EQT's Strategic Exit from Galderma and Its Implications for Private Equity Returns in the Healthcare Sector

In the annals of private equity, few exits have captured the attention of investors and analysts as profoundly as EQT's divestment from Galderma. The firm's CHF 555 million gain from the 2025 secondary offering of its stake in the Swiss dermatology giant is not merely a testament to EQT's operational acumen but a barometer of broader trends reshaping healthcare equity markets. This case study offers critical insights into how private equity firms are recalibrating their strategies in an era of heightened liquidity demands, regulatory scrutiny, and sector-specific dynamics.

The Anatomy of a Strategic Exit

EQT's investment in Galderma began in 2019, when the firm led a CHF 10.2 billion carve-out of Nestlé's dermatology division. Over the subsequent five to seven years, EQT and its co-investors—including Abu Dhabi Investment Authority and PSP Investments—transformed Galderma into a pure-play dermatology leader. The firm's exit in 2025, executed through a secondary offering of 15 million shares, netted CHF 354 million for EQT and marked a pivotal step in its “exits, exits, exits” strategy.

This move was not arbitrary. The secondary offering increased Galderma's free float by 7%, enhancing liquidity for shareholders and signaling institutional confidence in the company's prospects. Simultaneously, Galderma's share buyback program—financed from existing liquidity—further underscored management's commitment to shareholder value. Together, these transactions reflect a sophisticated understanding of capital structure optimization, a hallmark of modern private equity strategy.

Private Equity ROI in the Healthcare Sector: A Benchmark Analysis

To assess EQT's return within industry norms, it is instructive to examine private equity ROI benchmarks in healthcare. While exact figures for the dermatology sector remain opaque, broader trends suggest that successful exits typically hinge on three pillars: operational efficiency, market consolidation, and strategic diversification.

1. Operational Efficiency: Private equity-backed healthcare firms often achieve ROI through cost optimization and revenue growth. In Galderma's case, EQT's investments in R&D (from USD 150 million in 2018 to USD 300 million in 2023) and commercial platform expansion drove core EBITDA to nearly double during its ownership period. Such operational improvements are critical in sectors like dermatology, where innovation cycles are long and capital-intensive.

2. Market Consolidation: The dermatology sector has seen aggressive consolidation by private equity-backed platforms. Firms like Forefront Dermatology and Schweiger Dermatology have executed “second bites of the apple” by selling scaled platforms to other investors. EQT's exit from Galderma aligns with this trend, leveraging secondary offerings to monetize gains while retaining partial upside through remaining stakes.

3. Strategic Diversification: Galderma's foray into aesthetics and biologics—two high-growth segments—exemplifies how private equity firms diversify revenue streams. By 2025, Galderma's pipeline included two biologic candidates in the registration phase, a strategic pivot that enhanced its valuation and appeal to institutional buyers.

Macroeconomic and Sector-Specific Tailwinds

EQT's exit must also be contextualized within macroeconomic and sector-specific dynamics. The healthcare sector, particularly dermatology, benefits from enduring demand drivers: an aging population, rising awareness of skin health, and the proliferation of elective procedures. These factors have insulated the sector from broader market volatility, enabling private equity firms to achieve above-market returns.

Moreover, the post-pandemic environment has accelerated digital transformation and regulatory shifts, creating fertile ground for value creation. For instance, Galderma's integration of AI-driven diagnostics and telemedicine platforms during EQT's tenure enhanced its operational agility, a critical differentiator in a competitive landscape.

Implications for Investor Confidence

EQT's CHF 555 million gain underscores the resilience of private equity in healthcare, even amid rising interest rates and economic uncertainty. The secondary offering's success—despite a cautious macroeconomic backdrop—demonstrates investor appetite for high-conviction, sector-specific bets. This is particularly relevant for healthcare, where private equity's ability to unlock value through operational expertise often outpaces public market volatility.

For institutional investors, the case of Galderma highlights the importance of timing and strategic alignment. EQT's decision to exit via a secondary offering, rather than a traditional IPO or acquisition, reflects a nuanced understanding of market conditions. By reducing ownership concentration and enhancing liquidity, the firm maximized its return while mitigating downside risks—a strategy increasingly adopted by savvy private equity players.

Conclusion: A Blueprint for Future Exits

EQT's exit from Galderma serves as a blueprint for private equity in the healthcare sector. It illustrates how firms can leverage secondary offerings, operational rigor, and sector-specific trends to achieve robust returns. For investors, the lesson is clear: in an era of heightened liquidity demands, the ability to execute strategic exits with precision will be as critical as the initial investment thesis.

As healthcare markets evolve, private equity's role as a catalyst for innovation and efficiency will remain pivotal. EQT's CHF 555 million gain is not an outlier but a harbinger of a broader shift—one where agility, foresight, and sector-specific expertise define the path to value creation.