Botox, the neurotoxin marketed by Allergan for a host of uses, has dominated the aesthetic market for more than a decade. Now, a group of the drugmaker’s alumni are leveraging their experience to launch a fresh competitor.
Evolus, the medical aesthetics firm which went public in February 2018, launched its own neurotoxin drug, Jeuveau, in the spring following a February FDA approval. The firm’s president and CEO, David Moatazedi, spent more than 14 years at Allergan, where he learned most of what he knows about the aesthetic business and helped the company to a leadership position. Despite competition from multiple newer anti-wrinkle injections, Botox holds 70% of this $1 billion market.
“I have many good friends there and a great deal of respect for the company and the history,” Moatazedi said. “I was fortunate to be a part of that.” He left about a year prior to the launch of Jeuveau. “Really, it was an opportunity to build something new and different from what Allergan currently does.”
He’s joined in that endeavor by a group of former Allergan-ers, which also includes Evolus’ chief marketing officer, Michael Jafar, and its head of corporate communications, Crystal Muilenburg.
Evolus may be a new company, but 80% of its sales force has experience in the aesthetic space. “Our leadership team collectively has many years of experience and so our doctors see us as very mature in our decision-making,” said Moatazedi.
Then again, one of the things helping distinguish Evolus from the competition is its diversity of talent. The firm’s digital team, for one, hails from outside healthcare, he said, and has helped “remove the friction” in how pharma companies typically operate in this space. Its digital-order platform functions less like that of a pharma company and more like that of an aesthetic retail-focused one.
Instilling a digital ethos is just one of the ways Moatazedi says he’s seeking to diverge from his former employer’s playbook. Evolus, the CEO stressed, has been designed “from the ground up” to appeal to the younger, fastest-growing demographic of millennials, both professional and consumer.
Botox and its rivals, which also include Merz’s Xeomin and Nestle’s Dysport, sold by Galderma and Ipsen, are frequently used interchangeably. Given their minimal clinical differences, what distinguishes the brands essentially boils down to the marketing.
Social-media campaigns are not uncommon in the aesthetic space, nor are efforts to tap underserved markets like men or younger consumers. Allergan has also deployed its share of pricey DTC campaigns, not only for Botox but also for Juvederm, a dermal filler used to restore facial contours. For Kybella, a chin fat reducing injection, it enlisted reality-TV personality Khloé Kardashian. It once boasted of having the largest sales force in the aesthetics industry.
“Companies like Allergan, have done a great job … and we didn’t want to replicate what they were doing,” said Moatazedi. “We wanted to come in with a different value proposition. And so we engineered this company around the millennial mindset, not just in the digital platform, but in the way that the brand gets communicated to the consumer.”
Having a single digital platform for keeping doctors engaged with the company marks a distinct approach. The brand also launched with a millennial-friendly hashtag campaign, dubbed #newtox, then staged several social-media opps designed to engage potential prescribers, like an Evolus-themed runway and confetti-throwing station at a meeting ostensibly of the company’s advisory board, comprised of plastic surgeons and cosmetic dermatologists, in early May.
Moatazedi said practitioners attending the meeting “spent a full day learning about the science and the clinical data for Jeuveau,” as well as providing the drug maker with feedback on the totality of its marketing effort, details of which it had held close to the vest until then. “That feedback was critical because we spent the next several weeks refining our go-to-market strategy,” beyond simply the May 15 launch of its customer experience program.
The event’s location at the Ritz-Carlton in Cancun, however, drew some unwelcome scrutiny from those who feel the venue was extravagant for an event hosted by a manufacturer in order to educate doctors. Moreover, many of the HCPs posted positive messages about the product on Instagram, without disclosing that their trip was paid for.
Moatazedi said that, in addition to an advisory board meeting, the Cancun event “also happened to be [for] the launch of [the] company, the first company to launch in this category in a decade.” He added, “This wasn’t a social media event where we asked them to actively post to their patient base. That’s something they chose to do on their own.”
“We take compliance very seriously. We’re regulated just like every other pharmaceutical company is.”
“That being said,” in not having a reimbursed (read: therapeutic) form of its product, Moatazedi added, “we believe we have the latitude to do some things a little differently.”
Another one of those things is what the CEO described as baking “a culture that’s fun” into the company’s operations. “We don’t have to be stiff in the way that we approach the market or our employees.”
Internally, it has a culture council, one of whose actions was to ditch the standard town hall meeting for something the company calls Evolus Talks, where employees come together for a more open dialogue. Like the leader of any good challenger brand, Moatazedi says he’s also fostering a performance-driven aspect to the company culture, one where staffers feel capable of creating an outsized impact despite their small size relative to the competition.
The approach appears to be paying off. With its relatively small sales force of 140 reps, Evolus said that, from May 15 to early July, it was able to convince more than 5,000 clinics to sign up for its early adopter program (called Jeuveau Experience Treatment, or J.E.T., which allows clinics to provide new customers with up to three free shipments), exceeding its own expectation of 3,000. The number of actual doctors who have tried the product is likely to be higher. Ninety percent of the first three months’ worth of orders were transacted through its digital platform. Three-quarters of patients had switched from other therapies; the rest were neurotoxin-naive.
The CEO also touts his company’s transparency, not only in the way it communicates with employees but also in its pricing. “[Customers] have full visibility on the app,” he said. “There are no delayed payments or rebates back six months later where customers are confused by what they’re paying for product.” (Toxin procedures generally run $300 to $500 in the U.S. per procedure.)
The firm’s energy and appeal to the medical community come at an opportune time. Allergan’s being bought by AbbVie in a $63 billion deal expected to close early next year, and number-two player Galderma is being divested by Nestle to private equity group EQT Partners later this year.
“In a market where these doctors are spending a significant amount of their overhead dollars on purchasing products directly from these manufacturers, the relationship matters a lot and the greater the consolidation, the more the customer could have the risk of getting lost in the middle of that,” said Moatazedi. “We offer an opportunity where our leadership team knows these customers well and we offer it in a more boutique style type of operation.”
The wrinkle-smoothing injection’s second-quarter revenue of $2.3 million bested Wall Street’s estimate of a mere $450,000. That may have been a mere drop in the bucket compared to Botox’s cosmetic revenues for the quarter, which rose 10.7% vs. the prior-year quarter to $175.8 million.
Yet, the upstart’s debut suggests some possible chinks in the Botox armor and the bigger company may be feeling the heat. Allergan “significantly increased consumer marketing efforts in front of the Evolus 2Q launch with increased digital ‘noise,’ numbers of sales reps, and all around promotional activity,” according to a May investor note from Leerink.
The next stage of Evolus’ marketing will see new social and digital tactics, as well as the roll-out of new consumer and physician loyalty programs. But don’t look for it to run any TV spots asking consumers to ask their doctor for Jeuveau or to go online to find a clinic—too traditional.
“One thing we talk about internally is that, if we don’t form a culture that’s unique and different, not just in the behaviors but in the way that we think about the business, then ultimately we’re going to follow the same path that others have been down,” Moatazedi said. “And we’re about 20 years late to the game.”
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