2025 M&A trends in the healthcare sector

Key takeaways:

Healthcare M&A remains robust, driven by private equity interest, aging populations, and the digitisation of services

Technological advancements, including AI and automation, fuel efficiency and innovation, while cross-border deals gain momentum

Regulatory shifts present challenges but also drive opportunities in compliance-focused and scalable healthcare niches

The healthcare sector continues to attract robust activity in the mergers and acquisitions (M&A) space, showing remarkable resilience even amidst economic and regulatory uncertainty. As the global healthcare market evolves in 2025, M&A activity remains a critical lever for growth and consolidation, driven by macroeconomic trends, innovation in healthcare technology, and investor interest in niche subsectors.

RSM’s global industry professionals break down the major trends, opportunities, and challenges shaping healthcare M&A this year.

Recent M&A activity in healthcare

The healthcare M&A space remained active in the first half of 2025, despite global macroeconomic challenges. According to Scott Powers, Partner - Transaction Advisory Services for RSM in the US, "The healthcare sector has been significantly impacted by macroeconomic events in the first half of 2025, perhaps even more so than any other industry.” Contributing factors such as fluctuating international tariff policies, elevated interest rates, and increased regulatory scrutiny have created uncertainty, but the sector has pushed forward.

Regionally, activity has varied in focus. Powers notes, “Healthcare M&A activity in the U.S. has remained surprisingly resilient, with investments shifting from traditional provider practices to ancillary sectors like healthcare technology, pharmaceutical services, and behavioural health.” This adaptability reflects the healthcare industry's capacity for resilience in the face of macroeconomic challenges.

Similarly, Europe sees steady consolidation in areas like dental care and injectable clinics, as highlighted by Marcel Vlaar, Partner at RSM in the Netherlands. “We are seeing significant growth in the healthcare sector, mainly driven by consolidation plays of private equity (PE) firms and PE-led investments in healthcare niches,” he notes.

Challenges facing dealmakers in 2025

Despite its resilience, healthcare M&A is not without obstacles. Regulatory changes top the list of challenges for dealmakers. “Regulation changes and uncertain economic conditions are impacting consumer spending,” says Vlaar, illustrating the landscape's complexity.

Interest rates, however, appear less concerning in 2025. Freek van der Linden, Director at RSM Netherlands, notes, “Interest rates and financing conditions do not seem to be a significant factor this year.” Nonetheless, the broader economic picture, including labour shortages and rising operational costs, continues to put pressure on margins, amplifying the need for strategic investments and operational efficiency.

Deal growth drivers in healthcare

Strong macro drivers continue to fuel growth in healthcare M&A. Aging populations, rising public healthcare spending, and digitisation efforts remain prominent factors. Oliver Smyth, M&A Transaction Services Partner for RSM in Norway, emphasises the appeal of certain niches like eHealth and wellness programs in the Nordics. “Employee wellness services focused on treatment, health monitoring, and exercise programs as benefits for employees are gaining traction,” he shares.

Private equity’s influence on healthcare M&A continues to expand, as firms leverage high levels of dry powder to invest in scalable and innovative assets. Smyth confirms, “The sector is supported by strong macro drivers, including public healthcare spending and the drive to digitise services."

PE firms are primarily targeting business-to-consumer (B2C) focused subsectors, as Vlaar shares, “B2C-focused healthcare niches, such as dental and injectable sectors, are seeing intensified activity.” This focus on consumer-facing models reflects demand for accessible, high-value services.

The integration of technology into healthcare continues to disrupt traditional models, making it a focal point for dealmakers in 2025. Powers elaborates, “AI and automation are enabling greater efficiency, allowing businesses to increase productivity without significant headcount." This has transformed technology-enabled solutions into differentiators in highly competitive markets, attracting investor focus. Powers emphasises, “Businesses with a proven ability to utilise new technologies like AI and automation are generating significant interest in the market.” By reducing labour dependency and improving efficiency, these companies position themselves as valuable acquisition targets.

While human capital remains essential in healthcare, van der Linden observes that, “Differentiating intellectual property in technology-driven companies significantly increases their appeal.” This shift underscores the long-term potential of healthcare M&A to benefit both patients and businesses through innovation.

Cross-border transactions in 2025

Cross-border opportunities are also gaining traction as investors broaden their horizons. Scott Powers explains, “Cross-border M&A within healthcare has become more attractive for U.S. investors, particularly in less regulated sectors like healthcare technology." These deals often offer lucrative synergies, allowing global firms to access new customer bases while leveraging technology and expertise from international markets.

Smyth notes that cross-border interest is especially strong in Europe, driven by PE firms seeking platform and bolt-on opportunities. “Certain intellectual property and healthcare niches operate globally, making cross-border deals critically valuable,” adds van der Linden. This willingness to pursue international investments highlights the overarching potential in regions not overly burdened by varied regulatory frameworks.

The regulatory landscape’s influence on transactions

Regulation remains a double-edged sword in healthcare M&A. On one hand, stricter regulatory environments can deter investments. Smyth observes, “Political uncertainty and emerging regulations are shaping trends,” though direct impacts such as antitrust actions haven't significantly shifted market behaviour yet.

On the other hand, regulation is fostering opportunities in compliance-driven niches. For example, as countries aim to innovate within healthcare technology while addressing data security and patient privacy, businesses that satisfy these regulatory demands stand out as preferred assets.

Outlook for healthcare M&A in 2025

Looking ahead, the healthcare M&A sector is expected to maintain its momentum through the second half of 2025, driven by strong macroeconomic trends and investor appetite for innovation. Cross-border opportunities are set to grow, with U.S. and European investors increasingly targeting platform and bolt-on deals. PE firms, armed with a surplus of dry powder, are likely to continue focusing on scalable assets in high-demand niches.

The integration of AI and automation into healthcare is also expected to play a pivotal role in shaping M&A activity, as technology-driven companies become key acquisition targets. Despite ongoing challenges like regulatory changes and rising operational costs, the sector’s adaptability and focus on innovation position it for sustained growth.