Highlights from the Q4 update

CHCINACTION

The latest quarterly report on the global CHC market is now available on the CHC DASHBOARD website, including data & trends on the market’s performance at a global, regional and country level (for all 63 markets) in the year to end-December 2019. Here we highlight some of the key topline trends from this update, selecting one major global development from each of our company, category and brand watch sections.

Company Watch: Stada enters the global Top 20

While the list of global Top 5 CHC marketers remains relatively stable, one company that shot up the global rankings in late 2019 thanks to M&A activity, and now claims the No.11 position worldwide, is Stada. The German marketer agreed two major deals in November 2019 that elevated it into the global Top 20. First, as part of Takeda’s goal to divest around US$10bn in non-core assets, Stada bought around 20 selected OTC and Rx products marketed in Russia, Georgia & CIS countries, for US$660mn. Secondly, Stada entered into an agreement to acquire Walmark from Mid Europa Partners for an undisclosed sum. With global No.9 Takeda reportedly now planning to sell its wholly owned OTC subsidiary, Takeda Consumer Healthcare, Stada may feature soon among the Top 10.

9-11 Global.png

Category Watch: Analgesics already accelerating before Q1

Driven by accelerating growth in North America and Europe in Q4, analgesics recorded an upturn of 4.7% in 2019, ensuring the category’s best performance in three years. This trend looks set to accelerate even further in Q1 2020, with various top marketers reporting very strong analgesics growth for their key brands in the latest quarterly results, as a result of the Covid-19 pandemic. In 2019, topical analgesics still grew faster than systemics, though the latter showed the strongest improvement in growth, powered in particular by upturns in USA, Brazil and Germany.

Brand Watch: Vicks and Tylenol race ahead

Only two CHC brands generate more than US$1bn in sales globally – P&G’s global No.1 Vicks and J&J’s global No.2 Tylenol – and both also grew more than twice as fast as the global CHC market overall in 2019. The latest company quarterly results indicate that both brands have shown further acceleration in Q1 2020, driven in particular by gains in North America.

Thank you to everybody who attended Nicholas’ CHC Trends Webinar! If you were unable to join live, you can now purchase a recording of the full discussion, and submit up to 3 questions via email. To find out more or to purchase your copy of the recording, please contact elizabeth.bernos@NicholasHall.com

Survey shows growing support for pharmacies in Europe

CHCINACTION

According to a YouGov survey, commissioned by Stada and focusing on four European countries (Germany, Italy, Spain and UK), hope and confidence in healthcare professionals has grown in the wake of the Covid-19 crisis, though the picture does vary from one country to the next. With measures to reduce coronavirus infection rates defining daily life, Spaniards show the greatest concern for their health (51%), while people in Germany, Italy and UK are less worried (36-39%).

Germans (18%) are least likely to believe their healthcare system has absolutely proven itself, while 47% of Spaniards gave their health system top marks, followed by the UK (35%) and Italy (29%). Spaniards (32%) and Italians (28%) are most likely to have avoided visiting pharmacies vs only 14% in Germany and 19% in UK. In total, one in five people have greater respect and more recognition of what pharmacies provide on a day-to-day basis.

20200420_06_Infographic Corona Survey_pharmacy.png

The potentially good news for community pharmacies in Europe is that the coronavirus crisis does not appear to be leading to a large number of people ordering more medicines online. In fact, only 6% of those surveyed say they are taking this action. However, it will remain to be seen how consumer attitudes to internet & mail order purchasing of OTCs change in the coming years, especially in Europe. According to DB6 VP, Celine Waller, internet & mail order is expected to account for 19.2% of the total CHC market within the next decade, more than doubling its share from 9.4% currently. 

The survey also highlighted the likely impact of Covid-19 on the VMS market in Europe. UK consumers and Germans are generally not motivated to take more vitamins or similar products (<9%). In Italy and Spain, the readiness to do so is higher, particularly for vitamin C, D and multivitamins (13-15%). Paying greater attention to nutrition and taking more exercise hold greater attraction in the southern countries than in Germany and the UK, where people are more likely to say that the coronavirus situation has not changed their habits. 

Ensure that you have registered to join Nicholas online for a special webinar presentation with Q&A, which will take place next week! On 29 April at 10:00-11:30 UK time, Nicholas will review 2019 CHC market performance, explore the impact of Covid-19 and identify growth prospects for the future. For those unable to join, there will be the option to purchase a recording and submit up to 3 questions via email. To find out more or to register to join, please contact elizabeth.bernos@NicholasHall.com without hesitation!

Stada to rise up OTC rankings

otcinaction

Two major M&A deals agreed in the past week look set to elevate Stada into the consumer healthcare global Top 20. In this week’s blog, we look closer at the details of each deal and, based on the calculations of our DB6 data division, where Stada may end up in the rankings once both deals are closed.

As part of Takeda’s goal to divest around US$10bn in non-core assets, the company has agreed to sell to Stada around 20 selected OTC and Rx products marketed in Russia, Georgia & CIS countries, for US$660mn. The portfolio comprises cardiovascular, diabetes, general medicine, respiratory and OTC supplement entries, and includes Russia’s leading systemic cardiovascular, Cardiomagnyl (aspirin + magnesium hydroxide).

Stada will acquire the rights, title and interest to the products in Russia, Georgia, Armenia, Azerbaijan, Belarus, Kazakhstan and Uzbekistan, while under a manufacturing & supply agreement, Takeda will continue to manufacture the products on Stada’s behalf. The deal is expected to complete in Q1 2020 and, based on current assumptions, could elevate Stada into the No.7 position in Europe.

Screen Shot 2019-11-11 at 10.47.17.png

Stada already takes the No.9 position among Europe’s Top 10 OTC marketers

Stada has also entered into an agreement to acquire Walmark from Mid Europa Partners for an undisclosed sum. Based in Czech Republic, Walmark is a leading consumer healthcare company in CEE with a direct presence in nine markets, while its products are available in 40+ markets globally. The company’s portfolio spans multiple categories, and key brands include Proenzi joint health range, Urinal urinary health brand, Biopron probiotics for gut health and Martians paediatric supplements. 

Stada’s Head of European Markets, Steffen Wagner, commented: “We are significantly strengthening our presence in Central Europe — especially in Czech Republic, Slovakia, Romania, Bulgaria and Hungary — as a result of this acquisition. We are also looking at ways in which we can market the Walmark brands outside of the current core geographies.” Again, the deal is expected to complete in Q1 2020, and the combined impact of these two acquisitions may raise Stada up as high as the No.14 position in the global OTC rankings.

You can now take a first look at the speaker line-up of industry experts who will be joining Nicholas Hall in Athens next year for our 31st European CHC Conference, taking place from 28th to 30th April! To reserve your seat at the early-bird discounted rate, or to find out more, including information on sponsorship opportunities, please contact Jennifer.ODonnell@NicholasHall.com or Lianne.Hill@NicholasHall.com