The war for your teeth

State of play: Invisalign owner Align Technology and SmileDirectClub — as well as a slew of smaller companies — are increasingly sidelining orthodontists and taking market share away from wire-and-bracket braces.

• These companies sell clear-plastic aligners, which can progressively straighten y0ur teeth but, unlike braces, can be removed for eating, drinking, photo-taking and, well, romantic encounters.
• But the orthodontics lobby — led by the American Association of Orthodontists — has engaged in a long-running fight with SmileDirectClub over its direct-to-consumer strategy, which allows users to straighten their teeth without ever visiting the office of a medical professional.

The big picture: The pandemic triggered a boom in sales of teeth aligners. Invisalign and SmileDirectClub's sales soared as customers figured it was a good time to fix their crooked teeth, a medical condition known as malocclusion.

• “You’re sitting at home, you’re on Zoom all day, you have some extra coin in your pocket and a lot of people decided to do that,” Jefferies analyst Brandon Couillard, who tracks the teeth alignment industry, tells Axios.
• But sales have trailed off over the past year, bruising manufacturers' stock prices. SmileDirectClub in particularly rough financial shape after years of expensive legal battles and aggressive marketing. The company “could run out of cash” in 12 to 18 months, Couillard estimated.

Threat level: Hoping to carve out additional runway for growth, SmileDirectClub has attacked state dental boards that it views as protecting the orthodontics industry.

• The company in March won a ruling from the 9th Circuit Court of Appeals allowing it to sue the members of California’s state dental board, alleging that they violated antitrust law in a conspiracy to block SmileDirectClub's services.

How it works: People looking to straighten their teeth without wire braces have some options.

• Invisalign involves in-person oversight from a dentist or orthodontist. They get a cut of the revenue in exchange for selling and executing the service, which can take anywhere from several months to more than a year to have its desired effect.
• SmileDirectClub largely skips office visits by signing up patients directly. Customers receive an oral impression kit by mail and ship it back to the company, which employs dentists to design teeth-straightening plans and oversee cases remotely, corresponding with patients via photos and online instructions.

• Invisalign costs about $5,000 to $6,000 per case — only about $1,300 of that is the cost of manufacturing the aligners, according to Jefferies — while SmileDirectClub typically costs a few thousand less. And as those two market leaders have taken off, a host of smaller competitors have jumped in as well.

The other side: The American Association of Orthodontics did not respond to requests seeking comment, but the organization has argued that an orthodontist should oversee teeth straightening and that direct-to-consumer treatments should be avoided.

• “Orthodontic treatment involves the movement of biological material, which could lead to potentially irreversible and expensive damage such as tooth and gum loss, changed bites and other issues if not done correctly,” the AAO says on its website.

What we’re watching: Braces still have the upper hand: They're used in about 8 in 10 cases, including most children, Couillard says — which means there's plenty more room for the aligners industry to grow.

• SmileDirectClub is developing an app-based 3D mouth-scanning system that could make the process more enticing for prospective patients, but Couillard thinks Invaslign may be in a stronger position.
• “I think consumers prefer the experience of a professional being involved in the process in person,” he said. “Consumers, to some degree, are skeptical about an entirely virtual orthodontic experience.”