Aesthetics Market Improving Gradually

According to Leerink Swann, the mood at the American Academy of Dermatology (AAD) conference was upbeat and there were signs of gradual improvement in the aesthetics market. “This reinforces the conclusion from the 4Q:09 survey (published in late Jan) that procedure volumes are starting to grow, and the physicians we spoke with had an optimistic outlook that matched those data… Despite the economic challenges that depressed aesthetics volumes since 2H08, many dermatologists continue to shift their practices toward these lucrative cash pay procedures and away from therapeutic derm which faces challenges of its own (e.g., managed care pressure). There are still challenges though placing capital equipment because of tight credit. We remain optimistic that aesthetics will continue to recover during 2010,” the analysts say. As a result, Leerink Swann views Allergan (NYSE: AGN) and Syneron Medical Ltd (NASDAQ: ELOS) (rated OP) as best positioned to benefit.

Leerink Swann mentions that although Medicis Pharmaceutical Corporation (NYSE: MRX)“created some buzz with its Dysport Challenge, and physicians viewed the promotion as helpful, but not a game changer. On LipoSonix, the analysts say that “it seems to work well in certain patients, but managing the pain is a frequent issue raised that could pose a commercial hurdle for MRX.” Moreover, “there was good buzz on the Zeltiq (private co) system for non-invasive fat reduction that is available in the US, and physicians believe it could be a formidable competitor to LipoSonix as it takes less monitoring and is not painful,” Leerink Swann adds.

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