Allergan's Bonti buy part of plan to double medical aesthetics business
- Allergan will acquire California-based Bonti and its two mid-stage clinical programs in medical aesthetics for $195 million, bolstering what's become a multi-billion dollar business franchise for the pharma.
- Bonti is currently testing two botulinum neurotoxin serotype E candidates in Phase 2 studies for both aesthetic and therapeutic uses. What's attracted Allergan is the compound's rapid onset and relatively short treatment duration, attributes it believes will be attractive to customers new to medical aesthetics.
- Best known for Botox — another type of botulinum toxin — Allergan has steadily invested in its medical aesthetics business. On the other side of the ledger, the company recently decided to shed its anti-infective and women's health units to help pay down debt.
Allergan unveiled the deal for Bonti as it held a "Medical Aesthetics Day" to showcase its business to investors. Key to both the deal and its overarching market strategy is a bet on what it sees as growing acceptance of cosmetic treatments, particularly among millennials.
The pharma cited data which showed that three times as many millennials used a facial injectable in 2018 than did five years ago. Overall, only 6% of the 65 million Americans that Allergan estimates would consider such a treatment have actually followed through.
While those numbers are extrapolated from two surveys of roughly 10,000 people, Allergan's clearly convinced in the untapped business opportunity in medical aesthetics.
In order to meet that projected demand, Allergan expects to launch one to two new aesthetic treatments a year through 2025. The acquisition of Bonti gives the pharma two experimental programs aimed at broadening the appeal of injectable treatments.
"With the Medical Aesthetics market vastly expanding, a fast-acting neurotoxin with a 2 to 4-week duration will be an attractive option for consumers, particularly those who are considering a Medical Aesthetics treatment for the first time," said Allergan CEO Brent Saunders in a Sept. 14 statement.
Complementing that clinical push will be an expanded investment in direct-to-consumer marketing. Allergan averaged $55 million in annual DTC spending between 2015 and 2017. From now until 2020, the pharma expects to spend $150 million a year.
This fall, for example, Allergan will launch a new campaign dubbed "bo curious" that aimed at people considering treatment with Botox (onabotulinumtoxinA).
Already, medical aesthetics accounts for about 30% of Allergan's overall sales, totaling $1.15 billion over the three months from April to June. Just over $400 million of that came from cosmetic sales of Botox.
Growing its Juvederm and Kybella brands, along with the fat-zapping "CoolScultping" business it picked up in its $2.5 billion buy of Zeltiq last year, are also a large part of those growth plans.
What's not? Anti-infectives and women's health. In May, the pharma announced plans to sell the two business units after a strategic review aimed at addressing investor concerns about its growth strategy.
Medical aesthetics, along with eye care and drugs for diseases of the central nervous and gastrointestinal systems, will remain the core focus of the company moving forward.
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