As 2023 draws to a close, private equity backed urology groups continues to be active in the urology sector, driven by a confluence of factors that promise sustained growth in the coming years. The sector’s resilience and appeal can be attributed to the ongoing demographic shift, characterized by an aging population that increasingly requires urological care. Furthermore, the urology field presents a plethora of ancillary opportunities with economies of scale, including advancements in medical imaging, pathology, radiation therapy, the management of chronic urological conditions, and surgery center development. These factors collectively create a conducive environment for accelerated urology consolidation, with major players in the industry actively seeking opportunities to enhance their scale and geographic footprint.
Across the U.S., there are currently seven private equity backed urology platforms along with Summit Health, that have been actively acquiring urology groups throughout the United States. Looking ahead to 2024, we anticipate the activity to continue with current private equity backed urology platforms consolidating like-minded practice in current and adjacent markets.
We do not foresee any new private equity groups entering the Urology sector but do believe several PE-backed urology groups will achieve a “second bite” within the next 12 to 24 months.
Independent urology groups are poised to benefit from this trend, as the established platforms have developed economies of scale and strengthened their foundations, boasting a track record of success that continues to grow. However, there are instances where private equity backed urology groups underperformed due to lack of alignment with their practice affiliations. As a result, it is imperative to evaluate these groups based on cultural fit and benefits associated with joining a private equity backed urology platform.
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