Journey Medical said on Monday the U.S. Food and Drug Administration has approved its drug for the treatment of a long-term skin condition called rosacea.

Rosacea is a skin condition causing chronic inflammation of the facial skin and is often classified into four types.

The oral antibiotic, branded Emrosi, was approved to treat lesions associated with inflammatory rosacea, which causes persistent redness and small pus-filled bumps on the face.

However, shares of the company fell nearly 14% as the regulator approved the drug to treat inflammation associated with the condition, and not for reducing redness, also known as erythema.

The FDA had a concern with the prevalence of erythema across other types of rosacea that could lead to confusion amongst providers, CEO Claude Maraoui told Reuters.

Doxycycline capsules, branded as Oracea and owned by Galderma, are the current standard-of-care treatment for inflammatory lesions from rosacea in adult patients.

"Some investors may have been looking for erythema success on the label — as it would serve as a key differentiator vs. Oracea's label," B. Riley Securities analyst Kalpit Patel said.

Journey's Emrosi will be commercially available to U.S. patients late in the first quarter or early in the second quarter of 2025, the company said.

It plans to reveal Emrosi's pricing close to the launch, Maraoui said, and it would be "relatively in the same area" as Oracea's price, which comes around $950 a month.

Galderma did not immediately respond to a Reuters request for Oracea's pricing.

The approval was based on two late-stage clinical trials where the drug met the main goal after 16 weeks of treatment with no significant safety issues.

B. Riley's Patel estimates Emrosi to capture at least 50% of Oracea's market share and generate sales of at least $150 million at peak.