[Toxin War] ① Profitable Poison... 1,930 Days of Conflict

1930 days. This is the time it took from when Medytox filed a domestic damages lawsuit against Daewoong Pharmaceutical until the first trial verdict was delivered. It took well over five years just for the civil first trial result. Including the period before the civil lawsuit when the conflict between the two companies surfaced, it has exceeded seven years. What have the two companies been fighting over for such a long time? It is the so-called 'Toxin War.'

[Image source=Yonhap News]

The two companies have been disputing over 'Botulinum Toxin (BTX).' BTX is a highly toxic substance extracted from the botulinum bacteria. This toxin is so lethal that just 1 gram can kill one million people. It was even studied as a biochemical weapon during World War II. An unexpected application of this substance was found in the field of aesthetics. When an extremely small amount of BTX is injected under the skin, it causes a slight paralysis effect on muscles. This effect is utilized for cosmetic or medical purposes to smooth wrinkles.

BTX formulations are commonly known by the original product name 'Botox.' Allergan, an American pharmaceutical company that first commercialized this substance, named it 'Botox,' and the trademark became widely used as is. Medytox sells three types of BTX formulations: 'Medytoxine,' 'Coretox,' and 'Innotox.' Daewoong Pharmaceutical produces and exports the BTX formulation 'Nabota.'

Since around 2016, Medytox has claimed that Daewoong Pharmaceutical stole its bacterial strain. They allege that Daewoong Pharmaceutical recruited former employees and illicitly took out the strain while also copying the manufacturing process. Jung Hyun-ho, CEO of Medytox, even proposed a public debate to Daewoong Pharmaceutical to clarify the origin of the strain. The full-scale dispute began in 2016 when Medytox filed a complaint with the police against Daewoong Pharmaceutical. In January 2017, Medytox escalated the legal battle by filing a criminal complaint against Daewoong Pharmaceutical and its employees for violating the Industrial Technology Protection Act and the Unfair Competition Prevention Act due to strain theft. Then, in October 2017, Medytox filed a civil lawsuit seeking to prohibit the use of the BTX strain and formulation manufacturing technology and claiming damages.

The Toxin War extended to the United States when Medytox filed a lawsuit against Daewoong Pharmaceutical in a California court in June 2017. However, this lawsuit was dismissed on the grounds that the dispute should be resolved in Korean courts. In January 2019, Medytox, together with its partner Allergan, filed a complaint with the U.S. International Trade Commission (ITC) against Daewoong Pharmaceutical and Evolus. Evolus is Daewoong Pharmaceutical's partner that sells Nabota (known as Jeuveau in the U.S.) in the United States. The ITC's conclusion differed from that of the U.S. courts. In December 2020, the ITC issued a final ruling banning the import of Nabota into the U.S. for 21 months. With imports of BTX formulations immediately blocked, Evolus settled with Medytox and Allergan in February 2021, ending the ITC lawsuit. At that time, Evolus paid $35 million (approximately 46 billion KRW) to Medytox and Allergan.

Medytox also achieved a complete victory in the domestic civil first trial. On the 10th, the Seoul Central District Court ordered Daewoong Pharmaceutical to pay Medytox 40 billion KRW in damages and to hand over the bacterial strain and destroy the products. Daewoong Pharmaceutical immediately protested, filed an appeal, and requested a stay of execution of the first trial verdict. The stay was granted, buying time until the higher court's judgment.

Separately, regarding Medytox's criminal complaint, the prosecution concluded that Daewoong Pharmaceutical was not guilty and decided not to indict in February last year. This was because there was no evidence to prove that Medytox's bacterial strain or manufacturing process information was leaked to Daewoong Pharmaceutical. Medytox has filed an appeal with the Seoul High Prosecutors' Office, claiming the decision was unfair.

Medytox asserts that the process of securing the BTX strain was transparent. They explain that Dr. Yang Kyu-hwan, who was conducting research at the University of Wisconsin in the U.S., brought the BTX strain into Korea for research purposes after completing his degree. Jung Hyun-ho, CEO of Medytox and a prot?g? of Dr. Yang, expressed the intention to commercialize it and received the strain, developing Medytoxine, Korea's first BTX formulation. They also added that in the late 1970s, when Dr. Yang imported the strain, there were no related regulations, so importing for research purposes was relatively free.

On the other hand, Daewoong Pharmaceutical counters that their strain origin is certain. They have explained that they collected the BTX strain from the riverside in Pogok-eup, Yongin, and that records remain. A Daewoong Pharmaceutical official stated, "Even during the extensive prosecution investigation by the Seoul Central District Prosecutors' Office in February last year, no direct evidence or epidemiological evidence to determine the source relationship regarding strain theft was found," adding, "The court also acknowledged the lack of probative value of direct evidence and judged that the strain theft was not proven."