Establishment Labs: The Costa Rican Company That Took On AbbVie and Johnson & Johnson

When Juan Jose Chacon-Quiros founded Establishment Labs in Costa Rica in 2004, the global breast implant industry had been largely stagnant for more than a decade. The FDA had banned silicone implants in 1992, lifting the moratorium only in 2006. The three companies that dominated the American market had not faced a serious new competitor in years. Chacon-Quiros believed he could build one. He chose to build it in Alajuela.

Twenty two years later, the company is listed on the Nasdaq with a market capitalization of approximately $2.1 billion, its stock up roughly 96% over the past twelve months. It employs 1,004 people, sells in more than 100 countries, and just completed its most significant quarter of revenue growth since its founding. It has also never turned a profit. Both of those facts are true simultaneously, and understanding how requires reading the SEC filings with some care.

What they make

Establishment Labs makes one product that accounts for substantially all of its revenue: the Motiva Implant, a silicone gel filled breast implant manufactured in the Coyol Free Zone in Alajuela.

The differentiation is surface engineering. The SmoothSilk surface was designed to reduce the inflammatory response the body mounts against foreign objects. Less inflammation means lower rates of capsular contracture, the hardening of scar tissue that is the most common serious complication in breast augmentation. A 2021 study in Nature Biomedical Engineering, led by MIT's Robert Langer, concluded that SmoothSilk provokes the least inflammatory response of any commercially available implant surface.

The numbers are striking. The company's post market surveillance data shows rupture and capsular contracture rates each below 0.1%. The 10 year clinical trial data from the three U.S. approved competitors shows rupture rates between 8.5% and 24.2%, and capsular contracture rates between 12.1% and 18.9%.

The data collection methods differ, and the company is careful to note the caveat. Even so, the gap was significant enough that the FDA granted Motiva its PMA approval in September 2024, the first new breast implant approval since 2013.

Two newer products expand the platform. Mia Femtech, launched in 2023, allows augmentation under local anesthesia through incisions smaller than one inch. A three year study published in October 2025 in the Aesthetic Surgery Journal reported zero capsular contracture, zero ruptures, zero infections, and a 1% reoperation rate across 100 patients. Preserve, a tissue preserving surgical technology, launched in Brazil in February 2025. Both are expected in the U.S. market in 2026.

The U.S. acceleration

For years, Establishment Labs grew steadily through international markets. In 2021, with zero U.S. presence, it generated $143.8 million in revenue. By 2024, with international growth plus two months of U.S. sales, that reached approximately $175 million. Then the FDA approval changed the trajectory.

In Q1 2026, quarterly revenue hit $59.9 million, up 44.7% from $41.4 million a year earlier. The U.S. drove the acceleration: $19.6 million in Q1 2026, up from $6.1 million in Q1 2025. That is a 221% increase in four quarters. The U.S. now accounts for 32.7% of total revenue, up from 15.5% a year ago.

International revenue grew a steady 14%, driven by Asia Pacific and Latin America.

The U.S. market is also the higher margin market. Gross margin expanded from 67.2% to 70.7% in a single year, a shift management attributed explicitly to the U.S. mix.

What it costs to get there

SG&A expenses in Q1 2026 were $43.6 million, or 72.8% of revenue. That ratio reflects the cost of building a U.S. commercial presence from near zero in eighteen months.

The company hired a direct sales force. It conducted 607 physician education events in 2025, up from 239 the year before. Freight costs nearly doubled. A partnership with Meghan Trainor in March 2025 generated over 9 billion media impressions, according to the company.

R&D has held steady at approximately $20 million annually. Interest expense reached $7.1 million in Q1, up from $5.9 million, reflecting the growing debt balance.

The loss trajectory

The net loss in Q1 2026 was $13.4 million, down from $20.7 million a year earlier.

More telling: the operating loss narrowed from $16.9 million to $6.5 million. At the operating level, the business is approaching a different trajectory. Full year profitability remains out of reach for 2026 by management's own guidance. But the direction is clear.

The accumulated deficit stands at $509.1 million. The pace of accumulation is slowing. Whether it reaches zero depends on whether the U.S. ramp holds.

Built in Alajuela

The physical foundation sits in the Coyol Free Zone, where Establishment Labs has operated since 2010 under Costa Rica's Zona Franca regime.

In June 2021, the company broke ground on the Sulayom Innovation Campus, a second facility in the same zone. Originally budgeted at $35 million, the project ultimately cost $56 million. It was completed in June 2024: approximately 100,000 square feet, capacity for roughly 730,000 additional implants per year, LEED Platinum certified.

In December 2025, the FDA approved the new facility to manufacture all U.S. PMA approved products. That removed what had been a meaningful constraint on American sales volumes.

The company employs 1,004 people as of December 2025, the majority in Costa Rica, and has committed to adding up to 1,000 more as production scales. A Nasdaq listed medical technology company, manufacturing at global standards in a Central American free trade zone, competing against the divisions of AbbVie and Johnson and Johnson. That is not a common story. It is worth understanding how it was built.

$300 million in debt

The company has funded its growth primarily through equity and debt. On the debt side, Oaktree Capital Management has been the primary lender since April 2022, when the two parties entered a credit agreement for up to $225 million in term loans.

The draws came in stages. $150 million at closing in April 2022. $25 million in December 2022. $25 million in October 2024, triggered by the FDA approval. $25 million in September 2025, under a waiver of the original revenue milestone, a modification that signals the company needed capital before hitting its targets.

On April 30, 2026, four days after the quarter closed, the company replaced the entire facility with a new $300 million term loan from Oaktree. The first $265 million was drawn immediately, with $259 million used to repay the prior debt. The new loan matures in April 2031, carries an 8.75% rate, and includes a first year PIK option. The refinancing extends maturity by four years and removes a near term repayment cliff.

Cash on hand: $68.1 million as of March 31, 2026.

The silicone problem

Every Establishment Labs 10-K since the IPO has flagged the same supply chain risk. The company sources 100% of its medical grade silicone from a single supplier: Avantor Inc., formerly NuSil Technology. The supply agreement expires December 31, 2026. There is no qualified alternative.

In 2025, Avantor told the company it does not intend to allow automatic renewal. New terms will be negotiated. The outcome will directly affect cost of goods and gross margins from 2027 onward.

The company has been preparing. Avantor purchases in Q1 2026 fell to $7.8 million, or 53.7% of total purchases, down from $25.1 million and 79% a year earlier. Inventory has been built to $86.7 million. But inventory is a buffer, not a solution. The negotiation is the most immediate operational risk on the balance sheet.

New leadership

Chacon-Quiros stepped down as CEO effective March 1, 2025, ending a twenty year founding chapter. He built the company from a Costa Rican startup to a firm that today carries a market capitalization of approximately $2.1 billion, up from a mid 2025 peak of roughly $975 million. The stock has nearly doubled over the past twelve months. He remains on the Board.

Peter Caldini, who joined in 2023 with a background in international medical device commercialization, served as Interim CEO before being confirmed permanently on May 7, 2025. He now oversees the company's most promising growth period and its most complex balance sheet simultaneously.

The competitive question

The U.S. breast implant market is dominated by Allergan Aesthetics (AbbVie) and Mentor Worldwide (Johnson and Johnson). Sientra, the third approved player, was acquired by Tiger Aesthetics Medical. All three have deeper resources, larger sales forces, and decades of surgeon relationships.

Motiva's entry is genuinely differentiated. It is the first new FDA approved implant since 2013, an eleven year gap. That novelty, combined with the safety data, gives the company a real basis for market entry.

Whether surgeons and patients shift meaningfully from established brands is the central commercial question of the next several years.

What the filings show

Revenue is accelerating. The Q1 2026 run rate of roughly $240 million annualized compares to $143.8 million in all of 2021. The U.S. is now the fastest growing and highest margin segment. Operating losses are narrowing sharply. The infrastructure, the $56 million campus, the direct sales force, 607 physician education events, is largely built.

Against that: $509 million in accumulated deficit. $300 million in debt. A sole source supplier contract expiring in seven months. Tariff uncertainty. Currency risk on the international base. And the emerging question of whether GLP-1 weight loss drugs will reduce demand for elective aesthetic procedures.

The risks are real. So is the trajectory.

Under Caldini, the company has doubled its market capitalization, tripled its U.S. revenue, and narrowed its operating loss by 62% in four quarters. He now has to hold that pace while renegotiating the company's sole silicone supply contract, servicing $300 million in debt, and proving that a Costa Rican medical device maker can take durable share from the divisions of AbbVie and Johnson and Johnson in the most competitive surgical market in the world.

The filings show a company that has never been growing faster, and has never had more to get right at the same time.

Sources: Establishment Labs Holdings Inc. Form 10-K for fiscal years ended December 31, 2021, December 31, 2024, and December 31, 2025; Form 10-Q for the quarter ended March 31, 2026. All documents filed with the U.S. Securities and Exchange Commission.