The Botox Cosmetic line and other products overseen by Allergan PLC’s hub in Irvine have long been favorites among well-heeled women.
Now the company looks ready to make a mark among their male counterparts with a new entry for the drugmaker’s aesthetics division.
The product came courtesy of Allergan’s $2.1 billion purchase of Westlake Village-based Kythera Biopharmaceuticals Inc. The deal brings Allergan Kybella, a newly approved injectable drug to treat double chin—a condition that is most common among older men.
Kybella received its Food and Drug Administration approval at the end of April, two weeks ahead of schedule. It’s a version of deoxycholic acid, a naturally occurring molecule in the body that helps to destroy fat.
Double chins occur when a layer of fat develops around the neck, sags down and creates a wrinkle, giving an appearance of a second chin. The condition is traditionally treated surgically.
Kybella is debuting at a time when aesthetic procedures among men are growing, said David Moatazedi, vice president of sales and marketing at Allergan’s U.S. facial aesthetics unit. Moatazedi, who works out of Allergan’s Dupont Drive campus in Irvine, cited statistics from the Garden Grove-based American Society of Aesthetic Plastic Surgery showing that the number of cosmetic procedures on men reached 1 million last year, up nearly 300% since 1997.
“We believe that the growing popularity of aesthetic procedures among men will accelerate usage—and that Kybella is a catalyst for this trend,” Moatazedi said.
Early feedback among doctors who are using Kybella “support the increased interest level of men entering the market” for the drug, he said.
Kybella would complement Allergan’s lower-face dermal filler business, which includes Juvéderm and Juvéderm Voluma XC.
Botox Cosmetic is used for removing forehead wrinkles.
Allergan, which has a tax-friendly headquarters in Dublin, Ireland, and primarily operates out of Parsippany, N.J., has “[carved] out a new contouring market” with Kybella, Botox Cosmetic, the Juvéderm family, eyelash grower Latisse, and the SkinMedica line of skin products that are sold through doctors, Moatazedi said.
The newly approved drug “appears to fit seamlessly within Allergan’s current facial aesthetics footprint which now spans the forehead to lower neck line,” Elliot Wilbur, specialty pharmaceutical analyst with St. Petersburg, Fla.-based Raymond James & Associates Inc., said in a note addressing the deal.
$750 Million?
Kybella, at its peak, could reach sales of $750 million, Wilbur predicted.
Kythera management—prior to an announcement of the company’s sale to Allergan—earlier this year suggested that Kybella would be priced in line with other high-end facial aesthetics and lower-end surgeries.
That’s “potentially as high as the $3,000-$5,000 range if benchmarked against chin liposuction,” Wilbur wrote.
Dermal fillers accounted for $195.9 million in sales in the second quarter for Allergan, which is set to release third-quarter results on Nov. 4.
“Kybella is also expected to potentially draw in a greater percentage of male patients given that [it’s] more of a body-conscious sell rather than a straight beauty play,” Wilbur added.
Allergan has developed marketing materials and programs aimed at men, Moatazedi said, adding that those will be both at doctor’s offices and on a direct-to-consumer basis.
“We recently launched the first male-branded website for Botox Cosmetic and intend to do the same for Kybella,” Moatazedi said.
Various medical societies have also noticed growth in male aesthetics, including the minimally invasive arena Kybella will be in.
Figures from the Arlington Heights, Ill.-based American Society of Plastic Surgeons show that cosmetic minimally invasive procedures among men grew 67% from 2000 to 2014 to just over 1 million.
Botulinum toxin type A injections, including Allergan’s flagship Botox, made up the largest segment of procedures by men at almost 411,000; fillers made up 92,949 male procedures.
And data from market tracker Millennium Research Group shows spending on facial injectables will grow at a 12% compound annual rate through 2017 in the U.S. and Canada. Millennium notes that American and Canadian doctors spent $1 billion on such drugs in 2012, the latest data available.
Kythera, prior to being bought by Allergan, was touting Kybella as what it called a high-demand, nonsurgical option to reducing double chins. The company used a study by the Rolling Meadows, Ill.-based American Society for Dermatologic Surgery showing that 68% of Americans were “bothered” by submental fat, which is another name for double chin.
Integration
Allergan previously said that most of Kythera’s operation would remain in Westlake Village, but documents filed with the state Employment Development Department show that Kythera is permanently laying off 117 workers there, the majority of whom are area business managers, effective Nov. 30.
The company’s Irvine hub—which oversees its eye business along with aesthetics—employed an estimated 2,500 workers and has trimmed about 1,000 jobs in recent months.
The company also has added some jobs through consolidation since Actavis PLC acquired Allergan Inc. some months ago—a $72.5 billion deal that saw the acquirer keep the better-known Allergan brand name.
The net effect of the furloughs and new hires in Irvine has not been disclosed.
Allergan, in any case, is getting another product that could increase its male market share as part of the Kythera deal and fit into operations under the Irvine hub.
Kybella isn’t the only male-appeal product coming to Allergan through the deal.
KYTH-105, or sepiprant, is being studied for treating male pattern baldness.
Analyst Wilbur mentioned that the market for treating male pattern baldness is north of $1 billion, “despite limitations of existing therapies.”
Allergan, under its previous Irvine-based incarnation, had done some clinical work with the active ingredient of Latisse for treating hair loss in men.
