CHC market forecast to hold up well in 2020

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Forecasts released by Nicholas Hall’s CHC sales database DB6 project that the global retail CHC market is expected to slow to 3.5% in 2020 amid the Covid-19 pandemic.

  • Analgesics are expected to increase to 6.1% driven by strong sales of paracetamol-based systemics, while topicals are forecast to slow to 3.3% in spite of the switch of Voltaren in USA
  • CCA is projected to be the fastest-growing category with an increase of 6.5% boosted by coronavirus and reports of a high incidence of seasonal cold & flu at the start of 2020
  • GIs (+0.4%) and Derma (+0.8%) are expected to remain static as consumers cut back on non-essential purchases amid the tougher economic environment
  • Antiseptics & disinfectants are forecast to buck the low-growth trend in derma with a double-digit increase
  • Lifestyle CHC sales are predicted to slow to 1.8%, with erectile dysfunction (+13.2%) and sedatives & sleep aids (+7.8%) bright spots in an otherwise challenging category
  • VMS sales are expected to maintain growth of 3.4% with anticipated gains in some subcategories — notably vitamins C & D, zinc and immune supplements, offset by a deceleration in some other subcategories

The market is expected to bounce back in the longer term with a forecast CAGR 24/19 of 4.3% and CAGR 29/24 of 4.7% driven by switch, most notably of erectile dysfunction and daily oral contraceptives. CBD is not included in these retail forecasts.

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DB6 VP, Celine Waller writes: The Covid-19 pandemic has prompted an unprecedented surge in sales of certain CHC products as consumers have stocked up on essential medicines and sought products to protect their health. However, latest data points suggest that this spike has been short-lived with the market now stabilising and in some cases receding. We expect this trend to continue over the next few months, leading to a slight slowdown in CHC retail sales across 2020 in its entirety, although of course the industry is expected to be far more resilient than many others.

However, this only tells part of the story – as consumers are unwilling or not permitted to leave their homes, we expect an acceleration of the channel shift from bricks & mortar to e-Commerce. CHC sales in the Internet & Mail Order channel are forecast to increase by 22.5% in 2020. This will boost growth of the holistic “all channels” view of the market, which also includes CBD, to 5.0% in 2020 (an improvement on 4.3% in 2019). Internet & Mail Order is expected to account for 19.2% of the total CHC market within next decade, more than doubling its share from 9.4% currently. 

We are pleased to announce the latest DB6 market forecasts are now available! With over 150,000 pieces of data across 63 markets, DB6 now includes topline data across all channels of distribution, including e-Commerce! To find out more about our extensive database or to set up a free demo, please contact Kate.Holdcroft@Nicholashall.com.

Time’s 100 Best Inventions of 2019

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Time magazine has just published its annual round-up of the 100 best innovations – based on key factors such as originality, creativity, influence, ambition and effectiveness – and healthcare was the best represented category with 10 innovations in 2019. Most have been designed for use in primary care settings, such as GE Healthcare’s new Senographe Pristina with Dueta mammogram, but there were several innovations designed for consumer use.

One of these is Tivic Health’s ClearUp, which was added to our OTC New Products Tracker database following its launch in September 2019. Positioned as a drug-free handheld device to treat sinus pain owing to allergic rhinitis, ClearUp delivers microcurrent waveforms to sinus nerves under the cheek, nose and brow bone. The medical device provides three intensity levels for personalised usage, and each treatment takes five minutes to perform and lasts for up to six hours.

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Tivic Health’s ClearUp for sinus pain

Also on the Time Best 100 Innovations of 2019 list were portable ultrasound device Butterfly iQ, Theranica’s drug-free migraine treatment Nerivio and handheld doctor examination kit TytoCare. The latter retails for US$299 and has been designed to eliminate the need for a doctor visit by examining the lungs, ears, skin and throat with special adapters and then video­conferencing a doctor to monitor the metrics in real time. According to TytoCare CEO Dedi Gilad: “It transforms primary care by putting health in the hands of consumers.”

As for Nerivio, it was described as the “first smartphone-controlled acute migraine-relief wearable device” when it gained de novo FDA approval in May 2019. The medical device, which is not suitable for people with chronic migraine, is placed on the upper arm and uses smartphone-controlled electronic pulses to create a Conditioned Pain Modulation (CPM) response. Alon Ironi, CEO and co-founder of Theranica, has said the product will be launched at an “affordable price” when it comes to market in 2020.

Don’t miss out on the chance to save 30% on a subscription to the ultimate tool for tracking consumer healthcare innovation, OTC New Products Tracker! We’ve recently hit over 20K entries and made some innovative improvements within the past year, including powerful new graphs, additional filter options, PowerPoint export, Save & Search options and monthly customised innovations reports. Until the end of 2019 we are offering an exclusive 30% discount off list price — please contact waisan.lee-gabell@nicholashall.com to find out more!

France clamps down on OTC painkillers

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First came a public consultation launched by French medicines agency, ANSM, in August 2018 on how to increase consumer awareness of the risks of paracetamol misuse or overdose. Then followed the decision in July 2019 that, within 9 months, all paracetamol-based medicines must carry a prominent warning on packaging, to inform consumers about risks associated with paracetamol overdose, particularly hepatotoxicity. Paracetamol is the most commonly prescribed and used medicine in France, and the change affects more than 200 medicines.

Now, the ANSM has decided that, to reinforce the advisory role of the pharmacist and guarantee safe use of medicines containing paracetamol, ibuprofen and / or aspirin (in particular to avoid the risk of overdose), such products should be removed from the OTC self-selection list from January 2020 and kept behind the counter in pharmacies. ANSM has launched a consultation period with marketers, who have one month to comment.

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According to our estimates, the decision (if implemented) could affect around 90 SKUs on the French market. This includes the trio of leading paracetamol-based brands – Doliprane, Dafalgan and Efferalgan – as well as the top OTC ibuprofen-based (Nurofen, Advil) and aspirin-based (Aspirine Upsa) analgesics. Various OTC generics from the likes of Biogaran, Sandoz and Mylan, as well as systemic cold & flu remedies (Fervex, HumexLib) and topical analgesics, could also be affected.

The true effect that this decision could have on sales of OTC systemic analgesics remains to be seen, but it would clearly not be welcome news for marketers active in a category that remains in persistent decline, in part because of another regulatory decision (reverse-switch of codeine in July 2017). Leading brands such as Doliprane (Sanofi) and Efferalgan (formerly BMS, now Taisho) are available in both semi-ethical (reimbursed) and pure OTC versions, the latter often backed by TV ads, and it’s these latter SKUs which marketers have invested in over recent years that are most at risk.

Rapid regulatory change will be one of the themes at Nicholas Hall’s upcoming OTC.NewDirections Executive ConferenceTaking place in London on 14 November, the meeting will ultimately focus on the latest CHC Innovations and Technologies, with presentations from RB, Mundipharma, J&J and many more experts from CHC and beyond. To book your place or find out more, please contact jennifer.odonnell@NicholasHall.com without delay.

Tamiflu to switch to OTC in USA?

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With 2018 a barren year for Rx-to-OTC switch, it is welcome news that Sanofi has signed a strategic deal with Roche for the exclusive OTC rights to Tamiflu (oseltamivir 75mg capsules, Genentech / Roche Group) for flu prevention and treatment in the USA. Under the terms of the agreement, Sanofi will be responsible for leading negotiations with the US FDA for the OTC switch and subsequent exclusive marketing, scientific engagement and distribution of Tamiflu OTC in the USA. Roche will continue to market Tamiflu in the rest of the world and Sanofi will retain the rights to first negotiations for switch rights in other selected markets. Sanofi’s Executive VP for Consumer Health, Alan Main, noted that: “A successful switch of Tamiflu to OTC would support our global cough and cold strategy by expanding into flu with a sustainable point of difference in the market.”

As Nina Stimson, OTC.NewDirections Consulting Editor, commented: “To some extent this was an unexpected development, but welcome insofar as (if approved), OTC Tamiflu will help expand the boundaries of consumer healthcare. Of course, in certain conditions (such as the swine flu pandemic in 2009-10) Tamiflu has sometimes been available from pharmacists without a prescription; New Zealand was one such country to permit OTC supply on a temporary basis.” 

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Tamiflu’s patent in the USA and some other markets expired in 2016 and, as the chart above indicates, this has led to a steady decline in sales over recent years, with US Tamiflu sales falling by 29% in 2018 to total CHF168mn (US$170mn). Generic competition intensified in the USA in 2017 and continues to grow, while Tamiflu brand sales are now also in decline in Japan and internationally. Roche is now focusing its efforts on Tamiflu’s successor, Xofluza, which was approved by the FDA in late 2018.

If Tamiflu can switch to OTC successfully in the USA, then similar reclassifications will likely follow elsewhere. In 2009, in the midst of the global swine flu pandemic, Australia’s State of Victoria issued a public health emergency order allowing pharmacists to supply Tamiflu (oseltamivir) without a prescription. There has also long been talk of Tamiflu switching to OTC in Europe – in 2008, at the AESGP meeting in Sweden, the EMA’s Executive Director Thomas Lonngren cited Tamiflu as a possible candidate for the EU’s then newly created centralised procedure for Rx-to-OTC switch.

Explore the latest CHC Innovations and Technologies at our OTC.NewDirections Executive Conferencetaking place in London on 14 November 2019. Nicholas Hall and Nina Stimson will be joined by experts from companies including Bayer, Mundipharma and J&J to review key issues impacting our industry and ensure that you are Keeping Consumers in the Spotlight. Book your place before 13 September to take advantage of our early bird booking discount and save GB£100! To find out more, or to reserve your place, please contact Elizabeth.Bernos@NicholasHall.com.

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

Flu Trends: USA, UK seeing 2018 spike

Though it’s difficult to build a comprehensive picture of flu trends across the globe, reports suggest that January 2018 has seen a spike in flu activity in North America and Europe. In its full-year 2017 results, J&J also cited growth for its upper respiratory category as one of the trends underpinning a 3.7% rise (+2.6% organically) for its OTC division in 2017. This included strong Q4 growth for its CCA brands in the Asia-Pacific region, suggesting that cold & flu activity is robust across the northern hemisphere.

According to reports, the US is in the grip of its strongest cough, cold & flu season for almost a decade. In mid-January, Brenda Fitzgerald, Director of the Centers for Disease Control & Prevention, said: “We are currently in the midst of a very active flu season. With much of the country experiencing widespread and intense flu activity … so far this season, influenza A, H3N2, has been the most common form of influenza. These viruses are often linked to more severe illness, especially among children and people age 65 and older. When H3 viruses are predominant, we tend to have a worse flu season with more hospitalizations and more deaths. While our surveillance systems show that nationally the flu season may be peaking now, we know from past experience that it will take many more weeks for flu activity to truly slow down.”

As the chart above shows, the percentage of US patients visiting their doctor with ILI (influenza-like illness) has peaked sharply in late 2017 / early 2018, reaching levels not seen since the 2009-10 flu season. Similarly, in the UK, reports suggest this has been the worst flu season for seven years – since the 2010-11 swine flu epidemic – with doctors visits for suspected flu rising sharply in certain parts of the country (in Wales, they recorded a fourfold increase to 64.9 cases per 100,000).

As we make our way through Q4 2017 results season, we’ll keep a close eye on how this spike in flu activity is reflected in the CCA performance of various OTC marketers, though it may be that we have to wait until the Q1 2018 results come in to see the full effect of this trend.

Q1 2017: Early analysis of the global OTC performance

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Nicholas Hall’s global OTC database, DB6, has just published its latest figures relating to the Q1 2017 performance of the OTC market, and below are some standout trends based on early analysis of the data. Over the coming weeks, our OTC INSIGHT research teams will be compiling the latest trend info at a regional and Top 20 country level, and we’ll alert you as soon as this analysis has been uploaded to the OTC DASHBOARD website.

1. Russia returns to higher growth (+18.2% MAT Q1 2017 vs +11.3% full-year 2016)

A key factor in the slightly improved performance of the global OTC market in the 12 months to end-March 2017 (+4.5%) vs full-year 2016 (+4.3%) was higher growth in Russia. While a modest upturn in the world’s No.1 OTC market, USA, was offset by decelerating growth for both No.2 market China and No.3 market Japan, it was the European countries – largely No.5 Russia, but also No.4 Germany – that accounted for the improved performance of the global OTC market in Q1 2017.

2. CCA growth at the heart of Europe’s revived fortunes in Q1 2017

Global CCA sales were up 4.7% in 2016, thanks to a strong end to the year, and this trend continued into the first quarter of 2017, with growth accelerating to 6.3% in the MAT Q1 2017 period. Europe was largely behind this upsurge, with CCA growth in Western Europe showing a marked improvement (+3.8%), while Central & Eastern Europe was the biggest source of dynamism (+17.8%), led by Russia and Poland. This trend extended to the rest of the northern hemisphere, with North America also reporting higher CCA growth (+4.4%) in the MAT Q1 2017 period, with Canada especially vibrant (+6.9%).

3. Global Top 5 stays the same, but J&J may overtake Sanofi by mid-year

While the Top 5 global OTC marketers – GSK, Bayer, Sanofi, J&J and Pfizer – remain fixed in position and adrift from the rest of the competition, the battle for the No.3 spot between Sanofi (+3.8%) and J&J (+4.1%) continues to intensify. On current trends, it looks as though J&J may overtake Sanofi by the end of Q2 2017, and we will confirm the outcome of this battle later in the year.

In the meantime, please check your weekly briefings and OTC DASHBOARD‘s Charts & Graphs archive for more early analysis of the Q1 2017 results over the coming weeks.