Healthcare and life sciences ranked third among industries expected to see the most M&A activity this year, cited by 30% of respondents and trailing only technology and data centers. This modest dip (33% in 2025) suggests that capital is still finding its way into the sector even as dealmakers navigate the same valuation gaps and financing pressure shaping the broader market.

AI’s impact on healthcare M&A is splitting along a clear line: on one side is pharma and life sciences, where buyers are pursuing assets with differentiated data, AI-enabled research and development workflows, and digital infrastructure built to accelerate drug discovery and clinical development. But in healthcare delivery, while AI is creating efficiency in diagnostics, scheduling, and revenue cycle management, bedside care remains a people-led business that technology can support, not replace. That distinction is becoming a core diligence question: does an asset show measurable productivity gains from AI, or is it simply layering software onto an antiquated delivery model?

Private capital continues to build multi-site platforms out of fragmented physician and specialty practice categories. Urology, ophthalmology, behavioral and mental health, and aesthetic and med spa practices remain attractive for the same reasons they were last year: recurring revenue, high-margin procedures, and enough fragmentation left in most markets to support a roll-up strategy. Occupational health and other B2B-oriented service lines are drawing similar interest as buyers look to professionalize operations and expand into employer and payer channels. A growing number of states now require transacting parties to file notice of a transaction and receive clearance before proceeding, a framework that does not close the door on deals but reflects a new focus by some states on healthcare transactions.

The next wave of demand looks increasingly consumer-led. Women’s health, metabolic and weight-management care, prevention, and home-based and post-acute care are emerging as categories where buyers see room for broader access at more sustainable price points. For sellers in these spaces, the operators best positioned to command strong valuations will be the ones that can show standardized operations, clean financials, and a clear path to scale, the same qualities buyers are prioritizing across every sector this year.