1) Sustainable growth catalysts in medical aesthetics in Asia Pacific (APAC)

Medical aesthetics is evolving towards a new paradigm, with enhanced loyalty to physicians and ultimately creating annuity businesses. This enables the showcase of product developments and a deepening of the customer link, via upgrades, services and financing.

Premiumization and the democratization of luxury are key factors in the success of dermocosmeceuticals resonating with the psyche of the APAC consumer, who aspires to emulate and surpass the western consumer.

“e-beauty” is gaining ground, enabling direct access to patients and the enhancement of their engagement with a stronger product experience. The avant-gardism of Millennials’ and high level of connectivity of the Asian consumer empowers patients. There are 500 million daily active users on We Chat, Tencent, Taobao and Weibo, and social networks dedicated to medical aesthetics treatments, including SoYoung and Gengmei, have been released in recent years. This has paved the way for the use of new protocols, with DJs and influencers acting as “ambassadors of beauty”. This digital connectivity favors “self-actualization” and a novel form of self-expression, transcending inherited taboos and prejudices on beauty.

APAC consumption is also driven by the rediscovery of natural, herbal and organic beauty, normalizing the use of many anti-oxidants. With demographics ageing, these trends will become parts of wellbeing, preventative and lifestyle health. And due to serious environmental problems in inner cities, many leading players are launching personalized products to improve skin immunity and combat air pollution.

APAC consumers are attracted to the tech trailblazers that are breaking barriers with disruptive technologies and enabling more effective treatments with less downtime, side-effects and pain and hedging against counterfeits. This trend is fueled by:

- The growing importance of body reshaping - the Latin American body contouring fever is conquering APAC. This demands procedures such lasers, radio frequency, ultrasound and high intensity focused ultrasound, IPL-LED, cryotherapy and cryolipolysis, and shockwave therapy.

- Miniaturization of equipment and home-care empowerment-driven trends, such as new combined microneedling solutions and LEDs, high-precision pistols with shot count for accuracy and repeatability, mesoinjectors and pens.

- EBD assisted drug delivery and cosmeceutical delivery systems, such as laser-assisted drug delivery systems to help pass outer layer skins, NANOcosmeceuticals to drive the ingredient to its point of action and liposomal drug delivery technologies.

2) Customization reaches a turning point: “The Home-Care Devices”

The availability of medical aesthetics solutions at a patient’s fingertips through a smart phone matches the Millennials’ hedonistic trend towards instant beauty. The Internet of Things and virtual reality further frees the patient from technological constraints and enable them to develop treatments in the comfort of their own home. Examples include Nuskin’s Age-Loc, S-Skin from Samsung Health, Smart Brush from Kerastase and L’Oréal’s La Roche-Posay My UV Patch.

Home care devices, or “beauty toys”, provide patients with the opportunity to treat themselves to skin rejuvenation, and fosters the trend towards cocooning, personalization and “instant gratification”. It is powered by the underlying trend of disintermediating the access to the customer.

3) This leads to impressive merger and acquisition value-creation in medical aesthetics, dermo-cosmeceuticals, EBD, breast and body-reshaping implants

Consolidation trends favor the creation of value with Asia-Pacific targets and acquirers, as reflected in three of the last four major transactions:

- AGIC Capital-Fotona

- Bain Capital’s acquisition of a 45.32% stake in the Korean Toxin Manufacturer Hugel for $816m USD ($1,714m for 100% and an implied enterprise value to sales multiple of 16.6X and enterprise value to EBITDA multiple of 30.3X)

- Bloomage’s acquisition of Revitacare SA for a total value including milestones and earn-outs of 19m euros.

Going forward, an increasing number of both domestic and cross-border merger an acquisition transactions will drive the sector.