Merger and acquisition activity across healthcare and life sciences is expected to remain resilient in 2026, despite valuation pressures and market uncertainty, according to the 2026 KPMG Healthcare and Life Sciences
Kristin Ciriello Pothier, KPMG’s Americas life sciences sector leader, said the race for innovation is keeping the M&A market dynamic, driven by advances in artificial intelligence and demand for differentiated science. The survey of 500 executives also found that high valuations, competition for scarce assets, and uncertainty around future performance are shaping transactions, while healthcare leaders remain more cautious on valuation growth than their life sciences peers.
Capital deployment strategies for 2026 balance acquisitions with internal investment aimed at efficiency and scale. Drew Corrigan, U.S. healthcare sector leader at KPMG, said, “The focus for 2026 is on smart, sustainable growth,” highlighting a dual emphasis on operational improvements and platform or bolt-on deals. Subsector expectations point to continued competition in oncology and immunology, rising use of AI and machine learning in medical device targets, and steady investment in healthcare IT, telehealth, and behavioral health. Lower interest rates could provide modest support for deal volumes, while most respondents do not expect tariffs to materially alter M&A plans, reinforcing confidence in a steady transaction environment.