To the rest of the world, Canada is recognized as the land of universal healthcare – funded by our government. However, the reality is that there are many highly beneficial healthcare services that are not currently covered by public funding allocations. The pandemic showcased some of the gaps and shed light on holes that need to be filled in the existing system before adding more services under coverage. This isn’t an overnight fix – and for immediate needs in growth of our healthcare sector, we need funding now.
So where do we get this? A recent client of mine was from an investment firm interested in health care M&A in Canada. Our neighbours in the States have had a robust M&A climate in their privately-run health sector for years. In Canada, we have not historically been seen as a healthcare market conducive to M&A (Merger & Acquisition) activity. But… a large number of health services ARE in fact paid for privately and are outside of the publicly funded or insured service regime. In turn, investors are increasingly interested in healthcare M&A in Canada for those services not part of our universal health care – dentistry, orthodontics, physiotherapy, natural health, and (my favorite area of expertise) medical & orthopedic devices. Recognizing these opportunities for M&A is opening up a whole new world to provide options to optimize healthcare in Canada.
As technology enables Canadian healthcare to expand, private equity firms can help Canadian innovators bring much-needed healthcare options to patients quicker. Consolidation can bring cohesion to fragmented healthcare provisions with funding from private M&A investors. And it’s not just about PE firms having a lot of money… it’s about them having expertise to take the prehistoric facets of our healthcare system and modernize them, and the knowledge to lobby and deal with a very complex regulatory environment in Canada. It’s about creating efficiencies, centralizing back-office functions, and creating an environment that will not only offer a higher level of service to its patients, but also a more profitable system all-around.
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