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How Is Allergan’s US Medical Aesthetics Segment Doing?

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The US medical aesthetics segment

Allergan (AGN) leads in the aesthetics products globally, and its revenues are attributable to the acquisition of Allergan Inc. The US Medical Aesthetics segment includes facial aesthetics, medical dermatology products, and a wide range of silicone gel and saline breast implants for US markets only. Total revenues for US medical aesthetics were $1.5 billion during 2015. The increased contribution isn’t comparable on a year-over-year basis.

On a pro forma basis, revenues for the aesthetics business increased by 5% to $2.7 billion during 2015. This includes the US medical aesthetics segment revenues as well as revenues from aesthetic products under its International brands segment.

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Performance of the US medical aesthetics segment

The performance of each of the franchises for the US medical aesthetics segment in 2015 is as follows:

  • Facial aesthetics reported revenues of $817.8 million during 2015. The total facial rejuvenation portfolio includes Botox, an injectible to reduce glabellar lines temporarily, Juvederm dermal filler gel products, Vivite, Prevage MD, and MD Forte products.
  • Medical dermatology reported revenues of $493.5 million during 2015. This franchise has advanced dermatology products to treat skin diseases and improve skin appearance.
  • Plastic surgery products reported revenues of $202.5 million during 2015. These products include the Natrelle brand of products for breast augmentation, including silicone-filled implants and saline-filled implants, and breast reconstruction products.

To divest the risk, investors can consider the Vanguard Growth ETF (VUG), which holds ~1.4% of its total assets in Allergan. They could also consider the Health Care Select Sector SPDR ETF (XLV), which holds ~4.7% of its total assets in Allergan. XLV also holds 11.6% of its total assets in Johnson & Johnson (JNJ), 5.6% in Merck & Co. (MRK), and 5.0% in Gilead Sciences (GILD).

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