Medical Spas Take A Big Risk Selling Weight Loss Drugs

The Risks Outweigh Potential Rewards

Tampa – WEBWIRE – Wednesday, March 13, 2024

John LaRosa, Senior Analyst

Now is not the time to get greedy and jump on the GLP-1 bandwagon."

March 13, 2023: Marketdata LLC, a leading market research publisher of “off-the-shelf” studies about service industries since 1979, has released a 133-page report entitled: The U.S. Medical Spas Industry . This is a market study about a booming healthcare market that has become more mainstream. The study examines the operations of “medical spas” and whether they are making wise decisions getting into weight loss.

There are now an estimated 8,800 “med spas” operating in the United States. Medical spas only emerged in 1996 and have exploded in number since 2010. As non-invasive cosmetic procedures have become more popular and prices fell, med spas have flourished.

Marketdata estimates that revenues of the industry reached $17.5 billion in 2022. Average revenues per facility are $1.9 million, and some gross as much as $5-8 million. Net profit margins run about 20% of sales. Industry revenues are forecast to grow 9.8% per year to 2027 as more med spas open.

The Covid-19 pandemic actually boosted this business, as consumers in Zoom meetings viewed their facial faults and decided to do something about it. Business boomed in 2021. Fully 17% of the total med spas were ones started in 2021.

Med spas typically do Botox injections, dermal fillers, laser hair removal, chemical peels, microdermabrasion, and skin rejuvenation. Lately, however, many med spas have started selling the popular GLP-1 weight loss drugs and even compounded Semaglutide versions that are NOT FDA-approved. They’ve also offered IV injection therapy that has caused major problems in some cases.

A strong case can be made for med spas NOT getting into the weight loss business.

1. The industry is growing strongly without weight loss services. The added revenues from selling diet drugs are probably not that significant.

2. Med spa staff and MDs do not have the background to provide the support that dieters need – in nutrition, exercise, patient motivation and psychology. In addition, the average aesthetician that gives you Botox injections does not know how to handle drug side effects and other medical issues.

3. Risk of lawsuits: Novo Nordisk has pursued litigation against both med spas and compounding pharmacies, and will continue to do so. Many med spas may be selling less costly but inferior compounded Semaglutide, to attract customers.

4. Risk of long-term damage to the spa’s reputation. Patients will remember if they had a bad experience with diet drugs that a med spa sold them, and they will not return.

“It’s understandable that a med spa would want to be a one-stop shop and offer a full array of services to their clients, but I think it’s time to stay in their lane and stick to their specialty. Now is not the time to get greedy and jump on the GLP-1 bandwagon. It can hurt them.”, according to Marketdata’s Research Director, John LaRosa.

According to an article by Moneywise, talking about IV injections that went wrong, Alex Thiersch, the head of AMSPA (the med spa’s main association) said that: “There are states that simply don’t have the resources or the time to be looking at the medical spas and ensuring that they’re doing things correctly.” While he says many of these spas are compliant with state laws, there are some that allow unauthorized procedures and employ unlicensed workers. “There is a bit of an underbelly to this industry, where you’ve got folks who should not be doing the treatment that they’re doing.”

The FDA has issued warnings about the dangers of receiving unapproved fat-dissolving injections, like Aqualyx, Lipodissolve and Kabelline. The administration says it has received reports of brutal side effects, such as permanent scarring, severe infections and skin deformities, cysts and “deep, painful knots,” as well as reports of med spa personnel who weren’t licensed to administer these injections in the first place.

It’s just a matter of time for complications to arise related to compounded weight loss drugs with inferior ingredients resulting in bad patient experiences.

ABOUT THE REPORT

The U.S. Medical Spas Industry , published in November 2023, is an independently researched “off-the-shelf” study. The study is 133 pages in length, has 45 tables, and costs $1,295. This study examines the med spas market structure and history, revenues/growth, key market trends and issues, effects of the pandemic, consumer demand factors and demographics, and extensive med spa operating ratios. Covers national revenues (2002-2022 estimates, 2023 and 2027 forecasts). A 20 pp. Executive Overview is available for $99.

ABOUT MARKETDATA

Marketdata LLC, is a 45-year old independent market research and consulting firm that publishes market and industry studies covering a wide range of service and healthcare markets. The firm has a specialty tracking the weight loss market. John LaRosa is available for interviews (813-971-8080). A report table of contents is available by email or at the website: www.marketdataenterprises.com