APAC healthcare investments diversify as China dealmaking slows

India emerges as a prominent alternative amidst its growing middle class.

Asia Pacific private equity (PE) firms in healthcare are expanding their investments beyond China to other regional markets such as India, Japan, and South Korea, said Bain & Company.

Whilst the region experienced a compound annual growth rate of approximately 21% in deal value since 2016, deal volumes have dropped by 49% since 2023 amidst declining dealmaking in China.

“India, in particular, is emerging as a compelling alternative to China for dealmaking, given its expanding middle class fueling healthcare demand and its strong economic growth,” the report said.

Meanwhile, global healthcare PE rose to an estimated $115b in 2024, driven by a wave of large transactions. This includes five deals exceeding $5b—up from two in 2023 and one in 2022.

The biopharma sector continued to lead in deal value globally, whilst healthcare IT dealmaking rebounded last year.

Despite this global increase, APAC accounted for only 12% of the total deal value, compared to 65% in North America and 22% in Europe.