Equity fund managers step up healthcare investment

Healthcare is expected to take a bigger bite from the equity fund apple, according to a new survey by Pepperdine University's Graziadio School of Business and Management. A poll of 327 private equity executives concluded that 11 percent plan to invest in the healthcare industry. Although that number sounds relatively modest, only 4.8 percent of those managers said during the summer they would invest in healthcare.

Those figures do not include investments in the biotech, pharmaceutical and medical device sectors. Adding those in boosts the number of venture capital execs planning to invest in healthcare or related fields to more than 25 percent.

"The upswing of private investment in the healthcare industry is likely due in part to the federal healthcare reform legislation that was passed earlier this year," said John Paglia, lead researcher of the Private Capital Markets Project and associate professor of finance at Pepperdine. "The increased attention can also be attributed to a longer term demographic shift to an increasingly older population."

In addition to the increased attention toward healthcare, 70 percent of the managers said the demand for business investment is up from six months ago, as is the appetite for risk.

For more:
- read the survey results
- read the Wall Street Journal blog entry