CDC Report Shows Further Falls In US Life Expectancy

Life expectancy in USA has fallen for the second consecutive year, according to provisional data published by the US Centers for Disease Control & Prevention. For 2021, US life expectancy at birth was 76.1 years, the lowest since 1996 and down from 77.0 years in 2020. Male (73.2 years) and female (79.1) life expectancy also declined to levels not seen since 1996.

The almost one-year decline between 2020-21 was primarily owing to increases in mortality because of Covid-19 (50% of the negative contribution), unintentional injuries, heart disease, chronic liver disease & cirrhosis and suicide. This would have been greater were it not for the offsetting effects of decreases in mortality owing to influenza & pneumonia, chronic lower respiratory diseases, Alzheimer’s & Parkinson’s disease and perinatal conditions.

Nicholas Hall Writes: Does falling life expectancy matter? Yes, it matters a lot, to individuals and their friends and families; and to society, especially as some of the early deaths are among members of the economically-active population who financially support both the younger and older age groups. It also matters to our industry in that it continues to change the demographics, which may present new marketing opportunities.

As is his wont, tech billionaire Elon Musk has repeated his warning of a global underpopulation crisis, most recently tweeting that “population collapse due to low birth rates is a much bigger risk to civilisation than global warming”. Experts disagree. Demographer Joseph Chamie hit back: “He’s better off making cars … than at predicting the trajectory of the population. Yes, [in] some countries, their population is declining, but for the world, that’s just not the case.” This is backed by the UN’s World Population Prospects 2022 report, as we reported back when it was first published in July, which predicts that on 15th November 2022 the global population will reach 8bn and that it could grow to around 8.5bn in 2030 and 9.7bn in 2050, before peaking at around 10.4bn people during the 2080s.

Benchmark leading brands and track competitor activity across major and local players with CHC New Products Tracker. Featuring 36,000+ entries, this ultimate competitive intelligence tool allows you to create your own customised searches. Please contact david.redford@NicholasHall.com to set up a demo.

CHC regulation: News from EFSA and FDA

The European Food Safety Authority has stated that its scientists “cannot currently establish the safety of cannabidiol as a novel food owing to data gaps and uncertainties about potential hazards related to CBD intake”. Following the submission of numerous applications under novel food regulations, the European Commission asked ESFA to give its opinion on whether CBD consumption was safe for humans. EFSA’s expert Panel on Nutrition, Novel Foods & Food Allergens (NDA) believes there is insufficient data on the effect of CBD on the liver, GI tract, endocrine and nervous systems and psychological wellbeing. While studies in animals show significant adverse effects especially in relation to reproduction, it is important to determine if these effects are also seen in humans.

In other notable CHC regulatory news, the FDA has placed Sanofi’s Actual Use Trial to support the Rx-to-OTC switch of ED treatment Cialis (tadalafil) on hold, owing to concerns about the protocol design. Cialis is the only PDE-5 inhibitor that offers men a choice when it comes to treatment for ED – for use as needed and for once daily use. The AUT has not yet recruited any patients, but Sanofi noted that it “continues to work with the FDA to move the programme forward and will engage the agency in upcoming meetings as it determines the next steps”.

Source: EFSA

Nicholas Hall’s Touchpoints: Why am I not surprised at the latest EFSA ruling on CBD? Even though the Chair of the NDA Panel, Professor Dominique Turck, has let a crumb of comfort drop from his high table when he said, “It is important to stress at this point that we have not concluded that CBD is unsafe as food”, the announcement will have disappointed an industry and the many manufacturers who have sunk millions into proving the unique benefits of this new class of consumer healthcare products. This is, after all, the organisation that won’t allow probiotics to be named as probiotics on packaging, although it seems to me highly significant that the authorities in Spain and Netherlands are leading the way to override this ridiculous ruling by the Dr.No’s at EFSA. 

In much the same way, California is pioneering the move for hemp-derived CBD to be treated as supplements and eventually brought under the DSHEA umbrella. This is another crumb of much-needed comfort at a time when the FDA seems in a state of paralysis regarding the regulation of medicinal cannabis. And I’m extremely concerned with the recent news that the FDA has stopped Sanofi’s Actual Use Trial for the switch of Cialis, which my good friend Mary Alice Lawless believes could be a threat to the whole switch process in USA.

Explore the best CBD and lifestyle launches from 2021 in the Innovation Showcase featured in our recent Innovation in CHC report. Drawn from CHC New Products Tracker, you can also explore innovation by marketer, region and country. To order your copy, or for further information, please contact melissa.lee@NicholasHall.com.

GSK eyes CBD market with Cann partnership

Cann Group has entered into an exclusive evaluation & option agreement with GSK Consumer Healthcare in relation to the potential commercialisation of Satipharm CBD capsules for OTC (S3, Pharmacist-only) distribution in Australia. GSK also has potential interest in first rights to negotiate exclusivity periods to assess its interest in taking up commercialisation rights in other markets globally. Cann has granted GSK the exclusive right to evaluate Satipharm (excluding Cann’s Rx CBD products) for 60 days after the delivery of Cann’s final clinical study report.

In consideration of this, GSK will pay Cann £100,000 (US$130,437) as a non-refundable payment. Key terms of any definitive sales & marketing agreement will be contingent on factors including the results of the 4-week Phase 3 clinical trial and path to regulatory approval, as well as GSK’s marketing evaluation. Recruitment for the trial, which will examine the efficacy of Satipharm for the short-term treatment of sleep disturbances and quality of life outcomes, is in progress and the results are expected in H2 2022.

As highlighted in our recently published Innovation in CHC report, global launch activity for CBD products has dropped off substantially over the past two years since the pandemic. Regulatory uncertainty also still hovers over the status of CBD in the key US market, another factor in NPD dropping sharply there. In the near future, we expect there to be a greater emphasis on quality over quantity. Further clinical backing for CBD and other cannabinoids – in the way GSK is pursuing with this Cann partnership – will be crucial to this next phase in the maturity of the category.

Source: Nicholas Hall’s CHC New Products Tracker

Nicholas Hall Writes: “This is a very important story. As Peter Crock, the Cann CEO, says: “Cann’s ability to produce a CBD capsule that presents as a regular pharmaceutical and has proven benefits in terms of stability and bioavailability has attracted interest from a number of potential distribution partners. We are delighted to have this opportunity to work with GSK Consumer Healthcare, which would bring industry-leading expertise and market access to our CBD product platform if we enter into a definitive exclusive agreement.”

Alright, it’s not a done deal yet, but there is an expectation that it will be concluded for Australia, and possibly other markets. It is highly significant in many ways:

  1. It’s the first major move since Australia approved CBD for certain OTC indications in February 2021 
  2. With all due deference to Nestlé, it’s the first instance of a major CHC company taking a direct interest in the CBD market
  3. There is some real science involved
  4. The sleep indication will be a sure-fire winner in a category that grew 13.2% in 2021 and still has massive unmet consumer demand

And finally, is it a sign of the greater freedom that the independent Haleon will have to enter “difficult” categories, which might not be possible for an affiliate of Big Pharma? All in all, this is a bold move, and one I hope will succeed.

We are pleased to announce that the latest edition of Innovation in CHC from CHC New Products Tracker is now published! This report showcases 100 major innovations from 2021, profiles best-in-class brands and highlights key ingredient and delivery format trends. To order your copy now, or for more information, please contact melissa.lee@NicholasHall.com.

CHPA Self-Care Leadership Summit

From Nicholas Hall’s Regional VP, North America, Liz Cummings

USA: “If there was ever any doubt, the world has learned what we knew all along – that consumer healthcare is absolutely essential to public health and that good healthcare starts with good self-care,” observed Consumer Healthcare Products Association President & CEO Scott Melville during his keynote at the CHPA annual Self-Care Leadership Summit last week.

Two areas of self-care – dietary supplements and diagnostics – were especially important to consumers during the pandemic, he noted, and CHPA’s membership expansion into those categories positions the association well to support the full scope of the industry in the future. One example is the data-driven Dietary Supplement Index (USA), which identifies supplements sales by region and provides a tool for the industry to educate healthcare providers and insurers to make the case for nutrition as essential to healthcare.  

During the meeting, the CHPA awarded its Ivan D Combe Lifetime Achievement Award to longtime industry leader – and former Chair – Gary Downing. Praised by many former employees at the event for his leadership, Downing has spent his career growing CHC companies, with a resume that includes sales and management at the Richards-Vicks Company. He later co-founded MedTech Labs, which eventually sold for a 400% rate of return, joined the Lansinoh Laboratories Board of Directors and became CEO of Insight Pharmaceuticals, then Clarion Brands, which was recently sold to Bridges Consumer Healthcare.

The audience also appreciated with standing ovations the 40-year CHPA career of Phyllis Taylor, Sr Director of Membership and Sponsorship, when her retirement was announced by Melville. We at the Nicholas Hall Group of Companies send her our very best wishes for a happy next chapter with her family.

The CHPA meeting will be reviewed in detail in the forthcoming March / April issue of CHC Insight North America. To review the latest trends and developments across the region, please contact melissa.lee@NicholasHall.com to find out more, or to receive a sample copy of a recent issue.

Two Rx-to-OTC allergy switches approved by FDA

In a clear sign of a more favourable attitude to Rx-to-OTC switch, the US FDA last week approved two new allergy products for non-prescription use.

Lastacaft alcaftadine ophthalmic 0.25% solution (Allergan / AbbVie) is now available without a prescription online and in retail stores for individuals aged 2+ years with ocular allergies. As demonstrated in clinical studies, one drop works in as little as three minutes to provide relief from itchy eyes for up to 16 hours. Following the recent FDA Rx-to-OTC switch approval, the original patented prescription-strength formulation of Lastacaft is available in a 5ml multidose bottle containing a 60-day supply, as well as a twin pack with two 5ml multidose bottles.

Perrigo also received final approval last week from the FDA for the OTC use of Nasonex 24HR Allergy (mometasone furoate monohydrate 50mcg). This marks the first branded Rx-to-OTC switch for the company, which expects to begin offering the nasal spray later this year. Nasonex is a registered trademark of Organon and is used by Perrigo and its affiliates under licence.

Nicholas Hall’s Touchpoints: This development will no doubt lead to an increase in switch activity after House and Senate committee members cited concerns that “very few products in recent years have switched from prescription drugs to nonprescription drugs” and pointed out that the FDA is expected to “meet the goals of the Fall 2021 Unified Agenda and publish and subsequently finalise the proposed rule titled Nonprescription Drug Product with an Additional Condition for Nonprescription Use.”

The appropriations committees are also: “Concerned about dietary supplement products that are adulterated or misbranded, in particular with imported products. The agreement provides an increase of US$2mn in the FDA’s budget [US$6.1bn in total] to be used for inspections, as well as enforcement of the Dietary Supplement Health & Education Act of 1994”. My sense is that in the biggest market for both switch and dietary supplements, we could see a correction in the prevailing trend from treatment to prevention.

Take a look at the latest CHC innovations in our forthcoming 2022 edition of Innovation in CHC from CHC New Products Tracker. This report offers a look at Rx-to-OTC switch activity, as well as innovation by region, marketer and 20 individual countries. To pre-order your copy and save up to £1,350 with the pre-publication discount, or for further information on this report, please contact melissa.lee@NicholasHall.com.

NielsenIQ’s “Global Consumer Outlook”: Agility crucial in 2022

The pandemic may be entering its third year, but there are signs that governments are gearing up to living with Covid-19. NielsenIQ’s 2022 Global Consumer Outlook delves into consumer sentiment and spending, revealing how people will shop in the year ahead. With employment disruptions, supply chain breakdowns and varying recovery scenarios, the trends setting the tone for consumer behaviour in 2022 include:

  • Consumers will move towards an endemic mindset 
  • Virus variants will fuel different recovery trajectories
  • Inflation concerns will take a toll on consumers; prepare for continued global consumer spending constraints
  • New-found consumer priorities born out of the pandemic will not be compromised. Consumer prioritisation of health, wellbeing & financial security will take centre stage 
Source: NielsenIQ
  • Consumer spending intentions reflect a continued homebody lifestyle with cautious approaches intensified by inflationary pressures. Leisure & entertainment will continue to take a backseat against an ongoing Covid backdrop
  • Necessity will be a driving force. Consumers will bring added scrutiny on expenses that fall beyond priorities & necessities

For the full Outlook, click here.

Nicholas Hall’s Touchpoints: The NielsenIQ 2022 edition of “Global Consumer Outlook” is timely as we start to think again about a possible end of the pandemic. The NielsenIQ team concludes: “In the year ahead, agility will be critical. Retailers and brands that consider different trajectories and recovery scenarios will be better placed to address consumers’ changing priorities, states of cautiousness and increasingly constrained wallets. They must ensure their offerings can morph and resonate with how the landscape will continue to evolve in the years to come.”

One of the trends that we have observed in the USA, but not in other regions to the same extent, is a prioritisation of healthcare spend by consumers on products with tangible benefits. So for the first time in some years, we’ve seen more of the growth categories focusing on treatment than prevention. Is this a blip or the start of a longer-term trend? It’s too soon to tell!

An added complication is the weakness of the global economy and the predicted rise of inflation, which are putting more pressure on consumers, who in general will have to prioritise their shopping even more than in the past. So which consumer health products will they purchase in what may be a slimmed-down overall shopping basket? And a further knock-on effect may be a reduced interest in supporting sustainable products. The survey reported in our third lead story (below) is encouraging, but the practicality might be that consumers with less disposable income then before may not be able to prioritise these products, even though this remains their ideal.

These and many other issues are in the front of our minds at the moment as we begin to scope the 4th edition of our New Paradigms report (subtitled “A Return to the New Normal”) later in 2022.

Immunity: DSM and Sprim reports highlight evolving consumer needs

According to The Immunity Report, recently published by DSM, some 40% of consumers now buy supplements online. This offers convenience, choice and the chance for shoppers to conduct their own research. The digital space also provides more opportunities for tailored products and services vs the broad support offered in-store. Some 76% of global consumers who find nutrition-genetic testing appealing would do it to improve immunity.

In the digital space, supplements can also be more easily tailored to consumers’ lives and habits via online subscription services, which would interest 62% of nutritional supplement users. These can be based on factors such as demographic, lifestyle or season. As well as tailored convenience for the consumer through immunity products suited to them, subscription services can help brands to keep connected with consumers beyond delivery and learn more about their needs over time. One of the interesting findings in the report was how “pill fatigue” among consumers has led to a surge in demand for other delivery formats like gummies, drink shots and stick packs.

Separately, a recent survey conducted by Sprim involving 1,000+ participants across USA, Mexico and Brazil found that, with the pandemic driving interest in immunity, there has been a profound rise in demand for supplements. However, in a saturated market, consumers are becoming more discerning with their purchasing power.

The Sprim report presented five key takeaways, providing a foundation for companies in the immune support category seeking to serve the needs of this evolving consumer:

  • 61% began or increased their purchasing of dietary supplements for immune support in the wake of Covid-19
  • Scientific / clinical trial evidence was the most important consideration when choosing an immune support supplement
  • Vitamins C & D are the most popular ingredients for immune health
  • While most consumers in Mexico & Brazil purchase their supplements from drugstores, those in USA primarily buy theirs from online mass market stores
  • Feeling “tired & rundown” is the #1 buying trigger for immune supplements across all regions

Now is your last chance to save up to 50% off several Reports titles as part of our special end-of-year Reports saleending on 31 December! To find out more, or to create your custom discounted reports package, please contact melissa.lee@NicholasHall.com.

Q3 Results Round-up: C&D and Prestige

In this week’s blog, we look at the latest quarterly results of two Top 20 global CHC marketers, starting with Church & Dwight, which reported net sales of US$1.3bn in Q3 2021, up 3.7%. Online sales grew by 2.2% (on top of 102% growth in Q3 2020), accounting for 14.2% of total sales.

  • Consumer Domestic net sales were US$998.1mn, up 4.6% driven by household and personal care sales growth and acquisitions. Organic sales increased by 2.8%, owing to higher price and product mix (+6%), partially offset by lower volume (-3.2%). Vitafusion gummy vitamins were among the growth drivers
  • Consumer International net sales were US$227.0mn, a 6.3% increase, mainly driven by European organic sales performance (+8.8%), Global Markets Group organic growth (+6.9%) and currency gains. Despite continued lockdowns, organic sales increased by 2.3%, primarily owing to higher volume. Growth was driven by Waterpik oral care products and Sterimar nasal spray in Europe and Sterimar, Femfresh intimate wash, Vitafusion and L’il Critters gummy vitamins in the Global Markets Group

Comment: Reflecting ongoing trends, CEO Matthew Farrell noted during an earnings call that “Vitafusion gummy vitamins saw huge consumption growth in Q3, up 24%. Consumers have made health & wellness a priority. It appears that the new consumers that came into the category are staying, because if we look at the last year, Vitafusion household penetration is up almost 10%.”

Vitafusion remains a huge growth driver for C&D

As for Prestige Consumer Healthcare, revenues grew by 16.3% (+10.5% on an organic basis) in fiscal Q2 2022 (Jul-Sep 2021) to a record US$276.2mn.

  • North America OTC Healthcare sales were US$251.7mn vs US$216.6mn in the comparable quarter. This was driven by a strong performance across a majority of key brands vs their respective categories and increased demand in certain Covid-impacted categories such as motion sickness and travel-related channels
  • International OTC Healthcare sales totalled US$24.5mn vs US$20.8mn. The increase related primarily to a rise in consumer activity in Australia, which drove a sharp spike in demand for Hydralyte and other Covid-impacted brands, along with a foreign currency benefit of US$0.5mn

Comment from CEO, Ron Lombardi: Our record Q2 built on the strong results delivered in Q1 as our leading brands and business strategies enabled us to benefit from a higher-than-anticipated rebound in Covid-impacted areas, as well as strong consumer demand. The strong performance is broad-based with market share gains, revenue and earnings growth and is a testament to our focused execution in the current environment. Furthermore, TheraTears [acquired from Akorn on 1st July 2021] added incrementally to our strong results and we were pleased with the quick and seamless integration that is now complete.

Save the Date! We are delighted to announce that we will be heading to Athens on 4-6 May 2022 for our 32nd European CHC Conference & Action Workshop! Contact elizabeth.bernos@NicholasHall.com to reserve your space today!

Nielsen IQ: OTC pack size trends 2019-21

In this week’s blog, we share some insights and research from one of our partners, Nielsen IQ, on how purchasing patterns for OTC medicines have evolved in the US market over the past 2-3 years.

In 2019, prior to the Covid pandemic, all size ranges of OTC medications were growing 2-5%, with the larger packs slightly outpacing the smaller pack sizes. As the outbreak began, wellness concerns and “stocking up” behaviours increased, leading to accelerated growth rates of the largest sizes. In the back half of 2020, many shoppers were able use their stockpiled OTC medication purchases from earlier in the year.

Additionally, cold and flu incidence was low owing to less social interaction and the wearing of masks. As the vaccine has become widely available in 2021, normal activities are resuming but all OTC medication sales are down compared to the unsustainable growth of a year ago.

Source: Nielsen IQ. *Pain Relief, Upper Respiratory, Gastrointestinal, Sleeping and Alertness Aids.

The importance of extra large and super size pack sizes has increased consistently since the start of the pandemic. This growth traces across all the top OTC categories and to all forms of pain relief and sleep. The GI extra / super size gains are from liquids, while tablets are driving the CCA / upper respiratory growth.

The upsizing is also seen in shopping patterns. While there were 5 million less OTC medication shopping trips in 2020 compared to 2019, the number of trips in which shoppers purchased an extra or super large pack increased by 10.4 million (+3%), while smaller size trips were down to 15.4 million (-3%).

NielsenIQ Client Director Anna Mayo discussed Healthier Growth for OTC during our recent North American e-Conference 2021. If you were unable to join, contact us to purchase a recording of the session. Next on the agenda is our APAC e-Conference 2021 on 23 November. To find out more about either meeting, please contact elizabeth.bernos@NicholasHall.com.

Spotlight on WBA, plus US and UK retail

In its latest results, Walgreens Boots Alliance announced that fiscal 2021 sales from continuing operations rose by 7.5% on a constant currency basis to US$132.5bn, exceeding expectations. In Q4 fiscal 2021 (June-August 2021), sales increased by 11.8% to US$34.3bn.

  • United States had Q4 sales of US$28.8bn, up by 6.6%. Retail sales grew by 6.5%. Comparable sales were up 8.1%, reflecting an 8.9% rise in comparable pharmacy sales and 6.2% growth in comparable retail sales. Excluding tobacco & e-cigarettes, sales increased by 7.2%, reflecting broad-based growth across all categories. In particular, health & wellness sales were 14% ahead, aided by cough / cold & flu, at-home Covid tests and vitamins.
  • International sales rose by 61.8% to US$5.5bn, including a favourable currency impact of 9.2%. Sales were up 52.6% (CC), including higher sales associated with the formation of the company’s wholesale j-v in Germany. Excluding this, sales rose by 9.3% (CC), reflecting the ongoing recovery in the UK market, where Covid restrictions were lifted in July 2021. Boots UK comparable retail sales were up by 15.0%, with footfall on the high street recovering although still below pre-Covid levels. Boots.com continued to perform ahead of expectations, with digital sales in Q4 more than doubling vs pre-Covid levels.

Both the US and UK CHC markets struggled for growth in the MAT Q2 2021 period – as per the chart below – but there were signs in the WBA results of a strong recovery in retail pharmacy sales in both markets in July and August 2021.

WBA has also announced its new consumer-centric healthcare strategy to drive sustainable, long-term growth. The plan features the launch of Walgreens Health, a technology-enabled care model powered by a nationally-scaled, locally-delivered healthcare platform. Walgreens Health will bring equitable, personalised, healthcare to communities across USA in-store, at home, in the doctor’s office and via a mobile app. WBA’s aim also includes reimagining retail through expanded health & wellness offerings and mass personalisation; accelerating WBA brands and digital offerings; and expanding the Transformational Cost Management programme.

In addition, WBA has increased its ownership stake in VillageMD from 30% to 63% to advance its strategic position in the delivery of value-based primary care, a fast-growing segment of the healthcare system. The US$5.2bn investment will accelerate the opening of at least 600 Village Medical at Walgreens primary care practices in 30+ US markets by 2025 and 1,000 by 2027, with more than half of those practices in medically underserved communities. 

Now is your final chance to enter our Nicholas Hall’s CHC Marketing Awardstaking place during our APAC e-Conference 2021 on 23 November! If you wish to put your brands in the spotlight, enter your campaign before 22 October. To find out more about this online meeting or awards criteria, please contact elizabeth.bernos@NicholasHall.com.