Possible Expansion of Domestic Compensation Claims
If ITC Final Ruling Is Not Overturned
Daewoong Pharmaceutical Considers Filing Civil Lawsuit in the US
[Asia Economy Reporter Cho Hyun-ui] It has been a week since the U.S. International Trade Commission (ITC) issued a preliminary ruling on the 'Botulinum Toxin (Botox) War' between Medytox and Daewoong Pharmaceutical, but the conflict does not seem to have been resolved. As the ITC ruled in favor of Medytox, increasing the likelihood of Daewoong Pharmaceutical losing in the final verdict scheduled for November, Daewoong Pharmaceutical is even considering filing a lawsuit with the U.S. Supreme Court as a last resort.
According to industry sources on the 13th, Medytox and Daewoong Pharmaceutical have been engaged in civil and criminal lawsuits domestically since 2017 over strain theft. The civil lawsuit is currently in the first trial. The amount of damages claimed by Medytox against Daewoong Pharmaceutical is around 1 billion KRW, which is a small amount considering that both companies spend hundreds of billions of KRW annually on litigation.
The two companies currently hold different positions regarding the 1 billion KRW damage claim. Medytox believes that even if they win a damage lawsuit, they do not receive only the claimed amount but can receive more. A Medytox official stated, "Just because the damage claim is 1 billion KRW does not mean we will only receive that amount," adding, "We initially claimed 1 billion KRW for part of the damages and plan to submit additional evidence during the litigation process to determine the exact amount of damages." This means there is a possibility of increasing the scale of damages or filing new claims in the ongoing lawsuit depending on the submission of additional evidence.
On the other hand, Daewoong Pharmaceutical views this as a result of Medytox hastily advancing the domestic civil lawsuit. Medytox filed a civil lawsuit against Daewoong Pharmaceutical and its local partner Alpheon in the Orange County Court, California, USA, in 2017, but it was dismissed due to 'lack of jurisdiction,' prompting a rushed move to pursue the case at the Seoul Central District Court. A Daewoong Pharmaceutical official claimed, "At that time, Medytox, a domestic company, deliberately filed a civil lawsuit in the U.S. to block the U.S. Food and Drug Administration (FDA) approval of its botulinum toxin product 'Nabota.'"
Daewoong Pharmaceutical plans to file a U.S. civil lawsuit if the final verdict does not change the outcome. Since it is rare for the ITC final ruling to overturn the preliminary ruling, industry observers believe that Daewoong Pharmaceutical's lawsuit in the U.S. is highly likely. If that happens, the conflict between the two parties will inevitably be prolonged.
The two companies also have differing opinions on whether the ITC's preliminary ruling, as an administrative agency, will influence decisions by domestic judicial institutions. The domestic court has ordered both companies to submit materials presented to the ITC. The submission of these materials will proceed through mutual agreement between the two companies. A Medytox official said, "Since the ITC materials contain scientific evidence, there will be progress in the lawsuit," and predicted, "Similar results to the ITC will come out in domestic civil and criminal lawsuits." Conversely, a Daewoong Pharmaceutical official responded, "It is uncertain whether the ITC's ruling will affect domestic lawsuits," adding, "As an administrative agency, the ITC does not decide on compensation amounts, and its rulings are at the level of submitting opinions."
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