After seeing depressed levels of growth in dentistry throughout 2024, U.S. Oral Surgery Management is gearing up for increased industry activity and expansion in 2025.
USOSM's COO, Alisa Ulrey, and CFO, Henry Moomaw, recently connected with Becker's to share the company's goals and expectations for the new year.
Typically, growth for DSOs and dental organizations comes through inorganic and organic growth. USOSM is looking to expand in both areas in 2025, inorganically through acquisitions, and organically through optimizing operations for its current network.
"A goal for us this year is really around growth, and that's really twofold for us. It's both in the realm of organic growth and in the name of mergers and acquisition growth," Ms. Ulrey told Becker's. "We're not only focused on expanding our network of partner practices, but we're also managing and leading on how we continue to have existing practices thrive and grow organically. So we've been really working on things such as, how do we optimize our operations? How do we improve referral networks? How do we prioritize the strategies to really help our practices grow organically while also delivering that care?"
Private equity has become a big player in the dental space, particularly when it comes to acquisitions. For Mr. Moomaw, private equity has been a positive force and benefit for the industry.
"From our perspective, the private equity model that leads to the consolidation of independent dental and oral surgery practices has really greatly benefited the dental industry as a result of taking those administrative burdens off the shoulders of the dentists and the surgeons, and it's thus enabled them to devote more time to patient care instead of worrying about the other ancillary administrative activities," Mr. Moomaw said.
High interest rates, inflation and higher cost of capital were some barriers to growth and expansion last year for many dental groups. Those factors are becoming less of a concern, leading to the expectation and reality of more activity.
"With the interest rates now declining, with the U.S. elections now over, with some relief from inflation, we're already seeing some better traction this year, with more independent practices pursuing sale opportunities," Mr. Moomaw told Becker's. "The first half of each year is normally slower for us than the back half of the year, but we already have six practices currently lined up to partner with us in the first two months of 2025. By comparison, we partnered with only four practices for the entire first quarter of last year. We expect the 2025 M&A activity for us to be back more to the 2023 level, where it was very depressed last year, but we see a nice, nice bounce back plan for us."