Interview with the CEO

 "Our main brands have expanded their market share"

 

Jean-Paul Berthomé, Laboratoires Expanscience CEO

 

What were the key events in 2010 on Expanscience’s markets?
"Several of our markets went through a process of reorganization in 2010. A drop in the reimbursement rate from 35% to 15% for certain medications impacted Piasclédine 300 and Prexidine. This measure is associated with the accountability of players in the healthcare field. It is a part of a public deficit reduction strategy which is not specific to France, and has more to do with a financial rationale than with a public health approach. But it affects the entire treatment chain: the doctor, who must make prescription recommendations independent of reimbursement levels, supplemental health insurance, which is the subject of an increasingly heated competitive game, and the patient, who gains awareness of the cost of available treatments."

 

What other important events occurred in 2010?
During the year, consumers around the world were more mindful than ever of the presence of natural ingredients in cosmetic products. This deep-rooted trend creates many opportunities – along with many opportunists. Aware of the specific vulnerabilities of certain target groups, such as infants and pregnant women, Laboratoires Expanscience maintains the clear position it has always taken: combine natural products with quality, effectiveness and safety, which are not always guaranteed by organic labels. In addition, the financial crisis has not spared our distribution channels. A significant number of European pharmacies have experienced cash flow problems. This was followed by strong price pressure and an increased move toward consolidation. Finally, we decided to exit the Nutraceuticals market, which was completely transformed in the economic crisis and with which we no longer identify. "

 

How would you characterise the company’s overall performance in 2010?
"We have several reasons to feel satisfied. First of all, our main brands – Mustela Bébé, Mustela 9 Mois and Piasclédine 300 – have expanded their market share. In addition, our international activity increased by 8% in 2010 and made up 37% of our total sales. Turnover remained stable at 233 million euros. With regard to financial performance, 2010 was a time for optimising our operations and costs, and we ended the year with encouraging results."

 

In your view, what were Expanscience’s main business successes this year?
"In Dermo-Cosmetics, Mustela’s leadership was enhanced by the brand’s shift toward increasingly natural products. In Rheumatology, we successfully launched Flexea, our form of glucosamine. In the Dental Care field, Hyalugel climbed to second place in the oral dressings segment. Lastly, the Cosmetic Active Ingredients marketing business grew significantly, especially in the international market, which accounts for 56% of sales."

 

In celebreting its 60th anniversary, the company has frequently made reference to its commitments. How is this evident?
"These are values that our external partners recognize in us and which federate our employees. These commitments are demonstrated through the founding family’s dedication, over two generations, to the company’s long-term future. They are exemplified in our ability to constantly innovate in our fields of expertise, specifically concerning development and remodelling mechanisms for connective tissue and the cutaneous barrier. One of these commitments is also exemplified by our sustainable development initiatives."

 

What do you expect from Expanscience employees in terms of commitments?
"That they embody these commitments, focusing on the international market to advance our growth and on innovation. That they serve as ambassadors, demonstrating responsibility and solidarity when faced with the adjustments that the company must make."

 

With respect to sustainable development, what were the key areas of progress during 2010?
"We have set specific goals and milestones which enable us to assess the progress achieved by our proactive approach. Progress is already evident in several areas, such as energy consumption, following our 2009 carbon footprint assessment, the sustainable procurement of ingredients, with the establishment of a unit to ensure respect for biodiversity and local populations, and responsible communications through our signing of the Charte de l’Union des Annonceurs. In addition, we now submit our actions to a group of stakeholders in order to seek their opinions."

 

What are the prospects for Expanscience in 2011?
"Our goal is to continue our international expansion, especially in high-potential emerging countries. The marketing offensive will continue in 2011 with several launches of products and ranges, which should consolidate our market share."

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