Oct 6, 2026 · 22 min · 7 segments
In this episode, Evercore’s Sachin Aggarwal and David Ke discuss the current healthcare capital markets environment and the outlook ahead. Sachin Aggarwal – *Senior Managing Director, Everco*re…
So David, just starting at 30,000 feet, there are a lot of competing forces, a lot of competing macro forces in the market today.
And on the other hand, we've seen an M&A environment that we haven't seen in years.
And I would just maybe start by saying, if we take a step back and look at how this year has fared from a capital markets perspective, for healthcare companies, it's actually been a very, very strong year.
Despite all the macro headwinds that we have facing us, whether it's geopolitical headwinds, whether it's increase in interest rates or midterms, the fact that the capital markets environment for IPOs, follow-ons, as well as convertible issuances has been as robust as it has been this year, I don't think, candidly, we would have expected this amount of resiliency at the start of the year.
Part of that, and I would say significant part of that has been the health of the M&A market that you mentioned.
And so the way I think about it is the underlying M&A momentum, as well as positive clinical data that a lot of the life sciences companies have put out, these micro forces have actually superseded what we've seen in terms of some of the macro challenges that I mentioned earlier.
Now, that being said, we are inevitably going to hit some pockets of volatility throughout the course of the year.
I can make the argument that we may be in one right now, but by and large, I do believe that the healthcare capital markets has been incredibly resilient this year.
So despite the fact that we are in a little bit of an air pocket right now, we believe that we're still gonna see a fair amount of issuance activity return in the fourth quarter of this year.
And I am generally optimistic, cautiously optimistic about what the rest of this year, as well as what 2027 will bring for the healthcare capital markets.
And with that, I want to maybe ask a question back to you, which is something unique and interesting this year that we haven't seen historically for many years has been the decoupling of of healthcare and technology.
Usually, healthcare and tech tend to trade in the same direction as each other, just given in general, both of these are some of the highest beta sectors that we've seen in the equity capital markets.
However, this year, I think we can likely all agree that while technology and AI and semiconductors have really moved the market up or down, depending on which way these sectors trade every single day, healthcare has actually been fairly insulated and the correlation has been much lower this year compared to tech than in years past.
So David, just starting at 30,000 feet, there are a lot of competing forces, a lot of competing macro forces in the market today.
And on the other hand, we've seen an M&A environment that we haven't seen in years.
And I would just maybe start by saying, if we take a step back and look at how this year has fared from a capital markets perspective, for healthcare companies, it's actually been a very, very strong year.
Despite all the macro headwinds that we have facing us, whether it's geopolitical headwinds, whether it's increase in interest rates or midterms, the fact that the capital markets environment for IPOs, follow-ons, as well as convertible issuances has been as robust as it has been this year, I don't think, candidly, we would have expected this amount of resiliency at the start of the year.
Part of that, and I would say significant part of that has been the health of the M&A market that you mentioned.
And so the way I think about it is the underlying M&A momentum, as well as positive clinical data that a lot of the life sciences companies have put out, these micro forces have actually superseded what we've seen in terms of some of the macro challenges that I mentioned earlier.
Now, that being said, we are inevitably going to hit some pockets of volatility throughout the course of the year.
I can make the argument that we may be in one right now, but by and large, I do believe that the healthcare capital markets has been incredibly resilient this year.
So despite the fact that we are in a little bit of an air pocket right now, we believe that we're still gonna see a fair amount of issuance activity return in the fourth quarter of this year.
And I am generally optimistic, cautiously optimistic about what the rest of this year, as well as what 2027 will bring for the healthcare capital markets.
And with that, I want to maybe ask a question back to you, which is something unique and interesting this year that we haven't seen historically for many years has been the decoupling of of healthcare and technology.
Usually, healthcare and tech tend to trade in the same direction as each other, just given in general, both of these are some of the highest beta sectors that we've seen in the equity capital markets.
However, this year, I think we can likely all agree that while technology and AI and semiconductors have really moved the market up or down, depending on which way these sectors trade every single day, healthcare has actually been fairly insulated and the correlation has been much lower this year compared to tech than in years past.
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