State of Women’s Health Private Equity – White Paper
Winter 2025
Introduction
The women’s health practice management space has been consolidating since 2013, when Unified Women’s Health was formed by private equity firm Ares Management. Over the past decade, seven additional platforms have emerged, with the most recent being Nova Women’s Health Partners (Webster Equity Partners). Physician Growth Partners (PGP) served as the exclusive advisor to two of the three founding practices of the new platform, WomanCare and Women’s HealthFirst, two high-performing practices that had been attempting to merge for nearly twenty years before engaging PGP to navigate the landscape.
With many women’s health groups still independent, investors are keenly interested in groups offering a blend of traditional women’s health care alongside ancillary opportunities such as fertility, cosmetics, preventative wellness care, family medicine, and other services.
The existing platforms vary in maturity and strategy. Established platforms like Unified, Axia, and Women’s Care Enterprises have already experienced the “second bite” event, while newer entrants like Together Women’s Health and Femwell/VitalMD are focused on scaling within their regions before reaching this stage.
Despite a broad decline in physician practice management transactions year-over-year (473 in 2024, 537 in 2023, and 622 in 2022),1 the women’s health sector continues to see heightened investor interest. For example, PGP advised Tampa Woman’s Group (TWG) in their 2024 transaction with Femwell, which has since expanded its platform nationally. TWG’s comprehensive women’s health services, including cosmetics and wellness care, exemplify the appeal of entrepreneurial physicians who expand traditional Ob-Gyn practices with ancillary offerings.
Women’s Health Investment Drivers
Complicated Practice Dynamics
Smaller to mid-size practice owners face unique difficulties in trying to create somewhat of a work life balance; the highest challenges including on-call demands (for example, splitting call amongst 5 physicians vs 25), challenges scaling operations, and difficulty enjoying time away from work (due to administrative and operational time commitments). A private equity partner can help the practice address this need and relieve physicians of the burden.
Women are the Key Driver of Family Healthcare Decisions
In addition to medical treatments for conditions like cataracts and glaucoma, there is also a growing demand for elective ophthalmic procedures such as LASIK and cosmetic eyelid surgeries. The global LASIK market is projected to reach $3.79 billion by 20335, with increasing demand driven by patients looking to improve their vision without the need for glasses or contact lenses. Private equity firms are attracted to practices offering these elective procedures because they tend to generate high margins and are often paid out of pocket, which reduces dependence on insurance reimbursement.
Broadening of Healthcare Needs
One of the largest drivers leading private equity to women’s health historically has been the move to a more holistic care pathway for women. More than one-third of women’s health is focused on breastfeeding, reproduction, and contraception.2 More recently, clinics are servicing the demand for a full range of services from menopause care, general gynecology, cancer prevention, behavioral health, and even cosmetic care.
This shift has made the specialty more attractive as there is a strong demand for multiple healthcare needs when a patient enters a clinic. Private equity can help supplement the addition of services while enhancing the operations for practices, in addition to building out these ancillary service lines which has been what attracts private equity to specialty medicine whether it be ASCs, laboratory, pharmacy, etc.
Demographics & Models Unique to Women’s Health
The fragmented nature of women’s health allows for effective market consolidation, creating win-win outcomes for physicians and investors. An aging population drives increased demand for services such as menopausal care and cancer prevention. Additionally, updates to screening guidelines (e.g., earlier breast cancer screening) are expected to increase demand for preventative care. Private equity partnerships enable practices to introduce capital-intensive services like mammography and in-house labs, ensuring access to high-quality care.
Why Now?
Compete More Effectively
As the women’s health landscape evolves, smaller practices struggle to compete with larger, consolidated platforms. Partnering with private equity allows independent physicians to maintain clinical autonomy while accessing resources to strengthen their competitive position.
Economic Value
Women’s health groups with strong clinical and financial profiles continue to receive premium valuations and seller-friendly deal structures. These opportunities allow practice owners to achieve liquidity while retaining equity in a growing platform, making private equity partnerships increasingly appealing.
Optionality & Succession Planning
We have seen the early stages of platforms becoming interested in the combination of pediatrics, primary care, and women’s health, most notably being Femwell/VitalMD and Privia Health, which have prioritized these specialties for add-ons to their platform. Additional services that can be leveraged with a partner include fertility services, mammography, menopause treatment, and more. Typically, an ancillary service like mammography can be a large capital expenditure for independent practitioners, which has limited access for patients requiring these services. The wider aperture of potential partners bodes well for practice owners looking to explore all possible strategic options.
In addition, with pressures from outside consolidators such as Optum Health, Walgreens, and health systems becoming more acquisitive of independent physician practices, it is imperative physician group owners explore private equity to compare what the next 3, 5, and 10 years could/will look like whether they a) maintain the status quo b) were to partner with private equity and/or c) sell to a health system or retail giant.
Key Considerations For Practice Owners
When evaluating a potential partner, it is extremely important to find the right fit to ensure a strong go-forward partnership. PGP advises that four critical factors need to be considered when evaluating whether a partner is right for your practice:
- Achieve Clinical Autonomy
- Ensure there is a strong level of go-forward governance control at the local level
- The practice maintains directional control at the company, including work schedules, vacation days, work location, and retention of staff
- Maintained control of provider recruitment and retention
- Maximize Economics and Achieve Most Favorable Deal Terms
- Negotiating favorable economic deal terms (equity share price, timing of payment, etc.)
- Strike appropriate balance between total EBITDA credit vs the EBITDA multiple
- Financial engineering driving incremental EBITDA creation
- Receiving credit for various tangible growth initiatives in the business (new locations, new providers, new service lines, etc.)
- Ensuring potential partners have the resources to execute strategy
- Access to capital and economies of scale
- Adequate level of administrative and operational resources provided (Accounting / Finance, IT, RCM, Marketing, HR & Recruiting, Business Development, Legal, etc.)
- Track Record of Success
- Partnering with experienced healthcare / PPM ‘Operating Partners’ with a history of adding significant value and operational guidance in the PPM space
- Proven ability to align with young and newly recruited providers
- Exceptional key performance metrics (recruitment and attrition,
- location growth, service line expansion)
What Happens After the Transaction?
One of the biggest questions practice owners have is “what happens after the transaction is consummated?” If you are doing a transaction with a reputable private equity platform, physicians will largely continue to operate “business as usual”. The private equity partner will look to implement certain growth initiatives, but these initiatives will all be items that were discussed at great length in advance of consummating the transaction. On the clinical front, physicians will practice medicine the way they always have. Clinical autonomy is maintained, and an advisory firm like PGP negotiates this on the physician group’s behalf. As for infrastructure capabilities, groups that lack back-office sophistication will typically integrate into the “platform” practice’s EMR, Accounting and PM systems. Outside of day-to-day operations and clinical delivery, the most notable change is the holding of rollover equity in the new partnership by selling physicians. Due to the fact a substantial liquidity event is experienced, shareholders are required to utilize a percentage of their proceeds in the form of equity in the new enterprise. This is desired by the private equity firms as they want to maintain alignment with the physicians that they have invested in, creating a shared goal of growing the platform and creating a “second bite of the apple” opportunity 3–7 years down the road.
What to Look For in a Partner and Why an Advisor is Important
Every private equity sponsor views the world through a different lens when it comes to their motivations, growth plan and relevant experience within the space. When seeking a partner, it’s imperative for practices to be diligent in ensuring alignment for the future. The partnership is not permanent, but the years following a transaction will need close collaboration from each party for it to be successful.
Physician Growth Partners (PGP) works on behalf of independent physicians to ensure their goals and succession planning needs are met through a transaction. Our process is tailored around maximizing value, while identifying and engaging investors that will be a strong cultural fit with experience in the healthcare space to ensure a successful go-forward partnership. It is essential that you partner with a healthcare private equity group that has a similar vision.
While many independent groups may initially feel they can navigate a transaction without an advisor, those that have gone through the process with an experienced and reputable firm in their corner will be quick to highlight the significant value add from both economic, partnership and educational perspectives. Ensuring that each shareholder is prepared and fully understands the dynamics within a transaction is crucial for the future success of the business.
A seasoned healthcare transaction advisory team can ensure that the most attractive outcome is achieved. Through a formalized competitive marketing process, an advisor can ensure the practice maximizes their economics and transaction terms. A transaction process also allows the practice to interview multiple private equity partners and choose the group that presents the best ‘fit’.
Even if a group is approached by a buyer or has a buyer in mind, it is essential to run a process considering the practice has one opportunity to choose the right private equity partner, supplemented by the value a process drives regarding both deal terms and economics.
Conclusion
The consolidation within Women’s Health continues to accelerate into 2025. Given PGP’s proximity to deal activity and insights in the space, 2025 presents an opportune time for women’s health practice owners to explore private equity as part of a long-term growth strategy. Whether a practice is interested in pursuing a private equity partnership, questions the rationale and effectiveness of a PE partner, or downright disagrees with private equity, it is essential to get educated and ensure your practice is positioned for continued success in your market.
For those that choose to go down the path, it is imperative that culture and alignment, not simply economics, is the first goal. The role of an advisor like PGP can be the difference maker not only in knowing who can be trusted and who has a track record of success, but in ensuring an economic outcome that is satisfactory when reallocating ownership of your business.
If interested in pursuing a transaction, learning about private equity, the private equity strategy, transaction dynamics, or activity in your market, please use the information below to contact the PGP team and schedule a discussion.
1LevinPro HC – Healthcare M&A data platform, Levin Associates
2FemTech Analytics: FemTech Industry Landscape Q2 2022
