcare investment.
Growing interest in South Korea medtech South Korea is emerging as a major center for deals in Asia- Pacific, led by several large investments. South Korea’ s share of regional deal value rose to 26 % in 2024— an eight-percentagepoint jump from 2023( see Figure 4). This growth echoes trends seen in India and Japan, such as slowing inflation, an aging population seeking more healthcare services, and regulatory reforms designed to attract foreign investment, especially within the medtech sector.
Many medtech companies attracting PE investors in the region typically focus on offerings with global markets in segments such as aesthetic skincare and dental health. For example, aesthetic device maker Jeisys Medical was recently taken private by Archimed. South Korea’ s healthcare landscape is also opening up for investments in derivative and adjacent businesses. For example, MBK Partners acquired Geo- Young— a pharmaceutical wholesaler serving pharmacies, hospitals, and medtech companies— from Blackstone.
Growing interest in the broader region In 2024, a lineup of major healthcare deals reshaped the Asia- Pacific region’ s investment landscape. China, in particular, has become a unique hotbed for strategic carve-outs, as global multinationals spin off local operations to enable a more targeted approach to Chinese markets. A prime example is UCB Pharma’ s divestiture of its neurology and allergy portfolio in China to Mubadala and CBC Group, which also underscores the growing influence of Chinese and Middle Eastern capital.
A similar trend is evident in Southeast Asia, where regional players seek lucrative exit and carve-out opportunities. For example, Affinity Equity Partners recently closed a near-billiondollar sale of Island Hospital in Malaysia to IHH Healthcare, a Kuala Lumpur-based healthcare group. Australia, meanwhile, remains a magnet for healthcare infrastructure investments, with several large sponsor-owned assets expected to enter the market soon, indicating significant transactions on the horizon.
We are optimistic about the future of healthcare PE investment in Asia-Pacific. India continues to exhibit robust growth opportunities in dealmaking, particularly in the provider space, supply-chain management, and CDMOs. Simultaneously, the more mature markets of Japan and South Korea provide a balance to the growth investments in China and India. The rest of the region, including Australia, holds great promise, with numerous assets expected to re-enter the market in coming years. That said, the issue of how domestic and international investors adjust to the region’ s evolving economic landscape— notably, the question of how China’ s economy recovers— remains central to future deal strategies.
This article was provided by Bain & Company. The authors are Nirad Jain( Partner, New York), Kara Murphy( Partner, Boston), Dmitry Podpolny( Partner, London), Franz-Robert Klingan( Partner, Vienna), Dieter Meyer( Partner, Zurich), and Alex Boulton( Partner, Singapore).
70 ISSUE 2 | 2024 GlobalHealthAsiaPacific. com