As we reflect on this past year, we wrap up our Top 10 Deals of 2022 blog series.
In the beginning of this series we discuss that, in a year where IPOs were scarce, there was a flurry of M&A activity in the women’s health and sexual wellness vertical. This large acquirer appetite in a tough market is a testament to the recession-resistant nature of this category.
In each blog post, we explore one of the following acquirer profiles that were active in the women’s health and sexual health space in 2022:
- CPG conglomerates (blog here),
- late-stage venture backed start-ups (blog here),
- established healthcare companies (blog here),
- and finally, private equity funds.
In this final blog of the series, we explore the last of the four acquisition trends: private equity funds acquire women’s health and sexual wellness companies in 2022.
Research from Harvard’s GenderSci Lab showed a surge of private equity activity in the women’s health space in recent years. With trillion dollar market sizes, high-profit models, and increasing consumer adoption, it is easy to see why private equity firms (including Carlyle, Ares, PAI Partners, and TA Associates) are jumping on the chance to invest in the space.
Top Deals of 2022
The final 3 deals on the Top 10 Deals of 2022 list are all acquisitions made by private equity funds.
8) Yellow Wood Partners acquires Clio
In March 2022, Yellow Wood Partners created a sexual wellness platform by acquiring Clio, which offers sexual wellness devices.
Founded in 2009, Yellow Wood Partners, an investment firm out of Boston, invests exclusively in the consumer goods industry. Yellow Wood has $1.8B assets under management and has made 34 acquisitions, the majority falling under the health and wellness category.
Clio CEO, Jamie Leventhal, says “over the course of 20 years, Clio bootstrapped its way to becoming a $100 million-plus business that sold more than 10 million sex devices last year” – making it an attractive acquisition target.
Using Yellow Wood’s business scaling expertise, Clio’s products will be accessible to millions of consumers through drug and mass channels, further institutionalizing the sexual wellness category.
9) Carlyle & PAI Partners consortium acquires Theramex for $1.4B
In March 2022, Carlyle and PAI Partners joined forces in the acquisition of Theramex, a leading specialty pharmaceutical platform, dedicated to women’s health. Thermex offers a variety of treatment solutions across contraception, fertility, menopause, and osteoporosis. In a $1.4B transaction, the two investment firms look to scale Theramex internationally and expand its diverse suite of products.
Founded in 1987, Carlyle is a leading investment firm with a private equity sector that manages $164B in assets across 290+ portfolio companies. Carlyle has notable expertise in scaling health-related businesses and has experience supporting women’s health, through its investment in Millicent Pharma. Overall, the firm has invested $15 billion into the Healthcare sector.
PAI Partners originated in 1872 in Paris, France and is one of the oldest private equity firms to date. They manage €26.4B in assets with a focus on healthcare businesses.
Since its founding in 2018, Theramex has experienced double digit revenue and EBITDA growth. Robert Stewart, CEO of Theramex, is confident that with the support of Carlyle and PAI Partners, Theramex will be able to further accelerate its growth and reach a broader demographic of patients.
10) EW Healthcare Partners acquires TherapeuticsMD for $177M
TherapeuticsMD is a Boca Raton-based company, developing health care products for women for family planning, reproductive health, and menopause management.
EW Healthcare Partners was founded in 1985 as a focused healthcare investor, supporting more than 150 businesses spanning pharmaceuticals, medical devices, diagnostics and women’s health. In 2021, EW Healthcare acquired Majorelle, a women’s health pharmaceutical company offering prescription and over-the-counter products for sexual health and urology issues. In June 2022, EW Healthcare expanded their women’s health portfolio by acquiring TherapeuticsMD for $177M.
Future Private Equity Acquisitions
There has also been a major trend over the past few years of PE funds acquiring women’s healthcare practices. See this comprehensive list of transactions from 2013 to 2019 with prominent firms like TA Associates, Ares Private Equity Group, Summit Partners and more. There were 9 major women’s health practice deals in 2021 and 8 major investments in women’s health practice platforms by private equity groups in 2022. We expect to see venture-backed women’s health practices (like Kindbody, Tia, HerMD, Oula, and Origin) to be targets of PE funds in the next few years.
Yellow Wood Partners acquiring Clio shows us that PE funds are able to invest in sexual pleasure device companies. Amboy Street portfolio company, Dame, will be a target for PE funds as it continues to scale though direct-to-consumer channels and be a first in the category to enter mainstream retail such as Sephora, Nordstrom and Bloomingdales.
Private Equity will continue to be a promising exit path for women’s health and sexual health startups.
This concludes the Top Ten Deals of 2022 series where we examined 4 key exit trends in the women’s health and sexual health space and highlighted 10 noteworthy deals across the sector over the past year.
We are excited by the resilience of this industry as it sustained large exits even in a hard market. This further supports the incredible investment opportunity of early stage companies in the women’s health and sexual wellness category.
