2026 Healthcare M&A Outlook: Deal Dynamics and Sectors to Watch

Our expectation for 2026 is for a modest increase in healthcare PE and M&A deal activity building throughout the year as deal timelines remain elongated. In formulating our outlook predictions for 2026, we reviewed our banking team’s qualitative experiences in the market – including the “new normal” of extended buy-side diligence and shift in the pricing expectations of both institutional and founder-owner sellers. The lending market remains decidedly risk-on, with spreads at or near historic lows and yield-to-maturity at its lowest point since 2022.

Turning to sector-focused outlooks, our predictions are wide-ranging and driven by the confluence of three key forces shaping US healthcare: runaway medical cost inflation, AI disruption, and ongoing regulatory volatility. These trends are by no means novel, but they interact with ecosystem financial health and investor risk appetite in nuanced ways to push investor appetite for various healthcare subsectors in new directions.

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