Topline
Shares of Revance Therapeutics surged 18% Thursday after the company announced the Food and Drug Administration had approved Daxxify, a facial injection drug that Revance hopes will challenge Botox’s long domination of the aesthetics market.
A vial with Botox is seen at a cosmetic treatment center.
Key Facts
The FDA approved Daxxify for temporary improvement of moderate to severe frown lines, Revance said in a Thursday morning statement.
Shares of Revance climbed gradually Thursday afternoon, trading at $24.86 a share as of 3:30 p.m ET, up from a June low of $11.52 a share.
The drug functions similarly to AbbVie’s Botox—which dominates 70% of the facial injection market, according to the New York Times—by blocking chemical signals from nerves that cause muscles to contract.
The company says Daxxify can diminish wrinkles for up to six months, twice as long as Botox.
The FDA’s decision comes years after Revance submitted Daxxify for approval, encountering delays due to the Covid-19 pandemic as well as issues with the company’s quality control process.
Big Number
More than $14.6 billion. That’s how much the U.S. aesthetics procedures market was worth in 2021, according to the Aesthetic Society, a group of professional plastic surgeons.
Key Background
Botox, which is derived from a toxin produced by the bacteria clostridium botulinum, was initially used to create a drug to treat two rare eye muscle disorders. As patients began to notice the treatment also reduced the appearance of wrinkles, a company named Allergan—which later became a part of AbbVie—decided to explore the use of the product for the world of aesthetics. The FDA approved cosmetic use of Botox in 2002, and in 2020, it was also approved for 11 therapeutic uses. The aesthetics market has grown steadily in recent years, and AbbVie has a market cap of over $247 billion. Studies submitted to the FDA by Revance showed 80% of medical professionals saw no or light facial wrinkles four months after injecting patients with Daxxify, followed by roughly 50% of providers at six months. Shares of Revance first surged in August after the company reported strong second-quarter earnings. The company is still below its 52-week high, after hitting a peak of $29.14 per share in September 2021, though the stock is trading at its highest point in 2022. Revance has not provided details on the price of its injections, though it has suggested Daxxify could cost more than Botox due to the product’s longer-lasting effects, according to Reuters.
What To Watch For
Revance hopes Daxxify will eventually be used on more than just frown lines, CEO Mark Foley told the New York Times. There’s “huge medical opportunity” for the product, Foley said, citing overactive bladder, migraines and cervical dystonia as potential ailments the injections could treat. Botox is already used to treat a range of conditions, including bladder dysfunction, eye twitching and hyperhidrosis, or excessive sweating.
Further Reading
F.D.A. OKs Daxxify, an Anti-Wrinkle Drug and Botox Competitor (New York Times)
Source: https://www.forbes.com/sites/madelinehalpert/2022/09/08/revance-shares-jump-17-after-fda-approves-botox-rival/