Healthcare investment banking is a term used to describe an industry group in healthcare IB. The group’s main objective is to advise companies in the pharmaceutical, biotech, medical device, healthcare IT markets on mergers, acquisitions, and equity capital issuances. One excellent example is Chardan.
Most healthcare companies are in either of the two broad categories.
1. Biotechnology, Pharmaceuticals, and Life Sciences — In this category, you will find companies that make generic, branded chemicals and biotech. Further, it can include companies that specialize in making tools that are essential for life science.
2. Healthcare Equipment and Services — this category entails assisted living, hospitals, labs, nursing facilities, and medical device companies. So if you were wondering What is healthcare investment banking? No you know. However, you may want to know more than the definition and that is why you should keep reading.
Getting into this sector is interesting as it is always in operation, even if there is a recession. For instance, someone who is badly injured will still need the services of a healthcare facility. Further, the entire sector is heavily regulated by the government because of its role in the economy. An economy will have a hard time standing if it has a broken health system.
Who Gets Into Healthcare Investment Banking?
When people hear about healthcare investment banking, they get the impression that they need an advanced degree in biology, chemistry, or medicine to join the group. History has shown that healthcare groups hire undergrads from related fields. Even that, medical knowledge gives you an upper hand.
Another essential thing to note about this group is that the recruitment process is like any other group. Nonetheless, one needs to attain an MBA program or a top undergrad with relevant work experience. Proper preparation and networking play an essential role in the same.
What are the Trends and Drivers in Healthcare Investment Banking?
The truth is that several drivers apply in healthcare, and some of them include:
- The demographics.
- Government policies.
- Credit conditions and broader economic.
- Innovations and Product pipelines.
What is the Role of an Associate or Analyst in Healthcare Investment Banking?
What is healthcare investment banking is a question that many associates and analysts ask themselves whenever they can work in healthcare investment banking. The kind of experience you will get as an associate analyst depends on your focus on the healthcare sector. There are three points to note;
Healthcare Equipment and Services
It is one of the most significant sectors in the group. Here, you tend to work with more prominent companies that play a significant role in the group. Leveraged buyouts and standard M&A deals are pretty common. Interestingly, you will learn more about finance and the technology behind the development of different drugs.
Biotechnology, Pharmaceuticals, and Life Science
Here, you will need to be ready to work with both large and small companies. What this means is that you are likely to get more market experience and product knowledge. However, you will spend less time on high-yield debt financings and LBOs.
More Unusual Deal Types
Finally, you may get access to more unusual deals that will shape your career life in several ways. Deals such as royalty arrangements, joint ventures, spin-offs, and asset swaps are typical because big companies prefer to partner with other companies.