Revance Therapeutics is reversing course to stay competitive with AbbVie's market-leading aesthetics drug, Botox — and RVNC stock crashed Tuesday in response.
The company said earlier this year it was going after "prestige" accounts with its Daxxify, the newest in a class of botulinum toxins that smooth frown lines. But, during an investor day update, Revance said it's cutting Daxxify prices "to be priced competitively with Botox" and "accelerate market share expansion."
The news is likely to put a damper on analysts' expectation for $247.4 million in sales this year.
On today's stock market, RVNC stock crashed 17.3% to 13.81. Earlier, shares fell as much as 33.5%. Revance stock was among the worst-performing biotech stocks on Tuesday.
RVNC Stock: Competing With AbbVie
AbbVie is easily the market leader for botulinum toxin injections. It first gained approval in 2002. Now, Botox Cosmetic is a $2 billion-plus annual product. Sales are expected to top $3 billion in 2025 and $4 billion just three years later, according to FactSet.
AbbVie also sells Botox as a therapeutic treatment for conditions like migraines and excessive sweating. Today, that's an even stronger offering. Though revenue from Botox as a cosmetic drug is expected to overtake the shot as a therapeutic in 2026.
Revance hoped to differentiate itself with Daxxify. During a conference earlier this year, Chief Executive Mark Foley acknowledged the barrier to enter the U.S. market is higher than in places like South Korea and Europe. So, the company planned to go after customers who want a high-end product.
The company is also breaking into the therapeutic market. In August, the Food and Drug Administration approved Daxxify as a treatment for an involuntary movement disorder called cervical dystonia. RVNC stock jumped almost 3% on that news.
But RVNC stock dropped to its lowest point in four years after the company said it lowered the price of Daxxify. The company noted feedback from patients and physicians supports its decision and goal of achieving "broad-based adoption."
The new prices went into effect Sept. 1. Revance said in a presentation the new prices will make it easy for doctors and patients to switch to Daxxify, give doctors flexibility and allow the value of Daxxify to be "unencumbered by price."
"We think we could switch over 50% of our patients if Daxxify was priced competitively with Botox," a plastic surgeon with a private practice said, according to Revance's presentation.
High-Volume Collapse
But RVNC stock investors didn't buy it.
Shares collapsed in their highest volume since January, according to MarketSmith.com.
Revance stock already has a poor IBD Digital Relative Strength Rating of 9, putting shares in the lowest 9% of all stocks when it comes to 12-month performance. Just seven months ago, RVNC stock sat atop the IBD 50 list of elite stocks with a perfect RS Rating of 99.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
