Biomedical Wrinkle And Fat Removal System Business For Sale

Business description

Strategic Partnership / Licensing Opportunity
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Our client is a development-stage Biomedical company who has developed Next-Generation, Non-Invasive, Quick and Pain-free Ultra-Sound Wrinkle and Fat Removal System for aesthetic and dermatology applications.

This system offers very significant advantages over competition in the nascent, fast-growing market for wrinkle and fat removal. Moreover, the system and device has relatively low regulatory hurdles in the US and even lower in overseas market, allowing it to be marketed relatively quickly. The company will start marketing in international market in 2012. The level of technology and science involved in Company’s systems and products, patent protection, and deep technology and industry knowledge in the field, places a significant barrier to entry for others.

The Product and Technology
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The Company’s system is designed for both, skin tightening (wrinkle reduction) and lipoplasty (fat emulsification). It is based on a flexible and expandable platform. This is one of the primary differentiating features of the the Company’s system. No other currently available products can deliver both treatment modalities from the same platform.

Non-invasive ultrasound system selectively delivers ultrasound energy at the skin for skin tightening or through the skin for fat emulsification, targeting fat cells without bleeding, burning, or damaging surrounding tissues. Emulsified fat is metabolized and eliminated from the body. Most procedures take only 45-50 minutes and are virtually painless.

The Company will sell the Ultrasound Generator, family of ultrasound transducers (that will need periodic replacement), system software, and patient kits.

The Company’s technology will enable noninvasive, low-risk, office-based procedures does not require anesthesia and expanded applications of ultra sound in aesthetic applications. System has potential to be used on all body areas, including face and neck. Portable, cost-effective system will allow easier penetration into physicians’ practices and painless, quick and effective treatments will attract repeat patients to help build physicians’ practices.

Important features and advantages of the Company’s products and technologies are:

• Addresses a large ($4 billion) and the fastest-growing market in medical field
• The wrinkle / fat removal market is not covered by insurances and hence is not constrained by reimbursement limits
• Offers a technologically superior and effective product for both, wrinkle and fat removal
• The company’s technology expands some of the aesthetic markets (e.g. removal of eye pad fat, wrinkle removal, and cellulite removal)
• Low regulatory hurdle and hence can enter the market rapidly (relatively easier 510(k) filing with US FDA for Class II device. Even less hurdle overseas)
• High Barrier for competition due to sophistication and versatility of technology, patent protection, intellectual property, and industry knowledge and experience of the company
• Recurring revenues from disposables and added procedures to the platform system
• 70% gross margins
• Easy, painless, low-risk and quick procedures can be done in doctor’s offices or other medical facilities without anesthesia
• Equipment is compact, affordable, and easy to operate, thereby facilitating its penetration into physicians offices
• Platform technology expandable to more cosmetic (and even therapeutic applications in the future (e.g. varicose vein, cellulite, etc)

Market Need
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Since 2000, there has been a 69% increase in the total number of cosmetic procedures in the United States. Whereas cosmetic surgical procedures decreased by 20%, minimally invasive or non-invasive procedures increased by 99%. According to American Society of Plastic Surgeons, nearly 12.5 million Americans underwent cosmetic procedures in 2009.

In terms of the dollar figures, the global market size for lipoplasty and skin tightening is conservatively estimated in excess of US $1.8 billion. There is also over US $1 billion incremental growth potential for additional clinical applications not possible with existing competitive products such as cellulite reduction, eye pad fat reduction and skin tightening, acne treatment, and varicose vein treatment.

In addition to this roughly $3 billion wrinkle-removal and lipoplasty market, there is a huge untapped market for fat removal. There is no effective, non-invasive procedure currently available for fat removal / body sculpting.

Although liposuction is one of the most commonly performed cosmetic surgery procedures in the world, it is often associated with complications such as risk of infection, bleeding, bruising, healing abnormalities, risk of nerve damage, and even death. Liposuction is an invasive surgery that requires anesthesia, and is an expensive procedure associated with a long recovery, sometimes requiring time away from work and family. Other currently available treatments such as laser, radio frequency (RF), and intense pulsed light (IPL) have been described by physicians as having minimal efficacy with some of the same disadvantages as liposuction.

Considering that in the US, two out of three adults are over-weight, this is a very large untapped market.

Marketing Plan and Forecast
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The Company has spent last four years developing, testing, perfecting and designing their system and probe. It also spent this time in filing for patents (1 US patent issued, many US and global patents pending), and planning and preparing for marketing this product. Company’s products are ready for manufacturing and the Company plans its product launch in South America in 2012, in Europe in 2012/2013, and enter the US market in 2013.

The company should start making profits in 2014 and by its fifth year of product introduction (2017), its sales are expected to exceed $150 million, with plenty of growth left.

The Company and Management
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Previous generation of ultrasonic liposuction products were originally developed and successfully commercialized by the current management team. Highly skilled cross-functional management team has pioneered and launched numerous medical devices to provide world-class healthcare solutions, while consistently delivering profitable returns for investors and shareholders.

The company’s core competencies include next generation non-invasive therapeutic ultrasound technology, intellectual property/patents, global commercialization of electromechanical medical devices, track record of regulatory filings and approvals, manufacturing, and distribution experience.