[Special Stock] Divided Fortunes Amid Agreement in the 'Botox War'

[Asia Economy Reporter Junho Hwang] On the 22nd, the dispute between Medytox and Daewoong Pharmaceutical regarding botulinum toxin (Botox) ended in a settlement, causing the stocks of both companies to surge. Meanwhile, the stocks of related companies expected to replace Medytox remained flat.

On the 22nd, Medytox announced that it acquired 16.7% of the shares of Evolus, Daewoong Pharmaceutical's U.S. partner, becoming the second largest shareholder. Medytox acquired 6,762,652 common shares of Evolus for approximately 53.5 billion KRW. Evolus newly issued common shares at $0.0001 per share.

This agreement was made as the lawsuit over the alleged theft of Botox technology between Medytox and Daewoong Pharmaceutical was concluded. Last year, the U.S. International Trade Commission (ITC) banned the sale of Daewoong Pharmaceutical's Botox product Nabota in the U.S. for 21 months, ruling that it had stolen Medytox's manufacturing technology.

However, on the 19th, Medytox and Allergan (Medytox's U.S. partner) agreed to receive a settlement of about 38 billion KRW and royalties based on sales from Evolus, allowing the resumption of Nabota sales in the U.S. With this settlement, both companies returned to the pre-litigation status. Daewoong Pharmaceutical can now resume its Nabota business in the U.S. and sell the inventory held by Evolus in the U.S.

Accordingly, on this day, Daewoong Pharmaceutical's stock was trading at 151,000 KRW, up 11% from the previous closing price, while Medytox was trading at the upper limit price of 197,600 KRW compared to the previous day. Meanwhile, the stocks of related companies such as Hugel and Huons, which had emerged as latecomers expected to take the place of the two companies amid their dispute, remained flat.