Private Equity's Growing Influence in Canadian Fertility Clinics
Deep-pocketed investors are rapidly snapping up Canadian fertility clinics, transforming the landscape of reproductive medicine into a lucrative private enterprise. While publicly funded healthcare remains a cornerstone in Canada, the private in vitro fertilization (IVF) industry is experiencing a staggering surge, driven by high demand and significant profit potential.
The Personal Cost of Fertility Treatments
Nancy Abdalla, a 36-year-old marketing consultant, embarked on a multi-year journey to conceive, facing the harsh reality of declining fertility. After tests revealed a low egg reserve, she spent countless early mornings in a Toronto clinic, describing the environment as akin to an "airport" departure lounge. Her determination led to multiple IVF cycles, failed attempts, and ultimately, a successful pregnancy after spending approximately $100,000. Today, she cherishes her four-year-old son, Hendrix, emphasizing that the financial burden pales in comparison to the joy of parenthood.
No one shows up at a fertility clinic because they want to be there, Abdalla remarked, highlighting the emotional vulnerability of patients. Her story mirrors that of many Canadians, with one in six couples experiencing infertility and nearly 30,000 women undergoing fertility treatments annually.
The Business of Making Babies
The global fertility market was valued at US$34.7 billion in 2023, with projections nearly doubling within a decade, according to The Lancet. In Canada, private equity now owns 22 of the approximately 46 fertility clinics, while 21 remain physician-owned and three are attached to public hospitals, as reported by the Canadian Fertility and Andrology Society (CFAS).
Investors like Andrew Meikle, founder of The Fertility Partners Inc., backed by Peloton Capital Management, and David Thomson through Osmington Inc., are pouring millions into the sector. Private equity firms, such as KKR & Co. Inc., have made multi-billion-dollar acquisitions, including IVIRMA Global SL, which operates clinics in Ontario under the Trio Fertility banner.
An anonymous private-equity insider explained that the appeal lies in the user-pay model, which avoids government policy risks. Consolidation allows for streamlined operations, knowledge sharing, and potential efficiency gains, though it often leads to higher prices for patients. The redeeming and virtuous point of private equity doing this is raising the quality of care across a network, the insider noted.
Transparency and Ethical Concerns
Despite potential benefits, transparency remains a critical issue. Arthur Leader, a professor emeritus at the University of Ottawa, highlighted the lack of public data on clinic success rates. In Ontario, clinics are anonymized in ministry reports, with live birth rates varying dramatically—from as low as 7.9% to over 45% for women under 35.
Add-on treatments, such as pre-implantation genetic testing (PGT-A), costing up to $5,000, are increasingly common but often unnecessary, according to CFAS recommendations. Leader criticized these as gimmicks that inflate costs without improving outcomes.
Kerry Bowman, a bioethicist at the University of Toronto, pointed out that patients' emotional desperation can lead to consent for treatments with low success rates, complicating ethical considerations. People are so emotionally overwrought that making a clear-eyed decision is challenging, he observed.
Innovation and Patient-Centric Approaches
Some entrepreneurs are aiming to disrupt the industry with a focus on patient care. Melody Adhami, co-founder of Pollin Fertility, drew from her own IVF experience to create a clinic emphasizing transparency and technology. Through an app, patients can access results and manage appointments, with a goal to improve success rates through data analysis.
Adhami advocates for mandatory reporting of clinic success rates, similar to U.S. regulations, to empower consumers. Research by Ambar La Forgia of UC Berkeley supports consolidation, showing that clinics acquired by chains increased IVF cycles by 27.2% and success rates by 13.6%.
Independent Clinics and Future Outlook
Not all clinics are embracing private equity. Doctors like Crystal Chan, who purchased the Markham Fertility Centre, prioritize patient care over profits. Chan noted that private-equity-owned clinics often have higher fees, with no clear evidence of improved safety or efficacy.
Sarah Kaplan, professor emerita at the University of Toronto, warned that private equity's profit-driven incentives may not align with the needs of families. However, for patients like Abdalla, the outcome outweighs the financial strain. He is the joy of our lives, she said of her son, reflecting a sentiment shared by many navigating the complex world of fertility treatments.
