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Revance (RVNC) Gets FDA Nod for Anti-Wrinkle Product, Stock Up

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Revance Therapeutics (RVNC - Free Report) shares were up 21.6% on Thursday after it announced FDA approval for its DaxibotulinumtoxinA for Injection (DAXI), a rival treatment to AbbVie’s (ABBV - Free Report) blockbuster Botox injections for improving frown lines.

DAXI will be marketed as Daxxify for injection for the temporary improvement of moderate-to-severe frown lines, also called glabellar lines, in adults

Daxxify is the first and only neuromodulator product stabilized with Peptide Exchange Technology, which is devoid of both human serum albumin and animal-based components that most other modulators use. Revance claims this long-lasting, peptide-enhanced product is a disruptive innovation in neuromodulator product formulation in more than 30 years

Revance Therapeutics’ stock has risen 55% this year so far against a decrease of 24% for the industry.

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Daxxify’s approval was based on 36-week efficacy data from the SAKURA phase III clinical studies, which were conducted on more than 2,700 patients. The data from the studies showed that the neuromodulator was well tolerated and achieved clinically significant improvement with long-lasting results. The data demonstrated a median duration of six months and up to nine months for some patients. It showed that DAXXIFY could deliver year-long results with as few as two treatments per year compared to a 3 to 4-month duration profile with conventional neuromodulators, including Botox. Revance did not disclose the price of its injection.

AbbVie’s Botox is approved for several therapeutic and aesthetic indications. It brought in billions of dollars in sales and effectively fought competition. Other than frown lines, Botox injection is used for other cosmetic indications as well. Some analysts believe Daxxify is a big competitive threat to the aesthetics market leader, Botox, due to its long-lasting benefits. However, some analysts believe that Revance could have a tough time capturing market share from Botox loyalists. AbbVie acquired Botox as part of its Allergan buyout back in 2020. Botox (cosmetic plus therapeutic) sales totaled more than $1.9 billion in the first half of 2022.

Back in 2020, the FDA had delayed its decision on Daxxify’s biologics license application (BLA) as it was unable to conduct the required inspection of the company’s Northern California manufacturing facility due to pandemic-related travel restrictions. However, this communication was not a complete response letter. The FDA did not indicate any other review issues.

Revance is also evaluating DAXI in mid-stage studies for the full upper face, forehead lines and crow’s feet, as well as in two therapeutic indications — cervical dystonia and adult upper limb spasticity.

Zacks Rank & Stocks to Consider

Revance Therapeutics currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the same sector are Morphic (MORF - Free Report) and Agenus (AGEN - Free Report) , both carrying a Zacks Rank #1 at present.

In the past 60 days, estimates for Morphic’s 2022 loss per share have narrowed from $3.47 to $1.75. Loss estimates for 2023 have narrowed from $3.96 to $3.77 during the same period. Shares of Morphic have lost 36.5% in the year-to-date period.

Earnings of Morphic beat estimates in three of the last four quarters and missed the mark just once, witnessing a surprise of 48.29%, on average.

Estimates for Agenus’ 2022 bottom line have narrowed from a loss of 89 cents to 70 cents in the past 60 days. Loss estimates for 2023 have narrowed from 64 cents per share to 60 cents per share over the same time frame. Agenus’ stock is down 18.6% in the year-to-date period.

Earnings of Agenus beat estimates in three of the last four quarters while missing in one. The stock delivered a four-quarter average negative surprise of 12.02%.

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