I read an article called Botox Economy: Why Allergan is the Perfect American Company. For those who do not know, Allergan is a pharmaceutical firm that is based in Irvine California. It is best known for Juvederm, Botox, and breast implants. Allergan’s stock is in the 90s and near a 52-week high which makes the firm worth $26 billion. Allergan reported a $296 million profit in their most recent quarter. While companies around the world are struggling with low and slowing demand, according to the author, “Allergan serves as an example – and a metaphor – for how American firms can thrive in a low-growth economy”. Although half of Allergan’s revenue is from drugs that treat serious medical conditions, it is able to capitalize on the fast growing surgical cosmetic industry. They are able to plug into the social trend, capitalizing on the age conscious American who is concerned about aging (there are more and more of these people every day). They are also tapping into rapidly rising incomes in emerging markets and an increased desire to spend more money on physical maintenance. During the recession, the company’s sales remained steady and now they are increasing rapidly. According to Allergan’s CEO, Botox is the next big thing. The state of the market around the world says that people want to look better. Those who can afford it do and those who can’t save so they can. Allergan creates consumer demand by continuously innovating and finding new uses for existing products. There are also finding new overseas markets.
It is really amazing how fast this social trend is catching on. These are very expensive and painful procedures that people are willing to undergo just to look better. However, Allergen is able to make money and growing even in a down economy. I just hope they can continue to make money while remaining ethical. In my opinion, making money off people’s insecurities does not seen ethical but I might be the only person who thinks so. This article claims that Allergan is the perfect American company. Well, i think not. I think that if people just had a little bit more self confidence and accepted that aging is part of life, then Allergan would not be growing as rapidly as it is now.