International Investing in Healthcare and Life Sciences 2022

The latest report from global law firm McDermott Will & Emery looks at the international investment landscape in healthcare, and life sciences. HBI speaks to McDermott Will & Emery healthcare partner Sharon Lamb to find out more.

To read International Investing in Healthcare and Life Sciences 2022, click here.

Billed as a guide to key legal and regulatory issues in health and life sciences transactions, the report has launched at an interesting time. Lamb explains: “It’s useful to look at the context in which we are considering these issues. Inflation is an issue, energy costs are rising, staffing is problematic.

“Post pandemic, the consumerisation of heathcare continues apace. People are expecting care through technology and on their phones. Increasingly people run their lives through their phones and often the first port of call for a diagnosis is going to be something they can look up on the internet.

“And yet.. healthcare is one of the last areas to full digitise. There are still issues on the sharing of data between health professionals. Machines in one field can’t communicate with others. Yet I can get my bank to talk to all the other banks.
“Finally we’re seeing some movement in the European health data space. But it’s still difficult to get data that’s needed for valuable research. Regulations have been slow to catch up, but in some areas we are seeing change.”

She adds that she is keeping an eye on interest rates as this affects the funding of deals but even in what she calls “an uncertain climate”, fundamentally healthcare and life sciences are seen as resilient sectors and a safe space for international transactions and investment.

She clarifies: “And yet on some level healthcare remains extremely local. You can see macro trends and countries moving in a particular direction on investment control or medical devices and AI, but it’s the detail that makes it important to have experts guiding you through transactions. You can’t assume what is important in one jurisdiction is top of mind in another.”

The report provides a bird’s eye view of different jurisdictions, and the factors relevant to decisions on acquisitions or transitions. Lamb says: “Investors, pharma, or healthcare companies looking at how different countries pay for healthcare need to understand how drugs are reimbursed, and the landscape for using health data.

“Some countries have a more protectionist landscape for the private sector, quite traditional concepts of healthcare being run and delivered by doctors – the DACH countries in particular, in contrast quite significantly with say the UK where the only restrictions are in respect of primary care.”

Foreign investment has also been on the agenda in some of the largest European countries. “We have seen more concern about foreign investment, particularly where it effects public health or where things are considered sensitive, or strategic, so around the virus or biotechnology in particular.

“Germany has very specific rules, and the UK has had new foreign investment rules. At the end of 2020 new rules came into force in Italy in respect of foreign investment control.

“But on a more positive note, in Germany there have been changes around reimbursement of apps and software as a medical device. There’s been a real liberalisation there generally around digital health services.”

If you would like to read McDermott Will & Emery’s report, click here.