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Pharmaceutical Distribution Market Analysis – September 2015

Domestic and international expansion spurs acquisitions as the pharmacy market continues to vie for growth

Over the past three years, revenue multiples in the public markets have remained consistent at a median of 0.5x while EBITDA multiples have increased to a median of 10.5x. Since 2012, mean EBITDA multiples have increased by approximately 62%.

Transaction multiples are in a similar range with median revenue multiples of 0.6x and median EBITDA multiples of 11.4x over the past two years.

Our pharmacy index has largely outperformed the S&P 500 index over the past three years. The recent spike in the number of transactions within the industry has fueled the unprecedented growth. In an effort to gain market share, the top players in the industry continue to acquire smaller companies. The competition between these market leaders has led to the inflation of both public and private multiples.

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