This study examines the cumulative abnormal returns of mergers and acquisitions in the healthcare industry over the short and long run. The findings indicate that acquirers, on average, experience slightly positive abnormal returns in the three day window surrounding announcement, but this trend is reversed in the long run. In the year following announcement, acquirers experience negative abnormal returns that are statistically significant. This pattern occurs in every sub sector within healthcare. The study also finds that transaction and merger party characteristics possess explanatory merit with regards to acquirer abnormal returns, but the effects of these characteristics and their statistical significance varies by sector.