Hair removal, leg vein treatment are driving aesthetic laser sales
The American consumer’s appetite for aesthetic procedures has provided a growing source of private-pay revenues for dermatologists, beauty salons, health spas, and any health care provider that has plugged into this economic pipeline over the past 10 years. Although dermatologists and plastic surgeons rule at the top of this food chain, other subspecialties including ophthalmology and gynecology participate in this market as well. While surgical laser procedures proved largely impractical for many physicians in the past, the emergence of technician-delivered laser-based technologies makes adding aesthetic procedures to any medical practice quite feasible. Reduced cost of lasers, improved efficacy, and simple procedures managed by technicians make aesthetic practice development increasingly attractive.
Leg vein treatment and hair removal represent two laser applications which only require physician supervision in most states. Except for New Jersey, licensed practitioners can provide non-surgical laser treatments to patients throughout this country. Physicians in many states have been lobbying their medical licensing organizations to restrict the use of lasers to MDs in an effort to block competition from non-physicians. But economic and practice efficiency factors favor the use of lasers by highly trained technical specialists that perform these procedures exclusively. After all, it makes much more sense for an RN to treat leg veins or conduct lengthy hair removal sessions than to pull the MD away from patient consultations and surgical procedures. Using this model, a medical practice can diversify into aesthetic laser procedures through the addition of carefully selected laser equipment, a marketing program, and training a nurse.
Physicians in the U.S. now have access to a wide array of lasers for vascular and hair removal applications. For vascular lesions and leg veins, the most effective lasers are pulsed-dye, diode, and long-pulse Nd:YAG lasers which have been frequency converted to produce 532-nm output. Choices for hair removal are even broader, including: ruby, alexandrite, diode, and Nd:YAG. Due to an over-capacity condition in the laser industry, prices on aesthetic laser systems have become extremely competitive. For instance, when the first ruby laser was approved by the FDA for hair removal a few years ago, physicians paid close to $150,000 for this system. Currently, ruby lasers and even much newer technologies, sell for less than $70,000. Similar dramatic price decreases can be seen in the leg vein laser market, where the hottest new design (diode laser) is priced at $50,000.
Leading manufacturers supplying products to the aesthetic laser market include ESC Medical Systems (Boston, Massachusetts), with virtually every type of laser and their own unique flash-lamp-based non-laser system for hair and leg veins. With annual sales of more than $200 million, ESC is by far the largest aesthetic laser company in the world. Coherent Medical (Palo Alto, California) is another major competitor. This company produces the UltraPulse carbon-dioxide laser for skin resurfacing, the VersaPulse YAG laser for leg veins, and exclusively markets the Light-Sheer diode-based hair removal system. Candela (Wayland, Massachusetts) and privately-held Cynosure (Chelmsford, Massachusetts) compete directly with similar product lines, including pulsed-dye and alexandrite lasers. Each generates about $40 million in annual revenues. Continuum Biomedical (Dublin, California) produces the popular MedLite YAG laser used for numerous applications, and a high-power erbium laser for resurfacing. Other players include Laserscope (San Jose, California), Aesculap-Meditec (Jena, Germany), and Nidek (Fremont, California).
It turns out that choosing the most effective type of laser and most reliable laser supplier is much more challenging than negotiating the best price. Debates in the medical community rage on over the relative effectiveness of various types of hair removal lasers. Historically, ruby was the first type of laser developed for hair removal. However, pioneers with this technology soon learned that the 694-nm ruby wavelength was preferentially absorbed by melanin in the skin, severely limiting treatment to fair skinned patients with dark hair. At about the same time, a clever scientist working for Thermolase, a defense company in San Diego, California, patented the concept of rubbing carbon-based lotion into the skin, and then applying 1064-nm Nd:YAG energy to destroy hair follicles. In practice, this technique proved time-consuming, unpredictable, and produced many dissatisfied patients. An international chain of luxury Spa Thira salons, which were built at great expense to deliver this hair removal treatment, s ubsequently failed.
Presently, alexandrite lasers are widely considered as the most effective light-based hair removal technology. The 755-nm wavelength achieves depth of penetration to the hair follicle without damage to the overlying epidermis. Destruction of the deep-rooted hair follicles is further enhanced by methods of cooling the skin or stretching the pulse length so that more energy can be delivered to the bulb (root) of the hair follicle. And the addition of sophisticated scanning hand-pieces greatly increases the speed of treatment. Many believe that the ideal alexandrite laser should have a long pulse length (20 msec to 30 msec), cryogen skin cooling handpiece, and large-area scanning delivery system. Unfortunately, this combination of features is not available on any single product at this time.
Diode lasers operating at approximately 800-nm and producing 60 watts of power are the latest wave of hair removal devices to enter the market. Clinical studies substantiating the efficacy of this technology have not been produced yet, but initial users claim that diode systems appear at least as effective as ruby or alexandrite. Researchers believe that diode technology will prove more useful on darker skin types than predecessor lasers. And even with little scientific data to back the product up yet, Coherent Medical reports selling more than 200 of its LightSheer diode laser systems (priced at $150,000) in the first year of commercialization. Several other companies plan to commercialize their own versions of the diode, but at prices that dip below $75,000.
For leg vein treatment, even the best laser systems are only marginally effective on removal of small leg veins. However, physicians can use the laser in conjunction with sclerotherapy, and there is still a consumer preference for laser treatment. The best-selling lasers are 532 nm frequency-converted Nd:YAGs with a long pulse. In addition, companies continue to market numerous types of lasers for leg vein treatment, including: alexandrite, diode, and pulsed dye. Each of these lasers works in a slightly different way to essentially coagulate the blood without damaging surrounding tissue. But the thermal dynamics of blood flowing in vessels and varying vessel depth are just two of the many challenging factors at play in ongoing efforts to develop a highly successful laser treatment method. The properties of 800-nm diode laser technology seem well suited to leg vein treatment. Diomed (Boston, Massachusetts) already has a diode system on the market, and Coherent is expected to commercialize one in the near futu re.
Pricing of leg vein lasers suffers from the same industry conditions of oversupply and predacious competition that affects the hair removal laser market segment. While the most popular pulsed dye and flashlamp-based systems cost users close to $150,000 in 1997, average selling prices in 1999 are at least 30% lower for these technologies. Moreover, several new technologies entering the market for this application carry list prices below $75,000.
In 1999, on a worldwide basis, nearly 4,000 aesthetic lasers will be sold, generating more than $300 million in revenues. Approximately 75% of this sales volume will be accounted for by hair removal and leg vein systems. Continued improvement of this technology should translate into increased clinical efficacy and patient satisfaction — allowing physicians to achieve sustained economic growth via aesthetic laser procedures.
Michael Moretti is a medical laser industry analyst and the editor of Medical Laser Insight newsletter.
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