Daewoong Pharm BTX set to face import ban in US

Medytox's botulinum toxin strain Meditoxin / Courtesy Medytox

By Kim Jae-heun

The U.S. International Trade Commission (ITC), Thursday, ruled in favor of Medytox over Daewoong Pharmaceutical in its final decision to ban the latter from exporting its botulinum products to the U.S. for almost two years.

“Daewoong Pharmaceutical's botulinum toxin strain Nabota is believed to be in violation of Article 337 of the Customs Act and we order it to be banned from importing to the United States for 21 months,” the ITC ruled.

The ITC also prohibited Daewoong's global partner Evolus from selling its stock of the drug, which is marketed under the name Jeuveau there. If Evolus wants to import or sell Jeuveau while the U.S. president is reviewing the ITC's decision, it must pay $441 per vial for deposit.

The U.S. president must exercise his right of approval or veto within 60 days and President Donald Trump is expected to make the decision before the end of his term.

However, it is unlikely that Trump will go against the ITC's decision as there has only ever been one case out of 33 that the American president exercised his veto right.

The two local drug makers have been in a legal dispute over Daewoong Pharmaceutical's alleged theft of trade secrets of Medytox's botulinum toxin strain. Daewoong has been using it to develop its own botulinum product named Nabota and export it to the United States.

Medytox reported that Daewoong stole its strain and technical documents on the manufacturing process and filed an official complaint with the ITC in January last year on charges of violating trade secrets.

In the preliminary ruling in July, the U.S. trade panel saw Daewoong had misappropriated Medytox's business secrets and ordered a 10-year ban on imports of Nabota in the United States.

However, in final ruling, the U.S. panel reduced the term down to just under two years saying that it does not recognize Medytox's botulinum toxin as a business secret.

Both firms argued that they have won the trial.

“It has been proven that Daewoong Pharmaceutical has developed Nabota by stealing our strain and manufacturing process,” a Medytox official said. “Although our strain was not recognized as a trade secret by the ITC, it was revealed that Daewoong's claim that it found its botulinum strain in the soil of Yongin was clearly false.”

Meanwhile, Daewoong argued that it practically won the case.

“The ITC overturned the preliminary decision as it judged that the strain of Medytox was not a trade secret. But it partially accepted the wrong judgment regarding our manufacturing process technology and ordered the import ban,” a Daewoong Pharmaceutical official said.

The official added that Medytox's manufacturing process is already a well-known technology and it is different from Daewoong's process.

“We have been producing botulinum toxin products with patented technology and we have never violated Medytox's manufacturing process. The ITC's final ruling is a clear misjudgment based on reasoning.

Daewoong said it will take immediate action to apply for a provisional injunction to suspend the ITC's 21-month ban on Nabota.

“After that, we will appeal to the Court of Appeals for the Federal Circuit and seize victory,” a Daewoong Pharmaceutical official said.