Successfully buying, selling, and combining health care businesses is a complex, nuanced, and high-stakes process. Clients involved in health care transactions need a trusted legal and business partner—a law firm that not only knows their business and the intricacies of their particular health care sector, but also blends a detailed understanding of all of the technical and legal aspects of the deal, along with finding creative resolutions to major issues (to make deals happen), and a keen insight into the market forces at play in the health care industry. Recognized as “an unparalleled M&A Standout” in the BTI M&A Outlook 2022: A Whole New World of M&A report, and having a foundation as a super boutique, Epstein Becker Green is that trusted partner. We immerse ourselves within our clients’ operations to fully understand their vulnerabilities, opportunities, and goals, creating value at every stage of the deal, whether on the buy or sell side, and being proactive to get deals done.
Health Care Is in Our Genes
As the vast health care space continues to expand and consolidate, companies across the entire health care continuum—particularly physician groups, hospital systems, nursing homes, home health agencies, ambulatory surgery centers, imaging centers, behavioral health providers, laboratories, telehealth providers, health care tech and device companies, pharmacies, clinical research organizations, and many other health care providers and businesses—turn to Epstein Becker Green to strategically position themselves for long-term success. As one of the country’s premier law firms in the health law field, with approximately 125 health care attorneys, we know the health care industry inside and out. We are regularly asked to provide transactional and regulatory support and counsel with respect to:
- Acquisitions, mergers, sales, joint ventures, and strategic affiliations of a wide variety of regulated and non-regulated health care companies (including nonprofit/for-profit health care entity affiliations)
- Conversions of nonprofit health care entities to for-profit health care entities
- Physician consolidations into mega-groups, as well as major transactions with private equity platforms, hospitals, and national health care companies
- Creation of licensed health care entities and management services organizations
- Commercial lending transactions involving health care entities (including advice concerning securitization issues and venture capital transactions)
- Acquisitions of health care businesses and assets in bankruptcy
Regulatory Due Diligence of Health Care Transactions
Buyers count on our M&A lawyers to thoroughly examine a target’s compliance posture, and to assure them that regulatory issues—around billing and coding, health privacy and data security, false claims, fraud and abuse, licensing and accreditation, and various other types of potential regulatory exposure—will not impede the deal. Our extensive experience on the buy side of health care transactions provides valuable insights to enhance the benefit of our involvement on the sell side. In advance of a health care client going to market, we evaluate compliance issues that are likely to arise in the buyer’s due diligence, and proactively advise sellers on implementing changes that will facilitate maximum value in a smooth transaction process.
End-to-End Support in Health Care Transactions
Our in-house capabilities cover a variety of disciplines that commonly arise within the context of health care mergers, acquisitions, and other transactions beyond the health regulatory issues described above—such as antitrust, tax structuring, financings, corporate governance, intellectual property, government contracts, IT contracts, labor and employment, employee benefit plans, real estate, and environmental—in order to provide end-to-end transactional support in a cost-effective and efficient manner.
Comprehensive Services for Hospitals, Physicians, and Other Stakeholders
Our full suite of services includes:
- Providing input on strategic plans/initiatives to grow various business relationships, including creative “outside the box” options
- Providing guidance on antitrust issues, and whether Hart-Scott-Rodino filings are required
- Advising on a tax-efficient transaction’s structure and related tax impacts
- Analyzing federal and state statutes affecting transaction options and structure in various areas
- Evaluating the impacts of corporate organizational and other governance documents on transaction options and structure
- Identifying and addressing significant commercial or financing obligations
- Advising governing boards and senior management with respect to transaction options and structure
- Coordinating and executing due diligence reviews, and preparing important “disclosure schedules” to protect sellers
- Reviewing/drafting and negotiating transaction documentation
- Compiling, or assisting our clients with compiling, the necessary documentation for obtaining any federal (e.g., Medicare) and state (e.g., department of health) regulatory approvals
- Analyzing and negotiating the pension, welfare, and executive compensation aspects of the transaction
- Correcting any benefit plan-related problems or liabilities resulting from the transaction, and preparing new or revised compensation and benefit agreements, plans, and arrangements for the post-acquisition company and its employees, executives, and directors
- Obtaining required contractual consents, including for lease and vendor agreement assignments, as well as payoffs of debts and financing arrangements
- Assisting with post-closing integration
- Closed a large New Jersey health care merger between our client Kennedy Health System, located in southern New Jersey, and Thomas Jefferson University, a Pennsylvania university and health system. The merger expanded the health systems’ capabilities in cancer care and neurosciences. We provided advice on tax structuring, financing, employment/compensation, antitrust compliance, SEC filings, real estate, and intellectual property, among other issues.
- Represented a world-renowned integrated orthopedic and sports medicine practice that treats patients from all walks of life, including recreational, Olympic, and professional athletes from around the world, in a strategic affiliation with a significant investor. We guided the client through a multiple bidder process, assisted the client in choosing a good strategic partner, and carried the deal to fruition.
- Represented a private equity firm having assets under management of over $3 billion and focused on leveraged buyout investments in middle-market companies, on the acquisition of three different specialty pharmacies, for a cumulative value of almost $1 billion. Among other things, we advised on all health regulatory issues on those transactions, all health contracts, credit agreements, the disclosure schedule, the purchase agreement, and the diligence review.
- Currently providing advice to one of the most successful independent practice associations in the Greater New York region on structuring several joint ventures in a manner that is compliant with applicable federal and state regulations impacting health care organizations, such as federal and state anti-kickback statutes and self-referrals prohibitions (to allow the client’s physicians to provide cost-effective care to patients).
- Assisted an investment management company in preparing for the acquisition of one of the largest dental service organizations in the United States. We conducted a due diligence exercise of the target organization, reviewed all documentation and the company structure and permits, and advised on the purchase agreement and health regulatory risks.
- Advised an independent community hospital in upstate New York on its major affiliation transaction to become part of a health system. We provided advice throughout all stages of the transaction, from negotiating the letter of intent and coordinating due diligence to negotiating a definitive agreement and planning for applicable regulatory approvals.
- Served as U.S. regulatory counsel in connection with the proposed acquisition of a global radiopharmaceutical manufacturer and distributor. We conducted a regulatory due diligence review that included the target’s U.S. operations and a review of FDA regulatory compliance of the target’s global manufacturing facilities producing products for the U.S. market.
- Currently assisting a provider of interventional vascular care for patients with chronic conditions in its pursuit, as part of a joint venture, to acquire the assets of an academic medical center from a seller in bankruptcy. We are advising on bankruptcy strategy, regulatory approvals, and licensing issues, and negotiating terms of the asset purchase agreement.
- Currently representing an investor group in purchasing a hospital in New Jersey. The investor group has long specialized in reviving financially distressed ambulatory surgery centers and making them viable for their communities. The asset purchase agreement was signed in 2020. We are now pursuing Department of Health approval as well as key landlord and other consents. The matter has had complications due to ongoing litigation brought by a failed bidder.