Selling your oncology practice is one of the most significant financial and professional decisions you will ever make. In today’s dynamic Los Angeles market, strong buyer interest from private equity and healthcare networks presents a unique opportunity. However, capitalizing on this moment requires strategic preparation and a deep understanding of the M&A landscape. This guide provides a clear overview of the market, the process, and the key factors that will define your success.
Market Overview: A Vibrant Landscape for Oncology
The market for oncology practices in Los Angeles is exceptionally active. You are not just seeing local competitors expand. You are seeing a nationwide trend of consolidation playing out right here in Southern California. Large, well-capitalized buyers, including private equity firms and established cancer care networks, are actively seeking to acquire high-performing practices.
This demand is driven by a few key factors:
- A Focus on Value-Based Care: Buyers are looking for practices that are already efficient and deliver personalized, high-quality patient outcomes.
- Integrated Services: Practices with ancillary services, particularly medically integrated dispensing, are highly attractive as they represent multiple streams of revenue.
- Strategic Growth: Los Angeles is a key strategic market, and large players are competing to establish a dominant footprint, which gives sellers significant leverage.
This is not a typical market. It is a seller’s market, but only for those who understand how to position their practice to appeal to these sophisticated buyers.
Key Considerations for a California Oncology Sale
Selling a practice in California involves more than just agreeing on a price. There are specific state and specialty-level details that you must manage correctly. Getting these wrong can delay a sale or create future liabilities.
Here are three critical areas we see owners frequently need to address:
- Patient Record Governance: In California, patient records legally belong to the patient. Your sale agreement must have explicit, HIPAA-compliant terms for how these records will be transferred and how patient confidentiality will be maintained. It is a detail that buyers scrutinize heavily.
- Contractual Due Diligence: You need to review every single contract your practice holds. Your office lease, equipment leases, vendor agreements, and, most importantly, your payor contracts must be examined to see if they can be transferred to a new owner. An “un-assignable” contract can be a major roadblock.
- Real Estate Decisions: If you own the building your practice operates from, you have two assets to sell: the practice and the property. They are valued and sold separately. You need a strategy for both, whether that means selling the real estate to the practice buyer or leasing it to them long-term.
Market Activity: Consolidation is Happening Now
You do not have to look far to see the momentum. The oncology landscape in Los Angeles is actively consolidating. In recent years, we have seen significant transactions that signal a robust and competitive environment.
Large players like The Oncology Institute, City of Hope, and OneOncology partners have all made strategic acquisitions in the LA area, absorbing established practices to expand their networks. We have also seen ION acquire major groups like cCARE and the Los Angeles Cancer Network bring smaller practices into its fold.
This is not a future trend. It is the current reality. These transactions show that buyers are paying premium values for well-run oncology practices. Understanding who these buyers are and what they are looking for is the first step toward exploring your own options.
The Sale Process: From Preparation to Closing
A successful practice sale follows a structured, confidential process designed to protect your interests and maximize your outcome. While every deal is unique, the journey generally follows a clear path. Attempting to navigate this without a map can lead to leaving money on the table or having a deal fall apart during due diligence.
Here is a simplified look at the stages involved:
| Stage of the Sale | What It Involves | How We Help |
|---|---|---|
| 1. Strategic Preparation | We gather your financials and key documents and conduct a professional, private-equity-grade valuation. | We normalize your EBITDA to find hidden value and frame a compelling growth story that attracts buyers. |
| 2. Confidential Marketing | We identify and discreetly approach a targeted list of the most qualified strategic and financial buyers. | We leverage our proprietary buyer database to create a competitive auction, driving up offers and improving terms. |
| 3. Diligence & Closing | We manage the buyer’s deep-dive review of your practice and negotiate the final purchase agreement terms. | We run a professional due diligence process and advise on deal structures that minimize your tax burden. |
What Is Your Practice Really Worth?
Many physicians mistakenly believe their practice’s value is a simple multiple of its annual revenue. Sophisticated buyers do not think that way. They value your practice based on its profitability, specifically its Adjusted EBITDA.
Adjusted EBITDA is your Earnings Before Interest, Taxes, Depreciation, and Amortization. But it is “adjusted” to add back owner-specific expenses a new owner would not have, like a personal car lease or an above-market salary you pay yourself. This number represents the “true” cash flow of the business.
That Adjusted EBITDA figure is then multiplied by a number–the “multiple.” For a specialty like oncology, this multiple can range from 5x to over 10x. The final number depends on factors like:
- The size and scale of your practice.
- Your reliance on a single physician versus an associate-driven model.
- Your existing payor contracts and referral networks.
- Your practice’s growth potential.
Determining this value is both an art and a science. It is the foundation of your entire exit strategy.
After the Sale: Planning Your Next Chapter
The day you close the deal is not the end of the journey. The structure of the sale has long-lasting implications for your finances and your professional life. Thinking about these issues early in the process is critical.
Your Future Role
Do you want to retire immediately, or do you plan to continue practicing for a few more years? Your employment agreement with the new owner will be a key point of negotiation. We help physicians secure roles that protect their clinical autonomy while defining clear responsibilities.
Structuring Your Payout
Many deals include more than just cash at closing. You may be offered an “earnout,” which is additional payment tied to the practice’s future performance, or “rollover equity,” where you retain a minority stake in the new, larger company. This can provide a lucrative “second bite at the apple” when the larger entity sells again in the future.
Protecting Your Legacy
You have spent your career building your practice and serving your community. The right buyer will not only offer a good price but will also be a good cultural fit who will take care of your staff and patients.
Planning for these post-sale realities is just as important as negotiating the price. The right guidance ensures your transition is successful on your terms.
[Your legacy and staff deserve protection during the transition to new ownership. ->]Frequently Asked Questions
What makes the Los Angeles oncology practice market unique for sellers?
The Los Angeles market is characterized by strong buyer interest, particularly from private equity firms and healthcare networks. It is a seller’s market driven by demand for value-based care, integrated services, and strategic growth opportunities, giving sellers significant leverage if their practice is well-positioned.
What state-specific considerations should I be aware of when selling an oncology practice in California?
Key state-specific considerations include patient record governance (patient records legally belong to the patient, and HIPAA-compliant transfer terms are essential), thorough contractual due diligence (office leases, payor contracts, etc. must be reviewed for transferability), and real estate decisions (separately negotiating the sale or lease of practice property if you own the building).
How is the value of my oncology practice determined?
Practice value is based on Adjusted EBITDA, which reflects true profitability by adjusting earnings before interest, taxes, depreciation, and amortization to exclude owner-specific expenses. This figure is then multiplied by a multiple (typically between 5x and 10x) influenced by factors like practice size, staffing model, payor contracts, and growth potential.
What are the main stages in the process of selling an oncology practice in Los Angeles?
The sale process typically includes: 1) Strategic Preparation – gathering financials, valuing the practice, and framing growth stories; 2) Confidential Marketing – targeting qualified buyers through a competitive auction; 3) Diligence and Closing – managing buyer investigations and negotiating final terms, with professional support throughout to maximize outcomes.
What should I consider for my post-sale plans and legacy?
After closing, focus on your future role (retirement or continued practice under new ownership), structuring your payout (cash, earnouts, or rollover equity for future upside), and protecting your legacy by choosing a buyer who aligns culturally and will care for your staff and patients, ensuring a successful transition on your terms.