CHPA Report & Conference

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Last week, to tie in with its Annual Executive Conference (AEC), the Consumer Healthcare Products Association released a white paper that found, on average, every dollar spent on OTC medicines saves the US healthcare system around US$7.20, resulting in nearly US$146bn in savings annually. CHPA President & CEO Scott Melville commented that the “healthcare system undervalues the contribution of our industry’s products”, and explained that the research will support legislative initiatives promoting financial incentives for consumers to buy OTCs using health insurance flexible spending plans.

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Done in partnership with IRI, the study was conducted in part to raise the profile of OTC products in USA. It found that around 90% of people who buy an OTC product for a condition would seek medical care if the OTC product had not been available. The study analysed nine OTC categories to identify the primary contributors of cost savings to the healthcare system. The categories include allergy, analgesics, antifungals, cough / cold / flu, lower GI, medicated skin, upper GI, sleep and smoking control. The research showed that OTC medicines provide additional value through expanded access to more than 27mn consumers who would otherwise forgo treatment – more than 13mn Americans for allergies alone.

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Writing from Florida, Nicholas Hall said: “Trust was a major theme of CHPA’s Annual Executive Conference … Edelman presented data showing that consumer trust of healthcare is improving after plummeting last year. Speakers agreed that trust goes beyond building brands. In a session I moderated on Tuesday, Bayer CH President Heiko Schipper said that our industry needs to, “articulate better what we do. We are doing a lot of good things like being responsible for the environment and employee diversity”.

Taisho Executive VP Ken Uehara agreed: “Trust can’t be built instantly, certainly for our company, it’s our most important asset.” Alan Main, Executive VP, Sanofi, commented that in the past it was about building the brand: “I still think the brand comes first in people’s minds, but we have to look after the brands, not just for five years but for 30-40 years.” Katie Devine, who is moving into a new leadership role at J&J, said companies can choose not to reply to every tweet, but should maintain a fact-based conversation about being responsible in the treatment of employees, the population and planet.

Other questions I addressed to the Leadership Panel concerned the lack of Rx-to-OTC switch (Alan Main said switch has an important role to play in the future of self-care); CBD (all panellists believe it will develop well beyond the current US$500mn quoted by IRI, although Katie’s point, “I know how to switch from Rx to OTC, but not from illegal to legal”, was well taken); and the number one item on their wish list — speed to market and improved innovation were favourites … I liked the concentrated format of this year’s AEC, with two half-day sessions, which allowed time for networking, and was proud to have been one of three Preferred Sponsors of the meeting, in the good company of Google and the Emerson Group.”

Nicholas Hall will discuss the latest Market Trends and Innovation impacting the CHC market at our annual North American CHC Conference (26-27 June) in collaboration with our partners EverythingHealth. As well as the chance to network with other industry players, you can hear from Google, Jefferson Health, Persuadable Research and other industry experts. Don’t hesitate — book before 31 March to save with our generous early-bird booking discount! To find out more about this event, please contact elizabeth.bernos@NicholasHall.com.

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OTC Innovation Report 2018

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Lamenting the fact that Scott Gottlieb is stepping down as FDA Commissioner, Nicholas Hall commented in Friday’s OTC.Newsflash that: “Although producing few tangible results so far, FDA under Gottlieb has displayed a greater openness to finding new switch models at a lower cost and with shorter lead times, including the use of new technologies.” Nicholas Hall also said that “government support is vital to our industry” and that “more liberal regulations are at the heart of a successful self-care sector”.

A drop-off in switch activity over the past year is part of the explanation for lower levels of high-quality OTC innovation. In 2018, OTC New Products Tracker awarded just six products with 4 stars – eye care brands Lumify (USA) and Zabak Eye Drops (Poland), antacid Reza Band (USA) and antispasmodic Scopolan Compositum (Poland), plus Viagra Connect (UK) and allergy remedy Talerc (Brazil). Compared to previous years, this marked a falling-off in terms of 4-star innovations.

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The number of total OTC innovations (3,747) in 2018 was roughly in line with the previous year, and still much higher compared to 2014, 2015 and 2016. However, the number of 2* (528), 3* (94) and 4* (6) innovations was much lower, while the number of 1* innovations (3,119) was at an all-time high.

VMS continues to be a major source of innovation, with three of the Top 5 subcategories in 2018 – probiotics, multivitamins and hair & beauty supplements. Derma is another key source of innovation, with three of the Top 10 – acne remedies, eczema & psoriasis and lip care. The three other innovative subcategories which complete the Top 10 are sedatives & sleep aids, topical analgesics and sore throat.

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Please contact us for the full report. You can also review 17,000+ new launches and innovations with OTC New Products Tracker, the ultimate competitive intelligence tool! Products are given a star rating, with “me too” items ranked 1*; launches / line extensions in a new category / adjacency 2*; major launches / line extensions with strong new benefits / positioning 3*, and 1st Rx-to-OTC switches in a category, creation of a new OTC class or other major leaps in innovation 4*. With a recently-released major update including eye-catching new graphics and powerful search filters that help you visualise and explore the vast archive according to your exact requirements, now is the ideal time to set up your free trial. For a demo or more information, contact waisan.lee-gabell@NicholasHall.com.

Demand high for cannabis, but its self-care future in Canada is uncertain

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Since Canada’s introduction of the Cannabis Act, which came into force on the stroke of midnight on 17th October 2018, government-operated websites and private retailer portals powered by Shopify are reporting “hundreds of thousands” of orders, according to the company’s VP, Loren Padelford. In addition, long queues have been reportedly forming outside licensed retailers across the country, leading to shortages in some areas.

Canada is now the second country after Uruguay to legalise cannabis for recreational use by adults, who can possess up to 30g of legal cannabis, dried or equivalent in non-dried form in public; share up to 30g with other adults; purchase cannabis products from a provincial or territorial retailer; and grow up to four plants per residence (not per person) for personal use from licensed seeds or seedlings.

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At the same time, however, Health Canada has shut down all possible direct pathways for companies to market any cannabis-derived ingredient for health purposes. This, according to the department, is because the safety (and efficacy) of cannabis “is currently insufficient” once a health claim is added to a product label. This means that all levels of THC and CBD sold without a label claim can be sold to any adult but those with a claim may not.

Health Canada also ruled that all phytocannabinoids will be required to make an application for an Rx-to-OTC switch before consumer health claims could be granted through a further amendment to the Prescription Drug List. Of course, this requires a company to make an application under the New Drug regulations and pay significant fees for the processing the application. Not surprisingly, this decision lands all cannabis health products in the most expensive pathway to market access, likely only affordable to the largest of players.

For an in-depth report on this breaking story, see the forthcoming issue of OTC INSIGHT North America. If you work outside of North America, we also have titles covering Asia, Europe and Latin America. Click here to find out what key features OTC INSIGHT includes! To receive a sample issue or for details of subscription rates, please contact melissa.lee@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.

 

Further FDA delays to NSURE guidance on Rx-to-OTC switch

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One of the key topics at our North American OTC Conference to be held in Morristown, New Jersey this week (20-21 June) is Rx-to-OTC switch, and opportunities for marketers in the dynamic US regulatory climate. Hopes that the FDA would publish guidance this year on the Nonprescription Safe Use Regulatory Expansion (NSURE) were recently dashed after the Notice of Proposed Rulemaking date was changed to February 2019.

NSURE was introduced in 2012 to encourage utilisation of technology to “ensure” the safe use and self-selection of innovative Rx-to-OTC switches, but the programme has been stalled for several years.

At the Consumer Healthcare Product Association’s recent Regulatory, Science & Quality meeting, FDA Deputy Director for Regulatory Programs, Dr Doug Throckmorton, assured attendees that the 5-year delay had “nothing to do with our interest and support”, but was a result of administrative priorities. He encouraged sponsors to bring ideas to the FDA. This request has been voiced for several years, but manufacturers appear to be waiting for the draft guidance.

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For those that can’t make this week’s meeting, Nicholas Hall’s Opening Address will be live-streamed here at 8.30-9.10 on Wednesday 20 June.

Following this, you can also view these live presentations:

Dave Wendland, Hamacher Resource Group, will be presenting on Independent Pharmacy Opportunity: Myth or Reality? on Wednesday 20 June 09:40-10:10 here 

Join the CHC Institute Launch with Steve Sowerby and Ed Rowland on Wednesday 20 June 14:15-15:15 here 

See Joseph McGovern, Everything Health, review the Key Issues of Switch on Thursday 21 June 09:00-09:30 here 

Plus, join Everything Health’s Mary Alice Lawless & Joseph McGovern to review how you can Change the Words to Change the World in the move from OTC to Non-Prescription, followed by Nicholas Hall’s Summary & Close of the meeting on Thursday 21 June 12:40-13:30 here 

All timings EST. To ensure you enjoy the event in full (download the brochure here), including panel sessions and networking opportunities, reserve your place now by contacting lianne.hill@NicholasHall.com

AESGP meeting 2018: Key learnings

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OTC INSIGHT Europe Editor Sarah Carter reports back from this year’s 54th AESGP Annual Meeting, which was held in Amsterdam and served as a farewell to Dr Hubertus Cranz, who retired as Director General after 30 years in the role.

Below are 8 key learnings from the meeting:

  1. Representatives from Pfizer and Hexal / Sandoz demonstrated how Rx-to-OTC switch can act as a growth driver for the consumer healthcare industry, with Nexium Control (EU Centralised Switch) and MometaHexal (Germany) given as case studies. Both asserted that the Rx heritage of the brands was instrumental in their successful switch, with both market leaders in their respective Rx spheres.
  2. However, while switch offers growth opportunities, several speakers stressed that the limited 1-year data exclusivity available with a switched product in the EU can deter marketers from making the timely and costly investment needed to switch their product.
  3. Digitalisation has transformed the rules of the healthcare industry and education. According to Google, search engines and online videos are the most important touch points for OTC purchasers, with one in 20 searches on Google related to health. In 2017, there were 40bn healthcare queries in EMEA alone.
  4. The global volume of healthcare data doubles every 18 months. It is crucial that we build trust with consumers regarding Big Data, ensuring that our industry uses this in a responsible manner, particularly salient given the introduction of the EU’s General Data Protection Regulation on 25 May 2018.
  5. Low levels of health literacy act as a barrier to self-care. We must empower consumers with the tools and knowledge necessary to play an active role in their health management, healthy ageing and prevention. Healthcare systems need conscious individuals who actively pursue a healthy lifestyle, and seek HCP advice where necessary.
  6. Technology such as wearables and apps has helped to raise health awareness and engagement among consumers, driving the trend for wellness and encouraging people to become key actors in their health management. In the industry, we see increasing purchases of long-term preventive products, rather than OTC treatments.
  7. It is vital that we understand the consumer at a much deeper level than we have done historically, as they no longer want to be sold to, but engaged with. The advent of Big Data and AI deliver us new tools to generate insights and ultimately create more meaningful connections and stronger relationships.
  8. There is little to report on regulations — still no decision on botanicals, and no real update on medical device regulations.

Only two weeks to go until the annual North American OTC Conference! Hosted by Nicholas Hall and Everything Health in Morristown, New Jersey, 20-21 June, this highly-anticipated meeting will review crucial topics impacting the competitive landscape around the central theme of The Future of Consumer Self-care: New OTC Solutions. With topics on the agenda including the e-commerce revolution, a presentation on “Magical Marketing in Healthcare” from Google and a look at the industry’s ‘Switch wish list’, this promises to be an event you can’t afford to miss. To receive a copy of the full meeting agenda or to reserve your place now, contact lianne.hill@NicholasHall.com

Q3 2017: Global OTC growth stays at 4.7%

According to the latest figures published by Nicholas Hall’s global OTC sales database DB6, the OTC market maintained 4.6% growth in MAT Q3 2017. Commenting on the results, DB6 VP Celine Waller said: “Russia remained the fastest-growing leading market, though its growth slowed slightly compared to MAT Q2 2017 (+17.3%). Brazil and Turkey (+13.1%) also both achieved double-digit growth. Growth in the US increased marginally, with an improved performance in cough & cold offset by continued weakness in gastrointestinals and dermatologicals. France and Australia (-0.7%) remained in decline – France owing to the poor performance of the large OTx sector and reverse switch of some cough ingredients, and Australia driven by a slowdown in demand from Chinese consumers buying VMS products for resale in China (daigou or ‘suitcase entrepreneurs’).”

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Though OTC growth remains high in many of the Emerging Markets, the established markets of North America, Japan (+0.6%) and western Europe – notably Germany (+1.8%), France (-1.2%), Italy (+2.0) and UK (+1.7%) – remain relatively flat. Innovative Rx-to-OTC switches, such as the UK MHRA’s recent approval of the POM-to-P reclassification of Viagra Connect, or the emergence of new OTC categories, such as e-cigarettes or medical cannabis, offer the most promising route back to growth for many of these established OTC markets.

Nicholas Hall said: “Q3 data confirms 4.6% as the baseline for CHC growth, and frankly it’s not good enough!! Only the sleepiest or most risk-averse companies will accept competing in a market where growth is only modestly ahead of inflation + higher population. That is why the first serious step by Pfizer to switch Viagra is so important. Since we made our first detailed review of the ED category for a Big Pharma client exactly 5 years ago, we have been convinced that Viagra is potentially the world’s largest consumer health brand. Some might say that it already is, although that would be true only for the use of the Viagra brand name on the internet as most of the blue pills sold in that channel are not from Pfizer. As a legitimate CHC category, and with recreational use included — which Big Pharma companies dislike as they see ED brands as treatments — the overall CHC reproductive health category, including ED brands, condoms, oral contraceptives, EHC and conception products and diagnostics, could easily reach sales of US$20bn at MSP in all channels of distribution.”