Each Accuses the Other of Being a "Botox Bacteria Thief"... The Truth Battle Enters Its Fifth Year and Intensifies

"Competitor Defamation" Daewoong Pharmaceutical Sues Former Employee for Spreading False Information
Medytox Responds to 'Smuggling' Counterattack with "Brought in After Research at US University"
Fierce Battle for Global No.1 US Market Lead... ITC Preliminary Ruling on 6th

[Asia Economy Reporter Cho Hyun-ui] The five-year war over 'botulinum toxin (Botox)' is reaching a critical point. The conflict between Medytox and Daewoong Pharmaceutical, which began in 2016 over the origin of the bacterial strain, is intensifying ahead of the preliminary ruling by the U.S. International Trade Commission (ITC). There are also concerns that the verbal disputes and accusations of "stealing Botox strains" between the two companies are degenerating into a mudslinging fight.

According to industry sources on the 3rd, the ITC will issue a preliminary ruling on the lawsuit between Medytox and Daewoong Pharmaceutical on the 6th (local time). Although the final ruling is scheduled for November, since preliminary rulings are rarely overturned, the outcome of this decision is expected to determine the fortunes of the two companies.

Medytox's botulinum toxin 'Medytoxine'

◆The Botox War That Began in 2016= The 'Botox war' between Medytox and Daewoong Pharmaceutical started in 2016. Jung Hyun-ho, the founder of Medytox, who holds a doctorate in botulinum-related research, raised concerns about the origin of the bacterial strain around the time when other domestic companies like Daewoong Pharmaceutical and Hugel were entering the final stages of clinical trials overseas. Botulinum toxin is a highly dangerous substance capable of killing millions with a very small amount, and it is virtually impossible to find the strain naturally, as other companies claimed. In a media interview at the time, CEO Jung stated, "This is not about picking a fight with other companies, but if the origin of the strain is not clarified at the time of entering the global market, it could lead to national embarrassment," raising such suspicions.

Medytox specifically accused Daewoong Pharmaceutical of stealing the botulinum strain to develop its botulinum toxin product 'Nabota.' Daewoong Pharmaceutical countered, saying, "We used a strain discovered in domestic soil," and called it "a slanderous act by competitors." Medytox filed a civil lawsuit in October 2017 and sued Daewoong Pharmaceutical and Evolus, the U.S. distributor of Nabota, at the U.S. ITC in January last year. The core of the controversy is whether Daewoong Pharmaceutical stole Medytox's strain.

Four days before the ITC preliminary ruling, Daewoong Pharmaceutical filed a damages lawsuit at the Seoul Southern District Court against a former employee, Mr. Yoo, who moved to Medytox. Daewoong Pharmaceutical explained the reason for the lawsuit, stating, "Mr. Yoo made false claims that 'a former employee of competitor Medytox stole botulinum strains and production technology materials and delivered them to Daewoong Pharmaceutical.'" They added, "Medytox has pursued a slander strategy claiming that Daewoong Pharmaceutical conducted business using stolen strains and technology," and "Based on Mr. Yoo's false claims, Medytox filed civil and criminal lawsuits against Daewoong Pharmaceutical and also sued at the U.S. ITC."

Daewoong Pharmaceutical's Botulinum Toxin 'Nabota'

◆Fierce Battle Over the 2 Trillion Won U.S. Market= While Medytox has been claiming for years that Daewoong Pharmaceutical stole its strain, Daewoong Pharmaceutical has raised its voice, saying, "It is Medytox's strain that was stolen." The second and third largest botulinum toxin pharmaceutical companies in Korea are engaged in a mudslinging fight, each accusing the other of stealing strains. CEO Jung has stated that their strain was brought in by former Food and Drug Safety Administration Commissioner Yang Kyu-hwan, who researched botulinum toxin at the University of Wisconsin in the U.S. in 1979. Daewoong Pharmaceutical responded, "Although former Commissioner Yang is said to have secretly brought the strain from the U.S. without notifying authorities and given it to his university student, CEO Jung, there is no clear evidence, and rather the origin of Medytox's strain is questionable."

The reason the two companies have been in conflict for years is the importance of securing the U.S. market, which accounts for more than half of the global botulinum toxin market. The U.S. botulinum toxin market is about 2 trillion won, more than 12 times the domestic market size of 150 billion won. Daewoong Pharmaceutical's Nabota obtained approval from the U.S. Food and Drug Administration (FDA) in February last year, while Medytox has not entered the U.S. market. Medytox's chances of entering the U.S. market have further diminished after its domestic product approval was canceled last month due to document falsification and other reasons.

The ITC preliminary ruling could also have a sweeping impact on the domestic botulinum toxin industry. If Medytox wins, it could demand investigations into the origin of strains used by other domestic companies besides Daewoong Pharmaceutical. The Ministry of SMEs and Startups could also resume administrative investigations into Daewoong Pharmaceutical's strain origin. Since domestic companies are leading the global botulinum toxin market, the industry is closely watching this preliminary ruling, as it could affect future market dominance.