How egg freezing became a hot commodity on Wall Street
Investors circle as more women are willing to pay to postpone motherhood
About two dozen women ate cheese and canapés in a swanky Midtown Manhattan building in December. It could have been mistaken for a networking event if it weren’t for the women’s singular focus – egg freezing.
Formally called “oocyte cryopreservation”, egg freezing has boomed over the last decade. Since 2009, there has been an 11-fold increase in the number of women who choose to “bank” their eggs. During that time, the American Society of Reproductive Medicine officially removed its “experimental” designation.
“It’s a conversation more women need to talk about, just like miscarriages and periods,” said Florence Ng, 35, a real estate broker in New York City who froze her eggs this year. “These are really important and relevant today.”
Now, Wall Street is taking notice of the fertility industry. Analysts see it as one “ripe for a merger and acquisition cycle”, according to one group.
Extend Fertility, one of the organisers of this event, is one example of the new breed of fertility clinic. The business is in part backed by private equity and Dr Joshua Klein, Extend Fertility’s youthful chief medical officer, owns the medical practice. What it is selling is a promise: that capitalism and technology can buy women time.
“I’m confident we’re the busiest egg-freezing clinic in the US,” said Klein. “I definitely think this is something that will grow exponentially.” He added he “could easily see 50,000 women per year”, freezing eggs. So can Wall Street.
“The US fertility clinic market has come of age and is ripe for a merger and acquisition cycle,” wrote Capstone Partners, an investment banking firm, in early 2017. “The wave is already beginning.” It ticked off a raft of private equity and venture capital firms that recently purchased clinics.
“The trend for couples to marry later in life and to delay starting a family in pursuit of professional careers and financial security is also boosting demand for fertility services and accelerating industry growth,” wrote Capstone.
The majority of the women at the event reflected trends Wall Street in- vestors find attractive: 30-ish, working and unmarried. Many were also clients of the venture capital-backed Three Day Rule. The company uses professional matchmakers who pitch themselves as a “personal trainer”, but “for your love life”.
Two dynamics affect a woman’s fertility, and both are transformed with age. They are the quantity and quality of her egg supply. Unlike men, who make new sperm throughout life, women are born with all of their eggs. When a woman is in her 20s, the vast majority of those eggs will be normal, with the 23 chromosomes needed to pair with sperm and make a fetus.
But as women age into their 30s, those dynamics shift. Gradually, she will have fewer eggs as well as a higher proportion of abnormal eggs, with 22 or 24 chromosomes. By the time a woman is in her mid-40s, most fertility doctors believe she will have to seek donor eggs to get pregnant. Egg freezing, once reserved for cancer patients, is increasingly sold as the solution to this problem.
More than 99% of the nation’s fertility clinics now offer the procedure. Women are encouraged to freeze their eggs as young as possible – in their 20s preferably – to ensure the largest number are viable.
But with an accompanying cost of about $11,000, that creates a paradox. Most women in their 20s cannot afford such an expensive elective procedure. Women in their mid-30s, more able to bear the cost, are likely to have fewer viable eggs. And this group of women, 35 and older, represent the vast majority of fertility clinics’ egg-freezing customers. Of the 6,200 who froze eggs in 2016, 4,500 were older than 35, and 2,500 were older than 38.
The American Society of Reproductive Medicine seemed to anticipate this paradox. “Technologies such as oocyte cryopreservation may allow women to have children later in life,” said ASRM in its 2012 guidelines. “In particular, there is concern regarding the success rate of women in late reproductive years, who may be the most interested in this application.”
Even though there is no guarantee of a successful pregnancy, many patients, such as Ng, see egg freezing as an “insurance policy”. “I was working a lot. My hours are long. It’s very stressful and I just didn’t really have time to date at all,” said Ng. “I knew I had wanted the option to have kids one day … Egg freezing allows you to buy more time and focus on your career.”
‘The US fertility clinic market is ripe for a merger and acquisition cycle’
Taking it to the ‘bank’ … an egg-freezing party in Beverly Hills, California Patrick T Fallon