The aesthetic medical laser market has been under consolidation for the past few years now with large well known entities either merging or acquiring their competition. Following is a short recap of these deals.
Syneron and Candela agreed to merge their companies in late 2009. Syneron the younger of the two companies expected to leverage Candela’s will placed global sales force and product development teams with an eye on long-term growth and leadership for both companies within the aesthetic laser market.
In June of 2013, Cynosure, known for its light based cosmetic and medical laser systems, completed the acquisition of Palomar Medical, one of its main competitors. Cynosure holds 37 patents and delivers 14 different laser systems in 60 countries. Palomar Medical is recognized as a manufacturer of advanced cosmetic lasers and intense pulsed light (IPL) systems. Their laser hair removal and other aesthetic systems are considered industry leading. Both companies have a like commitment to deliver world class innovative light based aesthetic systems. Their combined distribution network equals over 100 countries with 52% of their combined revenue derived in North America. The balance of the market share resides in international markets.
In early 2012, Cutera announced they would acquire the aesthetic arm of US based Iridex. The strategic purchase was meant to further Cutera’s presence in the vascular aesthetic market.
Finally, for several years, Solta Medical has been on a buying spree as well adding Fraxel, Thermage, Aesthera and several other companies to their portfolio as the continue to build their presence in the anti-aging market. Now there are rumors of Solta being acquired by Syneron or possibly merging with Cutera.
In the end, most of these combinations took place in an effort to leverage synergies and combine back office operating expenses that include leveraging of sales and distribution networks. While these companies had gone public and raised significant cash, their biggest challenge is generating recurring revenue as they must spend considerable resources to market their products to medical doctors and medspas. The demand for anti-aging and other cosmetic treatments proved to be recession proof, but it will be interesting to see how things shape up in the coming years as more and more over the counter products are pushed to market versus sales of state-of-art and costly lasers for placement in professional environments. Certainly there hasn’t been a damper on continued innovation in the marketplace.