K-Toxin's First U.S. Direct-Sales Gamble: Hugel Reaches Half of Key Accounts Despite Profit Drop

More than 50% of accounts activated just four months into direct sales
Operating profit down 62% after buying back inventory from local distributor

Just four months after Hugel began selling its botulinum toxin product Botulax (known as Letybo in the United States) directly in the U.S., it has opened discussions with more than half of the large accounts it had targeted. Although North and South American sales turned negative in the third quarter and operating profit fell by more than 60%, the rapid expansion of its customer base is raising expectations for future profitability.

According to Hugel on November 6, more than 50% of its strategic U.S. accounts had entered the “account activation” stage as of early November. Account activation involves discussing a supply agreement or providing training for medical professionals before introducing a product. The figure rose by about 20 percentage points in a month and a half, from around 30% in mid-September. Strategic accounts are large U.S. aesthetic medicine chains that Hugel is targeting directly through its own sales organization.

Although the number of local U.S. accounts expected to drive overseas sales has grown rapidly, Hugel’s third-quarter operating profit fell 61.8% from a year earlier to KRW 18.1 billion. This was because sales declined and costs increased as the company changed its U.S. sales model. Until recently, Hugel recorded sales as soon as it supplied Letybo to U.S. distributor Benev. After ending the agreement about a year ahead of schedule in September, Hugel bought back the inventory remaining in Benev’s warehouse and reversed the sales it had previously recorded for those products. Because the volume bought back exceeded the volume newly sold in the third quarter, North and South American toxin sales were recorded at negative KRW 200 million.

Initial costs to establish a foothold in the U.S. market also rose in the areas of staffing and marketing. Selling, general and administrative expenses increased 60% from a year earlier as Hugel hired about 40 employees in the United States and expanded marketing.

Hugel has undertaken direct sales despite the impact on its earnings in order to set prices itself and increase profitability, while building trust over the long term in the conservative U.S. aesthetic medicine market. Securities analysts estimate that average selling prices under the direct sales model will be more than twice as high as those achieved through distributors.

Hugel’s first results in the United States contrast with those of Daewoong Pharmaceutical’s Nabota (known as Jeuveau in the United States), which entered the market earlier. According to third-quarter results released by Daewoong Pharmaceutical on November 4, Nabota sales reached KRW 116.3 billion, a quarterly record. Exports accounted for KRW 106.8 billion, up 127.9% from a year earlier.

However, analysts say the sharp increase in Nabota exports was largely driven by U.S. partner Evolus buying inventory ahead of the imposition of tariffs. Daewoong Pharmaceutical records sales when it supplies Nabota to Evolus. In other words, sales are based on the volume delivered to Evolus’s warehouse, not the amount actually sold by U.S. clinics and hospitals. Industry observers believe Evolus purchased an unusually large volume in one go ahead of the U.S. tariffs on pharmaceuticals in September 2026. Daewoong Pharmaceutical also attributed its third-quarter results to the impact of concentrated shipments to the United States. With its warehouse stocked, the volume shipped to the U.S. could decline in the fourth quarter.

Analysts say the performance of Korean-made botulinum toxin products in the United States should be assessed over the long term. Evolus, which sells Nabota, had a 14% share of the U.S. botulinum toxin market in the first three quarters of 2025. Hugel aims to raise its market share to the same level by 2030. “We will be able to compare the products’ actual competitiveness only in the second half of 2027, when Hugel will be handling all U.S. sales directly,” an industry source said.

This content was produced with the assistance of AI translation services.