Plate of medicines

Analysis

Life sciences and health care M&A update: Q1 2019

The life science and health care industry is starting to put more emphasis on using analytics to help overcome common challenges and find new industry wins. Many companies in the health care sphere are putting analytics at the top of their priority lists with efforts such as adding C-suite roles focused on analytics, establishing analytics strategies, and designing processes to help with data reviews. Life Sciences & Health Care mergers & acquisitions (M&A) update provides Deloitte Corporate Finance LLC insights and market data analysis that shed light on M&A trends in the life sciences and health care industry.

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Health systems strategic focus on analytics1

The health care industry is counting on analytics to help it overcome many of its challenges and unlock value from evolving and new data sources.

Analytics is a necessary capability to help shift to value-based payment models and can help health systems deliver higher quality of care while improving operations and lowering costs. It is also important for strategies and initiatives that depend on data mining—such as understanding social determinants of health and the importance of customer experience and preferences. Heading into the future, data analytics is expected to be one of the backbones for health systems seeking to use emerging technologies such as artificial intelligence (AI) and robotic process automation (RPA) to transform their care delivery or workforce.

Health systems are increasingly making analytics a priority, as their planning, governance, and investments show. They recognize its importance for their strategies today and even more so for the future. The Deloitte Center for Health and Solutions measured changes in analytics maturity across four areas, including having: (i) a defined strategy and vision; (ii) a dedicated analytics department; (iii) chief analytics leadership; and (iv) a formal data governance process.1

Investment into analytics2

The Deloitte Center for Health Solutions (DCHS) conducted research to see if health systems have increased their investments and use of analytics for clinical, operational, and financial functions. In late 2018, DCHS surveyed 56 chief information officers (CIOs), chief technology officers (CTOs), and chief analytics executives at health systems in order to understand today’s landscape and compare it with findings from the 2015 survey on the same topic.

When it comes to analytics, health systems in 2018 are more likely to have:

  • Defined strategies and visions (70 percent in 2018 vs. 40 percent in 2015);
  • Dedicated departments (88 percent in 2018 vs. 76 percent in 2015); and
  • Centralized governance models (68 percent in 2018 vs. 58 percent in 2015)

C-suite role3

Organizations are now more likely to have a C-suite role dedicated to analytics (30 percent had a chief analytics officer in 2018 vs. 12 percent in 2015).

Organizational strategy4

84 percent of executives say that analytics will be extremely important for their organization’s strategies in three years, compared to 36 percent who say analytics are extremely important today.

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References

1 Alison Hagan, Casey Graves, Dan Kinsella, and Wendy Gerhardt, Shifting into high gear: Health systems have a growing strategic focus on analytics today for the future, Deloitte Insights. 2019. https://www2.deloitte.com/content/dam/insights/us/articles/4897_Health-system-analytics-revisited/DI_Health-system-analytics.pdf, accessed April 14, 2019.
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