Aesthetics to Overcome Economic Downturn
Q: Merz Pharma enjoyed 13.2 percent revenue growth in Latin America in 2015-2016. How important is Mexico to Merz’s regional strategy?
A: Mexico is Merz’s most important market in Latin America and the fourth most important worldwide. Latin America is a young region for us: our Argentinian subsidiary was opened in 2016 and our Colombian and Brazilian units just before that. Merz’s financial year runs from July to June, so the 13.2 percent growth is for the second half of 2015 and the first half of 2016. Our aesthetics division saw the most growth in this period. Globally, the company is focusing on the aesthetics and neurotoxins markets. The rest of our portfolio consists of what we call regional products.
Q: What is Merz Pharma’s strategy to expand its portfolio?
A: Merz Pharma invests part of its profit annually in R&D, mostly in aesthetic medicine but also in research on neurotoxins, an important element in the study of the nervous system. Merz is working to find new applications for this compound. The company is also expanding its portfolio through strategic acquisitions such as Ulthera, a medical devices company that develops applications for a therapeutic ultrasound platform technology, and Anteis, a manufacturer of biomedical products. In 2016, we closed the purchase of ON Light Sciences, a US company.
Q: What solutions does Merz Pharma offer in the area of personalized medicine?
A: Our personalized solutions involve neurotoxins and have specific medical uses, with applications in spasticity, dystonia and blepharospasm. We have also published the results of an important clinical study called Tower. These results show that Xeomeen, our toxin, can provide personalized options for patients, allowing doctors to adapt treatments to each specific patient, including higher doses and different intervals. The toxin is available on the National Formulary and through the private market.
Q: Which aesthetics products will be introduced to Mexico?
A: We have an extensive global line and we are analyzing options to see which can be adapted to the needs of the Mexican market. We acquired a patch in 2016 that helps remove tattoos quickly and with fewer inconveniences for patients and doctors. The process for removing a tattoo is long, painful and requires many sessions but this patch reduces the time, pain and number of sessions. This is one of the areas we are entering.
Q: What possibilities are there for Mexican and Latin American companies to benefit from the Merz Corporate Venture Capital Initiative?
A: We are incentivized to look for new opportunities for development, not only globally but also locally. We are working with a local company that may become an opportunity for Mexico and, if it works, we will later make it a global opportunity. Our company invests through the venture capital fund and through other channels as the Merz family has different businesses.
Q: What is Merz’s strategy for growth in Mexico?
A: We believe we still have great organic growth potential. The aesthetics market in Mexico is just starting to develop. The country’s economic situation has slowed the aesthetic market down a little, but we believe that growth will resume. We are interested in growing through new products and offering new options to patients. This represents a great opportunity as we have several product lines in aesthetics in the US and in Europe that are not yet available in Mexico and that would be attractive to the Mexican consumer.
Q: What are Merz Mexico’s plans for 2017?
A: The deceleration of the Mexican economy has created a greater challenge to continue growing at the same rate. During 2017 we want to continue bringing new options to doctors and patients and to see growth in the markets in which we already participate.