Want Botox? A wrinkle filler?
A patient receives a Botox injection during an event in Arlington, Virginia.
Valeant, a pharmaceutical company, is trying to look good. It’s made an offer for Allergan, the company that produces Botox. Over the past couple of years, Valeant has bought up other pharma companies including Solta, Obaji and Medicis, makers of skin-smothing-lasers, creams and fillers. Valeant isn't looking to make more by increasing R&D, but you don’t have to wrinkle up your forehead to figure out why it wants to buy the company that produces Botox.
“They are clearly going to have a monopoly in the marketplace," says Dr. Jack Berdy, CEO of SmoothMed, a service that provides botox treatments in Manhattan. Berdy notes Valeant already bought the company that makes Dysport – a Botox competitor.
“I can’t imagine the company Valeant, who would look for economics in a takeover, maintaining both products in the marketplace," he said. "One of them would probably disappear.”
Along with a lot of jobs -- for some people, Valeant's offer is going to create stress (and wrinkles). Seamus Fernandez, an analyst with Leerink Partners, agrees. “That’s a fair conclusion,” he says.
Fernandez says the international market for cosmetic dermatology is worth billions every year. And with the potential for consolidating workforces, Valeant is trying to be efficient.
“Most doctors are pretty busy, they would much prefer to just talk to one person who could go through and update them on what’s new on all the products they use, rather than having to have a bunch of different sales people come in from each company,” says David Krempa, an equity analyst with Morningstar.
Fernandez says, unlike the wrinkles it fixes, the market for cosmetic dermatology is growing – at about 12 percent a year.