How do rising claims drive healthcare investment strategy?
Medical costs in Singapore and the Philippines may rise more than 16% this year.
Global healthcare private equity investment reached $191b last year, the second-busiest year on record by deal count, according to a report by Bain & Co., Inc.
Deal activity included 445 announced buyouts during the year. The value of exits—the sale of healthcare investments—climbed to $156b from $54b in 2024.
More than 150 sponsor-to-sponsor deals, where a private equity firm sells a healthcare company to another, were recorded in 2025, with a combined value exceeding $120b.
Biopharma attracted the biggest share of investment at $80b, followed by provider services at $62b. Medical technology deals hit $33b, whilst healthcare information technology transactions totaled $32b, Bain said.
Many transactions involved multi-site healthcare providers—operators that run several hospitals or clinics under centralised management and financial reporting.
In Southeast Asia, healthcare private equity deals reached about $3.6b in the first half of 2025, with Singapore accounting for about half of the investment.
Exit activity in the region reached 252 deals valued at about $33.4b during the period, with trade sales accounting for 57% of exits by number and 59% by value.
Rising healthcare costs are also shaping the operating environment for providers.
Willis Towers Watson PLC in a report projected medical cost inflation of 16.9% in Singapore and 16.1% in the Philippines in 2026, amongst the highest in Asia.
Cardiovascular disease, gastrointestinal disorders, and cancer remain the main drivers of healthcare claims across the region.
Private equity investment may not directly set medical prices, but it can influence costs by shaping how healthcare providers expand and operate.
Questions to ponder:
- How are rising medical costs shaping private equity deal structures and returns?
- How does private equity ownership influence service quality or pricing?
Read Here
Advertise
Sign Up
EXPERT OPINION
Rising healthcare costs in Asia continue to outpace global levels, with APAC medical inflation expected to reach 14%-15%, compared to around 10% globally. This surge is driven by emerging trends such as higher diagnosis levels and medical consumption rates, a growing chronic disease burden, and increased demand for more advanced, innovative treatments.
Both the global and local medical manufacturers see these trends as indicators of unmet demand and long‑term growth prospects. Asia’s healthcare market is projected to reach around US$5 trillion by 2030, contributing almost 40% of global sector expansion, reinforcing the region’s strategic importance. As a result, capital is increasingly directed toward Asian markets and models that enhance efficiency, reduce system strain, and make healthcare more affordable.
Today, investment momentum is strongest in telehealth, AI‑enabled diagnostics, outpatient and pharmacy‑based care, integrated digital platforms, biotech innovation, and hospital management. These sectors are well‑positioned to deliver scalable, tech‑enabled, and cost‑effective healthcare. Regional hotspots such as India, Singapore, Vietnam, China, Japan, and South Korea are attracting the bulk of activity due to rapid demand growth and infrastructure gaps.
Despite the opportunities, regulatory fragmentation and slower innovation cycles, driven by strict oversight, remain notable challenges. Still, rising healthcare costs ultimately reinforce investor conviction in technology‑driven, scalable care models across Asia’s evolving healthcare landscape.