Longer-Acting Botox Competitor is Coming

 Wrinkles received some bad news this week: A new, longer-acting competitor to Botox Cosmetic received its first FDA approval. Revance Therapeutics  (RVNC)  finally overcame manufacturing deficiencies to snag regulatory approval for Daxxify in a specific aesthetic condition.

A pivotal clinical trial demonstrated many patients maintained responses for six months, whereas the benefits of Botox generally last three to four months. The potential to need only two treatments per year is expected to become a significant selling point. Daxxify is also the only product on the market to exclude animal-derived components, which could provide a marginal boost in certain demographics.

Investors are rightfully excited about the possibilities to compete in the aesthetics market with Botox, but the company has greater ambitions for Daxxify that will require additional approvals over the next few years.

What's the Market Opportunity?

Daxxify earned FDA approval specifically for treating glabellar lines, or vertical wrinkles between the eyebrows and on the forehead. It may seem silly to draw such a distinction, but it's important for investors to understand the nuances involved in the approval and overall market for the product.

Drugs such as Botox and Daxxify are called neuromodulators. They're derived from toxins produced by the soil bacterium Clostridium botulinum, which is responsible for botulism. The rare but serious illness is characterized by paralysis in vital body systems caused by the bacterial toxins. However, when the toxins are purified and used in infinitesimally small amounts measured in nanograms, they can locally reduce activity in the nervous system. Neuromodulators have treatment applications in wrinkles, migraines, muscle spasms, and other conditions spanning both aesthetics and therapeutics.

Revance Therapeutics will need to earn separate FDA approvals for each new indication. The first approval will compete with Botox Cosmetic in the aesthetics market, which is generally what most people associate with the world's most famous neuromodulator. AbbVie  (ABBV)  generated full-year 2021 revenue of $1.4 billion from Botox Cosmetic. It generated $862 million in domestic sales in the first half of 2022, suggesting it's on pace to grow over 20% this year.

That provides a significant opportunity for Revance Therapeutics, but success will take time. Daxxify will need to compete against four different neuromodulators in aesthetics including Botox Cosmetic, Dysport, Xeomin, and Jeuveau. The longer-acting formulation is expected to provide a significant advantage within the competitive landscape.

Wall Street is generally optimistic about the company's ability to achieve success. Revance Therapeutics has built commercial infrastructure for its dermal filler products that can be leveraged to launch and ramp Daxxify. Existing relationships with dermatologists could accelerate market share gain, especially considering the value proposition for doctors.

The long-acting formulation is a key selling point for patients who desire fewer injections. It's also a selling point for dermatologist offices, which can charge more for Daxxify and generate more revenue per patient visit.

https://www.thestreet.com/investing/a-longer-acting-botox-competitor-is-coming