Friday, the FDA approved a new treatment for eliminating wrinkles called Jeuveau. Shares of Jeuveau owner Evolus rose almost 12% after the announcement, while shares of Allergan, the company that makes Botox, fell almost 4%.
But that’s not the story’s last wrinkle: Allergan also accused Evolus of stealing its anti-wrinkle recipe and asked the International Trade Commission to investigate.
Allergan’s anti-aging empire is built on a secret
Allergan won approval for Botox in 1989 and trademarked its recipe for the drug instead of filing for a patent (which is a more common practice for pharmaceutical compounds).
Unlike a patent, Allergan’s control over its secret recipe will never expire, giving the company extraordinary control over the market: Botox currently accounts for 70% of the $3.5B US market for wrinkle-eradicating injections.
But on the other hand, Allergan’s recipe isn’t protected like a patent — which means competitors can try to replicate the wrinkle recipe. Now, Evolus claims it replicated Allergan’s recipe — but Allergan insists it was stolen.
Like Botox’s younger, smoother brother
When Jeuveau — which was rejected by the FDA in its initial bid 8 months ago — hits the market, Evolus will become the first company in almost 10 years to break into the “aesthetic neurotoxin” market.
But more importantly, this youthful alternative to Botox will also cost between 20% and 25% less than Allergan’s elderly anti-aging treatment.
This caused some serious frown lines for Allergan, which is why the company is now going to such great lengths to protect Botox (Allergan doesn’t like losing: It once transferred an eyedrop patent to a Native American tribe to gain “sovereign immunity” against competitors).
Botox may not have any crow’s-feet, but it does have sharp talons
Allergan claims that an ex-employee at partner company Medytox stole its “most secret, most protected manufacturing processes” and gave them to Evolus and now wants the ITC to block its Jeuveau-riche competitor.
Evolus says the allegations are “completely without merit” and plans to roll out its product this spring as planned (Allergan has issued similar patent infringements before).
The stakes here are high for Allergan, which needs Botox to give its balance sheets that youthful glow: Botox accounted 23% of the company’s overall revenue last year.