MAT Q2 2018: 5 Key Trends & Developments

Our latest Q2 2018 trend reports on the OTC market at global, regional and Top 20 level are now available on the OTC DASHBOARD website. Here we highlight some of the key trends & developments that have emerged in the latest data.

  1. Europe and Asia drive CCA upturn: Improving CCA growth helped the global OTC market report a slight upturn in Q2 (+4.2%). This followed a return to CCA growth in Europe (+2.7%) in Q2 2018, powered by the UK (+5.8%) and Germany (+4.1%), while France (+0.5%) also returned to positive territory. CCA growth in Asia-Pacific (+5.7%) likewise improved in Q2, thanks to a clear upturn for Systemic cold & flu (+4.7%), with key markets like S Korea enjoying high growth (+6.6%) on the back of OTC innovations such as the relaunch of Dong-A’s Pantec Q.
  2. Sanofi reclaims the No.3 spot from J&J: While GSK maintains its clear lead as the global OTC No.1 marketer, a tight three-way race remains in play for the No.2 spot between Bayer, Sanofi and J&J. Bayer is still the global No.2, while Sanofi reclaimed its position as the global No.3 in Q2 2018, moving ahead of J&J. In Sanofi’s Q2 results, the company reported a return to OTC growth in Europe and a continued strong rise in Emerging Markets, especially in Latin America. The company reported a CCA upturn in both regions, offsetting US allergy decline.
  3. US market behind VMS upturn: Higher Q2 growth in North America’s vast supplements market (+4.0%) has been the key trend behind the improving global picture. In Q2, multivitamins (+2.8%) underwent a clear upturn while the trend for probiotics (+6.9%) and immune supplements (+10.4%) also improved. The latter category has been a particularly vibrant source of OTC innovation in recent months; for example, Nestle has launched elderberry immune gummies as part of its mykind Organics line, while post-surgery immunity supplements and those with a digestive health crossover have also been popular.
  4. Where’s the growth potential? 1. Adjacencies: OTC marketers are increasingly looking to build new consumer healthcare adjacencies, either via switch – in the case of erectile dysfunction and Pfizer’s Viagra Connect – or new product innovation, in the case of medical cannabis. Canada recently voted to legalise cannabis, though the future for CBD and THC supplements remains uncertain. We don’t yet include sales of medical cannabis products in OTC DASHBOARD, though we do track developments in this category closely in both our innovation database, OTC New Products Tracker, and regulatory newsletter, OTC.NewDirections.
  5. Where’s the growth potential? 2. New territories: Rest of World countries (mainly Middle East & Africa) enjoyed continued high in Q2 2018, with sales up 6.6% in the 12 months to end-June 2018, to total US$9.2bn. High growth for analgesics (+7.2%) and CCA products (+6.7%) ensured a strong regional rise overall, allied with a dynamic performance in the key regional market of Turkey (+13.3%). RB is one marketer performing well in the region, claiming a spot among the Top 5 OTC marketers in Q2 2018, following dynamic growth of its CCA portfolio, powered by sore throat remedy Strepsils and its strong support via A+P and line extensions.

With M&A activity in the CHC industry increasing rapidly, now may be the right time for your business to explore growth opportunities. Our specialist M&A boutique is working with a number of strategic and financial partners to assess potential opportunities — for buyers and sellers — and is well placed to discuss the current business climate and possible synergies. To find out more, please contact ammar.basit@NicholasHall.com

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Bangladesh: Amazon eyeing 2020 entry

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As today’s OTC DASHBOARD hot topic report shows, the e-commerce market in Asia-Pacific is undergoing rapid change, with China passing new e-commerce laws that will take effect in January 2019, while India has also just released draft rules for the online sale of medicines. Amazon also last week unveiled a new Hindi version of its website.

Yet all this upheaval is not isolated to the major markets of India and China. Amazon announced over the weekend that it is planning to begin operations in Bangladesh within the next couple of years, to compete with its arch e-commerce rival Alibaba, which is already present in the country via Daraz. With a population of just over 166mn, Bangladesh is an attractive and fast-developing market.

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According to local reports, however, resistance from local e-commerce players in Bangladesh is likely to be strong. Many are opposed to the government’s new Digital Commerce Policy, which allows foreign companies to have 100% shares in local e-commerce ventures (previously it was capped at 49%).

Key areas of sensitivity will be pricing and investment in the local economy. The e-Commerce Association of Bangladesh (e-Cab) is in favour of protection for local e-commerce companies and is reportedly working on a list of policy recommendations, including foreign firms having to host their websites locally, as well as ensuring 90% of staff are locals and that companies have a logistical presence in the country.

Explore the digital landscape at Nicholas Hall’s upcoming OTC.NewDirections Executive Conference. Other topics on the agenda include Medical Device Regulations, Medical Cannabis, Switch and Smart Probiotics. This will be an inspiring day on 12 September in London, focusing on Where Innovation Meets Regulation. For details of the full agenda or to reserve your place contact elizabeth.bernos@NicholasHall.com

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.

 

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”.