MAT Q1 2018: Global OTC growth steady at 4.1%

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According to Nicholas Hall’s global OTC database, DB6, the OTC market maintained 4.1% growth in the 12 months to end-March 2018. This steady but slower rate of global OTC growth compares to a faster pace during the first three quarters of 2017, when growth peaked at 4.6%.

The key factor in the persistent slowdown in Q1 2018 was lower OTC growth in the USA (+2.5% vs +2.8% for calendar 2017), with faster development held back by a weak allergy season. As highlighted in our OTC DASHBOARD market summary for North America, the impact of recent Rx-to-OTC switch activity in the US market has also been minimal.

Some positives emerged in the MAT Q1 2018 data. OTC growth in Western Europe improved to 1.8%, boosted by a high incidence of cough & cold in the first quarter of this year, while Latin America’s OTC market continued to increase strongly (+11.8%), with leading country Brazil up by 9.8%.

The OTC performance in Asia-Pacific (+4.7%) was mixed, with China (+6.3%) and India (+7.9%) improving upon their 2017 growth, however Japan and Australia remained flat in Q1 2018. Growth in the Middle East & Africa remained stable at 6.7%, while Central & Eastern Europe decelerated further to 5.5%, with weakening growth in both Russia (+3.5%) and Poland (+3.3%).

If you are not a subscriber and would like to find out more about what DB6 covers, please contact kayleigh.griffinhooper@NicholasHall.com for a free demo.

 

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Nicholas Hall’s Closing Speech at 4th Asia Pacific Conference

Nicholas Hall’s 4th Asia-Pacific Conference has just taken place in Singapore, which included the APAC Consumer Healthcare Awards, an opportunity to recognise innovation in Asia-Pacific’s OTC industry that produced the following winners:

Asia-Pacific Creativity in Consumer Healthcare Award

Panadol 1st

Systane 2nd

Bactidol 3rd

Worldwide Digital in Consumer Healthcare Award

Insto 1st

OBH 2nd

APAC New Product of the Year in Consumer Healthcare Award 

Scotts DHA Gummies 1st

Dimetapp Ultra Plus 2nd

As Nicholas Hall made clear in his closing speech, which you can watch in full above, the high number of companies supporting their awards entries with passionate case studies was an encouraging sign in an OTC industry currently undergoing huge disruption. Some of the uncertainty is emanating from the renewed focus on M&A activity.

Nicholas Hall pointed to the uncertain future ahead of us, arguing that there are now no guaranteed business models for OTC companies. That said, he believes that brands will survive, as long as marketers and product managers “feed and water them” and also convey real emotional benefits to consumers.

Though the OTC industry is currently experiencing poor rates of growth across the world – with the exception of some markets like Vietnam – Nicholas Hall remains positive for the future, insisting on the need for OTC marketers to constantly refresh their portfolios, while also engaging more with the digital world. Now more than ever, the global OTC industry is desperate for continuity and innovation.

Following on from the Asia-Pacific Consumer Healthcare Awards Ceremony at our Singapore Conference, we now look ahead to our 2018 European Marketing Awards! Click here for more details on the awards for which you can enter. With entries closing on 1st February, please contact jennifer.odonnell@NicholasHall.com to find out about entry criteria or to book your place at the conference now!

Cognitive Boost For Children Whose Mothers Take Supplements In Pregnancy

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Maternal multi-micronutrient (MMN) supplementation during pregnancy could drastically improve cognitive ability in children, reports a study published on 17th January in The Lancet Global Health. This may be apparent in children between the ages of 9 to 12 years.

The Summit Institute of Development research team led a follow-up study involving 2,879 schoolchildren in Indonesia whose mothers were supplemented with MMN or iron + folic acid (IFA) in the Supplementation with Multiple Micronutrients Intervention Trial (2001-2004).

SID’s initial research was conducted with 31,290 pregnant women on Lombok Island. The women were selected randomly to receive multi-micronutrient supplements.

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The CEO of SID, Mandri Apriatni, commented: “Results of our initial research showed there had been an 18 percent decrease in infant mortality rates each year among mothers who had taken multi-micronutrient supplements during their pregnancy, much lower compared to those who only received iron and folate acid supplementation.”

In the follow up-study that saw children complete cognitive tests over a two-year period, researchers observed better procedural memory in MMN children vs IFA children. The difference between the two corresponded with the increase associated with an additional half-year of schooling.

Children of anaemic mothers in the MMN group scored considerably higher in general intellectual competence, equivalent to the increase associated with an additional full year of schooling. Overall, there was a positive coefficient of MMN vs IFA in 18 / 21 tests.

WHO expresses interest in new Zika test

Scientists in Singapore have developed a kit that can test for the Dengue, Chikungunya and Zika viruses all at the same time in just two hours.

The three mosquito-borne viruses cause similar symptoms such as rashes and joint pain. Symptoms for the Zika virus are generally mild and go away within a week, causing the disease to be misdiagnosed.

The kit is ready for use and only costs a few dollars to produce. Dr Masafumi Inoue, a senior research scientist at the Agency for Science, Technology & Research’s Experimental Therapeutics Centre confirmed that the World Health Organisation (WHO) has expressed interest.

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Dr Masafumi Inoue is currently compiling clinical data for the health authority before sending the kit over for testing. If the testing is successful, the WHO may use the kit to test for the viruses.

As it is extremely important to quickly distinguish between the three major mosquito-borne viruses, the kit could prove incredibly useful in ensuring patients receive the required treatment and care without delay.

All that is required from the patient is a blood or urine sample. The genetic material of the virus is then extracted to find out what the virus is. The detection process takes two hours, reducing the time by threefold if each of the viruses were to be tested for individually.

The idea to develop the kit came about six months ago when Brazil had been hit badly by a large number of Zika cases.

OTCs in Action Episode 54: Japan’s First Food for Cognitive Function

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This week OTCs are in Action in Japan, where Otsuka has introduced Nature Made Ginkgo Biloba, Japan’s first Food with Function Claim for cognitive function. Research has shown that flavonoid glycosides and terpene lactones extracted from ginkgo biloba can improve perception and recall of perceived objects.

According to Otsuka: “Traditionally prized in Europe for its health benefits, ginkgo biloba has also been recognized as a health food in Japan for many years. A systematic review of research results for flavonoid glycosides and terpene lactones extracted from ginkgo biloba leaves led to notification and acceptance of this supplement as Japan’s first Food with Function Claim for cognitive function.” Nature Made Gingko Biloba is delivered in tablet form.

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The Food with Function regulatory classification was introduced in April 2015 and allows food supplements to be supported by nutrient claims, as long as scientific evidence has been provided to the Consumer Affairs Agency, reports the December issue of Nicholas Hall’s OTC INSIGHT Asia-Pacific. Unlike Foods for Specified Health Use, these products are not subject to case-by-case review by the agency.

Another recent innovation from Otsuka offers heart health benefits to Japanese consumers. In November, the company expanded claims for Nature Made Super Fish Oil in Japan with the specific health benefit of “inhibition of triglyceride levels in the blood”.

OTCs in Action Episode 52: Japanese tax tweak to raise OTC spending

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This week, OTCs are in Action in Japan, where the government plans to reward self-medicating consumers with a tax deduction. Under current tax codes, Japanese consumers can deduct medical expenses over US$800 or so per year from taxable income, but OTC expenses are often not high enough to meet this threshold. A recently proposed tax incentive will require a minimum OTC expenditure of only about us$80 to qualify for the deduction – a benefit the government is hoping will nudge consumers with minor ailments away from expensive hospitals, and toward drugstores.

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According to Nikkei Asian Review: “The health ministry expects more than 10mn households to qualify for the deduction. If the break changes patient behaviour, the resulting drop in government medical spending could outweigh the expected tens of billions of yen in lost tax revenue. Reining in social insurance expenditures is also crucial to achieving the government’s goal of a primary surplus by fiscal 2020.”

Nichols Hall’s DB6 database shows that the US$7bn Japanese OTC market has been ailing with sales declines for the past several years – encouraging people to put OTCs in Action for financial rewards will be therapeutic for consumers, manufacturers and government.

 

 

OTCs in Action Episode 48: Will increased Chinese OTC demand boost sales in Japan?

OTCinActionheaderThis week, OTCs are in Action in China, where the termination of the one-child limit will slightly increase demand for children’s OTCs. However, this will not only impact the Chinese OTC market, but neighbouring countries as well. Many younger, affluent Chinese consumers prefer fast-acting Western medicines to locally-manufactured OTCs and Traditional Chinese Medicine, but the lengthy, complex and expensive registration process deters many companies from entering the market.

Because of this, many Chinese tourists are buying OTCs in Japan, Hong Kong and other countries, according to the October issue of Nicholas Hall’s OTC INSIGHT Asia-Pacific. Neighbouring countries are welcoming these consumers with a variety of incentives:

Japan’s National Tourism Organisation reported that relaxed regulations for travel, depreciation of the yen and the MERS outbreak in South Korea were among the factors increasing the number of Chinese visitors to the country by 134% in the year to May 2015.

This increase in travel, coupled with last October’s consumption tax exemption for foreign visitors buying OTC medicines, has led several drugstore chains to adapt their stores in tourist hotspot areas to attract overseas consumers. In particular, leading chain Matsumotokiyoshi announced in late 2014 that it was planning to open 20 duty-free drugstores aimed at foreign shoppers, with all expected to be operational by March 2016.

Additionally, industry sources estimate that purchases by consumers from China account for 50-70% of OTC sales in Hong Kong. Planograms in chain drugstores appeal to them — large SKUs of infant milk powder and other products are shelved in high profile areas.

To see samples from OTC INSIGHT Asia-Pacific, click here.

With nearly 1.4bn residents, China is the world’s most populous country, albeit with a scarcity of children. To learn more about this emerging market, join us in Shanghai as Lynn Xu – Senior VP, Greater China Practice Leader at Nielsen, Jeff Crowther, Executive Director at US-China Health Products Association, and the Nicholas Hall team host the OTC Action Workshop. Click the link for more details: OTC Action Workshop Shanghai