Private Equity Health Care Acquisitions – March 2021

April 20, 2021

In light of the growing investor interest in health care and the risks associated with private equity ownership of health care companies, the Private Equity Stakeholder Project will be tracking private equity-backed health care acquisitions. Below is a list of private equity health care buyouts and add-on acquisitions completed during March 2021. We will continue to track acquisitions on a monthly basis.

See February 2021 acquisitions here.

Epselon – GTCR

Private equity firm GTCR is creating a new platform for health care investments called Epselon Global. Epselon will focus on acquiring health care companies to “build a market-leading healthcare business,” though the specific subsector of health care has not been made public.[i]

GTCR is a prolific health care investor, with at least 11 current health care portfolio companies and almost 50 past investments.[ii] Multiple GTCR health care companies have made headlines for lawsuits alleging cancer-causing emissions, poor medical care, billing fraud, and other issues. GTCR’s checkered history in health care raises questions about how the firm will ensure that Epselon does not run afoul of the law.

Frequent GTCR partners Michael Mulhern and Phil Macnabb will co-invest and lead Epselon. Mulhern and Macnabb have held senior executive roles at multiple GTCR companies, including Sterigenics (aka Sotera Health).[iii]

Sterigenics is a medical device sterilization company. In the last two years it has been sued over 800 times for emitting ethylene oxide, a cancer-causing gas, in excess of permissible limits. Most recently, the New Mexico Attorney General filed suit in January this year.[iv]

GTCR has owned Sterigenics since 2011. Warburg Pincus recapitalized the company in 2015, becoming the majority owner with GTCR staying on with a minority stake.[v]

Ethylene oxide has long been on the federal list of carcinogens, but in 2016 the EPA released conclusive evidence linking the gas to breast cancer, leukemia and lymphomas at extremely low levels of exposure, and reclassified it as a “known” carcinogen.[vi] Beginning in October 2016, the Warburg Pincus and GTCR-led ownership group began taking debt-financed dividends from Sterigenics totaling approximately $1.17 billion.[vii]

Some of the pending lawsuits against Sterigenics allege that Sterigenics’ owners intentionally began moving money out of the company through the dividend recapitalizations in order to insulate their capital from potential lawsuits related to the emissions.[viii]

Warburg Pincus and GTCR took Sterigenics public in November 2020 but have retained a controlling stake in the company.[ix]

GTCR also previously owned Correct Care Solutions (CCS), a health care company operating in prisons and detention centers.[x] CCS, which is now known as Wellpath, has been sued at least 1,395 times in federal courts for a range of allegations including wrongful death, malpractice and inadequate medical care.[xi]

Curo Health Services, a home health and hospice company that GTCR formed in 2010, [xii] has also faced legal trouble. In 2017, Curo paid a $12.2 million settlement to the US Department of Justice for allegedly engaging in illegal kickback schemes during GTCR’s ownership.[xiii]

Genesis HealthCare – Pinta Capital Partners

Nursing home giant Genesis HealthCare has voluntarily delisted from the New York Stock Exchange after receiving a $50 million cash infusion from private equity-owned ReGen Healthcare.[xiv] Genesis operates more than 325 nursing homes and assisted-living centers in 24 states.[xv]

ReGen is owned by private equity firm Pinta Capital Partners. The investment gives Pinta a 25% ownership stake with options to increase its share to 43% by April 15. Pinta has appointed two new directors to the Genesis’s board including David Harrington, a founding principal at Pinta.[xvi]

Pinta’s investment in Genesis comes at a time when private equity ownership of nursing homes faces pronounced scrutiny. New research has shown that private equity-owned nursing homes have higher mortality rates and declines in patient wellbeing.[xvii]

Following Genesis’s announcement, Sen. Elizabeth Warren wrote a letter to Genesis raising concern about the transaction and highlighting large payouts made to its now-departed CEO despite declining financial condition.[xviii]

March2021 Private Equity Health Care Acquisitions:

Buyouts

Company Name	PE Firm	Type
The Eye Health Group	Beverly Capital	Eye care
Ginger	Blackstone Group (growth equity)	Behavioral health
Renalogic	Carrick Capital Partners	Renal risk management services
ViaQuest	Council Capital	Behavioral health
ECLAT Health Solutions	Gulf Capital	Revenue Cycle Management
Hansei Solutions	Gulf Capital	Revenue Cycle Management
Cordis (of Cardinal Health)	Hellman & Friedman	Medical Devices
Cherry Tree Dental	ICV Partners	Dental services
Refac Optical Group	Lincoln Road Advisors	Eye care
Advent Home Medical	New Harbor Capital	Medical supplies
NDC	Platinum Equity	Health care supply chain
Regent Surgical Health	TowerBrook Capital Partners, Ascension	Ambulatory surgery centers
It’s Never 2 Late	Vista Equity Partners (growth equity)	Elder care
HealthPRO Heritage	Wellspring Capital Management	Contract therapy for SNFs, home health
FoodScience	Wind Point Partners	Nutritional supplements

Add-on Acquisitions

Company Name	PE Firm	Acquiring Entity	Type
A Step Ahead Autism Solutions	ABRY Partners	Lighthouse Autism Cente	Behavioral health
American Preclinical Services	ArchiMed and Ares Capital	North American Science Associates	CRO
Bio-Optronics	Ares Capital, Audax Group, Genstar Capital and Linden Capital Partners	Advarra	Health tech
Advantage Medical (California)	Ares Private Equity Group	Convergint Technologies	Health care security tech
MAXhealth	Arsenal Capital Partners	Best Value Healthcare	Primary care centers
Digestive Disease Associates	Audax Group	Gastro Health	Gastroenterology
BlueMed Medical Supplies	Audax Group	Aspen Surgical Products	Medical supplies
Reign Dental	Blue Sea Capital	DECA Dental Group	Dental services
Harbor Psychologist	Centerbridge Partners	Community Psychiatry Management	Behavioral health
BTG Specialty Pharmaceuticals	Charterhouse Capital Partners, Mérieux Equity Partners and Partners Group	SERB	Pharmaceuticals
ViruDefense	Clearlake Capital Group	Team Technologies	Medical supplies
PatientPing	Clearlake Capital Group	Apriss	Health tech
himagine solutions	Everstone Capital, Goldman Sachs Merchant Banking Division	Omega Healthcare Management Services	Healthcare outsourcing services
EBS Healthcare	Five Arrows Capital Partners	The Stepping Stones Group	Behavioral health
Performance Therapy Center	Great Point Partner	Spine & Sport Physical Therapy	Physical therapy
Total Body Rehab: Orthopedic and Hand Therapy	Gryphon Investors, Harris Preston & Partners	Physical Rehabilitation Network	Physical therapy
Three ATI Physical Therapy clinics in CA	Harris Preston & Partners, Gryphon Investors	Physical Rehabilitation Network	Physical therapy
Vitaldyne Medical	Inverness Graham	Catheter & Medical Design	Medical supplies
Wine Country Occupational Medicine	Kain Capital	Akeso Medical Holdings	Occupational medicine
Outcome Health	L Catterton, Searchlight Capital Partners and Silver Point Capital	PatientPoint	Health tech
Associated Urological Specialists	Lee Equity Partners	Solaris Health	Urology
CE Resources, Inc	Leichtman Capital Partners	Therapeutic Research Center	Medical education
CompuClaim	Level Equity, Radian Capital	Lock8 Partners	Health tech
Pinellas Cancer Center	M33 Growth, Havencrest Capital Management, ROCA Partners	The Oncology Institute of Hope and Innovation	Oncology
Advanced Plan For Health	Marlin Equity Partners	Virgin Pulse	Health tech
Sandcastle Centers	MBF Healthcare Partners	Acorn Health	Behavioral health
Kamana	McCarthy Capital	Triage Staffing	Staffing tech
Downtown Women’s Health Care	NaviMed Capital	Velocity Clinical Research	Women’s health
Diamond Pharma Services	Odyssey Investment Partners	ProPharma Group	Pharmaceuticals
Dunn Regulatory Associates	Onex, TowerBrook Capital Partners	Acacium Group	Health care consulting
Everwell Specialty Pharmacy	Osceola Capital	Revelation Pharma Corp	Pharmaceuticals
Cobius Healthcare Solutions	Parthenon Capital Partners	MRO	Health tech
Archetype Innovations	Revelstoke Capital Partners	Carrus	Health tech
Honeybee Health	Rosewood Private Investments	INW Innovations in Nutrition + Wellness	Health tech
180 Health Partners	Sunwater Capital, Equality Asset Management	Mindoula	Behavioral health
Harlingen Family Dentistry	Surge Private Equity	Access Dental Management	Dental services
Allen’s PharmaServ	Sverica Capital Management	Procare Ltc	Pharmacy services
Casamba	The Carlyle Group, Level Equity and Silversmith Capital Partners	Net Health	Health tech
NBN Infusions	The Halifax Group	PromptCare	Home health
iTakeControl	The Riverside Company	Red Nucleus Solutions	Health tech
PROHealth Home Care	The Riverside Company	Best Life Brands	Senior care
Alliance Home Health Care & Hospice Care	Vistria Group	Mission Healthcare	Home health
Austin Gastroenterology	Waud Capital Partners	Texas Digestive Disease Consultants	Gastroenterology
Children’s Center For Growth and Development	Waud Capital Partners	Ivy Rehab	Behavioral health
Digestive Health Specialists PA	Webster Equity Partners	One GI	Gastroenterology
Dayton Gastroenterology	Webster Equity Partners	One GI	Gastroenterology
Partners in Drug Abuse Rehabilitation Counseling	Webster Equity Partners, BPEA Private Equity	BayMark Health Services	Behavioral health