Dermatology has been one of the most attractive sectors within the latest trend of healthcare industry consolidation as private equity-backed physician practice management (PPM) companies have driven a high volume of practice acquisitions.

Consolidation in the dermatology sector helps to address the imbalance between provider supply and patient demand while increasing practice efficiency and expanding upon ancillary services. While transaction activity slowed in 2024, driven partially by higher interest rates which reduced private equity activity, we continue to observe elevated levels of investor interest in the space, and recent data suggests dermatology remains highly fragmented with approximately 10 to 15 percent of practices being backed by private equity. 

This report presents our outlook for the dermatology sector, including:

• Industry Overview
• Demographics
• Transaction Activity
• Valuation Multiples
• Dermatology PPM Platforms
• Transaction Structure
• Subspecialties and Ancillary Services
• Compensation Trends
• Reimbursement
• Provider Shortages

Landon Forsythe materially contributed to this report.