Navigating the Storm: Opportunities for Restructuring in Healthcare & Pharma

On the surface, healthcare and pharmaceutical companies should be somewhat immune from the growing global financial crisis, given the level of investment being injected into the industry. However, market events also may accelerate break-ups, restructuring, and bankruptcies.

For instance, one serious risk hospitals and related service providers may face is the threat of personal injury lawsuits, according to law.com’s Critical Mass report. Like the U.S. opioid epidemic, major class-action litigation arising from those claims could push impacted businesses into financial distress.

Other unknowns include the sheer overwhelm hospitals and healthcare services may experience from the current crisis. Increased demand for a stronger US public healthcare system also could have widespread ripple effects on R&D investment and the global life sciences sector.

Add to this potent mix activist shareholders, as well as vulture funds armed with large cash piles that are on the prowl for bargains across all industries. Finally, mix in ongoing industry portfolio reshuffling, encompassing everything from increased geopolitical and regulatory resistance to large-scale mergers.

With the future so blurry, what practical steps can healthcare and life sciences finance professionals take now to save pain later?

Create an emergency repository

Gathering and collecting documents always takes longer than people think. In fact, according to our internal data for healthcare and life sciences, the process usually takes more than a month. Taking on this task in the middle of a business crisis is the last thing you need, so it's better to collect the key documents you need in advance.

Challenges like these are the reason we designed Datasite, the leading data room provider to the healthcare and life sciences industry, supporting it on all transaction types throughout the equity and debt lifecycle. Datasite Prepare, our exit-readiness platform, will auto-categorize documents and automate redaction in the data room for you. That way, you can make sensitive IP and medical data HIPAA compliant and share-ready in advance of any surprise events.

Train up in down times

Datasite Prepare isn’t the only way Datasite can help you navigate a complex optional or forced event. Our platform and in-house support team have assisted the restructuring and bankruptcy community for the last 25 years on many of their largest transactions.

With the future so uncertain, now is a good time to brush up on how to use our other products, including Datasite Outreach and Datasite Diligence. By taking this sensible step, you can put your team in the best position to use the technology available to them quickly and efficiently when timelines are tight.

Should you plan to restructure, use Datasite with foresight.