(Reuters) -Crown Laboratories would buy the anti-wrinkle injection maker Revance Therapeutics (NASDAQ:RVNC) at a roughly 50% lower price compared to an original agreement signed in August, the companies said on Monday, sending the latter’s stock tumbling 20%.
The lowered takeover price follows months of delay in the deal after Revance, which makes a rival to AbbVie (NYSE:ABBV)’s blockbuster product Botox, faced a dispute with its partner Teoxane.
As per the current agreement, Crown will buy all of Revance’s outstanding shares for $3.10 per share, or $325.20 million according to Reuters’ calculations. The previous agreement was for $6.66 per share or $924 million.
Revance received a notice in September for breaching the maximum allowed buffer stock levels and not adequately promoting and selling Teoxane’s dermal fillers, as required by their distribution agreement.
While Revance denied the allegations, the notice prompted it and Crown to extend the closing date of the deal first announced in August.
Revance and Teoxane in October agreed to revised brand guidelines and minimum purchase commitments through 2029.
“This significant devaluation is a reflection of multiple forced errors, starting with the failed launch strategy for Daxxify and ensuing reputational damage to Revance’s relationships to the surprise merger announcement near all-time lows, then leading to accusations of breach of contract with Teoxane,” said Stifel analyst Annabel Samimy.
Revance initially set a premium price for Daxxify, its rival to Botox, claiming it lasts twice as long. However, last year, the company reduced the price to match Botox after having difficulty attracting customers.
In the first nine months of 2024, Revance earned $177.2 million from its products and had forecast $280 million in sales for the year in June, an outlook it withdrew in November.
The companies expect the transaction to close in the first quarter of 2025.