P&G In Deal To Market Items Like Anti-Cellulite Device

Packaged goods company Procter & Gamble has inked a 10-year deal to market high-tech beauty care items under one of its brand names with an Israel-based medical products company.

The profit sharing deal was announced yesterday with new partner Syneron Medical. P&G was not able to comment on the partnership or what it hopes will evolve from it, although Wall Street analyst Amit Hazan of CIBC World Markets said a product launch is expected in the second quarter of 2008.

From the looks of it, the end result will seemingly be one or more high-tech, high-priced, hand-held devices for everything from facial wrinkles and age spots to cellulite, with removable/replaceable heads and a price tag possibly in the $400-500 range.

Syneron's business is manufacturing and distributing medical aesthetic devices that use radio frequency and light. While development is slated to be done by Syneron, LeRoy said that in actuality, the two companies will be in development together. "It's not like Syneron is going to present us with something we may not like [as some have suggested]," said LeRoy.

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The plan calls for P&G to run extensive market research and consumer testing on the main prototype device to be developed.

P&G wouldn't comment on branding or what type of rollout is planned, but it's plausible the end result could be an item marketed first to dermatologists and other doctors to use on patients, and then eventually sold directly to consumers for home use, said ex-P&Ger and industry consultant Gary Stibel, managing partner of New England Consulting, Westport, Conn.

P&G's expertise is marketing directly to consumers, but in this case, since U.S. Food & Drug Administration approval would probably be required, the easier and faster way to go to market would be through doctors first, Stibel said, while seeking approval for home use at the same time.

Unlike Oppenheimer analyst Linda Bolton Weiser, who estimated a selling price of $500 or less, Stibel speculated that pricing could reach four digits. "This could be the biggest move Procter has made since it bought Spinbrush...or launched Crest," said Stibel. "Think about it, there's no amount of money a woman wouldn't pay to get rid of cellulite," he said.

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