Allergan boosts beauty focus with $350M SkinMedica bid
Even as Allergan ($AGN) mulls a sale of its Lap-Band anti-obesity device business, the company is moving to beef up its focus on the more glamorous side of aesthetics. The company said it will buy SkinMedica for $350 million up front, with another $25 million more assuming the acquired skin care products reach certain sales milestones.
SkinMedica makes non-prescription and prescription aesthetic skin care products and creams (a makeup line will be spun off after the deal closes). The company will become a separate global business unit within Allergan once the sale is complete.
Allergan's pursuit of SkinMedica makes sense, as the company will be able to add more skin products to the items it already sells, including Botox and aesthetic medical devices such as breast implants. But the acquisition suggests a greater emphasis on the more glamorous side of aesthetics and reinforces speculation about a possible departure from other areas. A few weeks ago, Allergan revealed in its third quarter financials that it was considering a sale of its anti-obesity device business, after facing Lap-Band setbacks including increased safety concerns, complaints, congressional scrutiny and lawsuits.
For the third quarter, Allergan's medical device net sales declined in the 2012 third quarter while sales of other products soared, suggesting that Allergan may very well unload its anti-obesity division in favor of the other aesthetics products it has that are doing far better.
- read the release
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