Allergan Drops, Stops Textured Breast Implant Sales in Europe

Allergan plcAGN announced that it has suspended the sale of its textured breast implants and tissue expanders and will further discontinue the supply of any remaining products in Europe, reportedly due to a cancer risk. The decision was taken following a compulsory recall request from French regulatory authority Agence Nationale de Sécurité du Médicament (ANSM) after the product's CE Mark certification expired.

Shares of Allergan were down almost 7% following this news on Wednesday. Moreover, the stock has lost 16.5% year to date, narrower than the industry's decline of 19.5%.

Although the French authority has not identified any major risk associated with women's health regarding these textured breast implants, Allergan is still focused on this serious issue and is fully cooperating with the regulatory body to resolve the same.

Fortunately for Allergan, the issue will not affect its smooth implants sales. The company has renewed the CE Mark certification for its smooth implants with GMED and will continue to market the same in Europe.

We would like to remind investors that Allergan's breast implants generated sales of $314.4 million during the first nine months of 2018, an 8.3% increase year over year. The breast implants fall under the Medical Aesthetics products segment, which also includes Allergan's renowned products such as, Botox and Alloderm.

Approved for therapeutic and aesthetic use, Botox is a key top-line driver for Allergan. Its cosmetic indication includes three facial aesthetic treatments, namely forehead lines, crow's feet wrinkles at the outer corner of eyes and the glabellar lines.

Botox's therapeutic diseases include overactive bladder, cervical dystonia and strabismus among others.

Botox grossed sales of $2.6 billion in the first nine months of 2018, reflecting a rise of 13% year over year. However, there have been concerns pertaining to the chronic migraine indication, regarding new competitors of Botox with the entry of calcitonin gene-related peptide (CGRP) antibodies.

Notably, Novartis/Amgen's AMGN CGRP antibody, Aimovig, Teva's TEVA Ajovy (fremanezumab) and Lilly's LLY Emgality (galcanezumab) were all approved by mid-2018 and was launched subsequently.

However, Allergan, on its third-quarter investor conference call stated that introduction of the CGRPs should expand the migraine market and Botox plus the other CGRPs can coexist in the larger market.

Zacks Rank

Allergan currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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