Evolus (EOLS)

[DewDiligence]

Court_ruling_in_Korea_against Daewoong may_end EOLS sales_of Jeuveau—(a/k/a BTX):

https://www.koreabiomed.com/news/articleView.html?idxno=20428

The Seoul Central District Court on Friday ruled in favor of Medytox in the lawsuit filed by Medytox against Daewoong Pharmaceutical...including the prohibition of infringement of trade secrets, and ordered Daewoong to… turn over Daewoong's BTX strain to Medytox, and discard all finished BTX products made with the strain.

The ruling comes after Medytox filed a lawsuit against Daewoong Pharmaceutical for damages of 1.1 billion won in October 2017, claiming that a former employee stole Medytox's BTX strains and product manufacturing process technical documents and provided them to Daewoong Pharmaceutical.

… After the ruling came out, Medytox immediately sent out a press release stating that it had regained the legitimate rights of its BTX strain five years and four months after filing a lawsuit against Daewoong.

… Daewoong said it will appeal the court's decision, saying that the ruling was a “clear misjudgment.”

… On Friday, Medytox's shares surged by a daily limit of 30 percent... Daewoong shares dropped…9.35 percent from the previous day.

As a side effect of the ruling, Hugel, which is currently embroiled in a U.S. International Trade Commission dispute over the origin of its strain with Medytox, also saw the stock price decline…18.17 percent from the previous day.

The ruling will also affect Evlous, which markets Daewoong's BTX products in the U.S., as all of Daewoong's BTX products are currently manufactured in Korea.

As the ruling ordered Daewoong to discard all products made with Medytox's strain, Daewoong's thriving BTX export business will likely ground to a complete halt if Daewoong fails to receive a suspension of execution from the court.

Above all, if the ruling leads to the cancellation of the license for Daewoong's BTX product, the Ministry of Food and Drug Safety may revoke its export permission.

As Evolus' revenue entirely consists of Jeuveau, the company will no longer be able to maintain sales if such a ruling happens.

This is an outcome we all knew might happen—see, for instance, #msg-149854993. Moreover, the Korea court ruling announced today may additionally keep Hugel (#msg-165634697) and Aeon (#msg-170687120) off the US market.