Dermatology remains an attractive segment for private equity investment, FTI Consulting reports.
An aging population (driving medical dermatology use), the presence of an out-of-pocket cosmetic segment (with a 2010–2019 procedural growth rate of 3.5 percent), the use of ancillary services (dermatopathology labs and Medical Spas (“Med Spas”), a diversified revenue mix, increased awareness of skin health, practice fragmentation and a growing shortage of dermatologists contribute to its attractiveness. Total investment peaked in 2018; subsequent acquisitions were mostly add-ons reflective of a “buy and build” strategy.
The U.S. population is rapidly aging, with a projected increase of the >70 population from 38 million in 2020 to 53 million in 2030. Concurrent with the aging senior population is an increase in precancerous (Actinic Keratosis) and cancerous (Basal Cell, Squamous Cell) lesions.
Aging is also associated with wrinkles, age spots, excessive cellulite and fatty tissue deposits and other conditions amenable to remediation. Cosmetic procedures are concentrated in the 40–69 age cohort, accounting for 74.9 percent of the total, whereas 30–39-year-olds account for another 15.7 percent. The population of the 40–69-year-old cohort is projected to increase at a CAGR of 0.4 percent through 2030, as compared to that of the >70 population at 3.4 percent. Read more.
