What footprint does Evolus have as a young player in a well-established medical aesthetic market?
In 2002 when BOTOX® Cosmetic first emerged on the market, no one envisioned that this would be the start of an entirely new category of aesthetic medicine. Fast forward 20 years, there are now over 30,000 clinics around the U.S. (twice the number of Starbucks locations) and an aesthetic market worth $15 billion. Rather than buying over-the-counter beauty products, younger consumers prefer to turn to medical solutions that are clinically proven to solve their needs. We call this performance beauty, and this is category Evolus is creating.
Evolus offers a product (Jeuveau®) built around an entirely different platform and focused on the beauty space that is governed by the FDA. Jeuveau is manufactured using a unique manufacturing process (Hi-Pure™ Technology), resulting in a different look and feel for the consumer. Thanks to all these characteristics, Evolus has already captured nearly 10% of the market in the U.S. and has nearly 500,000 consumers in our loyalty program. They benefit from a $40 savings on every treatment through the Evolus Rewards Program, which is a meaningful savings. An average U.S. consumer spends around $300 to $500 per treatment two to three times a year, which is about the same price as a professional hair styling and dyeing.
How did you see the public opinion on Botox change through time and did this shift help you in any way?
Back in the 40s, people in the U.S. were reticent about hair coloring but over the course of two generations; today over 70% of women get their hair dyed. The aesthetic industry is going through a similar renaissance. Fifteen years ago, only celebrities were using injectables and most people kept their interventions secret, but today the injectors are not only seen as medical practitioners but also as artists. In the end, it is about taking a market that only had surgical options 20 years ago, and they’re now being replaced by minimally invasive solutions that deliver great outcomes. The idea of innovation is in the pipeline, and we think there are opportunities both through innovation in the injectable category and through the advancement of science in areas such as gene therapy.
What is the expansion strategy behind Evolus' future, given the heightened global demand? Are you looking to spread your wings?
In the U.S., we have been the fastest growing neurotoxin for two years in a row and we projected that we are going to grow nearly 50% this year, which is over three times the growth of the entire neurotoxin market.
In addition, we invested heavily in getting approval in Europe since it is the second largest market in the world for aesthetic treatments. and next year, we also expect to receive approval in Australia. Last month, we launched in the UK under the Nuceiva brand, and we are seeing a lot of interest.
We plan to expand our portfolio of products in aesthetics and to enable this, we invested significant resources into our digital platform, which includes a smart app through which most of our customers purchase our product and pay their bills in a frictionless manner. Our vision is to make the beauty experience delightful and achievable for our customers and their consumers. We are investing in the younger generation, which according to a McKinsey survey, approximately 30%of younger consumers are interested in getting treatments in the next couple of years, which is more than two times greater than the prior generation. The performance beauty industry is on the rise, and we are targeting the segment driving the boom in this category.
What are the main challenges you have encountered over the past 10 years, including from a regulatory standpoint, and what is the key to mitigating them?
The threshold for efficacy is very high and the bar for safety is higher, which makes the approval process for aesthetic products challenging. Because they are for aesthetic purposes and do not have lifesaving benefits, the regulatory bodies set a high bar on safety, so our product has to offer excellent results. These tight boundaries also create greater barriers for new entrants.
How do you envision the future of the beauty industry and the role it plays in society?
The category of medical aesthetics will converge with the beauty industry. Large consumer beauty companies with over-the-counter products will eventually operate in this space we define as performance beauty. Although we use FDA regulated technologies like the pharmaceutical industry, we try to have a more beauty company inspired type of approach in relation to customers. Next generation aesthetic companies will have to be built around the consumer habits of the younger demographic.
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