BB&T Contributing Writer

NEW ORLEANS — More than 9,000 dermatologists from around the world attended the 69th annual Academy of Dermatology (Schaumberg, Illinois) annual meeting held here to learn that their science is undergoing rapid evolution and significant growth while other medical sectors seem somewhat dormant by comparison. Dermatology, once a medical specialty centered primarily around topical treatments, has utilized its understanding of the skin to deliver advanced research and development in devices, often challenging plastic surgeons in cosmetic procedures. This meeting wasn't for just learning about new products for Americans who need to maintain their appearance in order to compete for jobs. Worldwide, there is an epidemic of adults seeking the fountain of youth. And the dermatologists who treat them might have found it here.

In 2008 and 2009, the previously explosive growth rate in cosmetic product sales fell off due to the lagging American economy, unemployment, consumer confidence and tight credit—all of which directly contribute to this lucrative, self-pay medical sector's business. Interestingly, procedural volumes in the U.S. began to show nominal positive trends despite negative consumer confidence numbers in 4Q10; and now in 1Q11, a more dynamic growth in procedures and consumer interest seems to be back (see Table 1). The number of cosmetic minimally invasive procedures increased 5%, with nearly 11.6 million procedures in 2010.

Table 1

Top five minimally-invasive procedures 2010

• Botulinum toxin type A (5.4 million)

• Soft tissue fillers (1.8 million)

• Chemical peel (1.1 million)

• Laser hair removal (938,000)

• Microdermabrasion (825,000)

Source: American Society of Plastic Surgeons

(Arlington Heights, Illinois)

New lasers, technologies abound

Energy-based devices for cosmetic treatments have been available since the mid-1990's and can utilize radio frequency, ultrasound, intense pulsed light, cryotherapy, or lasers to alter cellular structures. Applications for these devices include skin tightening, skin resurfacing, skin rejuvenation, tattoo removal, removal of vascular and pigmented lesions, acne reduction, hair removal, body contouring, cellulite reduction, and now non-invasive fat removal. Growth in all of these applications is predicted to continue as seen in Table 2.

There are eight key players in the energy-based aesthetic device industry generating more than $800 million or more in annual revenues in 2010 from sales of energy-based devices. The issues with these companies are that there is a low barrier to entry, an ongoing shuffling of players, and continual product enhancements contributing to a constant concern about the company's sustainability and attractiveness to investors.

Most laser companies already offer a variety of both stand-alone one-laser boxes and multi-laser multi-therapy platforms. The average selling price for these capital goods purchases is often in the range of $60,000 to $185,000 depending on the product/system and may be purchased, although about 80% are leased. Most lasers also include disposable components which carry ASPs in the range of $300-$500.

In this fast-growing segment of the aesthetic medicine industry there are a number of players continually developing new enhancements to laser technology, adding different energy-based devices, or offering unique product marketing programs in order to maintain or grow their market share or expand into a new market segment. Technological progress such as fractional therapy and different energy sources have offered physicians tools to improve results, offer new applications, and reduce post-procedure recovery times; causing competitors to always be pushing the envelope in order to survive (see Table 3).

Each condition is best treated by a specific laser wavelength (see Table 4). The current gold standard for maximum results with minimum downtime is fractionation of the laser beam, where microscopic zones of injury are created as opposed to ablating the entire surface. Tiny pinpoints of laser light are delivered to a specific depth in order to treat the exact issue being addressed (tightening, lifting, discoloration, etc). Currently in play is the combination of wavelengths or energy sources to improve effectiveness, which is not listed in the table.

Plastic surgeons beware

While many conditions can be improved using several treatments with non-ablative fractional lasers that achieve similar results with less downtime than the ablative fractional lasers; there are some conditions that have better outcomes with an ablative fractional laser, such as vertical lip lines and upper and lower eyelids. “We can actually achieve blepharoplasty-like results using an ablative fractional laser,“ Roy Geroneums, MD, Clinical Professor of Dermatology, New York University Medical Center (New York) said. Over recent years using the newer technologies, experience has led to a better understanding of the various mechanisms and associated outcomes. “For deep dermal remodeling – intended to provide a longer lasting benefit – the depth of injury is one parameter to look at,“ according to Geronemus. In his presentation “Maximizing Aesthetic and Medical Results with Fractional Lasers“, he delineated which type of lasers performs best for specific conditions (see Table 5).

In a similar discussion of when a non-invasive procedure crosses over into surgical-like results, R. Rox Anderson, MD, professor of dermatology at Harvard Medical School (Boston) showed a 70% improvement in scars following a fractional ablative laser treatment during his presentation “Emerging Fractional Research and Technologies.“ Ablative fractional procedures can approach the results once achieved only by a knife. He explained, “Many things will be fractionated, not just lasers. Ultrasound, cryotherapy, photodynamic therapy are examples of future fractionated therapeutic devices.“ These new technologies will lead to advanced drug/device delivery combinations, targeted cellular therapies, and new ways of delivering surgical and pharmaceutical therapies, he said.

In a course on lasers, Christopher Zachary, MD, chair of the department of dermatology at the University of California, Irvine, said that “Fractionated treatments have dramatically changed the way we treat the skin. And not just for rejuvenation,“ he added. “Dr. Anderson has stated that we can remove 50% of the facial skin and it will be healed in one week with no scarring. This fact has opened the doors into all kinds of research including laser drug delivery, wound healing, etc.“ Zachary concluded by stating that these findings in dermatology have widespread impact on all areas of medicine.

Non-Invasive Fat Reduction

Also during the course on lasers, Matthew Avram, MD, Director of the Massachusetts General Hospital (Boston) Dermatology Laser & Cosmetic Center, spoke on non-invasive fat reduction and body contouring. “Body contouring is one of the hottest new areas of interest,“ he opened. He cautioned the audience, however, saying that this is not the same as liposuction in that it is not intended to remove large amounts of fat. “Liposuction is not only invasive but also provides dramatic results that can be seen immediately. Non-invasive fat reduction is not for people who are overweight or obese. It is for people who may be slightly overweight or even normal weight but who have diet and exercise-resistant areas of fat in select locations, such as love handles or muffin tops,“ Avram said.

“The efficacy is limited, but real“ he said, “but the results do not approach those of liposuction.“ He warned the audience to be careful with patient expectations for outcomes. Investors should also use caution when projecting procedure numbers for non-invasive fat reduction if using liposuction procedure numbers that amounted to 203,000 in 2010 since these are two distinct patient pools. Although still an emerging market with unknown expectations, analysts have pegged non-invasive fat reduction as having a market potential in the hundreds of millions of dollars.

Avram continued his presentation by outlining the new technologies in development for non-invasive fat reduction (see Table 6).

Avram reviewed the clinical studies on each of the non-invasive products with some skepticism, noting “Few of the trials utilized a control,“ and he referred to another study that admonished the use of tape measurements as a tool to compare effectiveness in fat reduction. Avram emphasized the benefit of performing histology, ultrasound, or other objective measurements to compare efficacy, rather than a subjective tape measurement. He felt as though the HIFU technology held promise but there was no data yet. Zeltiq (Pleasanton, California) is the clear leader in this space with more than $25 million in revenues, representing about 50,000 treatments, in 2010 (their launch year). Zeltiq not only used scientific data to demonstrate effectiveness, but also designed a pay-per-click business model that offers the doctor a payback in 6 months averaging only 3 patients per week.

It is important to note that the non-invasive fat reduction devices listed above serve a different patient sector than those lasers designed for cellulite remediation such as Eleme (now owned by Cynosure (Westford, Massachusetts) or Cynosure's SmartLipo laser that is a minimally invasive adjunct for liposuction.

Advances in Hair Removal

With hair removal accounting for by far the largest number of laser procedures performed, it only makes sense for companies to compete aggressively for market share in that arena. Schlomit Halachmi, MD, PhD, Rabin Medical Center (Herzella Pituach, Israel) gave an in-booth presentation on Lumenis' (Yokneam, Israel) hair removal system that, according to her study, provided for a quicker, less painful hair removal procedure. “The first laser used to remove hair was a ruby laser in 1996 at Massachusetts General Hospital (Boston),“ she began. “Now there are about a million laser hair removal procedures performed annually in the U.S. alone; and well over that worldwide. Originally 84% of the patients were women, but now close to 50% are men; most of whom want the hair on their back removed. Since the back entails such a large piece of property, the length of time to perform the procedure, along with the pain become critical factors,“ Halachmi told the audience. Lumenis has added a vacuum to their laser hand piece that, in lay terms, distracts the nerves from feeling all the pain. The chart below depicts the change in time for hair removal procedures that Halachmi experienced in her study (see Table 7).

Privately held Alma lasers (Buffalo Grove, Illinois) claims that their Soprano diode laser is virtually painless for hair removal due to its low fluence and high repetition rate. They also employ two sequentially firing wavelengths, allowing for hair removal for a mix of skin tones. Cynosure (Westford, Massachusetts) promotes their hair removal system with two blended wavelengths, integrated skin cooling, and larger spot size – all designed to make hair removal quicker and less painful.

Home Use Lasers: A New Frontier

Companies are developing and launching laser devices to be used in a MedSpa and in the home with the objective to tap into the large underserved patient pool that would like a treatment more efficacious than a cream, but not as costly as a cosmetic procedure performed in a doctor's office.

Palomar Medical Technologies (Burlington, Massachusetts) introduced the first home version of a wrinkle-reducing laser, Pavlovia, through QVC, the television station that sells consumer products. The FDA cleared the 1410 nm laser designed for consumer use to treat peri-orbital wrinkles in 2009 after reviewing its PMA on a hundred patients. Just this past December, Palomar commercially launched the Palovia on QVC with astounding results. They have sold thousands in the last 6 weeks at a consumer price of $499. It is now also sold on their website www.Palovia.com at the same price.

Solta Medical (Hayward, California) plans to serve the full continuum, from professional use in doctor's offices, to MedSpa versions they were demonstrating at this show, and eventually their home version. Solta drives patients into their customer's offices by heavy promotion to the consumer using strong product branding. Solta doctors can track online the potential patients in their area who are seeking Thermage, a Fraxel, or Isolaz laser. Their MedSpa product, Clear & Brilliant, was on display at the show and represents the company's foray into the professional services market. The product will target both MedSpa's and physician's offices, but can be run by a nurse or technician. The product is still pending FDA clearance but has the CE mark and is expected to launch in Europe at the end of 1Q11-2Q11. Solta has partnered with Philips Medical (Amsterdam, the Netherlands) to market their home-use laser for skin rejuvenation that is still in development.

In 2009, Cynosure entered a funded cooperative agreement with Unilever to develop and commercialize light-based devices targeting the home use personal care market. The initial focus of the program will be to develop products to address skin rejuvenation, treating wrinkles, lines, and skin texture. A commercially available product is not expected until 2013.

Zeno (Houston) markets a home use acne clearing system that is the only FDA cleared over-the-counter IPL device that uses a combination of both heat and light to clear skin of some types of acne.

Industry expects the home use market for laser and light-based cosmetic devices to soar in the next few years.

Table 2

Projected 2012 Aesthetic Laser Growth Markets

• Worldwide market to reach $954.7 million by 2012

• Skin resurfacing procedures to increase 19.3%

• Body sculpting procedures to increase 25%

• Skin rejuvenation procedures to increase 18.9%

• Vascular/pigmented treatments to increase 20%-25%

• Laser hair removal to reach $221.5 million

• Tattoo removal to grow 10% annually

Source: In Media Report, IMS research

Table 3

Key Laser Manufacturers

(In order of estimated market share)

• Syneron (Yokneam, Israel; purchased Candela 2009)

• Cynosure (Westford, MA)

• Lumenis (Yokneam, Israel)

• Palomar (Burlington, MA)

Cutera (Brisbane, California)

• Alma Lasers (Caesarea, Israel)

• Solta (Hayward, CA)

Iridex (Mountain View, CA)

Table 4

Select Laser Applications

Condition to be Treated

Suggested wavelength

Suggested laser

Hair removal

755-1064nm

YAG,IPL, KTP, Diode

Pigmentation

530-1100nm

IPL, KTP, pulsed dye, Diode, YAG

Smoothing, fine lines

1440-1540nm

Non-ablative fractional laser, Erbium

Deep wrinkles, sagging, scars

2790-10,600nm

Ablative fractional CO2, Erbium, YSGG

Acne

1450nm

Diode, IPL

Rosacea, vascular

530nm

IPL, YAG, Diode, Argon, KTP, pulsed dye

Source: BB&T, Industry sources

Table 5

Ablative and Non-Ablative laser Procedures

Ablative

Non-Ablative

Rejuvenation

Rejuvenation

Pore Size

Pore Size

Fine Lines

Fine Lines

Acne scars

Acne scars

Surgical Scars*

Surgical scars

Moderate tightening*

Mild to moderate tightening

Deeper Lines

Actinic keratosis (1927 nm)*

Some Dyschromia

Dyschromia

Diffuse photodamage (1927nm)*

Vertical lip lines*

Other than the face*

Eyelid lifting*

* indicates a clear advantage over the other type laser

Source: R.Geronemus, MD

Table 6

Non-Invasive Energy-Based Fat-Reduction Devices

Energy

Company

FDA cleared

Sold OUS

Transdermal Focused Ultrasound

Medicis Pharmaceutical (Scottsdale, Arizona)

Pending

Yes

High Intensity Focused Ultrasound (HIFU)

Slender Medical (Israel)

No

Yes

High Intensity Focused Ultrasound

Ultrashape Ltd

(San Ramon, CA)

510(k) submitted

Yes

Monopolar RF

Solta/Thermage (Hayward, CA)

Starting clinicals for this application

Yes

Bipolar RF & IPL

Syneron (Irvine, CA)

Yes for cellullite

Yes

Multiple Source

RF energy

EndyMed (Israel)

Submitted; expect soon 2011

Yes

Low level laser

Erchonia

(McKinney, Texas)

Yes

Yes

Cryolipolysis

Zeltiq (Pleasanton, CA)

Yes

Yes

Source: BB&T, Avram,MD

Table 7

Time reduction for hair removal procedures

Procedure

Without vacuum

With vacuum

Bikini line

16 minutes

2-3 minutes

Axilla

25 minutes

2-3 minutes

Legs

1 ½ hours

30 minutes

Back

50 minutes

10-15 minutes

Source: Schlomit Halachmi, MD, Lumenis