No other sector in the U.S. economy offers the combination of value, resilience and consistent growth that the healthcare sector does. The U.S. healthcare industry (one of the largest segments of the U.S. economy) has grown from $1.7 trillion in CY2004 to an estimated $2.4 trillion in CY2008, representing approximately 17% of GDP. Growth is expected to continue at a 7% CAGR to $3.1 trillion by 2012 (and will represent 20% of GDP soon thereafter).

Pressure from the federal government, healthcare organizations, and consumers has initiated a strong movement towards technology integration in healthcare to reduce costs (from administrative and clinical inefficiencies) and medical errors. These inefficiencies can be alleviated through the use of healthcare information technology (HCIT) as a critical tool for managing organizations. As a result, spending on healthcare technology is expected to reach approximately $60 billion by CY2011.

The Stimulus

With the HITECH act and an estimated $21 billion dollars allotted by the government toward HCIT, there is a significant market opportunity for vendors across the HCIT space to benefit as hospitals and physicians upgrade and purchase systems.

Nearly 25% of hospitals earn negative margins; HCIT vendors continue to address this challenge, increasing the breadth and depth of high ROI technology solution offerings.

Arbor Value

Through the completion of a number of healthcare deals (including Lynx Medical Systems, HealthCare.com and Sparta Systems), Arbor has developed strong relationships with both strategic companies and private equity firms specializing in the Healthcare Technology and Services sectors. This in-depth knowledge of both the industry and the players enables Arbor to be current with industry trends and provide valuable advice to growing companies. Arbor understands that in these challenging times, having an advisor can help you navigate the investment landscape and differentiate yourself among other healthcare companies.