Healthcare M&A Interview with Raxit Shah
hosted by Lockton's Annie Heiss
Annie Heiss
I'm here today with the wonderful, Raxit Shah. Raxit is a deal lawyer at Ropes & Gray and focuses his practice on mergers and acquisitions, leveraged buyouts, divestitures, and other strategic transactions.
He advises clients and portfolio companies on general corporate and operational matters, has experience advising PE funds, strategic investors, public companies, and private companies, and is largely focused on transactions in the healthcare and life sciences, tech, manufacturing, industrial, and retail industries. He’s been recognized since 2023 by Best Lawyers as “One to Watch” in corporate governance and compliance, corporate law, and M&A. He’s also actively involved in pro bono work relating to immigration, asylum representations, and criminal record expungement cases, among other things.
Thanks for joining us, Raxit!
Thanks, Annie. Looking forward to today, and thank you for having me.
Raxit Shah
Annie Heiss
Let’s start at the beginning of your career—how did you get into M&A law?
Growing up, I’d watch lawyer movies and always wanted to debate others, but I found myself quickly attracted to and energized by problem-solving in a setting where I was working with my client hand-in-hand on every step of the transaction, and in general, where the parties were trying to get to a mutually satisfactory outcome and get a deal closed, which is how I landed on M&A law.
I enjoy the way economics and business dynamics shift from deal to deal. Even when working with the same client, like a PE fund, each investment presents its own considerations depending on the business and the level of investment. Finding creative solutions to similar issues and having the space to navigate them adds real value to our work.
I also appreciate the opportunity to sharpen my skills alongside strong, creative, and intellectually curious people—our clients included. I’ve learned a tremendous amount not only from them but also from counterparties, target companies, and, of course, my colleagues at Ropes who have helped shape my perspective and career.
Raxit Shah
Annie Heiss
I completely agree. When I moved from being an M&A attorney to working in insurance, it was important to me that I’d still be surrounded by intellectually curious people. Insurance isn’t typically associated with innovation—many see it as rote or unimaginative—but the transaction liability space is a real exception. In this field, we’re continuously shaping and evolving insurance products.
I’ve joked that we operate on the “cutting edge of insurance,” and while it gets a laugh, it’s true. We’re developing solutions for risks that were nearly impossible to quantify—or insure—just twenty years ago. And the goal mirrors what I enjoyed in M&A: creating outcomes that are better for all parties involved. That’s a challenge I find genuinely rewarding.
What led you to focus your practice on healthcare M&A?
I didn't really set out to focus on healthcare M&A deals.
I don't think many people do unless they have a healthcare background. In my first healthcare deal at Ropes, I immediately began to see the unique complexity and opportunity that you just mentioned, and how there really is still quite a broad scale and variety of investors in the space who aren’t just deeply knowledgeable but also care about the missions of these companies and providing better healthcare and access to the general population. In a non-traditional way, this allows me to contribute to delivering better, more accessible, more efficient healthcare. It allows me to have a personally meaningful tie to my work as well.
Raxit Shah
Annie Heiss
And what is it that you’re seeing happen in healthcare M&A right now? Are you seeing any differences in the nature of the target companies in these transactions as opposed to years prior?
“We're seeing the healthcare M&A space really open up to more investors.”
We’re seeing the healthcare M&A space really open up to more investors. On the private equity side especially, a lot of funds that previously didn't invest in healthcare are starting to do so.
Raxit Shah
Annie Heiss
Any theories on why that is?
“Healthcare funds are broadening mandates, diligence advisors have matured, and a 10 to 15 year track record gives investors confidence. With more tech-enabled models and AI delivering clear ROI, the sector feels both innovative and de-risked."
Investor interest is rising for several reasons. First, there’s more dry powder and a broader appetite for deals once overlooked, especially after the post COVID ups and downs.
Second, healthcare targets are far more sale-ready with stronger cyber resilience, clearer compliance and policies, and proactive prep around what buyers scrutinize which lowers execution risk.
Third, technology is widening the door: growth in health IT, medtech, and pharma services lets tech-oriented funds back HCLS assets without heavy direct reimbursement exposure.
Meanwhile, healthcare funds are broadening mandates, diligence advisors have matured, and a 10 to 15 year track record gives investors confidence. With more tech-enabled models and AI delivering clear ROI, the sector feels both innovative and de-risked.
Raxit Shah
Annie Heiss
That’s helpful context because on the RWI side, we see a lot of deals come across our desk, but without conversations like this, it’s hard to know whether the deals we’re seeing are truly representative of the broader healthcare market, or if we’re only seeing the deals where people think R&W insurance is available.
There’s still a common misconception that healthcare coverage is limited on the rep side, which really isn’t the case anymore. What I have noticed, especially over the last two years, is a significant uptick in tech-enabled healthcare platforms; we’re seeing everything from vaccine-management apps to value-based care platforms to software solutions for physician practices.
Curious if you’ve been seeing similar trends in your deals?
We’ve definitely seen more tech-enabled platforms coming through. While PE investors still pursue roll-up strategies, there’s clearly a shift toward enablement platforms and, as you mentioned, value-based care infrastructure—especially in spend management.
There’s also a growing focus on specialty pharma and biopharma services, often through combined businesses that don’t just focus on one aspect, but touch both care delivery and development.
To name a few examples, we’ve seen lots of opportunities with contract development manufacturers, clinical research organizations, and businesses that are providing ancillary services within those ecosystems.
In terms of deal structure, there’s been a noticeable increase in joint ventures and carve-outs, often with a significant rollover component from an existing sponsor to maintain continuity in the business. Sponsor clients are increasingly looking to get creative on types of transactions, including in some cases transactions where they partner on an acquisition with a large strategic in the space. So, while some platforms may seem narrower in focus, their capabilities are expanding, and their exposure and valuations are increasing because they combine multiple services rather than focusing narrowly.
I’m curious if you’ve seen a similar trend, especially compared to the smaller deals that were more common pre-COVID?
Raxit Shah
“Pre-COVID, most PE investment in healthcare was pretty straightforward—individual optometry or dental clinics, light on complexity, basically direct patient care without much else. Now, the deals are much more complicated, and fascinating."
Annie Heiss
Yeah, pre-COVID, most PE investment in healthcare was pretty straightforward—individual optometry or dental clinics, light on complexity, basically direct patient care without much else. Now, the deals are much more complicated, and fascinating.
Just in the past six months, I can think of more than five deals where the targets had a mix of tangible assets like buildings and medical equipment, physician and administrative staff, regulatory risk from the care being provided, and a tech-enabled platform with all the cyber, HIPAA, and PHI considerations. From a reps and warranties insurance perspective, a target like that could look daunting, and even five years ago, carriers likely wouldn’t have touched deals like that.
I’m curious, have you had experience using R&W insurance to shift risk on more complex deals like these, and if so, how has that gone?
"In the healthcare deals I’ve worked on over the past few years, we’ve placed reps and warranties policies on virtually every single one. There really isn’t a deal I can think of where we didn’t."
In the healthcare deals I’ve worked on over the past few years, we’ve placed reps and warranties policies on virtually every single one. There really isn’t a deal I can think of where we didn’t.
To your point, there used to be hesitancy given the scope and complexity of these companies—HIPAA requirements, tech-enabled platforms storing sensitive data, and all the associated governance, not to mention billing, coding and related documentation risks for businesses with a heavy government reimbursement component.
But many of these companies have become very sophisticated internally, with strong cybersecurity policies and staff training, and externally, with robust plans for breaches or phishing attacks. And many of our clients have an established playbook for shoring up compliance practices in a short period of time post-closing as long as they get comfortable that a given business has a healthy culture of compliance and a dedication to ongoing improvement.
Overall, the industry itself has matured, and companies are coming to market at a stage where these risks are manageable, often no different than in a non-healthcare deal. Insurers, too, have evolved. They’re no longer intimidated by the industry as a whole; once they understand the details, they can assess the actual risks and insure these companies in a targeted way rather than avoiding the sector entirely.
Raxit Shah
Annie Heiss
Those risks have become more priceable, essentially, right? They’re able to quantify them.
Yes, exactly, and get ahead of them.
Raxit Shah
“It’s interesting how reps and warranties insurance has evolved over the years. Over time, as more policies have been written and claims data has accumulated, it’s become clear that the risks associated with healthcare M&A aren’t as scary as initially feared by the underwriting market."
Annie Heiss
It’s interesting how reps and warranties insurance has evolved over the years. Over time, as more policies have been written and claims data has accumulated, it’s become clear that the risks associated with healthcare M&A aren’t as scary as initially feared by the underwriting market.
Of course, there are still hot-button issues—HIPAA, cyber risk, billing and coding, government enforcement—but once we could quantify the likelihood of these risks materializing, it became much more predictable and more readily available.
Yes. To your point, underwriting has definitely become more predictable. I think there’s much tighter risk allocation now—it’s more targeted rather than broad.
Because of that, and because everyone in the space is more sophisticated, deals are signing and closing faster, which is obviously important for investors. They don’t want a process to drag on six or twelve months unnecessarily, and insurance certainly shouldn’t be the hold-up.
The market has been able to meet those timelines successfully, which has made reps and warranties insurance a natural, standard tool in healthcare M&A.
Part of why more sponsors and insurers are entering the space is the comfort and predictability insurance provides. Given the success of prior deals and the established relationships with sophisticated insurers and advisors, sponsors are willing to bring that approach into expanding markets. New investors can leverage that history, which provides more certainty for all parties. That confidence drives more demand, which naturally brings more insurers into the market.
Raxit Shah
Annie Heiss
Exactly. It’s great to hear your perspective, because from this side, it’s sometimes hard to tell what comes first—the chicken or the egg.
At this point, though, we have a solid group of carriers in the market who will underwrite almost any healthcare transaction without upfront, deal-specific exclusions, as long as there is sufficient underlying medical malpractice and professional liability insurance in place.
I’m genuinely curious, on most of your deals, are the sellers also providing an indemnity?
No, they're not. The exception would be if there is a material, deal-specific exclusion as a result of due diligence findings where the client isn’t comfortable taking on that risk without protection.
Raxit Shah
Annie Heiss
That's been the case on the ones I've seen, but I was curious if it’s the same for you.
That ties closely to risk assessment—buyers are becoming more comfortable with the risks, and insurers are as well.
Everyone goes in with eyes wide open, understanding the regulatory landscape, including state oversight and, in some sectors, antitrust considerations. There’s now a clearer blueprint for managing those risks.
Cybersecurity and AI governance policies are also much more sophisticated, which adds to that confidence. While there are still walkaway deals, the targets buyers are pursuing tend to be more advanced.
That’s part of why we’re seeing more investment in enablement platforms—less reimbursement risk, clear compliance paths, measurable cost-reduction opportunities, and overall, more sophisticated operations.
Raxit Shah
Annie Heiss
It’s fascinating to see the role reps and warranties insurance is playing in the evolution of healthcare M&A.
Yes. For our clients, RWI really helps provide post-closing certainty. While no one can predict exactly how an investment will perform in five years, RWI covers exposures and risks, allowing them to focus on what matters.
With compressed timelines and competitive deal processes, buyers are under increasing pressure to move quickly and commercially on diligence and to offer sellers more competitive terms.
Having insurance in place lets clients prioritize the key deal points, and RWI carriers help us to focus on what risk really matters.
Raxit Shah
Annie Heiss
Totally. It’s interesting. We recently had an RWI claim on a medtech healthcare deal where we were reminded that you can do all the diligence in the world, but there’s one thing diligence can’t protect against: being lied to by the sellers.
In this case, company management had essentially been keeping two sets of books, making manual upward adjustments to revenue and downward adjustments to expenses. Within a year, it became clear the investment would have to be written down to zero. That’s when clients are really happy they bought the insurance. Our carrier stepped up and paid a full-limit claim—and frankly, they wished they’d bought even more coverage. This illustrates why rep and warranty insurance, which sometimes gets a reputation for being a hassle to place, is so valuable. We see claims on about 20% of our policies.
Raxit, we’ve spoken a lot about what we’re both currently seeing in the industry, but I’d love to know what excites you most about the future of your healthcare M&A practice.
"It’s an exciting time to be in this space, with growth opportunities across insurance, private equity, and the companies themselves. Everyone is becoming more sophisticated, and the ecosystem is expanding in multiple directions, which creates a lot of potential for continued growth."
I’m really excited to see these sophisticated, high-performing healthcare companies continue to come to market. There’s strong appetite from our clients to invest in them, and at the same time, these companies are improving care for everyone.
The development of new technologies and the integration of these platforms in healthcare is exciting to see—and even to experience personally. Take telehealth, for example. It’s now so ubiquitous, but there was a time when it felt out of reach for the average person. Today, it’s at everyone’s fingertips as long as they have a healthcare plan.
The industry is evolving so quickly, and seeing how these platforms make care more accessible, efficient, and better for patient outcomes is genuinely exciting. Direct access to providers—being able to speak to your doctor or send a message and actually get a response without going through layers of bureaucracy—is life changing. Many platforms now also allow patients to manage prescriptions and submit reimbursements all in one place, which streamlines the process and improves outcomes.
From an investment perspective, this is exciting too. Many of these platforms have been waiting on the sidelines to come to market, and now we’re seeing them launch with stronger performance, more sophisticated cybersecurity, clear pricing, tighter compliance, and well-prepared books. It’s an exciting time to be in this space, with growth opportunities across insurance, private equity, and the companies themselves.
Everyone is becoming more sophisticated, and the ecosystem is expanding in multiple directions, which creates a lot of potential for continued growth.
Raxit Shah
Annie Heiss
Definitely. From my perspective, I expect RWI coverage to keep expanding. More carriers are likely to enter the market or expand participation, especially as healthcare deals become more common. That also means we’ll see more claims, particularly around regulatory risk.
I’m curious to see how carriers handle these claims and what new data emerges. It might sound nerdy, but it’s genuinely an exciting time for healthcare M&A.
Thank you so much again for joining us, Raxit. It’s been fascinating talking to you.
Likewise, Annie.
Raxit Shah
[1] Affiliation of Medical Professional Corporations with Consolidated Groups of Corporations: Federal Tax Considerations, Christine Lane, Eric Homsi, and David Steenburg, LexisNexis, LexisNexis
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