Dun & Bradstreet Logo

Anne Law

Trouble in Botox-land?

by Anne Law | Dun & Bradstreet Editor

January 23, 2008 | 1 Comment »

Pharmaceuticals firm Allergan is not a maker of allergy medicines, as its name might imply. It’s a company catering to those who want to look, see, and feel better. What started off as an eye and skin-care treatment maker now gets a large chunk of its profit from Botox, the popular wrinkle-reducer used in cosmetic procedures. The company also makes breast implants and obesity treatment device Lap-Band.

Despite its obviously successful line of products catering to self-image shoppers, as well as eye and skin disease sufferers, Allergan has a few storms brewing on its front. Impending competition from rival Medicis, which is working to bring a Botox-like product to market, is at the fore. Several other companies have similar products in development stages.

Allergan has so far had a monopoly in the US anti-wrinkle drug market; Botox makes the company over $1 billion per year, or about one-third of Allergan‘s annual sales. The company is also facing an opponent in Johnson & Johnson, which plans to launch a product similar to the Lap-Band.

In addition, late last year the company filed a patent infringement suit against several personal care product makers, including Jan Marini Skin Research, for selling eyelash extending products that contain ingredients similar to Allergan‘s Lumigan, a prescription drug used to treat glaucoma. Rumor has it that Allergan is pursuing its own eyelash enhancement product based on the Lumigan formula, a move that follows in the footsteps of Botox, which started off as a medical treatment for facial muscle spasms.

Regardless of these roadblocks, many analysts and investors remain bullish about Allergan‘s stock. The company has a healthy pipeline and a wide berth of traditional pharmaceuticals in its stable to maintain sales, especially in the eye care field. In addition, the popularity of Botox – come on, we’ve all heard of it – is unlikely to suffer too much, especially with the ever-increasing popularity of cosmetic procedures. All in all, my estimation is that Allergan probably won’t feel more than a minor discomfort from the aforementioned threats.

Thusfar the alternatives to Botox have had deliberately milder effects, Allergan is barely even under indirect threat.

Leave a Reply

Your email address will not be published. Required fields are marked *