Allergan plc (AGN - Free Report) announced that the FDA has approved its Botox Cosmetic product for a third indication — temporary improvement of moderate to severe forehead lines in appearance, associated with frontalis muscle activity in adults.
So far this year, Allergan’s share price has slipped 0.1% compared with the industry’s decline of 19.8%.
Approved for therapeutic and aesthetic use, Botox is a key top-line driver for Allergan. Its cosmetic indications include improvement in appearance of glabellar lines (frown lines between the brows) and severe crow’s feet. This latest FDA approval makes Botox Cosmetic the only neurotoxin treatment approved for three facial aesthetic treatments — forehead lines, crow’s feet wrinkles at the outer corner of eyes and glabellar lines.
Botox’s therapeutic diseases include overactive bladder, cervical dystonia, chronic migraine and strabismus among others.
The drug generated $1.53 billion sales in the first half of 2017, an increase of 12.7% year over year, driven by strong demand trends. The latest label expansion approval for forehead line treatment, which enjoys a pent-up demand, should drive the sales further.
We remind investors that Botox became a part of Allergan’s portfolio following the March 2015 $77 billion acquisition of Allergan Inc. Having previously commanded a strong presence in the generics market, Allergan with the merger has found place on the top 10 list of world-wide pharma companies based on sales. Later, Allergan sold its generics business as well as the Anda distribution arm to Teva Pharmaceutical Industries Ltd. (TEVA - Free Report) in 2016. However, in April 2016, Pfizer, Inc. (PFE - Free Report) had terminated an agreement to combine with Allergan.
Allergan carries a Zacks Rank #3 (Hold). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
A better-ranked biotech/drug stock is Biogen, Inc. (BIIB - Free Report) with a Zacks Rank #2 (Buy).
Biogen has seen the Zacks Consensus Estimate for current-year earnings being revised 4.5% upward for 2017 and 2.3% for 2018 over the past 90 days. Shares of the company have rallied 11.9% this year.
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