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26 June 2015

COMPANY NEWS 3 Bayer sharpens OTC focus Pfizer growsits footprint 3 with new facilityinChina OTCmachines offered in US 3 CVS to pay US$1.9bn for 4 with saleofDiabetes Care Target pharmacybusiness Weifaset to enlarge 5 ayer is set to sharpen its focus on its tour as the Consumer Health unit’sbiggest-sell- itsOTC operations Brecently-expanded OTCbusiness by ing franchise (see Figure 1). OTCcompanies need 6 selling its Diabetes Careunit –which in- Werner Baumann,Bayer HealthCare’schief to pricesmarter cludes anumber of OTCdiagnostic devices – executive officer,said that the companywas Mission adds expertise 8 to Panasonic HealthcareHoldings for C1.02 confident that its Diabetes Care business would in transdermal patches billion. The deal is expected to close in the thrive as part of Panasonic HealthcareHoldings Merz lookingfor innovativefirms 8 first quarter of 2016. –which wasbacked by private-equity firm Sanofi’s NasacortAllergy 9 The business includes the Contour line of KKR and technology giant Panasonic –point- to enter Canadian market blood-glucose monitoring meters and strips, ing out that the German companyhad along- Phynovaopens up 10 which is the Bayer Consumer Health unit’s standing relationship in the diabetes sector with pipelineofTCMs biggest-selling brand, with sales of C658 mil- the Japanese firm. lion in 2014. Commenting on the deal, KKR said that GENERAL NEWS 12 Outside of Europe, Diabetes Care products in partnership with Panasonic it would create were sold directly to consumers through phar- a“global diabetes care powerhouse” with the Greek pharmacists strike 12 macies, drugstores and mass merchandisers, aim of transforming the diabetes-care industry. over wider access to OTCs Bayer pointed out, while in Europe theywere ASMI welcomes reportonselfcare 12 primarily sold via pharmacies. Focus on Life Sciences Canada approves IBS-reliefproduct 12 Diabetes Care forms part of Bayer Con- Bayer announced in September last year that OTCibuprofen gets allclear 13 sumer Health’sMedical Care unit, along with it intended to focus entirely on its Life Sciences from New Zealand agency the company’sradiology products. Bayer Con- businesses –including its consumer healthcare Perrigotolaunch 13 sumer Health also includes the German firm’s interests –byspinning offits MaterialScience store-brand Mucinex D Animal Health and Consumer Care units. Bayer polymers operation (OTC bulletin, 26 Sept- Consumer Health is adivision of the Bayer ember 2014, page 9). MARKETING NEWS 14 HealthCare sub-group. By floating the MaterialScience business UPSA adds granules to 14 Selling the Diabetes Care business will see on the stock market, Bayer claimed it would EfferalganlineinFrance Consumer Care –which wasexpanded signifi- position itself as a“world leader” in the fields Benecol debutsinChina 15 cantly when Bayer acquired Merck &Co’s of human, animal and plant health. in solublepowder format Consumer Care operation and its Claritin, Cop- Earlier this month, the companysaid that Nelsons backs Arnicare cream 15 pertone, Dr Scholl’sand MiraLAX brands late the MaterialScience unit would change its name Scandinavia will be first 16 last year (OTC bulletin,10October 2014, page to Covestro on 1September and be floated on to seeSwimCount launch 1) –become Consumer Health’sprimary focus. the stock market by “mid-2016 at the latest”. Insomniadevicelaunched in UK 16 Furthermore, the OTCloratadine-based al- MaterialScience reported annual sales of Sudocrem’s app inspired 17 lergybrand Claritin will takeoverfrom Con- C11.7 billion in 2014. by Britishsummer fêtes Contour Clarityn

FEATURES 20 Other five Other five brands brands Advantage Empowerment key to 20 (Animal driving OTC growth Aspirin Health) Merck taps consumers 24 for inspiration REGULARS Advantage Aspirin Events – Our regularlisting 19 Bepanthen (Animal Health) Bepanthen People – Smithappointed PAGB 27 Aleve Aleve chiefwithDarracott as deputy Consumer Health’s top-10 brands by sales pre- and post- acquisition of Merck Consumer Careand sale of Diabetes Care, based on Bayer’s third-quarter 2014 and first-quarter 2015 results (Source –Bayer) Generics Sister Ad 04-2015_Generics Sister Advert 23/04/2015 10:44 Page 1 All that’s happening in generics and biosimilars

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COMPANY NEWS OTC

Retailing BusinessStrategy OTC machines Pfizer grows its footprint offered in US withnew facility in China elf-service machines offering consumers Sarange of OTCmedicines could soon be fizer has begun construction of aUS$95 particularly in China,”Schmeltz explained. found across the US, as manufacturer Pharma- Pmillion (C84 million) OTCmanufacturing Noting that Pfizer also had plans to house a box rolls out its “automateddrugstore”. facility in Suzhou, China, in response to “grow- research and development facility on the site, Describing the machine –known as the ing demand” for its consumer healthcare prod- Schmeltz pointed out that this would help the Pharmabox –asa“pharmacyatyour finger- ucts in the Asia-Pacific region. firm to develop “innovative”consumer health- tips”, Pharmabox noted that its “unique self- Located near the firm’sexisting facility in care products for consumers in the region. service kiosk” carried over140 items typically Suzhou, the newplant would initiallymanufac- Pfizer’sexisting production facility in Su- found in alocal drugstore. ture Caltrate dietary supplements and Centrum zhou, which opened in 1994, had been expand- The Pharmabox offered arange of OTC multivitamins, Pfizer said, with plans to extend ed anumber of times, the companynoted, “to and personal-care brands, the firm pointed out, production to additional products in the future. keep pace with adouble-digit growth in de- including Benadryl allergy products, Listerine Commenting on the move,Andy Schmeltz, mand for the Caltrate and Centrum brands”. mouthwashes, Trojan condoms, Tylenol pain- Pfizer Consumer Healthcare’sregional presi- The facility employs astaffof700 and pro- killers and Zantac heartburn treatments. dentfor Asia-Pacific and Europe, Middle East duces arange of OTCbrands includingRobi- Claiming that the Pharmabox was“unique and Africa, said Asia-Pacific wasa“large and tussin cough and cold products, as well as Cal- in the automated-retailing industry”, the com- rapidly-growing region” for the company’sCon- trate and Centrum, plus anumber of prescrip- panysaid the vending machines offered “well- sumer Healthcare division. tion medicines. known products at the same or lower prices “The newplant in Suzhou will give us the Keith Choy, Pfizer Consumer Healthcare’s than found in most pharmacies”. production capacity we need to meet increasing regional general manager for North Asia, said The Pharmabox wasdesigned to get OTC demand for our consumer healthcarebrands, thenew facility would build on the “strong foun- and personal-care products into communities dation” the companyalready had in Suzhou. that were “not well-served by traditional bricks “Weare confident that as we expand with our and mortar pharmacies”, the firm said, noting newsite here, we will build on the productive that its machine could be placed “anywhere IN BRIEF and mutually-beneficial relationships we have where people live,work, or congregate”. ■ MITHRA PHARMACEUTICALS –the developed within the community,” Choynoted. “The Pharmabox,”the firm stated, “provides Belgium-based women’shealth specialist –has In addition to the existing plant in Suzhou, asafe, simple and effective wayfor consumers announced plans to raise funds through an Ini- Pfizer operates three other manufacturing sites to obtain high-demand pharmaceutical products tial Public Offering (IPO) on the Euronext in China, as well as tworesearch and develop- in highly-frequented areas, 24/7.” Brussels market. ment facilities. OTC OTC OTC

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26 June 2015 OTC bulletin 3 OTC26-06-15p2-9_Layout 1 23/06/2015 17:47 Page 4

OTC COMPANY NEWS

Annual Results Mergers&Acquisitions LloydsPharmacy CVS to payUS$1.9bn for boosts Celesio Target pharmacy business xpanding the reach of LloydsPharmacyin Ethe UK helped to liftsales at Celesio’s VS Health is set to acquire Target’sre- Portland, Oregon; and Seattle, Washington. ConsumerSolutions division by 13.1% in its Ctail pharmacybusiness for US$1.9 billion “The transaction enables CVS Health to short financial year from 1January 2015 to (C1.7 billion) in amove that will create the reach more patients, adds anew retail channel 31 March 2015. biggest pharmacychain in the US, with over for our productsand givesour consumers more Consumer Solutions’ turnoverhad advanced 9,000 locations. convenient options,”Merlo claimed. to C979 million, the pan-Europeanwholesaler Under the terms of the deal, CVS Health said Brian Cornell, Target’schairman and chief and retailersaid, thanks to the “solid growth” it would gain Target’smore than 1,600 in-store executive officer,said that the deal would give of LloydsPharmacyand “overall positive cur- pharmaciesacross 47 US states –which gen- the firm’scustomers access to CVS Health’s rency-exchange effects”. erate around US$4 billion in annual sales –and “best in class healthcare services”. Arise in service agreements with hospitals rebrand them with the CVS/pharmacyname. “With CVS Health managing the pharmacies had helped to drive up LloydsPharmacy’ssales, CVS Health currentlyoperates over7,800 in our stores, the Target team will be able to Celesio noted. The firm did not break down Con- pharmaciesacross the US, under the CVS/phar- focus its efforts on delivering complementary sumer Solutions’ sales in individual markets. macyand Longs Drugs names. products to consumers that focus on eating Consumer Solutions’ earnings before inter- The transaction also adds Target’s80walk- well and staying active,” Cornell explained. est and tax (EBIT) had decreased by 11.2% in clinics in sevenUSstates to CVS Health’s Cornell added that Target would continue to C46.8 million, Celesio said. “Some larger existing network of around 1,000 units. to manage non-pharmacyhealthcare products one-offs”, such as the write-offofaninform- CVS Health said the deal represented the sold in its stores. ation technology project in the UK, had been start of a“strategic relationship” between the Expanding on the plans to co-develop flexi- behind the “substantialdrop” in EBIT,the com- twofirms, which would see Target include a ble format stores, Merlo said the twofirms panyexplained. CVS/pharmacyinall its newretail stores offer- would “carefully evaluate and select locations The Consumer Solutions division accounted ing pharmacyservices. best suited for the small-format Target stores”. for 19% of Celesio’stotal sales in the period, As part of this wider relationship, CVS “Additionally,Target and CVS Health will which advanced by 5.6% to C5.27 billion. Health revealed that both companies planned explore innovative newmarket offerings that Celesio’sdominant PharmacySolutions to co-develop five to 10 “flexible-format stores”, have the potential to generate strong returns on wholesale division posted a4.0% rise in sales which would be branded as TargetExpress and investment and offer long-term benefits for to C4.29 billion in the three months. EBIT at include aCVS/pharmacy. consumers and communities,”Merlo revealed. the PharmacySolutions business slipped back Commenting on the deal, Larry Merlo, CVS “Weoperate in arapidly-changing health- by 4.9% to C64.2 million. Health’spresident and chief executive officer, care and regulatory environment,”Merlo in- Celesio is nowoperating as part of Mc- said the strategic relationship brought together sisted, “and this requires companies likeours Kesson and is housed in the US wholesaler’s “twoleading retailers with complementary to continually innovate, provide additional points Distribution Solutions division, led by group strengths, brands and cultures”. of access, lower costs and improve quality.” president Paul Julian. By snapping up Target’spharmacies, Merlo Noting that the closing date for the deal was Last month, John Hammergren, McKesson’s said that CVS Health would growits retail pres- uncertain, CVS Health said it washopeful it chief executive officer,said Celesio was“per- ence into newcities, such as Denver, Colorado; would be completed before the end of the year. forming well” and was“well-positioned” for OTC future growth. McKesson acquired Celesio last year,after Mergers&Acquisitions striking deals with its European counterpart’s twobiggest shareholders (OTC bulletin,7Feb- Genomma sells controllingMarzam stake ruary 2014, page 1). OTC exico’sGenomma Lab has sold acontrol- Genomma’schief executive officer,said the Mling stakeinits distribution unit Grupo companywas “excited” to be partnering with Comercial eIndustrial Marzam to Dutch private- Moench and its experienced team of long- IN BRIEF equity fund Moench Coöperatief for MXN1.35 term investors. ■ DADHA GROUP –the Indian pharmaceu- billion (C77.4 million). “Going forward, we will work together to ticals firm –has launched Netmeds,which it Moench had snapped up a50% “plus one continue to improve Marzam’soperations and claims is the first pan-India online pharmacy. share” stakeinMarzam, Genomma said, not- to expand the company’sdistribution network,” The online pharmacyoffered aprescription ful- ing that the Dutch fund had an option to in- Herrera insisted. filment service, the companynoted, along with crease its shareholding in the future. Genomma snapped up a50% stakeinMarz- arange of OTCmedicines, personal-care prod- Genomma explained that it planned to use am in March 2014 (OTC bulletin,28March ucts and medical devices to help people who the funds generated by the sale to pay down 2014, page 3) and in October acquired the re- were unable easily to access apharmacy. debt and repurchase stock. maining 50%. OTC Commenting on the sale, Rodrigo Herrera, OTC

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COMPANY NEWS OTC

BusinessStrategy Weifa set to enlarge its OTC operations

orway’sWeifais“exploring opportunities” Rank Company Annual sales Change Market share Nto expand its consumer healthcareopera- (NOK millions) (%) (%) tions into newcountries outside its home mar- ket, as part of its “ambitious” plans for growth, 1Novartis Norge 243.2 +4.5 22.2 according to the firm’smanagement team. 2Weifa216.7 +1.0 19.8 Outlining Weifa’sstrategy following the spin 3Johnson &Johnson 160.1 ±0.0 14.6 offofits business-to-business (B2B) manufac- 4Takeda Nycomed 83.5 -7.3 7.6 turing division, the firm said that it was“well 5Bayer 34.7 +7.9 3.2 positioned” to growits OTCoperations now 6Meda 34.6 +8.2 3.2 that it wasa“pure consumer health player”. 7Actavis Norway 32.9 -3.0 3.0 Weifa’sB2B unit wasmovedtoanewly- 8Boehringer Ingelheim 26.3 -1.9 2.4 established subsidiary named Vistin Pharma at the start of June, after the company’ssharehold- 9Théa Nordic 19.8 +6.3 1.8 ers voted in favour of the move (OTC bulletin, 10 Aco Hud 17.8 +10.7 1.6 1May 2015, page 6). Total OTCmarket sales 1,095.8 +2.9 100.0 Weifahad plans to expand the reach of its Consumer Health business into the “wider Figure1:Breakdown of the top-10 OTC companies in Norway by 2014 sales at pharmacy purchasing prices Nordic-Baltic region”, the firm explained, and (Source –Association of the Pharmaceutical Industryin Norway) hoped to achieve this by securing partnerships ated sales of NOK217 million (C24.7 million) fromprescription-to-OTC status in 2012. with local players in those markets. in 2014 at pharmacypurchasing prices (PPP), Noting that Weifahad taken a70% share “Different types of partnerships will be es- just behind Novartis, with sales of NOK243 of the pain-relief segment in 2014 with its Ibux sential to achieve our goal to become asignifi- million at PPP. and Paracet brands, the firm explained that line cant pan-Nordic consumer healthcare com- As the second-largest local player,Théa extensions and pursuing prescription-to-OTC pany,”Weifainsisted, “ranging from distributor- Nordic holds the ninth position in the market, switches would be keytomaintaining its dom- ships, co-selling and co-marketing, to strategic and generated 2014 sales of NOK19.8 mil- inant position. co-operation and acquisitions.” lion at PPP. “Switching is one of the main growth drivers While the companywanted to growits pres- in Norway’sconsumer healthcaremarket,”Weifa ence in Europe’sOTC market, Weifasaid it was Leading pain-relief firm noted, “and we expect it to provide attractive committed to “remaining the leading Norwegian Commenting on the firm’splans to streng- growth opportunitiesgoing forward.” consumer healthcare company”. then its position in Norway,Weifasaid it in- Weifahad a“historic track record” of switch- “Weifa’sstrategy is to use its dominant plat- tended to become the “fastest-growing player” ing medicines from prescription-to-OTC status, form in Norway to growthe business in exist- in the cough and cold category,while reinforc- the firm pointed out, highlighting the switches ing and newcategories,”the firm revealed. ing its position “as the number-one player” in of Ibux 5% ibuprofen gel in 2000, the Samin Weifaisthe biggest local player in Norway’s the pain-relief segment. glucosamine arthritis treatment in 2011 and the OTCmarket by some distance, ahead of Théa The company’sleading cough and cold Bronkyl acetylcysteine medicine in 2012. Nordic, and second only to Novartis in the over- brand –the expectorant Bronkyl –had good Successfully switching medicines and “com- all market, according to figures published by prospects for growth in the Norwegian market, petent brand building” had givenWeifaa“strong theAssociation of the Pharmaceutical Industry Weifaclaimed. Bronkyl had already captured strategic position” in Norway’s“fast-growing” in Norway (see Figure 1). a24% share of the OTCexpectorants cate- consumer healthcare market, the firm claimed, Weifa’sConsumer Health business gener- gory,the firm pointed out, following its switch and left it well-placed for future growth. OTC

IN BRIEF Mergers&Acquisitions ■ SUPPNOW has introduced a vending Emami snaps up Kesh King hair-careline machine that it claims will provide gym users with nutritional supplements at prices lower ndia’sEmami has added to its portfolio of “This acquisition forms part of our aggres- than in retail stores and without the shipping Iproducts based on traditional ayurvedic medi- sive growth strategy,” Agarwal noted, “and delays that come with buying online. The US- cine by snapping up the Kesh King range of marks our first foray into the ayurvedic hair- based companysaid the vending machines hair and scalp treatments for INR16.5 billion and scalp-care segment.” would be located in gyms and fitness centres (C228 million). Kesh King products –which include Ayur- and would offer the “highest-quality brands” Describing the deal as a“perfect strategic vedic Medicinal Oil, Aloe Vera Herbal Shampoo and instant nutritional advice via the “built-in fit”, Emami director,Harsh Agarwal, claimed andAyurvedic Capsules –were based on “ayur- nutritionist” feature accessedthrough an inter- that the Kesh King product range would give vedic formulations”, Emami said, to prevent active screen. thecompanya“stronger presence” in India’s prematuregreyhair and dandruff. OTC personal-care market. OTC

26 June 2015 OTC bulletin 5 OTC26-06-15p2-9_Layout 1 23/06/2015 17:47 Page 6

OTC COMPANY NEWS

BusinessStrategy OTC companiesneed to price smarter

anyOTC manufacturers are struggling ing research was“neither possible, nor advis- relation is generally in line,”heexplained, Mto implement a“holistic and structured ablefor all products”. Forthis reason, Simon “while aposition in the upper-left corner high- pricing approach” as theygrowtheir portfolios. Kucher &Partners had developed a“prag- lights potentially over-priced products. Positions This can lead to missed margin-expansion oppor- matic butpowerful approach to help OTCman- in the lower-right corner showpotential for a tunities, according to Dr ClemensOberhammer ufacturersmakesolid pricing decisions and higher strategic price positioning.” and Omar Ahmad, managing partners at Simon design efficient pricing processes”. The three remaining pillars of the pricing Kucher &Partners. The approach wasbuilt on four pillars, Ah- strategy devised by Simon Kucher &Partners “Nowadays, manyOTC manufacturers are mad said. One wasastrategic-pricing pillar and could only be effectively utilised to support confronted with an increasing number of brands there were three tactical-pricing counterparts. tactical pricing decisions if the overall strategic and products to manage,”Oberhammerpointed The strategic-pricing pillar investigated positioning wascorrect, Oberhammerwarned. out. “A clear process on handling pricing is often whether the “strategic price-value positioning Once the strategic positioning of the brands not in place, and market research, if conducted, of aproduct/brand is in line with the market”, hadbeen settled, reducing the complexity and often focuses on top products and non-pricing he explained, while the three tactical-pricing the overall number of individual pricing deci- related issues.” pillars made it possible to “establish aprice sions wasthe next keygoal, Ahmad explained, To manage expanding portfolios better,Ah- architecture within aseparate portfolio”, “help noting that to do this “a consistent pricing and mad explained, OTCmanufacturers needed a to assess the price-change potential of a‘reg- portfolio structure must be created”. professional pricing strategy.Such astandard- ular’ price increase” and to “support pricing deci- Simon Kucher &Partners’ PriceMap con- ised, value-based approach to pricing, used con- sions by providing apragmatic method to esti- cepthad been designed to “understand the in- sistently across all brands and products, could mate and reflect the impact of price-volume dividual portfolio from the consumer point of “increase acompany’sreturn on sales by 2%- relationships in the market”. viewand clarifyhow the specific products with- 3%”, he claimed. in one brand should be positioned relative to Failing to put in place astructured approach Rate strengths and weaknesses each other”, he added. to pricing had several negative consequences, Looking at each pillar in detail, Oberham- “In the first step, all productsthat should Oberhammer and Ahmad said, including alack merexplained that the first pillar,named Com- be priced relative to each other within acom- of “transparencyand traceability of pricing Strat, enabled acompanytorate, from the con- pany’sportfolio are grouped into one pricing decisions made”; amisguided focus on “com- sumer’sperspective,the strengths and weak- category,” Ahmad said. petition-oriented –and less value-oriented – nesses of its individual products compared to “Then value drivers that influence consumer price setting”; and a“limited understandingof those of competitors. willingness to pay,such as pack size, are identi- price-volume relations and their impact”. “This shows whether aproduct is position- fied,”hecontinued. “Finally,bydepicting these “Simply put, OTCmanufacturers do not ed correctly in the market,”Oberhammer point- value drivers in amap and creating simple pric- leverage their full pricing potential in many ed out, “by illustrating and aggregating per- ing principlesfor the value position of the prod- cases. Theycompletely overlook the opportu- ceivedvalue versus the perceivedprice of every ucts relative to each other,aconsistent and logi- nity to generate additional profits.” market-player offering” (see Figure 1). cal price structure appears” (see Figure 2). Oberhammer said he was“convinced” that “A position along the diagonal consistency Anygaps between the current price versus conducting continual in-depth consumer pric- corridor implies that the perceivedprice-value the logical price positioning uncovered by the system might be aresult of competitive actions, High 10 Ahmad admitted, buttheymight also highlight room for potential price adjustments. ve Once defined, price maps were apowerful Own product tool, Oberhammer claimed, that could simplify pricing decisions for acomplexportfolio.

rice Competitor A “Furthermore, theyenable OTCmanufactur- dp Competitor B ers to identify gaps and inconsistencies in their ve existing product portfolio and help logically to Strategic competiti advantages 5 Underperforming price newproducts filling these gaps,”headded.

Consistency corridor Competitor C The third pillar of the pricing approach, the PriceChangeIndicator concept (see Figure 3), made it possible to “evaluate the price-change

Consumer-percei potential of all products within apricing cate-

riority gory”, Oberhammer said. Competitor D “The concept should be applied in prepa- wp Overperforming Low 0 Lo ration for the regular price round, which is 0510 typically performed once or twice ayear by Low Consumer-perceivedvalue High OTCmanufacturers,”hepointed out.

Figure1:Value map displaying perceived value versus perceived price of all competing brands or products The most important indicators that were (Source –Simon Kucher) likely to affect consumer willingness to pay

6 OTC bulletin 26 June 2015 OTC26-06-15p2-9_Layout 1 23/06/2015 17:47 Page 7

COMPANY NEWS OTC

were defined in four categories: consumer-, competition-, market- and margin-oriented, Ob- Value drivers erhammer explained. Form Dosage Pack size Each pricing category wasthen evaluated 40 on each indicator; specifically,whether or not aprice adjustment–positive butalso nega- 400mg +xx% Capsules tive –was considered as favourable, he pointed 20 out. The aggregation of these evaluations finally +x% Potential new yielded an indication for the overall proposed +10% product price adjustment. 200mg “Using quantitative and qualitative data – 20 depending on data availability –helps evalu- Pricing category A Tablets ate price change opportunities transparently and pragmatically,” Oberhammer said. “It also 100mg 10 ensures that pricing decisions are not based +5% only on abrand manager’ssubjective assess- ment or competitors’ prices and, as aresult, presents explicit arguments as to whycertain Granules 100mg 20 prices have to be adjusted.” Reference product Moving on to the fourth pillar of the pricing Pricing principles (such as capsules are priced 10% higher than tablets) concept, Ahmad said that the final stage had Figure2:PriceMaps structureofthe product portfolio from aconsumer’s point-of-view using value drivers, been designed to “estimate and showthe im- areference product and simple pricing principles (Source –Simon Kucher) pact of price-volume relations”. “In cases where no hard market research data is available, the PriceStrat pillar can be CONSUMER-ORIENTED COMPETITION-ORIENTED used to estimatethe price-volume relationship,” Indicators which reflect customers’ Indicators which reflect the Ahmad revealed. willingness to pay and purchasing competitive environment “PriceStrat is apragmatic workshop-driven behaviour approach that leverages the knowledge of inter- Examples nal companyexperts,”headded, “and in numer- Examples Market-share ranking ous projects it has been used successfully to Brand awareness Price gaptocompetitors structure discussions around price-volume re- Importance of price in purchase decisions lationships and to reliably determine profit- and revenue-optimal prices.” MARKET-ORIENTED MARGIN-ORIENTED This approach had already paid offfor a number of companies, Oberhammerclaimed, Indicators which reflect the general Indicators which reflect cost and margins market environment with OTCmanufacturers that had followed Examples the process enjoying, on average, a2-3% im- Examples Margin provement in return on sales. Category growth Cost of goods (COGS) evolution “All concepts can be applied by brand man- Time since last price increase agers with only very limited training,”hepoint- ed out, “and moreover, as only minimal time

investment is required, the approach is also ap- Figure3:Different categories of indicators used in the PriceChangeIndicator to evaluate the overall potential plicable to small brands and in small countries.” for change (Source –Simon Kucher) OTC

IN BRIEF BusinessStrategy ■ ALLERGAN is the newglobal trading name SDC Nutrition builds in Brazilianmarket for Actavis.The move comes after Actavis snapped up AllerganinMarch this year.The Ssports-nutrition companySDC Nutri- particular,represented one of the “biggest op- companypointed out that, following feed- Utionisset to expand its presence in Brazil portunitiesfor SDC outside the US”, with the back from customers, its Canadian and US by establishing asubsidiary in the country. sports-nutrition market expected to growbyal- generics business would continue to use the Led by Juan Alonso, former chief executive most afifth in Brazil overthe next five years. Actavis name, while its US distribution busi- officer of nutritional products retailer GNC To takebest advantage of the opportunities ness would retain the Anda name. Arebrand- Brazil, the SDC Brazil subsidiary would build in Brazil, SDC felt it wasdesirable to have peo- ing campaign had nowbeen initiated, Aller- on the “significant presence” the firm had built ple “on the ground” to drive wider distribution. ganexplained, while anew global website up in Latin American pharmacies and retail Meanwhile, SDC said it had recently launch- – allergan.com –had been launched and anew stores so farthis year,the companyclaimed. ed three brands in Chile through stores oper- logo had been unveiled. Sean Marszalek, SDC’schief executive offi- ated by Walgreens Boots Alliance. OTC cer,said that Latin America, and Brazil in OTC

26 June 2015 OTC bulletin 7 OTC26-06-15p2-9_Layout 1 23/06/2015 17:47 Page 8

OTC COMPANY NEWS

BusinessStrategy Mergers&Acquisitions Merzlooking for Mission adds expertise innovativefirms in transdermalpatches erz Pharma is on the look out for in- Mnovative projects in the cosmeceuticals ission Pharmacal has snapped up Pro- segment and has C25 million in corporate ven- MSolus Pharmaceuticals for an undisclos- ture capital to spend. The companyhas also ed sum, in amove the US companyclaims will secured aloan of up to C500 million to finance enable it offer the “latest, highly-effective trans- its growth strategy. dermal patches in awide variety of therapeu- Mission Pharmacal says acquiring ProSolus Commenting on its planned venture capital tic categories”. Pharmaceuticals will allow it to offer transdermal investments, the German firm said funding The acquisition of ProSolus gave Mission patches in a“wide variety” of therapeutic categories would be focused on “early-stage start-up com- “unrivalled expertise”,the Texas-based firm said, manufacturing facility with its ownresearch panies, as well as researchprojects, specifically “in the development and manufacture of sophis- and development arms,”Valkonoted. in the areas of anti-ageing, skin-rejuvenation ticated and convenient transdermal drug-delivery “ProSolus has significantly improvedthe and body shaping”. products to treat avariety of health conditions”. durability of transdermal patches,”Valkopoint- Investing in start-ups would “complement” Mission claimed that the deal would build ed out, “creating more desirable,smaller sizes Merz’ ownresearch and development efforts, on its existing “successful partnership” with that stay in place while working effectively.” the companynoted, in which it had recently ProSolus, which had seen the twofirms co-dev- “This design strength, combined with Pro- invested “close to 15%” of its 2014 C994 mil- elop arange of OTCpain-relief patches, includ- Solus’ state-of-the-art manufacturing capabil- lion sales revenue. ing the LidoFlexPain Relief line. ities, givesMission vast potential to quickly Hans-JörgBergler,member of Merz’ exec- LidoFlexPain Relief patches delivered a4% deliverpatient-friendly products,”headded. utive board, said the firm’sinvestments would concentration of lidocaine, Mission pointed out, The acquisition of ProSolus would support “primarily foster early-stage aesthetic concepts” andcould be worn while exercising, bathing or Mission’slong-term goal to “growand improve” that could be launched within five to 10 years. swimming to provide “consistent relief”. its portfolio with “leading OTCand prescription Commenting on the deal, Pete Valko, chief products” in its “core therapeuticareas of focus”, Boost start-up firms operating officer of Mission’ssubsidiary Bio- the firm said, includingwomen’shealth, uro- “The aim of the investment is to help foster Comp Pharma, said ProSolus –which he will logy,paediatrics and dermatology. innovative companies –for example in the also lead –was “the newjewel in Mission’s Mission’sOTC portfolio includes the Calcet US, Europe and Israel –inthe early stages of crown as amanufacturing supplier”. and Oncovite dietary supplements, the Max- product development,”Bergler explained, “and, “ProSolus brings to Mission its high-barrier- ilube personal lubricant and the Thera-Gesic if the development is successful, to become to-entry transdermal solutions and atop-notch pain-relief cream. along-term investor and partner.” OTC “With this venture capital,”Bergler added, “we want to support newproducts and tech- Mergers&Acquisitions nologies, as there is still aneed for newcon- cepts in aesthetic dermatology,[such as] in the CVC gains controlling stake in Alvogen areas of cellulitis, hair loss and age marks.” Meanwhile, Merz said securing asyndicat- ninvestment consortium led by CVC gen’sboard,”Wessman said. ed loan of up to C500 million would give the ACapital Partners has acquired a“control- “Collectively,theywill provide significant companythe “greatestpossible freedom of ling stake” in generics player Alvogen from experience and additional resources to help ac- action going forward”. Pamplona Capital Management. Financial de- celerate our strong momentum and takeAlvo- The loan demonstrated that the firm was tails were not disclosed. gen towards its ambition of being one of the “holding steadfastly to its growth policy”, Merz The consortium –which includes Singapore- leading generics players in the world today,” insisted, and was“prepared to invest further in based investors Temasek, along with Vatera he stated, noting that Alvogen had in recent order to strengthen its status as one of the mar- Healthcare Partners –will be majority share- years “transformed from being adomestic US ketleaders in aesthetics and neurotoxins”. holders, while Alvogen chief executive Robert business to aglobal player”. However, the companyadded that no spe- Wessman’sAztiq Pharma investment vehicle Tomas Ekman of CVC said the consortium cificinvestment for the funds had been identi- will retain a“significant stake” and Pamplona was“delighted to be working with Robert and fied to date. will also retain asmall stake. Wessman will his team to continue Alvogen’sextraordinary Merz generated its 2014 sales of C994 mil- continue to serveaschief executive following expansion”, adding that it would “look forward lion from its Aesthetics, Consumer Care and the transaction. to bringing our ownnetwork and operational Neurotoxins divisions. While predominantly aprescription drugs expertise to support the team”. Sales of Consumer Care products –includ- manufacturer,Alvogen does offer over100 Meanwhile, Pamplona said it was“pleased” ing the Merz Spezial and Tetesept brands – generic OTCmedicines, food supplements, with the progress that Alvogen had made and reached C67.8 million in 2014, accounting for medical devices and cosmetics. believedthe business, under Wessman’sleader- 7% of Merz’ total sales. “I am delighted to welcome such apresti- ship, was“well poised for future growth”. OTC gious consortium of newinvestors to Alvo- OTC

8 OTC bulletin 26 June 2015 OTC26-06-15p2-9_Layout 1 23/06/2015 17:47 Page 9

COMPANY NEWS OTC

Mergers&Acquisitions DistributionAgreements Abbott backs Sanofi’s NasacortAllergy Mylan/Perrigo to enter Canadian market bbott has stated its intention to use its A14.5% stakeinMylan to support the lat- anofi’sNasacort Allergy 24HR nasal spray cough, cold and sinus portfolio. ter’splanned bid for Perrigo. Swill soon be available in Canada, nowthe Pendopharm’sOTC cough, cold and sinus “Asboth Mylan’slargest shareholder and French companyhas struck adistribution deal offering includes the Helixia Cough Prospan its partner through our continued manufacturing with local player Pendopharm. range of expectorants and Rhinaris Sinomarin relationships, Abbott has considered the entire Under the terms of the agreement, Pendo- nasal sprays for adults and children. situation, and we believe Mylan’sstandalone pharm has gained exclusive rights to market and Noting that overaquarter of the Canadian strategy and acquisition of Perrigo will further distribute non-prescription Nasacort (triamcino- population suffered from allergies, Pendopharm enhance its platform, is strategically compelling, lone acetonide) in Canada. said Nasacort had good prospects for growth is value-enhancing for shareholders, and offers Sanofipointed out that it retainedCanadian in the country’snon-prescription market. aclear path to completion,”said Miles White, rights to the prescriptionform of the drug, Abbott’schairman and chief executive officer. Nasacort AQ. US launch in 2014 Mylan has seen anumber of bids for Per- Nasacort wasset to become the “first-to- Nasacort waslaunched onto the US non- rigo rejected by the US-based store-brandspe- market non-prescription intranasal steroid in prescription market last year,following the US cialist, butsaid in May that it wascommitted Canada”, Pendopharm noted, following the pre- Food and Drug Administration (FDA’s) switch to making the deal happen (OTC bulletin,22 scription-to-OTC switch of triamcinolone ace- of the inhaled corticosteroid in 2013 (OTC bul- May 2015, page 3). tonide by national medicines regulator Health letin,25October 2013, page 1). “When we acquired Abbott’snon-US dev- Canada in January this year. Nasacort generated sales of C114 million eloped markets specialty and branded generics Describing Nasacort as an “innovative prod- for Sanofiin2014, putting it into fifth place in business earlier this year,” responded Mylan’s uct” with “attractive benefits for consumers”, the firm’sroster of Consumer Healthcarebrands executive chairman, Robert Coury,“we gained Pendopharm said that the brand wasagood (OTC bulletin,13February 2015, page 11). an important stakeholder in Abbott, which un- “strategic fit” with the company’sexisting OTC derstands the powerful potential of our plat- form and the critical importance of our scale and breadth across our distribution channels.” Meanwhile, Israeli generics giant Teva says it can now“commence proceedings before the Dutch Enterprise Chamber” in its attempts to takeoverMylan, having had aUS$82-per- sharetakeoverbid rejected in May (OTC bul- letin,22May 2015, page 3). Having acquired 4.61% of all Mylan’sout- standing shares, the Israeli group has pledged to keep its holding below5%, provided Mylan holds an extraordinary general meeting (EGM) on its proposed acquisition of Perrigo “no later than 31 August 2015”. OTC

IN BRIEF

n OCULUS INNOVATIVE SCIENCES –a US-based speciality pharmaceuticals firm –said that its Alevicyn SG Antipruritic Spray Gel had receivedboth prescription and OTCap- provalfrom the US Food and Drug Adminis- tration (FDA). As an OTCproduct, Alevicyn wasindicated to “relieve the burning and itch- ing associated with manytypes of abrasions, common skin irritations, lacerations and minor burns”, the companynoted, “as well as the man- agement of irritation and pain from minor burns, including sunburn”. OTC

26 June 2015 OTC bulletin 9 OTC26-06-15p10-13_Layout 1 23/06/2015 17:56 Page 2

OTC COMPANY NEWS PhynovaBusinessStrategy opensuppipeline of TCMs

raditional Chinese medicines (TCMs) rep- icinalproducts among European consumers. tured to western pharmaceutical standards”. Tresent a“newand interesting opportunity” Established in 2002 as adrug-development The companyhad gained “lots of experi- for European consumerhealthcare firms look- business, Phynova –based in Oxford, UK, with ence” in understanding the western require- ing to drive growth, according to Robert Miller, asubsidiary in Beijing, China –develops and ments for TCMs, Miller explained, and the kind chief executive officer of natural healthcare commercialises natural healthcare products de- of safety data needed to seek product approvals products firm Phynova. rivedfrom the active compounds found in plants under the European Union’s(EU’s) tradition- Speaking exclusively to OTC bulletin,Mill- used in traditional medicines. al herbal medicinal directive,2004/24/EC. er said OTCcompanies could open up a“whole Through its Beijing subsidiary,Phynova had newpipeline of products” by moving into the identified araft of plants with a“rich history of First ever TCM approval TCM space. use in Chinese traditional medicine”,Miller Using this knowledge, Phynova achieved Noting that innovative OTCproducts “did explained, that had the potential to be adapted in March the first-everTCM approvalfrom the not come along very often”, Miller claimed for the European OTCmarket. UK’sMedicines and Healthcare products Reg- that there existed thousands of medicinal plants The firm used its presence on the ground in ulatory Agency(MHRA), for the firm’sJoint that had been used by the Chinese for hundreds China “to mine this wonderful group of about and Muscle Relief Tablets under the agency’s of years that could be adapted for sale in 10,000 medicinal plants that the Chinese have registration scheme. Europe’sconsumer healthcaremarket. been using for hundreds of years,”Miller noted. According to the product’sTraditionalHerb- These products could be accompanied by Once suitable plants had been identified, al Registration certificate, Phynova Joint and “new and exciting indications”, Miller insisted, Phynova’s team in Oxford worked to develop Muscle Relief Tablets are indicated “for the and feed a“growing appetite” for natural med- aTCM, he said, that was“safe and manufac- relief of backache,minor sports injuries, rheum- atic or muscular pains and general aches and pains in the muscles and joints, based on tradi- tional use only”. Derivedfrom the plant sigesbeckia,the prod- uct wasa“natural alternative treatment” to non- steroidal anti-inflammatorydrugs (NSAIDs), Miller claimed, and its approvalbythe MHRA gave consumers “peace of mind” that it was manufactured to western standards. To gain approvalfor its Joint and Muscle Re- lief Tablets, Phynova had provided the MHRA with a“very detailed dossier on all the modern research that exists for the ingredient, includ- ing anyclinical studies or bibliographic evi- dence”, Miller pointed out. It wasalso arequirement that Phynova provedthat the TCM had been used for more than 30 years, with at least 15 years of use in the EU, he explained. Noting that “lots” of consumers had al- ready registered their interest in Phynova Joint and Muscle Relief Tablets, Miller said that the firm wasset to launch the product onto the UK market this month through its ownwebsite. After successfully navigating the MHRA registration process, Phynova wasplanning fur- ther applications and targeting European ex- pansion, Miller revealed. The firm had submitted at the start of June its second application to the UK regulator,he noted, for its Isatis Cold and Flu Relief product. Isatis Cold and Flu Relief wasderivedfrom the isatis plant, Miller explained, which wasone of the most commonly administered TCMs in China for the relief of colds and flu. “Millions of Chinese consumers consider it to be avery effective treatment for colds and

10 OTC bulletin 26 June 2015 OTC26-06-15p10-13_Layout 1 23/06/2015 17:56 Page 3

COMPANY NEWS OTC

flu and there’salot of good researchtosup- the products into other European countries,” port it,”hepointed out. Miller explained. Isatis had the potential to “establish itself “Our plan is to go to France and Germany successfully” within the UK’scold and flu mar- next, and then we will move onto some smaller ket, Miller claimed, as consumer demand for markets after that,”henoted. natural remedies in the country was“becoming Asked about the size of the European mar- stronger and stronger”. ket, Miller said TCMs had been around for “The question is: Howfar can anew prod- 25 years in the region and were “reasonably uct in the UK’sOTC cold and flu market go?” popular”. However, it wasstill a“fringe med- Miller asked. icine”, he added, as Europe did not have the “Obviously,we’re not Reckitt Benckiser same infrastructure to support it that there was (RB), we don’thavehuge amounts of marketing in China. muscle,”headmitted. “But the advantage that While Phynova had big plans to seek ap-

products likeours have is that they’re new, and provals across Europe for its TCMs, Miller RobertMiller,chief executive officer of Phynova, said newOTC products that aren’treformulations admitted that the companywas on the lookout that traditional Chinese medicines (TCMs) offered or reworkings don’tcome along very often.” for apartner to help the products takeoff. OTC firms an exciting opportunity to feed consumers’ Miller noted that Phynova wasworking on “We’re aresearch and development com- “growing appetite” for natural products the registration in collaboration with Chinese pany, so we’re not really in the business of going are lots of OTCmedicines,”Miller said. firm XiangxuePharmaceuticals, acompanywith outand distributing these products,”henoted. European consumers were used to self-sel- a“solid track record” in modernising TCMs. Asked if Phynova would consider collabo- ecting herbal products, Miller pointed out, add- Xiangxue would be responsible for manu- rating with aconsumer healthcarefirm, Miller ing that there wasagap in the market that facturing the active ingredient, Miller explain- said the companywas “definitely” interested TCMs could fill. ed, while Phynova had prepared the MHRA in forming apartnership. “There is agrowing trend of consumers seek- application and would work to prove the quality, ing out more natural products,”heinsisted. safety and efficacyofthe TCM. In discussions with OTC firms “When you go into Boots in the UK you Asked when Phynova hoped to receive ap- “Weare already in discussions with the con- seewestern traditional herbal products, so it’s provalfrom the MHRA, Miller pointed out that sumer healthcare divisions of some of the big obviously already areasonably popular area,” it was“difficult to say”. European pharmaceutical firms,”herevealed, Miller said. The company’sfirst registration had taken “but we would also be interested to talk to some “Consumers likenatural products, butat “quite along time”, he admitted, butthe process of the medium-sized companies that also work the same time theywant to knowthat they’re had been a“big learning curve” for Phynova. in the OTCspace very effectively.” safe,”henoted. “Hopefully,now that we’re more experienced Phynova envisioned its TCMs being sold “I believe if you put TCMs on the market with the registration process, this application OTCacross Europe in all outlets where western that are effective,consumers will vote with their will be abit more straightforward,”Miller herbal productswere already available, such as feet and come back to these productsoverand said optimistically. pharmacies and supermarkets, Miller explained. overagain.” However, OTCaccess to TCMs wasinthe OTC Several TCMs in pipeline spotlight at arecent industry meeting, where In addition to Isatis Cold and Flu Relief, Werner Knöss, chair of the Herbal Medicinal Miller noted that the firm had “several more” Products Committee (HMPC) of the European Regulatory Af fairs TCM registrations in the pipeline which it in- Medicines Agency(EMA), said the committee tended to submit to the MHRA. had to consider howmuch TCMs were designed FTCwants more Phynova also had plans to seek approvals to support self-medication (OTC bulletin,12 for its TCMs under the traditional herbal medi- June 2015, page 11). homoeopathy info cines directive across the EU, Miller revealed. “The starting point for using aTCM or an “Having already prepared the applications Indian Ayurvedic product is normally avery he US Federal Trade Commission (FTC) for the MHRA, it makes it much easier to take careful diagnosis by aspecialist,” he noted, and Tis set to hold apublic workshop to exam- then a“very individual prescription”. ine advertising for OTChomoeopathic drugs. Commenting on Knöss’ statements, Miller Noting that it had arranged the workshop in said Knöss wasright about howTCM was responsetothe rapid growth of the homoeo- practised by doctors, butwrong about how pathymarket in the US, the FTC said that it was TCMs were used OTC. inviting the public to submit research, recom- “In China, you go to the TCM doctor,they mend topics for discussion and to participate diagnose you and write aprescription and then as panel members. you go to aChinese herbal pharmacyand they While no schedule for the 21 September dispense your prescription,”Miller explained. meeting has been released, the FTC said it “So that process is very similar to the west- wanted to look at changes in the market; how ern system,”henoted. homoeopathic products were advertised; the “But what’salso very similar is that if you go science behind homoeopathy; and public pol- into apharmacyinChina, the walls are lined with icyconcerns surrounding the current regula- Phynova Joint and Muscle Relief Tablets is the first traditional Chinese medicine approved by the UK’s OTCTCMs that consumers use for self-medica- tion of homoeopathic products. Medicines and Healthcareproducts RegulatoryAgency tion. It’snodifferent to aBoots store where there OTC

26 June 2015 OTC bulletin 11 OTC26-06-15p10-13_Layout 1 24/06/2015 09:17 Page 4

OTC GENERAL NEWS

Regulatory Af fairs Regulatory Af fairs Wales pushes Greekpharmacists strike for e-cigs ban over wider access to OTCs se of e-cigarettes in enclosed spaces could Ube banned in Wales under aproposed new reek pharmacists have held anationwide strike“wheneverneeded”. Lourantos also called public health law, amid fears theycould act as Gstriketoprotest against agovernment pro- on Greece’sprime minister,Alexis Tsipras, to agatewaytosmoking for children. posal to allowfor the first time the sale of OTC sit down and discuss the government’sproposal If passed, the ‘Public Health Wales Bill’ medicines in supermarkets. with the association. –which wasintroduced to the Welsh Assem- Describing the strike–which saw99% of The PFA’sposition on the sale of OTCmed- bly on 8June –will bring “nicotine-inhaling the country’spharmaciesclosed –asan“ab- icines in Greece has receivedsupport from the devices”, such as e-cigarettes,inline with ex- solute success”, the Panhellenic Pharmaceuti- country’sOTC association, EFEX. isting smoking rules by prohibiting their use calAssociation (PFA) said it remained “adam- Aspokesperson for EFEX told OTC bulletin in enclosed and “substantially-enclosed”pub- ant”that “not asingle pill” should be sold out- that the official position of the association was lic and work places. side pharmacies. that “OTC drugs should be giventoGreek con- Furthermore, the bill proposes allowing the The PFAclaimed that widening access to sumers only via the hand of the pharmacist in restrictions to be extended to certain open non-prescription medicines outside pharmacies legally-operating pharmacies”. spaces and potentially to “makeprovisions for would increase irresponsible use and lead to a Under the government’sproposal, non-pre- smoke-free vehicles”. rise in the number of adverse events. scription medicines would be permitted for sale Explaining the rationale behind the pro- “It is apublic health issue,”itinsisted. outside pharmaciesthrough “specially-construct- posed ban, Mark Drakeford, Wales’ minister In addition,the PFAargued that the move ed outlets in supermarkets”, which would be for Health and Social Services –who intro- would not benefit consumers and could lead required to obtain alicence to sell OTCmedi- duced the bill –said that the legislation would to higher prices for OTCproducts. cines and to employ“suitably-qualified person- help prevent the use of e-cigarettes from nor- Following the strike, the association held a nel”, according to the proposal. malising smoking and “undermining” the exist- general meeting at which it resolved to keep the The proposal wasone of anumber of mea- ing laws on smoking established in 2006. pressure on the government. sures outlined by Greece’scoalition government However, the newmeasures were “not in- Konstantinos Lourantos, chair of the PFA, to unlock much-neededfunds to pay its credit- tended to interfere with the use of e-cigarettes said the association wasready to launch another ors and avoid defaulting on its loans. in anysmoking quit attempt, or in reducing OTC the harm from smoking”, he insisted. An exact date for the enactment of the bill Regulatory Af fairs hasnot been decided. This provision will not be effective in England. ASMI welcomes reportonself-care OTC he AustralianSelf-Medication Industry range of productsfrom which to choose. Regulatory Af fairs T(ASMI) has welcomed areport launched Dean Schoombie, the ASMI’sexecutive by the country’shealth minister that calls for director,said that the GAP report pointed to a Canadaapproves self-care to be part of national healthcare policies. need to “reorient the healthcaresystem towards Produced by the strategic policyinstitute amuch greater emphasis on the prevention of IBS-relief product Global Access Partners (GAP), the report, titled the manylifestyle diseases” which had been ‘Towards Responsible Self Care: The role of forecast to drive up healthcaresystem costs. ealth Canada has approvedUS-based IM health literacy,pharmacy and non-prescrip- “It also highlights the need for the health HHealthScience’sIBgard peppermint-oil tions medicines’, sets out aseries of recom- system to support consumers to takemore res- natural-health product for the relief of the mendations for government, citizens, health- ponsibility for managing minor conditions symptoms associated with irritable bowel syn- care professionals, pharmacies and insurers to and chronic illnesses in partnership with health drome (IBS). help drive up the levels of self-care. professionals,”hepointed out, “rather than be Designed to deliverpeppermint oil into the The report calls for more encouragement passive recipients of healthcare.” small intestine as “tinymicrospheres”, IBgard for consumers to self-care and for the gov- “Expanding self-care, along with improved is indicated specifically for the “improvement ernment to makeself-care an integral part of health literacy, should lighten the load on Aus- or relief of abdominal pain and discomfort, national healthcare policyand to work with tralia’shard-pressed health services and fed- abdominal bloating and distension and urgency stakeholders to makeitareality. eralbudget,”Schoombie claimed, “whilst im- of bowel movement”. Furthermore, the report says that regula- proving patient outcomes, consumer conven- IM HealthScience said that IBS affected tory authorities should foster an environment ience and quality of life.” around five million Canadiansand that Canada thatsupports evidence-based non-prescription Government acting alone wasunable to had one of the highest rates of IBS in the world. andcomplementary medicines, and that prod- put these recommendations into action, he add- IBgard would give consumers access to ef- uct innovation and wider access to safe, ef- ed, insisting that it would require “input and fective relief from IBS, the firm claimed. fective treatments is needed to meet the de- action” from all parts of the healthcare sector. OTC mands of consumers who want abroader OTC

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GENERAL NEWS OTC

Regulatory Af fairs Legal Cases/Regulatory Af fairs OTC ibuprofen gets all clear Healthclaims from New Zealand agency case rejected he European General Court has dismissed here is no link between lower doses of ibu- matory drugs (NSAIDs) should warn consumers Tacase brought by the UK Health Food Tprofen and an increasedrisk of adverse about the risk of liverdamage. Manufacturers’ Association (HFMA) and its cardiovascular events, according to NewZea- The TGA opened aconsultation in February Dutch counterpart to annul the European Uni- land’smedicines agency, Medsafe. on the proposed wording of additional advisory on’s(EU’s) list of permitted Article 13(1) gen- Having reviewed the latest data linking ad- statements in the Required Advisory Statements eral-function health claims for foodstuffs. verse cardiovascular events to ibuprofen, the for Medicine Labels (RASML) documentfor dic- The decision meant that anumber of con- agency’sMedicines Adverse Reactions Com- lofenac, flurbiprofen, ibuprofen, ketoprofen, mef- cerns surrounding the “restrictive”list of health mittee (MARC) said it had concluded that there enamic acid and naproxen when included in non- claims would not be tackled, the association wasasmall increase in the risk of “cardiovas- prescription medicines for oral administration. pointed out, adding that the list had effectively cular thrombotic events” when the ingredient The proposed additional statements warned “outlawed hundreds of well-established health wasused in high doses of 2,400mg per day and that excessive use of NSAIDs in medicines for claims on all foodstuffs”. in long-term treatment. oral use could increase the risk of heart attack Furthermore, the court had “missed areal However, doses less than or equal to 1,200mg and stroke, and that diclofenac could also in- opportunity to address anumber of critical of ibuprofen daily –the dose generally used crease the risk of liverdamage. issues” related to developing apermitted list for OTCpreparations –were not associated with However, one respondent had pointed out of health claims for botanicals,HFMA said, a such outcomes. that liverdamage wasadocumented side effect process which had been on hold since 2010. of all NSAIDs, the TGA noted. The European Food Safety Authority (EFSA) No changes to OTC packs As aresult, the regulator has proposed that evaluated and rejected around 500 Article 13(1) Therefore, no changes were required to the theupdated advisory statement on labels of oral health claims for botanicals,which led to the consumer medicine information or data sheets medicines containing the aforementioned NSAIDs European Commission putting the work on hold for OTCibuprofen products, Medsafe noted. should nowread: “Do not use for more than a back in 2010. The agencyadded that the “overall benefit- fewdays at atime unless adoctor has told you While the European Commission announc- to-risk-of-harm balance” for ibuprofen remain- to. Do not exceed the recommended dose. Ex- ed afurther “reflection” on the issue in the ed “positive”. cessive use can be harmful and increase the summer of 2012 (OTC bulletin,10August Meanwhile, Australia’sTherapeuticGoods risk of heart attack, strokeorliver damage.” 2012, page 1), since then there has been no Administration (TGA) has proposed that labell- The change should be implemented by July news on whether or not EFSA will ever pro- ing for all OTCoral non-steroidal anti-inflam- 2016, the TGA noted. ceed with the list of general-function claims OTC for botanicals. The problem wasthat botanical ingredi- ProductApprovals ents were being treated differently under the food claims regulation than theywere under Perrigo to launch store-brand Mucinex D legislation covering traditionalherbal medi- cines (OTC bulletin,15October 2010, page 1). errigo is set to launch astore-brand rival According to Perrigo, MucinexDextended- In response to the concerns,the European Pto Reckitt Benckiser’s(RB’s) MucinexD release tablets –indicated to relieve chest con- Commission announced in 2010 that the com- cough and nasal-decongestant medicine in the gestion and to makecoughs more productive – munity list of permitted general health claims US, after its partner Actavis obtained final ap- had salesofapproximatelyUS$83 million (C74 for foods would be establishedintwo steps. provalfrom the US Food and Drug Adminis- million) through food, drug and mass merch- The list for all substances other than botanicals tration (FDA) for its 1200mg guaifenesin and andisers in the past 12 months. would be adopted in asingle step, it explain- 120mg pseudoephedrine extended-release bi- Joseph Papa, Perrigo’schairman and chief ed, with claims for botanicals considered once layer tablets. executive officer,said the firm had worked the first step had been completed. closely with Actavis to gain approvalfor aprod- This means that while alist of 222 per- uct which was“difficult to manufacture” and mitted health claims wasagreed in 2012, eval- the companycould nowprovide US consumers uating 2,078 Article 13(1) general-function with a“high-quality, value alternative to Muc- claims for botanicals has remained on hold. inexDtablets”. “The judgement represents areal missed Perrigo pointed out that it would begin ship- opportunity to address anumber of crucial ping its alternative to MucinexDtoretailers issues and concerns,”the HFMA said, “not and wholesalers in time for the upcoming cold least that of the European Commission’sfail- and flu season. The companyalready offers ure to meet the stated requirement that health astore-brand version of RB’sMucinex600mg claims should be well understood by the aver-

Perrigo is set to launch its store-brand equivalent to guaifenesin expectorant. age consumer.” Reckitt Benckiser’s Mucinex Dlater this year OTC OTC

26 June 2015 OTC bulletin 13 OTC26-06-15p14-17_Layout 1 23/06/2015 18:22 Page 2

OTC MARKETING NEWS

UPSALine Extensions adds granulesto Efferalganline in France aboratoiresUPSA has expanded its para- Lcetamol-based Efferalgan range in France to offer consumers strawberry and vanilla-flav- our oral granules in 250mg and 500mg strengths, as well as acappuccino-flavoured version in a 1g presentation. An advantage of the oral granules, UPSA said, wasthat theycould be taken directlyfrom The strawberry and vanilla-flavoured Efferalgan Beiersdorf’sElastoplast wound-carebrand is helping the sachet and swallowed without water. granules areavailable in 250mg and 500mg strengths to “cover the cost of summer fun” for UK consumers Packs of the strawberry and vanilla granules by offering discounted entrytovisitor attractions through an exclusive ‘family days out’ partnership contain either 10 sachets of the 250mg strength sumers advised to contact their doctor if symp- with Superdrug. –which is suitable for children and adolescents toms persist. Those with serious liverorkidney Running until 28 July,the campaign –the brand’s weighing between 21kg and 50kg –or16sach- complaints should contact adoctor before use. first exclusive tie-in with the health and beauty retailer –offers consumers who arepartofSuperdrug’s ets of the 500mg version, which is aimed at UPSA’s Efferalgan range also includes 1g ‘Beauty Card’ loyalty programme the chance to claim people weighing more than 27kg. paracetamol tablets, 500mg orally-dispersible a‘two-for-one’ voucher for over 300 attractions Meanwhile, the cappuccino-flavoured 1g tablets, and effervescent tablets containing around the country, such as adventurecentres, museums and zoos, when they purchase aspecial strength is available in packs of eight sachets 500mg paracetamol with 200mg vitamin C. Elastoplast pack. They can do this either in-storeor and is suitable for adults and adolescents weigh- Meanwhile, UPSA also markets French online via superdrug.com. ing over50kg. brands such as the Donormyl insomnia treat- The offer is being promoted via in-storepoint-of-sale materials and an email marketing campaign, as well All three versions should be used for no ment, the Fervex range for cold and flu and the as online activity,including acampaign microsite. more than five days for treating pain and three Mucomyst cough remedy. OTC days for treating fever, UPSA said, with con- OTC

14 OTC bulletin 26 June 2015 OTC26-06-15p14-17_Layout 1 23/06/2015 18:22 Page 3

MARKETING NEWS OTC

MarketingCampaigns ProductLaunches Nelsons backs Benecol debuts in China Arnicarecream in soluble powderformat he natural waytobounce back” will “Tbe the tagline of natural products firm aisio has launched its cholesterol-lowering Nelsons’ latest UK campaign for its Arnicare Rplant stanol-basedBenecol brand in China arnica cream, as it looks to position the topical as apowdered drink. herbal remedy as “a first-aid option for all the The Danish firm has partnered with Hang- family after summer adventures”. zhou Neptunus Bioengineering –part of the Scheduled to run from mid-July until mid- Neptunus Group, which owns the Nepstar phar- August, the adventure-themed campaign was macy chain –toroll out the product in approx- designed to encourage families to be active imately 1,700 Nepstar stores. together outdoors, the companynoted, while These stores will mainly be located in large The Benecol powdered drink will be launched initially highlighting that Arnicare cream was“there cities on the east coast of the country. in around 1,700 Nepstar pharmacies to help with anybumps or bruises sustained Cholesterol levels in the world’smost pop- within Nepstar stores, Erkinjuntti noted, adding along the way”. ulated country had been rising as western-style thatthe Neptunus Group wascurrently creating Promotional activity will include print ad- eating habits became more common, Raisio marketing materials “in line with global Ben- vertisements in women’slifestyle magazines pointed out, adding that there wasalso an “in- ecol branding principles”. creasing interest towards functional foods and Distribution would “expand in the future to supplements” among Chinese consumers. covermore points of purchase in the main Chi- Noting that Benecol wasalready available in nese cities”, Erkinjuntti added. markets such as Indonesia and Thailand, Raisio The firm is also looking to make the drink said the launch in China strengthened further available through “selected hospital stores” and its “strategically-important expansion into new, healthcare professionals in the next six months. growing markets in Asia”. Raisio reacquired the rights to the Benecol Selling the powdered drink through Nepstar brand in Belgium, Ireland, the UK and the US locations also meant that qualified pharmacy from Johnson&Johnson subsidiary Cilag In- staffmight be able to give “advice on choles- ternational late last year (OTC bulletin,28Nov- terol-lowering lifestyle, diet and other options ember 2014, page 9). to consumers”, Olavi Erkinjuntti, Benecol’s Available across 26 markets, Benecol features sales director,told OTC bulletin. in arange of spreads, drinks, dairy and cereal Initial marketing activity would be focused products, as well as bread and supplements. OTC Nelsons’ latest Arnicarecampaign is encouraging families to get active outdoors, while highlighting that ProductLaunches Arnicarecream can help with “bumps and bruises” such as TopSanté,aswell as in supermarket Ansell enters lubricants market with Skyn Sainsbury’sin-store magazine. The print advertisement –which will also nsell says it will spend “just under” smoothest silicone product moneycan buy”. be used to promote the cream within ‘soft-play’ AUS$5.0 million (C4.4 million) to support It is also said to be proventolast longer than centres and gyms, as well as on online plat- its Skyn sexual-wellness brand’sentry into the regular water-based lubricants. forms –focuses on afamily in agarden. US personal-lubricant market and bolster its Carozza said that Ansell expected to achieve As afather is shown in the creative chasing condom range. a5%share of the personal-lubricant market – his young son, the mother and daughter are pic- Carol Carozza, the US firm’svice-president valued by Nielsen at US$265 million –through tured laughing under ahomemade tepee, while of sales and marketing, told OTC bulletin that the newlubricants, with the aim of becoming text points out that the product –formulated a“major marketing campaign devoted to the the number-twoplayer within three years. from the alpine plant arnica montana –“soothes digital space” would begin in July and run Currently,the top-twobrands are Church & your skin and relievesbruises naturally”. throughout the autumn to promote the Skyn Dwight’sTrojan and Reckitt Benckiser’sDurex. Additional digital marketing would include Natural Feel and Maximum Performance lubri- Further lubricant line extensions would be targeted themed content and acompetition on cants, as well as its latest ‘Elite’ condom. introduced in early 2016, Carozza added. the Arnicare Facebook page, Nelsons noted. The campaign includes apartnership with Meanwhile, the ‘Elite’ polyisoprene condom ‘Fans’ of the Arnicare page would be offered “men’sdigital lifestyle brand” Thrillist, as well is said by Ansell to be 15% thinner than its the chance to win afamily day out at a‘Go as activity on Facebook and Twitter. Original variant. Ape’ outdoor-activity centre by posting about Skyn Natural Feel is said to be a“premium The line extension also joins the Skyn Extra their plans and suggestionsfor keeping active water-based” lubricant blended with aloe vera Lubricated, Intense Feel and Large condoms, through the summer. and vitamin E, while the companyclaims the as well as the Skyn Selection assortment pack. OTC Skyn Maximum Performance formula is “the OTC

26 June 2015 OTC bulletin 15 OTC26-06-15p14-17_Layout 1 24/06/2015 09:16 Page 4

OTC MARKETING NEWS

ProductLaunches ProductLaunches Insomnia device Scandinaviawill be first launched in UK to see SwimCount launch ealthcare products distribution firm Scrubs HEtc is encouraging UK consumers to “say etailers in Scandinavian markets will be the goodnight to insomnia” by launching an acu- Rfirst to sell Danish firm MotilityCount’s pressure sleep-aiddevice. SwimCount OTChome-fertility test, after the Claimed to be the only product of its kind device wasrecently granted aCEmark. on the UK market, H7 Insomnia Control –a The product, which measures howwell class Imedical device –consisted of adhesive sperm cells swim, would be available in phar- patches and plastic ‘pressers’ to be applied on macies and drugstores, MotilityCount noted, the wrist in aplace known in Chinese medicine adding that it was“in dialogue with distributors SwimCount is said to assess the quality of sperm as the ‘Ht7’ point, Scrubs Etc pointed out, to andretail chains” to launch the product in other cells based on their ability to swim improve the “length and quality” of sleep. European markets including France, Germany, on their ability to swim. One patch should be applied to each wrist Italy and Spain. Motility and concentration are measured by 30 minutes before going to bed, the firm said, Formerly known as MotilityCount, the test’s inserting asperm sample into the device. The adding that the pressers stimulated the Ht7 name had been changed to SwimCount so con- test will provide results in around 30 minutes. point until “satisfactory sleep” wasobtained. sumers across Europe could more easily under- Auser is shown, via acoloured indicator, The process should be repeated for 10 con- stand it, the firm pointed out. whether his motility count is above or below secutive nights and then on alternatenights SwimCount wasalso expected to be launch- the threshold for normal sperm set by the World thereafter,Scrubs Etc maintained, adding that ed into “a UK chain” by autumn 2015, the firm Health Organization (WHO) of 10 million mo- most users would experience an improvement said, although it did not provide further details. tile sperm per ml. Those with alow sperm count In the meantime, the test could be purchased would be encouraged to visit aspecialist, the for C50.00 from the website swimcount.com, by companyinsisted. consumers across Europe, MotilityCount noted. The launches would be supported by a“mix Said to be the first of its kind in the world, of online and offline” marketing activity tailor- the “secure, discreet and easy-to-use” Swim- ed to each market, MotilityCount noted, as well Count device gave “a better estimate of male as public-relations programmestoraise aware- fertility” than other tests currently on the market, ness of male fertility and the SwimCount test. MotilityCount claimed, not only by measuring There would also be point-of-sale materials the concentration of sperm cells, butalso by for pharmacies and continued training support assessingthe quality of the sperm cells based for pharmacystaff, MotilityCountpointed out. H7 Insomnia Control is claimed to gently stimulate a OTC point on the wrist known as the ‘Ht7’ point to improve the length and quality of sleep DigitalMarketing in the length and quality of sleep after six to 15 days of use. McNeil offers Healthyday mobile app Noting that the “non-invasive”, drug-free device had been proventobeeffective for 75% cNeil Consumer Healthcare claims its them to “takeappropriate precautions”. of users, the firm said H7 Insomnia Control MHealthyday app offers US consumers It did this, the firm explained, by using a would appeal to insomnia sufferers who had a“whole newway to outsmart the cold, flu and “patent-pending algorithm” to cross-reference previously been reluctant to treat the condi- allergy season”. IMS data and content from “highly-trusted tion overconcerns of addiction or drowsiness The app acted likean“early warning sys- sources used by doctors and hospitals” –such resulting from other sleep remedies. tem” to showwhen common ailmentsorissues as the Mayo Clinic –with ‘trending’ illness An extensive public-relations campaign were prevalent in auser’slocal area, Johnson & data from social-media channels, gathered by would back the launch of the product through Johnson’sOTC subsidiary noted, and enabled online social health network Sickweather. “online and offline lifestyle media”, Scrubs Etc The Healthyday app also included a‘30 Sec- noted, including in trade and consumer press, ond Solutions’ function, McNeil added, that as well as via websites and blogs. answered common health questions. H7 Insomnia Control would be available Some of the app’scontent would be sponsor- through independentpharmacies and via on- ed by McNeil brands, the firm pointed out. line retailer Amazon, the firm pointed out, Consumers would be made aware of the app while alaunch in amajor pharmacychain was –which is only available on Apple devices – expected by October. via the App Store, McNeil noted, as well as Abox of 20 patches has arecommended “other Johnson &Johnson channels” such as its McNeil’s Healthyday app is said to act like an “early retail price of £9.90 (C13.88). warning system” to informusers about the prevalence HealthyEssentials healthy-lifestyle website. OTC of colds, flu or allergies in their area OTC

16 OTC bulletin 26 June 2015 OTC26-06-15p14-17_Layout 1 23/06/2015 18:22 Page 5

MARKETING NEWS OTC

AdvertisingComplaints DigitalMarketing Sanofi sorry for Sudocrem’s app inspired Bioflorin advert by Britishsummer fêtes anofihas issued an apology to Moroccans Safterits Swiss subsidiary featured the city “typical British summer fête” is the in- of Marrakech in advertising for its Bioflorin Aspiration behind Allergan’slatest social- diarrhoea-reliefproduct. media app to support its Sudocrem dermatology The firm’sSwiss campaign for Bioflorin brand in the UK. –which is not sold in Morocco –showed an Created by social-media agencyOrbital image of Marrakech’sJamaa El Fna Square, Media, the app –which will be active until 24 with the message: “Don’tspend your holiday July via the UK Sudocrem Facebook page – in the bathroom.” comprises acompetition featuring three games Responding in astatement, Sanoficonceded often played at the traditional summer event. thatthe advertisement “undermined the excell- Consumers can choose to play a‘whack a ent image of tourism in Morocco, and specif- gremlin’, ‘hook aduck’ or ‘hoop toss’ game for ically Marrakech”. the chance to win prizes such as Apple Watches, UK consumers can choose to ‘whack agremlin’ as The French companyinsisted that different Amazon Kindle electronic readers or money- partofthe Sudocrem summer fête app ‘visuals’ had been developed for the campaign offcoupons. on parenting website bounty.com and content that represented “major tourist destinations More entries could be earnt if consumers “en- on the site’sFacebook and Twitter pages. worldwide, includingthe city of Marrakech”. gaged” with Sudocrem’sother digital channels Orbital Media created asimilar ‘gamifica- Although the image of Marrakech had been via the app, the firm noted, includingbyfollow- tion’ app for Sudocrem in 2013 with a‘Virtual “immediately withdrawn”, Sanofinoted, the ing the brand’sInstagram, Pinterest or Twitter Treasure Hunt’, which wasclaimed to have advertisement had been shared across social profiles and by inviting Facebook friends to play. generated a“23% spike” in product sales and networks “on alarge scale”. Further “micro competitions” would run on reached approximately 10 million people over “Sanofiregrets this incident and apologises the Facebook page to support the app, Allergan the twomonths it waslive. to tourism professionals and Moroccan citizens,” pointed out. These included a‘Best Face Paint- Allergan–which has owned the Sudocrem the companystated. ing’ contest, which invited users to upload photos brandsince acquiring Forest Laboratorieslast The firm said it was“committed” to Mor- of their children’spainted faces for the chance year (OTC bulletin,25July 2014, page 3) –has occo, where it had been “present for 50 years”, to win £200 (C279) worth of vouchers for toy recently recruited Orbital Media as its global and had made “major investments”, adding retailer Toys “R” Us or Sudocrem ‘goodie bags’. lead social-media agencyfor Sudocrem, with that it had developed close relationships with The summer fête competition is being pro- the aim of providing social-media monitoring “authorities and health professionals, as well moted across Sudocrem’ssocial-media channels in 35 markets initiallyand rolling out apps to as with economic and industrial players”. and website, as well as via online advertising “relevant territories’ social-media platforms”. OTC OTC

ProductLaunches Osteo Bi-Flex campaign to get 2016 boost

BTY will begin afull US marketing cam- aproprietary ‘Joint Shield’ boswellia serrata Npaign –including television and print ad- extract, as well as vitamin D3 and 40mg of a vertising –for its recently-launched Osteo Bi- natural collagen source called UC-II collagen. Stada Arzneimittel is leaning on the popularity of its Multilind skin-carerange in Germany to launch a0.5% FlexEase mini-tabs in January 2016. This had been shown to improve joint comfort hydrocortisone cream under the Cortilind brand name. As more and more people were getting their by 40%, the firm claimed. The pharmacy-only medicine for treating allergic information online and “using social channels Noting that joint supplements were “fairly and inflamed skin complaints such as insect bites and sunburnissaid to offer rapid and effective relief for recommendations from friends and word of large in relation to other vitamins and supple- in adults and children aged from six years. mouth”, initial support for the latest variant ments” due to the amount of glucosamine and Stada –which is supporting the launch with –said to be 80% smaller than its Osteo Bi-Flex chondroitin theycontained, Albert So, Osteo trade-press advertising –recommends aretail price of C9.96 for a30g tube. One Per Day tablets –had primarily been focus- Bi-Flex’ssenior brand manager,said the mini- OTC ed on Osteo Bi-Flex’sFacebook and Twitter tabs offered consumers apill that waseasier to accounts, the companypointed out. take, and wasalso shellfish- and gluten-free. IN BRIEF Current promotional activity also included Other products in the Osteo Bi-Flexrange money-offcoupons in print publications,NBTY include an omega-3 formula, as well as an ■ PFIZER has launched the first gummy multi- told OTC bulletin,while the complete cam- MSM variant with methylsulfonylmethane and vitamin in its Centrum supplement line in the paign would encompass television, print and aherbal offering with turmeric, which was US under the Centrum MultiGummies name. digital advertising. launched in autumn 2014. OTC Each Osteo Bi-FlexEase mini-tab contains OTC

26 June 2015 OTC bulletin 17 Full Pg Adv.1 5-6-15_Layout 105/06/2015 16:54 Page 1

Sponsoring an Award will getyou noticedbythe global generics and biosimilars industries.

Contact [email protected] for more details.

Awards Presentation &Cocktail Reception. Madrid, Spain,Tu esday13October 2015

Visit www.generics-bulletin.com Email [email protected] Call +44 1564 777550

Awards sponsored by: OTC26-06-15p19Events_Layout 1 23/06/2015 17:49 Page 2

EVENTS OTC

16 September AUGUST 3-5November CHPAMeet the ■ 10th Ceuta International 20 August Manufacturer with Bayer ■ Alliance conference ■ Basics of New Jersey, US Istanbul,Turkey Pharmaceutical This one-day meeting with Bayer Delivering asolution to your international market management support RegulatoryAffairs Consumer HealthCare is open to or expansion plans. This unique event brings together leading health members of the Consumer Health- London, UK and beauty,OTC and diagnostic manufacturers, keyindustry opinion care Products Association (CHPA). This one-day course is run by The leaders, retailers and outsource solution distributors from over100 global Contact:CHPA. Organisation for Professionals in markets giving delegates an opportunity to meet like-minded people. Tel: +1 202 429 9260. Regulatory Affairs (TOPRA). Contact:Ceuta Healthcare. Fax: +1 202 223 6835. Contact:TOPRA. Tel: +44 1202 449 709. Email: [email protected]. Email: [email protected] Tel: +44 20 7510 2560. Website: ceutahealthcare.com. Email: [email protected]. Website: chpa.org/MTM/. Website: topra.org. 17-18 September OCTOBER Contact: Generics bulletin. 20-21 August ■ Marketing Authorisation Tel: +44 1564 777 550. ■ Marketing Authorisation in Latin America 5-6October Fax: +44 1564 777 524. in Russia/CIS Berlin,Germany ■ AFAMELA/WSMI Email: natalie.cornwell@generics- Berlin,Germany Topics to be discussed at this two- Conference bulletin.com. Countries to be discussed at this day meeting will include legal Mexico City,Mexico Website: generics-bulletin.com/ two-day seminar include Belarus, framework and national authori- ‘Advancing self-careand respon- generics-biosimilars-awards. Kazakhstan, Russia and Ukraine. ties; national marketing authorisa- sible self-medication for ahealth- 21-24 October Contact:Forum Institut für Management. tion procedures; dossier require- ierfuture’ is the theme of this two- ■ CRN’s Annual Tel: +49 6221 500 680. ments; and harmonisation trends. day conference,run by the Mexi- Symposium for the Fax: +49 6221 500 555. Contact:Forum Institut für Management. can non-prescription association, Email: [email protected]. Tel: +49 6221 500 696. AFAMELA and the World Self- DietarySupplement Website: forum-institut.com. Fax: +49 6221 500 555. Medication Industry (WSMI). Industry Email: [email protected]. Contact:AFAMELA. California, US SEPTEMBER Website: forum-institut.com. Tel: +52 55 5286 5297. Afour-day conference organised by the US Council for Responsi- 2-3September 21-23 September Email: [email protected]. ble Nutrition (CRN). ■ Advanced Website: afamela.org/index.php/ ■ Vitafoods Asia Contact:CRN. Pharmacovigilance afamela-wsmi-conference. Hong Kong Tel: +1 202 204 7700. Atwo-day exhibition and confer- London, UK 12-14 October Fax: +1 202 204 7701. ence focusing on nutraceuticals, Athree-day course covering drug ■ 12th TOPRA Email: [email protected]. as well as functional foods and safety regulations. Annual Symposium Website: crnusa.org. drinks and dietary supplements. Contact:Management Forum. Berlin,Germany Contact:Informa UK. Tel: +44 1483 730071. Athree-day event run by The Org- 26-28 October Tel: +44 20 7551 9785. Fax: +44 1483 730008. anisation for Professionals in Reg- ■ Vitafoods Russia &CIS Email: [email protected]. Email: registrations@management- ulatory Affairs (TOPRA). Moscow,Russia Website: vitafoodsasia.com. forum.co.uk. Contact:TOPRA. Athree-day event covering diet- Website: management-forum.co.uk. ary supplements, food supplements 4September Tel: +44 20 7510 2560. and functional food and drinks. ■ Marketing Authorisation 22-23 September Email: [email protected]. Website: topra.org. Contact:Adam Smith Conferences. in North &South Africa ■ GMP and Recent Tel: +44 20 7017 7444. Frankfurt, Germany Inspection Findings 13 October Fax: +44 20 7017 7447. The regulatory environment in for Human OTC Drugs ■ Global Generics & Email: kristinag@adamsmith Maghreb and South Africa will be WashingtonDC, US Biosimilars Awards 2015 conferences.com. the subject of this one-day course. Atwo-day workshop organised by Madrid,Spain Contact:Forum Institut für Management. the Consumer HealthcareProducts These Awards will recognise the NOVEMBER Tel: +49 6221 500 696. Association (CHPA). achievements of the global gen- Fax: +49 6221 500 555. Contact:CHPA. erics and biosimilars industries. 23-24 November Email: [email protected]. Tel: +1 202 429 9260. Organised by Generics bulletin, ■ EuroPLX 59 Website: forum-institut.com. Fax: +1 202 223 6835. theywill reward business develop- Athens,Greece This two-day meeting will pro- 10 September Email: [email protected]. ment initiatives, cleverlicensing Website: chpa.org. deals and smart legalmanoeuvres. vide aforum for business devel- ■ Mutual Recognition & opment decision makers for dis- Decentralised Procedure cussing and negotiating collabor- Bonn, Germany 14-15 October ative agreements in licensing, mar- This one-day seminar will look at ■ AESGP Conference keting, and distribution of patented regulatory strategy and submis- Brussels,Belgium medicines, generics, biosimilars, sion management. This two-day conference, subtitled ‘Substance-based medical devices: An OTCproducts, medical devices Contact:Forum Institut für Management. important part of self-care’, is being organised by the Association of and food supplements. Tel: +49 6221 500 680. the European Self-Medication Industry,the AESGP. Contact:RauCon. Fax: +49 6221 500 555. Contact:AESGP. Tel: +49 6221 426 2960. Email: h.wolf-klein@forum- Tel: +32 2735 51 30. Fax: +32 2735 52 22. Fax: +49 6222 9807 77. institut.de. Email: [email protected]. Website: aesgp.eu/events/Brussels2015/. Email: [email protected]. Website: forum-institut.com. Website: europlx.com.

26 June 2015 OTC bulletin 19 OTC26-06-15p20-23_Layout 1 24/06/2015 09:23 Page 2

OTC AESGP MEETING Empowermentkey to driving OTC growth

While there is apositivefeeling around the consumer healthcare industry, “One aspect of this newmarket dynamic without empowering the consumer,opportunitiestobuild on the momentum that is quite intriguing is the breakdown of the old silos of OTCmedicines, personal-care prod- could be lost, according to IMS’ Andy Tisman. Matt Stewart reports. ucts and nutrition products,”heexplained. “But the result of the growing attractiveness utting the consumer at the centre of placed to succeed in the market. of the consumer health marketplace is that it the business will be crucial for any “I think all players in this marketplace – has become more competitive,” Tisman pointed consumer healthcare companythat which is becoming much wider than just tradi- out. “If you look back afew years, it wasquite Pwants to takeadvantage of the cur- tional OTCfirms – will need to adopt new fashionable for pharma companies to be getting rent positive outlook for the industry,accord- ways of thinking to be successful,” Tisman out of consumer health and OTC, buttoday ingtoAndy Tisman, senior principal, Consumer noted. “Companies need to embrace awider firms are trying to maximise their position in Health, at market researcher IMS Health. range of opportunities to compete in an environ- the market by diversifying to ensure their busi- Speaking to delegates at the 51st Annual ment of emerging competitive threat and be ness includes aconsumer health element.” Meeting of the Association of the European careful when and where theyplace their bets.” Moreover, manyfast-moving consumer- Self-Medication Industry,the AESGP,inBar- This shift in focus away from “pharmaceu- goods (FMCG) and consumer packaged-goods celona, Spain, Tisman said that consumer em- ticals for the consumer” towards “consumer (CPG) players had entered the market, Tisman powerment wasan“absolute keytrend”. Those products for health and wellness”,Tisman said, said, largely because of the extra margins avail- companies that focused on “getting into a would lead to some traditional business mod- able for products carrying health benefits. consumer’smind”, he noted, would be best- els becoming obsolete. There were the obvious examples of Rec- kitt Benckiser (RB) and Procter &Gamble, Pharma OTCOTC share of Pharma he added, butother firms not known for health- 16 12 care, such as Unilever, Nestlé and Danone, had 10.9% 10.8% 10.6% 10.5% 10.2% 10.4% also taken steps into the space. 14 10.1% 10.0% 9.8% 9.9% 10.1% 10 As these companies entered the market and brokedownthe category-based silos that had 12 Year to March 2015: dominated for manyyears, much more “trans- Pharma: C800 billion 8 10 vergent segments” were emerging, Tisman re- OTC: C84 billion 9.0 vealed–such as cosmeceuticals and nutraceu- harma (%) th (%) 8 7.5 7.7 7.7 ow 6 7.1 6.9 ticals – where products had particular benefits 6.6 6.5 6.6 6.5 eofp 6.1 butwere delivered in avariety of formats,

5.9 har

lue gr 5.8 6 5.5 5.3 5.4 5.2

Va 5.1 which could be as apharmaceutical, afood sup- 4 Cs 4.4 4.3 4.6

OT plement or acosmetic-type product. 4 “This then opens the wayfor companies to 2.0 2 2 think creatively about regulatory strategy,for example,”Tisman pointed out. “I’ve had sever- 0 0 al conversations about howitispossible to find 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 the same product registered in different ways

Figure1:Annual growth of the OTC and prescription pharmaceuticals markets in the years ending 31 March in different countries within the same region.” 2005 to 31 March 2015 (Source –IMS OTC Global Analysis)

Global growth: 5.7% Western North CEEMEA* China Europe America GSK/Novartis 4.9 1.2% Rest of Latin Japan Australasia Bayer 4.8 0.4% Asia-Pacific America 5% 3% Johnson &Johnson 3.9 2.6% 13% 7% Sanofi 3.7 8.8% 10% 10% 27% Pfizer 2.8 7.0% 15% PGT Healthcare 2.3 2.3% 18% 16% Reckitt Benckiser 2.3 11.8% 19% 27% Boehringer Ingelheim 1.9 4.5%

Takeda 1.3 5.2% 20% 17% -2% Taisho 1.3 -5.9% Share of sales Share of growth -5% 012345 *Central &Eastern Europe, Middle East &Africa Value share(%) Figure 2: Contribution to salesand growth in the Figure4:Value shareand value growth of the top-10 global OTC companies in the 12 months ended global OTC market in 2014broken downbyregion 31 March 2015 (Source –IMS OTC Global Analysis) (Source–IMS OTC Global Analysis)

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AESGP MEETING OTC

25 14 Europe three-year Greece Latin America average growth: 5.6% 20 12 Denmark

th (%) CEE* Australasia ow 15 10 Africa CEE* Western Germany South Asia Spain

arye gr Europe th (%) Austria 10 North 8

Middle East ow Asia Norway

Latest Europe latest 5 China 6 Global latest Italy Finland year growth: 7.0% arye gr South-East Asia year growth: 5.7% Sweden Portugal 4 Ireland Luxembourg 5101520 Latest Switzerland Two-year average growth (%) Belgium North America 2 Japan UK Holland France Global two-year -10 average growth: 5.4% -2 0246810 *Central and Eastern Europe Three-year average growth (%) *Central and Eastern Europe

Figure3:OTC sales growth by region in the 12 months ended 31 March 2015 and in the two years Figure5:OTC sales growth in Europe by countryinthe 12 months ended 31 March 2015 and in the three ended 31 March 2015 (Source –IMS OTC Global Analysis) years ended 31 March 2015 (Source –IMS OTC Global Analysis)

25 18 Europe three-year Europe three-year average growth: 5.6% average growth: 5.6% 16 Reckitt Benckiser 20 Kazakhstan

th (%) 14 Russia ow Hungary 12

th (%) 15 Poland Stada Omega

Turkey arye gr ow 10 Boehringer Estonia Pharma Ingelheim 10 Czech Slovak 8 Sanofi

Romania Latest arye gr Bulgaria Republic Republic BMS 6 Europe latest Europe latest year growth: 7.0% Croatia Serbia GSK/Novartis Latest 5 Latvia year growth: 7.0% PGT Healthcare Bayer Slovenia Lithuania Johnson &Johnson -2 246810 12 14 16 18 20 246810 12 14 16 Three-year average growth (%) -2 -5 -2 Three-year average growth (%)

Figure6:OTC sales growth in Central and EasternEurope (CEE) by region Figure7:OTC sales growth of the leading companies in Europe in the year ended in the year ended 31 March 2015 and in the three years ended 31 March 2015 31 March 2015 and in the three years ended 31 March 2015 (Source –IMS OTC Global Analysis) (Source –IMS OTC Global Analysis)

However, to takeadvantage of these new the industry thought about innovation, Tisman plained, “with manyconsumers then moving categories, much thought had to go into how claimed, with amove towards thinking“much to Wikipedia,asitcomes up as the first result most effectively to bring these products to mar- more broadly” than just line extensions and in around two-thirds of all searches.” ket, Tisman said, insisting that it washere that newproducts. IMS had undertaken some correlation an- the consumer really needed to be at the “centre “These days companies also have to con- alysis, he pointed out, as it wasclear that this of everything that you do”. centrate on information technology,apps and level of information availability empowered “If we go back afew years, although we devices,”headded, “which empower the con- consumers to self-manage their health. all talked about consumers and tried to under- sumer to takeaholistic role in managing their “When we looked at cold remedies in Ger- stand them, alot of the thinking in the OTC many overthe past couple of market –and Iinclude my ownwork in my years,”hesaid, “the peaks in days at SmithKline Beecham –was brand-out- “In the past few years, therehas been abig Wikipedia searches for colds wards,”heclaimed. move away from brand outwards to starting correlated really closely with “In the past fewyears, there has been abig with the consumer, and Ithink it is some of the sell-out data in terms of move away from brand-outwards to starting peaks and troughs. This trend with the consumer,and Ithink it is some of the FMCG/CPG companies that have led wasalso seen in Poland with the FMCG/CPG companies that have led the the way in this sortofthinking.” anti-allergy drugs.” wayinthis sort of thinking,”Tisman said. “This While sounding anote of process starts with areally deep understanding caution that these products of what the consumer is looking for and how health rather than simply treating their illness.” were seasonal, Tisman said that the correlation that can be delivered and communicated.” IMS had taken alook at some of the social was“hard to miss” and that it demonstrated “I think we have seen that the companies media and technologytrends that had been that consumers were taking advantage of the in- that have taken the consumer-led approach are growing up around healthcare,Tisman said, formation available to manage their conditions. the ones that have been leading the growth in highlighting the use of online encyclopaedia All these changes were playing out in what the past twoorthree years in the OTCmarket- Wikipedia as aresource for managing health. wasanera of positive growth for the industry, place,”hepointed out. “A huge number of searches through search Tisman said, noting that for several years up This shift had also had an impact on how engines are to do with healthcare,”Tisman ex- to 31 March 2014, the OTCmarket had been

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OTC AESGP MEETING

growing faster than the prescription pharma- like twice the pace of the prescription market.” business within their portfolio, it wasnot sur- ceuticals market at manufacturers’ prices (see Growth wasmainly coming from emerging prising to see RB leading the growth, he added. Figure 1onpage 20). markets, which wasatrend that wasunlikely Looking regionally,the majorityofthe coun- The picture in the past 12 months had been to change, Tisman said, with 89% of OTCmar- tries in Western Europe had shown good short- different, Tisman said, butthat wasa“one off” ketgrowth generated by developing regions term growth in the 12 months to the end of the due to afew issues, such as apoor cold and such as Central and Eastern Europe (CEE), first quarter of 2015, Tisman said, with big flu season compared to the prior year. Latin America, the Middle East and Africa markets like Germanyand Italy producing He also cited “data-comparability issues” (MEA), and anumber of Asian markets (see “really encouraging” performances (see Fig- which had shrunk US market growth slightly, Figure 2onpage 20). ure 5onpage 21). and had held back the apparent growth of the Looking overatwo-year period, it wasa “When we look at CEE, we see asimilar consumer health sector. similar picture with developing markets charg- picture, where most of the major markets – These factors, Tisman said, combined with ing forward (see Figure 3onpage 21). Poland, Russia, Turkey –are all trending at or agenuinely strong year for the US prescription above their historic growth rates,” market –where there were no patent expiries he added (see Figure 6onpage 21). on major drugs and there were several newsuc- “The OTC market is going to see growth Highlighting the volatile political cessful launches for hepatitis C–explained in the 4%-7% range or maybe even a and economic situation in Russia, the past year’sfigures. little bit higher going forward.” Tisman said that at least in rouble “But this wasvery much aone-off,”Tis- terms there wasstrong growth in man insisted. the market, butitbecame adiffer- IMS believedthat the OTCmarket wasset Tisman said that broadly speaking, the major- entpicture once translated into euros or dollars. to rebound –and much stronger growth had ityofthe big players had not kept up with the The strength in its European cough and already been seen in the first quarter of 2015 – market growth rates (see Figure 4onpage 20). coldportfolio meant RB wasthe most outstand- while the prescription market would “slide back Only three of the top-10 leading multina- ing performer across Europe as awhole, Tis- to around 3%-5% growth,”Tisman said. tionals grewfaster than the market –RB, Sanofi man noted, butothers had been at least main- “Meanwhile, the OTCmarket is going to and Pfizer –and these companies had benefit- taining, and some improving, on their historic see growth in the 4%-7% range, or maybe even ted from astrong cough and cold season over growth rates (see Figure 7onpage 21). alittle bit higher going forward”, he revealed, the 2014/2015winter,Tisman explained. Moving on to anew region for IMS, MEA, “so OTCwill continue to growatsomething With astrong focus on the cough and cold the higher growth rates –both in the short-

20 Middle East &Africa South Africa 15 BMS three-year average growth: 9.9% 13 Johnson &Johnson Pfizer 15 11 Egypt UAE* Middle East &Africa Adcock Ingram thow (%) Middle East &Africa latest year growth: 8.5% 10 latest year growth: 8.5% 9 ar gr

ye 7

thow (%) Sanofi Morocco Lebanon Saudi Bayer 5 Kuwait Arabia 5 Spimaco ar gr Latest ye GSK/Novartis French West Africa Algeria 3 0 Pharco 1 -1 1357 9111315 Latest Three-year average growth (%) -1 578910 11 Tunisia -5 Three-year average growth (%) -3

-5 Julphar 10 Jordan *United Arab Emirates Middle East &Africa three-year average growth: 9.9%

Figure8:OTC sales growth in the Middle East and Africa by countryinthe Figure9:OTC sales growth of the leading companies in the Middle East and 12 months ended 31 March 2015 and in the three years ended 31 March 2015 Africa in the 12 months ended 31 March 2015 and in the three years ended 31 (Source –IMS OTC Global Analysis) March 2015 (Source –IMS OTC Global Analysis)

1.0 North America three-year 30 average growth: 0.3% 0.5 25 Argentina Puerto Rico Latin America 20 latest year growth: 18% -3 -2 -1 0123 Three-year average growth (%) Brazil -0.5 15 Venezuela

thow (%) Chile North America latest Uruguay -1.0 year growth: -0.6% 10

US ar gr Ecuador ye -1.5 5 Central America thow (%) Peru Dominican Republic Colombia -2.0 Latest ar gr -2 046810 12 14 16 18 20 Canada ye -2.5 -5 Three-year average growth (%) Latin America three-year average Latest Mexico -3.0 -10 growth: 15.5%

Figure10: OTC sales growth in North America by countryinthe 12 months Figure11: OTC sales growth in Latin America by countryinthe 12 months ended 31 March 2015 and in the three years ended 31 March 2015 ended 31 March 2015 and in the three years ended 31 March 2015 (Source –IMS OTC Global Analysis) (Source –IMS OTC Global Analysis)

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AESGP MEETING OTC

20 25 PGT Heathcare Pfizer Asia-Pacific Sanofi two-year average Latin America latest 15 growth: 5.0% Australasia South Asia 20 year growth: 18% thow (%)

15 ar gr 10

EMS ye Boehringer Ingelheim Grupo Farma Asia-Pacific latest North Asia 10 Genomma three-year average: +38% China thow (%)

year growth: 4.2% Latest GSK/Novartis 5 Hypermarcas one-year average: +38% ar gr

ye 5 South-East Asia Latin America three-year average growth: 15.5% -6 -4 02468101214 Latest 0 Two-year average growth (%) 10 15 20 25 Three-year average growth (%) Bayer -5 Japan -10 Figure12: OTC sales growth of the leading companies in Latin America in the Figure13: OTC sales growth in Asia-Pacific by region in the 12 months 12 months ended 31 March 2015 and in the three years ended 31 March 2015 ended 31 March 2015 and in the two years ended 31 March 2015 (Source –IMS OTC Global Analysis) (Source –IMS OTC Global Analysis)

20 Bangladesh 12 Asia-Pacific three-year India Asia-Pacific Merck average growth: 6.8% Australia 10 three-year average ar 15 Asia-Pacific latest growth: 6.8% ye year growth: 7.7% 8 NewZealand thow (%) Latest gr 10 Bayer Asia-Pacific latest Malaysia 6 Reckitt year growth: 7.7% Pakistan Johnson & Abbott

Singapore thow (%) 5 4 Johnson Sanofi Benckiser Hong Kong South Korea Philippines Vietnam ar gr Indonesia ye 2 GSK/Novartis -4 02 6810 12 14 16 Sun Pharma 0 Taiwan Three-year average growth (%) Latest Sri Lanka 6810 12 -5 Pfizer -2 Three-year average growth (%) Thailand -10 -4 Unilab

Figure14: OTC sales growth in Asia-Pacific by countryinthe 12 months Figure15: OTC sales growth of the leading companies in Asia-Pacific ended 31 March 2015 and in the three years ended 31 March 2015 in the year ended 31 March 2015 and in the three years ended 31 March 2015 (Source –IMS OTC Global Analysis) (Source –IMS OTC Global Analysis)

termand long-term –were much closer to CEE IMSfelt that the actual figure wasabout 1%- back, Tisman pointed out, as the developed growth rates than to those found in Western 2% growth after removing the comparability market of Korea had offset the gains in the em- Europe, Tisman pointed out. issue (see Figure 10). erging markets such as Indonesia. Several of the leading markets –Algeria, Moving on to Latin America, Tisman said Japan remained in a“quite depressed posi- Egypt, Saudi Arabia, South Africa –had been that Brazil and Colombia were the growth tion”, he added, noting that IMS had not seen driving the strong advances (see Figure 8), drivers. However, he offered aword of caution anyparticular signs of the situation improving. Tisman said, adding that IMS viewed MEA as on Argentina and Venezuela, as their strong Looking at the leading countries in the Asia- an “interesting sub-region” which wascaptur- growth had been drivenbyinflation. Pacific region, Singapore and Indonesia in the ing industry’sattention and where there existed When adjusted, the growth in Argentina and South-East Asia sub-region were growing fast, “a lot of potential for growth”. Venezuela wasmuch closer to Brazil and Col- Tisman said, while South Korea and Taiwan Furthermore, Tisman flagged up that in- ombia (see Figure 11), he pointed out. –the developed markets in North Asia –were dustry had the opportunity to work with the Overall, IMS wasseeing around 10% growth doing. “It is really tough to get growth in those regulators to establish aproperly-defined OTC forthe keymarkets in the region, Tisman said, developed Asian marketplaces,”Tisman said market in anumber of the MEA countries. so it wasa“good area to focus on”. (see Figure 14). Looking at the players in the MEA region, Looking at the leading players in the region, there remained aheavy weighting towards loc- Strong local players there wasamore definite split, with four com- al companies –atypical trend in the develop- “When we look at the players in the region, panies performing quite strongly above the mar- ing world –with four of the top-10 players as with MEA, we see several local players in ketgrowth rate –RBagain, Merck KGaA, headquartered in South Africa or the Middle strong positions,”Tisman noted, “with EMS, Abbott and Sun –and acluster of the other East (see Figure 9). Genomma, Hypermarcas and Grupo Pharma six performing behind the market growth rate The strength of these local players wasone all making the top-10 on the basis of the data (see Figure 15), Tisman noted. of the core challenges for multinationals in the and local currency” (see Figure 12). Again there were alot of local players in MEA and other developing markets, Tisman Finally,looking at Asia-Pacific, there were the market, Tisman pointed out, butassome of claimed, and akey reason whybig companies very different results across the sub-regions, them were really only operating in one market didn’tkeep up with global growth rates. Tisman noted, with South Asia –Bangladesh, theydid not make the regional top 10. Skipping overanin-depth look at North India, Pakistan, Sri Lanka –performing strong- “But it is an area with alot of opportunity,” America for reasons of the data comparability est, while Australasia and China had also put he claimed, “if you can find the keys to un- issues mentioned before, Tisman said that while in solid performances (see Figure 13). lock the right doors.” there wasaslight decline in reported figures, South-Eastern and North Asia had slipped OTC

26 June 2015 OTC bulletin 23 OTC26-06-15p24-27_Layout 1 24/06/2015 09:20 Page 2

OTC BUSINESS STRATEGY Merck tapsconsumers for inspiration

Just overayear after taking overMerckKGaA’s Consumer Health business, Uta Kemmerich-Keil tells Matt Stewart about howthe company is engaging with consumers and driving the business forward.

ne of the most important “Wewant to makesure we have agood basic things for us is really to understanding of whether aproduct intrigues embrace consumerisation the consumer or not.” “Oand have it entrenched in While admitting it sounded obvious, Kem- our DNA,”says Uta Kemmerich-Keil, president merich-Keil said Merck only wanted to bring and chief executive officer of Merck KGaA’s to market products that really resonated with

Consumer Health business. “Consumer health- consumers. This wasnot always the case across Uta Kemmerich-Keil, president and chief executive care is not aone-way conversation anymore.” manyindustries, she added. officer of Merck KGaA’s Consumer Health business, Meeting with consumers face-to-face and Oneway Kemmerich-Keil likes to get per- said engaging with consumers was crucial for success in the OTC market through social networks, combined with tradi- sonally involved in engaging with consumers tional market researchand user testing, are is through the series of consumer days the com- ed its Apaisyl headlice shampoo brand with all playing acrucial part in Merck Consumer panyhosts. Apaisyl Detect’ Nits, agel that when applied Health’songoing revival, not only driving the “Weinvite them in and have interviews with to dry hair tracks down nits and dyes them firm’ssales –which movedforward by afifth them which we broadcast to the rest of organ- blue. Theycan then be easily detected and com- to C217 million in the opening quarter of 2015 isation, so Ican listen to what theysay in Saudi pletely combed out of the child’shair. (OTC bulletin,12June 2015, page 4) –but Arabia or in Brazil,”she explained, “In Ger- The firm’sinteractions with consumers in also helping the German companytomeet its manyIparticipate in person to get areal feel France had uncovered this “pain-point”, Kem- strategic goals. merich-Keil reiterated, and had en- Having laid out a‘3x3’ plan of develop- abled the business to develop a “Real-worldengagement is veryhelpful ing aminimum of three leading brands in key product that made areal difference. categories and achieving at least a3%mar- as it gives you agrounding in what Merck wasalso actively encour- ketshare across the company’stop 15-20 mar- consumers think and how consumer aging consumers, healthcare pro- kets, Kemmerich-Keil said the insights the com- fessionals and its ownstafftocon- expectations varycountry-to-country.” panywas able to glean from consumers would tribute ideas for howproducts be crucial to hit this target. could be improved–orideas for en- “There are manyways to ensure you reach of what people are looking for.” tirely newproducts –through an online inno- out to consumers,”she pointed out, “but first “This type of real-world engagement is very vation portal – merck-consumer-idea.com. youhavetohaveenough data on what is going helpful as it givesyou agroundinginwhat “This is aglobal idea portal for crowd- on with your brands in the market.” consumers think and howdifferent consumer sourcing ideas,”Kemmerich-Keil said. “It is “Wehavebeen investing in market research expectations vary country-to-country,” Kem- asystematicapproach that allows people to to amuch larger extent than we have before, not merich-Keil insisted.“It won’tgiveyou statis- access the website and input an idea for aprod- only on the brands themselves and their posi- tics, butitwill give you real insights.” uct or improvement.” tioning, butalso whether our campaigns make This increased engagement with the con- “Pharmacists are using it, our consumers the consumer fall in love with them,”Kem- sumer had thrown up some surprises, Kem- areusing it, our ownpeople from our field force merich-Keil explained. “That is amust-have.” merich-Keil said, admitting that there were some even use it, when theycome back from amar- Another element Merck Consumer Health product concepts that she had agut feeling ketwith good ideas,”she noted, “and it means hadbeen expanding wasconsumer testing, she could work, butdid not resonate in testing. that good ideas won’tget lost.” revealed, and getting consumers involved early It had also uncovered cultural differences “A dedicated team looks at what comes in,” with product concepts. that had abig impact on product positioning, Kemmerich-Keil said, “and if we see alot of “Before we engage in research and develop- Kemmerich-Keil revealed. repetition we knowthat there is something ment activities, we want to makesure that we While looking into the headlice market in that is wanted.” are not just going on agut feeling,”she stated. France, for example, the companydiscovered “Wethen give feedback, so people that have that unlikeinGermanyorthe UK, discussing suggested ideas knowtheyare appreciated and headlice wassomewhat taboo. also howthat idea is progressing.” “Having headlice wasstill considered, by This represented the very first step of the some people, to be asocial class issue in development journey, Kemmerich-Keil pointed France,”Kemmerich-Keil said. out, which wasthen followed by “a very clear This depth of feeling had created aneed for filtering process” so that only ideas that really consumers –and especially mothers –toknow resonated with the consumer went forward. forsure that the headlice had been eradicated “You have to makethe effort to capture the Merck launched Apaisyl Detect’ Nits in France after discovering consumers wanted away to show after treatment, Kemmerich-Keil pointed out. ideas out there and takethe negative feedback headlice werelong gone Taking this insight on board, Merck expand- and learn from it,”she explained.

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BUSINESS STRATEGY OTC

Merck wastaking asimilarly pragmatic ap- proach to the rapidly-expanding world of digi- talhealth, Kemmerich-Keil pointed out. “You have to embark on these journeys or you will get left behind.” Digital health wasa“big topic” and one that “everybody is jumping on”, she admitted, andwhile there were alot of opportunities, no one yet knewhow best to commercialise them. ForKemmerich-Keil, the digital health arena wassplitting in twodirections: diagnostics and measuring wellbeing. Aperson’sability to self-diagnose and eval- uate their owndata, would, in the mid-term, help drive people towards productstheycould use to ‘By focusing on its strategic brands, Merck Consumer Health has moved closer to delivering its 3x3 strategy’ treat themselves, Kemmerich-Keil claimed. we have to to be digital,”she noted. “But what ed to the Consumer Health business from the However, measuring wellbeing –through has impact and what doesn’t?” Merck Serono business last year (OTC bul- step-counters, apps to monitor sleep, eating “You cannot say if lots of clicks will lead to letin,17March 2014, page 1) –had been the habits and heart rate –had amuch more prom- lots of sales, butyou can use digital platforms standout performers in the opening fewmonths ising long-term outlook, Kemmerich-Keil said, to become more than just aproduct to the con- of this year,Kemmerich-Keil noted, especially as this process had the ability to change con- sumer,” Kemmerich-Keil claimed. in Asia and Latin America. sumer awareness and attitude. The firm’srecently-launched Bion Equilibre “The successful commercialisation of the “Consumers knowing that theydon’tsleep magnesium supplement in France wasaprime Neurobion franchise–along with the probiotic enough, don’tmove enough, don’teat the right example of this approach, Kemmerich-Keil said. product Floratil which wastransferred across food and have high blood pressure, will help “Bion Equilibre waslaunched with an app at the same time –demonstrated the strong OTCcompanies,”she explained, “as the more that acts as alife coach, guiding you through consumerisation capabilities of the Consumer people become aware of their health, the more your day,helping you deal with fatigue and Health business,”Kemmerich-Keil said. theywill makeproactive decisions to takecare stress,”she explained. “It givesthe consumer It had also led to another Merck Serono of themselves.” alifestyle tool that follows them through their brand –the Vigantol vitamin Dline –moving As afirm with anumber of high-profile sup- day and helps them find their equilibrium.” under the Consumer Health umbrella. plement brands –led by Bion –Merck needed “I can’ttell you howmuch of the revenue Achieving the 3x3 goal would not just be to be able to profit from this heightened aware- generated by Bion Equilibre wasdue to the aone- or two-year job, Kemmerich-Keil insisted. ness, Kemmerich-Keil said. app, butitisanimportant touch point that we While in some markets –likeMexico, Belgium “I have alot of sympathywith the approach have to have,” Kemmerich-Keil insisted. and Austria –the companyhad already reached of not doing all product development in house,” “Wehad to look at what benefits we could the target, in others it would takelonger to Kemmerich-Keil revealed. “So, let’sfind some- delivertothe consumer besides just raising build the scale needed, she admitted. one to partner with who is as good on the tech- vitamin, mineral and magnesium levels,”she “There are ahandful of markets where the nology side as we are on the health side and added. “This is true about alot of our brands. goal will be reached in the next one or two we will see what will happen.” We are looking at what other benefits or services years –Brazil, France Germany, or Indone- It would takeawhile to see what worked and we can offer to add value to our products.” sia for example –and there will be approxi- what didn’tand some in the industry would All the developments would feed into the mately another 10 markets or so that will take end up paying some “early-learning money”, 3x3 strategy,Kemmerich-Keil said, astrategy alittle longer,including India, Malaysia, South Kemmerich-Keil said, butoverall it would be which wasstarting to really pay off. Africa and the UK.” good for the industry to tap into this consumer “I have asuper agile and very entrepreneurial “But we have aplan in place for how to desire better to look after themselves. team,”she enthused, “who knowhow to take get there, and we knowthe organic growth paths Acrucial trick to making digital health work things from power-point presentation to action.” for certain brands, such as launchingBion in for the industry would be making sense of the Growth wascoming from more or less Brazil to add scale there,”she explained. colossal amounts of data that the digital health every region, Kemmerich-Keil said, noting that The companywould also look at acquisi- movement wascreating, she said. the business waswell exposed to growth mar- tions or other inorganic growth strategies, if “When you listen to data experts, they kets, with over50% of its business coming it felt progress wastoo slow, she added. clearly advise you to have in mind what you from Latin America, Middle East and Africa “I would hope that in five to sevenyears are looking for when you collect your data,” as well as Asia. we will be saying we are there and in many Kemmerich-Keil pointed out. “Just collecting “When you look at Latin America and markets we will already be farbeyond that,” dataand having it in adatabase doesn’treally Asia we are talking about 25% organic growth Kemmerich-Keil said. help you, so you have to have an intention, other- in the first quarter,which is apretty impressive Despite having developed astrong record wise it doesn’twork.” number,” she pointed out. “Europe is solidly of taking what were essentially prescription- Interaction with consumers wasalso evolv- growing –wegrewaround 3% organically, only brands –Neurobion and Floratil –and ing thanks to the digital-health sphere, Kem- more-or-less in line with the market –and our turning them into successful OTCbrands, merich-Keil said, giving the industry –through Middle East and Africa business is growing Kemmerich-Keil said Merck Consumer Health digital marketing –anew “touch point”. nicely too at around about 7%.” did not see undertaking full prescription-to-OTC “Wehavetobewhere our consumers are, so Dolo-Neurobion and Neurobion –transferr- switches as akey priority.

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OTC BUSINESS STRATEGY

need and an already strong prescription brand. on your power markets. When you sprinkle “If the healthcare system wants to encour- your investments all overthe place, it is prob- age switch, we have to have better incentives ably not the best waytowin.” for it to work properly,” she added, “as at the “Wewill look at smaller deals –that can be moment the system is sub-optimal.” brands or companies –tostrengthen in agiven The regulatory environment as awhole con- market, ideally in our existing categories,”she tinued to be challenging, Kemmerich-Keil said, reiterated. “Weare always open to local deals with alot of change –not all of it positive – which makesense.” and “huge differences” country-by-country. “Wewill look deeper for these deals in our “Any aspirations to get to auniform envi- focus markets, those that are further away from Moving the Neurobion brand from the Merck ronment, even on aregional level, are wayoff.” the3x3 goals than we would like,”Kemmerich- Serono division bolstered Consumer Health’s Looking at the market overall, the industry Keil admitted, “as that is where we can win.” presence in emerging markets wasindecent shape, Kemmerich-Keil claimed, “But it is not easy.Itisaseller’smarket, “Does it makesense to in-license switch with solid growth and margins, despite it re- not abuyer’smarket,”she added. “You really candidates? Yes, in general,”she admitted. “We maining ahighly fragmented sector. need to makesure you are adding value and have developed the skills and it makes sense This fragmentation had drivenalot of re- getting the return-on-investment you need.” to leverage those, buttoget acandidate in cent acquisition activity,but Kemmerich-Keil Turning to twobig markets where Merck and drive that switch really would only be a saidthat Merck wasnot interested in anylarge- Consumer Health had no presence –China secondary priority for us right now.” scale “transformational” deals. and the US –Kemmerich-Keil noted that while “First priority is to leverage our expertise for “You want to be strong on the ground to attractive,theywere also challenging in many real OTCbrands or food supplements,”Kem- win in your category,” she explained, “so when ways. Anyone attempting to enter either mar- merich-Keil pointed out. “Actively searching for Ilook at acquisitions, Ilook at what fits locally ketneeded a“very good strategy” to ensure these candidates will be my first priority.” and will strengthen our business.” theydid not “just burn money”, she claimed. Noting that the incentivestoswitch were “Whether you have C1or C2billion in global “If there is agood opportunity that presents also not very appealing,Kemmerich-Keil com- sales is not decisive in whether you win in a us with asmart waytoenter those markets, then mented that to switch successfully you needed particular category in aparticular market,” we will look at it, butit’snot something Iam arare combination of atruly unmet consumer Kemmerich-Keil insisted. “You want to focus chasing,”she said. OTC

26 OTC bulletin 26 June 2015 OTC26-06-15p24-27_Layout 1 23/06/2015 19:28 Page 5

PEOPLE OTC

Manufacturers Industr yAssociations Valeant appoints Smith appointed PAGB chief financial chief with Darracott as deputy aleant Pharmaceuticals has named Robert VRosiello as its newchief financial officer. he Proprietary Association of Great Britain John Smith Rosiello will takeoverfrom Howard Schill- T(PAGB) has announced that John Smith, er on 1July. former business unit leader for UK, Ireland and Thespecialitypharmaceutical companysaid the Netherlands at Pfizer Consumer Health- that Schiller would remain at Valeant in acon- care, will takeoverasthe association’schief sultancyrole. executive on 13 July. Rosiello is joining Valeant from McKinsey Smith replaces Matthew Speers,who is &Company, where he is asenior partner in stepping down after 18 months at the helm of the charge of the consultancycompany’sglobal industry association to “pursue other interests” merger practice. (OTC bulletin,13December 2013, page 23). In his role at McKinsey, Rosiello had led Helen Darracott –PAGB’sdirector of Legal Helen Darracott mergers and acquisition integrations for phar- and Regulatory Affairs for more than 12 years maceutical, specialty pharmaceutical and med- and who is responsible for the association’score ical device companies in Asia, Europe and the services and regulatory functions –has been pro- US,Valeant said, helping healthcare, technol- moted to deputy chief executive. ogy and consumer firms deliverboth growth Commenting on the appointments, Carlton and improvedfinancial performance. Lawson, PAGB president, said the association J. Michael Pearson, chairman and chief ex- was“confident” that Smith and Darracott would ecutive officer,said Rosiello’s“tremendous form a“strong team to move PAGB forward” expertise in healthcareand in particular merg- and deliveronits “core objectives”. ersand acquisitions”, coupled with his “un- Speers had developed agrowth strategy facing unprecedented financial challenges, questioned intellect, work ethic and integrity” which would enable the organisation to sup- we need to support and encourage people to would prove to be of “great value” to Valeant port the UK consumerhealthcare industry for self-care,”headded. and its shareholders. the next five years, Lawson pointed out. Prior to his role at Pfizer,Smith held a OTC As chief executive,Smith promised to “fur- number of leadershippositions at Wyeth Phar- ther the self-care agenda” in the UK and to maceuticals –which Pfizer acquired in 2009 “work with government and regulators to en- (OTC bulletin,29January 2009, page 1) –in- Retailers sure that consumers are placed at the heart of cluding general manager of Wyeth Consumer Vitamin Shoppe regulatory decisionsmade”. Healthcare for Portugal, Russia, South Africa “With the National Health Service (NHS) and Spain. recruits CM leader OTC itamin Shoppe has appointed Michael Industr yAssociations VBeardall as president of its Nutri-Force Nutrition contract-manufacturing business. PGEU names Smits as its next president Beardall had joined Nutri-Force –which also manufactures and sells its ownline of he Pharmaceutical Group of the European previously worked for GlaxoSmithKline (GSK) sports-nutrition products under the Nutri-Force TUnion (PGEU) has elected the Netherland’s andYamanouchi Europe, before leading aphar- Sports and Betancourt brands –from rivalnutri- JanSmits as its next president. He will take macygroup for 12 years. tionalsupplements contract manufacturer Cap- overfrom Ireland’s Darragh O’Loughlin in Commenting on his newrole, Smits said that stone Nutrition, the US-based retailer noted, January 2016. it wascrucial to generate data on outcomes from where he had most recently served as president. Amember and former president of the Royal services provided by pharmacists to “substan- Previously,heworked at Cornerstone Re- Dutch Pharmacists Association, KNMP,Smits tiate the vision” the profession had for its future.

search &Development. Jan Smits “It will makeclear that the community Colin Watts, Vitamin Shoppe’schief exec- pharmacist makes asubstantial contribution to utive officer,said that Beardall brought over healthcareand society,” he insisted. 15 years experience in the nutritionalsupple- “The correct use of medication helps to post- ments industry to Nutri-Force. pone or even prevent costly hospital admissions,” “With Beardall’sleadership and aseasoned Smits pointed out. “So, from an economist’s management team that is already in place, we perspective,you could say that widening the have the foundationtosupport future growth role of the communitypharmacistshould not be at Nutri-Force,”Watts insisted. seen as acost, butrather as an investment.” OTC OTC

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