Private Equity Firm Acquires Wichita Dermatology Practice, Signaling Continued Consolidation

WICHITA, KS – Wichita Dermatology & Aesthetics has partnered with Forefront Dermatology, a leading dermatology group backed by private equity firm Partners Group, the companies announced this week. The move exemplifies a broader trend of consolidation within the dermatology industry, as private equity firms increasingly seek to scale regional practices and capitalize on growing demand for dermatological services.

The partnership will provide Wichita Dermatology & Aesthetics with access to Forefront’s centralized support services, including billing, marketing, and technology infrastructure. This will allow Dr. Landon Johnson and his team to focus on patient care, according to a joint statement. However, industry analysts see the acquisition as part of a larger pattern of consolidation driven by rising costs and the need for greater operational efficiency.

“The economics of running a private practice are becoming increasingly challenging,” says an anonymous healthcare consultant specializing in dermatology M&A. “Rising administrative burdens, declining reimbursements, and the costs associated with maintaining cutting-edge technology are pushing smaller practices to consider partnerships with larger groups.”

A National Trend of Consolidation
The dermatology industry has seen a surge in private equity activity over the past several years. Platforms like Forefront Dermatology, Schweiger Dermatology, and PhyNet Dermatology have been aggressively acquiring regional practices, creating large, consolidated networks. This trend is fueled by several factors, including an aging population, increasing rates of skin cancer, and a growing demand for cosmetic procedures.

“Private equity firms see dermatology as a relatively stable and predictable investment,” explains an anonymous finance professional familiar with healthcare M&A. “Demand for dermatological services is generally consistent, and the industry has attractive margins. The fragmented nature of the market also presents opportunities for consolidation and growth.”

Data shows that dermatology M&A volume remains high. Over 85 practice acquisitions were completed in 2023 alone, predominantly by a handful of private equity-backed strategic platforms. This concentration of ownership is raising questions about the potential impact on patient access and healthcare costs.

Forefront Dermatology: Building a National Network

Forefront Dermatology is currently the largest, most diversified dermatology group practice in the United States, operating over 260 clinics across 29 states. Backed by Partners Group, the company has been actively expanding its footprint through acquisitions and organic growth. Partners Group’s investment strategy centers on providing support, technology, and resources to physician partners through industry-leading, clinically driven platforms.

The firm’s overall investment strategy focuses on structurally sound sectors with growth potential, avoiding those with high disruption risks. Healthcare represents a significant portion of Partners Group’s portfolio, indicating a strong commitment to the sector.

“Partners Group is looking for platforms with strong leadership and a clear vision for growth,” says another anonymous investment banker specializing in healthcare. “Forefront Dermatology has a proven track record of success, and they are well-positioned to continue expanding their network.”

Impact on Wichita Dermatology & Aesthetics

The acquisition is expected to provide Wichita Dermatology & Aesthetics with access to a broader range of resources and expertise. Dr. Johnson, who will remain with the practice, stated that the partnership will allow his team to focus on delivering high-quality patient care.

However, some industry observers caution that consolidation can also lead to changes in practice culture and potentially limit physician autonomy. “It’s important for practices to carefully consider the implications of a partnership before making a decision,” says the healthcare consultant. “They need to ensure that their values align with those of the acquiring group.”

Patient feedback regarding Dr. Johnson’s practice is mixed. While many patients praise his clinical expertise and bedside manner, citing positive experiences with skin cancer treatment, others have expressed dissatisfaction with communication and treatment outcomes. One patient review described a dismissive experience, while another detailed concerns over a surgical scar. The long-term impact of the acquisition on patient experience remains to be seen.

The Future of Dermatology

The trend of consolidation in dermatology is likely to continue in the coming years. As private equity firms seek new investment opportunities, and independent practices face increasing financial pressures, more acquisitions are expected. This will likely lead to the creation of even larger, more consolidated dermatology networks.

“The dermatology landscape is changing rapidly,” says the finance professional. “We are seeing a shift from independent practices to larger, more integrated networks. This will have a significant impact on how dermatological care is delivered in the future.”

Industry analysts suggest that practices considering a partnership should prioritize maintaining clinical quality, preserving physician autonomy, and ensuring a seamless transition for patients. The ultimate goal should be to create a sustainable and patient-centered model of care that benefits both providers and patients.

The acquisition of Wichita Dermatology & Aesthetics serves as a microcosm of a broader trend reshaping the healthcare industry, signaling a future where scale and consolidation may increasingly define the landscape of dermatological care.