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15 August 2014

COMPANY NEWS 2 RB starts revolution with Sanofi racesahead 2 of OTCcompetitors Meda grabs Rottapharm 3 for SEK21.2bn £100mn R&D investment Omegaoutlines European ambitions 4 GSKhas no plans to 6 new £100 million (C126 million) UK- spin offConsumer Abased consumer healthcareresearch Valeant faces US lawsuit 7 and development centreannounced by Rec- over allegedinsider trading kitt Benckiser (RB) will play akey role in RB sees opportunity 8 the company’sdrive to “create arevolution” in medical devices in the sector,according to the firm’schief Procter&Gamblestartscullingbrands 9 executive officer Rakesh Kapoor. GNC’s Retail plan in doubt 10 Kapoor told OTC bulletin that the Centre as CEOleaves of Scientific Excellencewould give the fast- Negativecurrencyeffects 11 moving consumer-goods (FMCG) giant the damageBayer “right infrastructure, the right technical abilities Taisho lookstoincrease 12 and most importantly the right people” to de- demand for OTCs liverthe innovations in consumer healthcare Pfizer committedto 13 that would enable RB to be a“global leader in Consumer Healthcare this newhealth revolution”. Reckitt Benckiser’s chief executive officer,Rakesh Celesiotosoon see 14 “Wehaveworld-class talent on this site and Kapoor,said the CentreofScientific Excellence would theydeserveaworld-class facility,” he pointed help the firmtobecome “a global leader in this new McKessonbenefits health revolution” out, “and it will become amagnet for talent GENERAL NEWS 15 from around the world.” novation differently from traditional pharma- Based at the company’sexisting site in Hull, ceutical companies. MHRA calls for proposalsto 15 the newfacility –set to open in 2018 –would “Welook at product development through put OTCdrugs on blacklist become the “global technical innovation hub” the eyes of consumers, we mine the science Russiaconsiders 16 for the firm’sconsumer-health powerbrands, and we find newways to provide relief over- non-pharmacysales such as Nurofen and Strepsils, Kapoor said. the-counter,” he said. “This innovation makes Asthma useworrieslead 17 “The centre will be working on developing avery real difference to people’shealth.” Singulairsafetyconcerns effective and innovative solutions for every- “When we think about innovation, we don’t Body weight is no issuefor 18 day ailments,” Kapoor revealed. “In particular, think about molecules first,”Kapoor explained. emergencycontraceptives it will lead ground-breakingresearch in pain “Ofcourse eventually we do think about mole- MARKETING NEWS 19 management and indigestion relief,”heexplain- cules or products wouldn’tget made, butwe ed, “as well as in howtouse flavours to make think first about howtoeducate and bring be- Infirsttomakeglobal debut 19 themouth salivate and makeon-the-go reme- havioural change.” with Dr CocoalaunchinUS dies more palatable, and in combining these “Takehygiene for example,”Kapoor explain- BayerbolstersBerocca 20 developments with active ingredients.” ed. “Hygiene is the basis for good health and in US and UK The innovation that would come out of the with our Dettol brand –arange which will also Australians canaccess 21 newfacility would makeareal difference to how benefit from the investment –weeducate mil- Merck’sNasonex OTC people managed their health, Kapoor claimed. lions of mums around the world on howtokeep Prestige offersdairy defence 21 “People are living longer,the global popu- their children safe from illnesses and diseases lation is increasing and our health services will which are caused by bad hygiene practices.” FEATURES 24 struggle to cope,”headded. “Self-care has to be Hand-in-hand with RB’sattention to con- OTC market growth 24 acritical part of the solution. But for self-care to sumer education, Kapoor said, came aneed to remains fragile work, effective innovations are needed that pro- keep healthcare practitioners up-to-date on the vide effective remedies with great convenience, best waytotreat everyday ailments. This was REGULARS supported by excellent consumer information.” another area of focus for the firm. Noting that the newcentre would represent However, innovation would only drive Events – Our regularlisting 23 the largest investment in research and develop- change if it waswidely available, Kapoor in- People – Walgreens BootsAlliance 27 ment in the company’shistory,Kapoor claimed sisted, noting that he had asked for a“coalition appointsleadership team that RB approached consumer healthcare in- ■ Continued on page 27 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 2

OTC COMPANY NEWS

Second-QuarterResults Sanofiraces ahead of OTC competitors

anofi’sConsumer Healthcarebusiness is Region Second-quarter Change (%) Proportion Sgrowing faster than all its competitors in sales (C millions) CER* of sales (%) thesegment, thanks to the switch of Nasacort in the US and strong sales in emerging mar- Emerging Markets 434 +36.4 53 kets, according to the company’schief execu- US 177 +23.2 22 tive officer Chris Viehbacher. Western Europe 161 ±0.0 20 Speaking as the French firm posted Con- Rest of World 44 -25.0 5 sumer Healthcare sales up by 20.2% to C816 Total Consumer Healthcare816 +20.2 100 million in the second quarter of 2014, Vieh- bacher said the business had become an “ex- *CER is constant exchange rates

tremely important part” of Sanofiand had been Figure2:Sanofi’s Consumer Healthcaresales in the second quarter of 2014 by region (Source –Sanofi) growing “incrediblywell”. Even excluding the transfer of products “pre- cort in the US (OTC bulletin,25October 2013, In 2013, Cialis generated worldwide sales of viously reported in prescription pharmaceuti- page 1), the companywas gearing up for the US$2.16 billion (C1.62 billion) and since its cals” in the prior-year period, the division had potential switch of Eli Lilly’serectile dysfunc- launch has generated turnoverofmore than still outpaced the competition, Viehbacher noted, tion drug Cialis (tadalafil), Viehbacher noted. US$14 billion. with sales rising by 9.2% in the quarter. Having acquired the rights to switch the Turning to the company’ssecond-quarter Expanding on Consumer Healthcare’splace product in Europe, Japan and the US (OTC results, Sanofisaid the 9.2% rise in Consumer within the Sanofigroup, Viehbacher explain- bulletin,30May 2014, page 1), Sanofibelieved Healthcare turnover–excluding the transfer ed that it enabled brands to “live for decades” there wasanexciting opportunity to open up of prescription products –had been due to the and provided the “long-term revenues” that a anew OTCcategory,Viehbacher said, and to successful Nasacort launch and astrong show- companylikeSanofineeded to ensure the finan- drive further strong growth at its OTCfranchise. ing in Emerging Markets. cial stability required to takeresearch and dev- If aswitch wasgiven the go-ahead, Sanofi Nasacort (triamcinolone acetonide) had gen- elopment risks. anticipated marketing Cialis OTCafter the “ex- erated C21 million in US sales in the three Furthermore, Consumer Healthcare kept the piration of certain patents”, the firm noted. months, Sanofinoted. Total Nasacort sales were company“in touch regularly with actual con- Cialis has been approved asaprescription C26 million, putting the brand into seventh place sumers”, he claimed, adding that it wasim- medicine in more than 120 countries world- in Sanofi’sroster of Consumer Healthcare portant for Sanofi“nevertoforget the people wide with anumber of indications,including brands (see Figure 1). aspect of our business”. erectile dysfunction and the signs and symp- Indicated to treat “seasonaland year-round Meanwhile, following the switch of Nasa- toms of benign prostatic hyperplasia. nasal allergies in adults and children twoyears of age or older”, Nasacort offered the 60 mil- Business Second-quarter Change (%) Proportion lion Americans who suffered from nasal aller- sales (C millions) CER* of sales (%) gies anew OTCtreatment option,Sanofisaid. Allegra94+53.8 1 The fexofenadine-based brand Allegra was Doliprane 70 +4.4 >1 the best-selling of Sanofi’sestablished brands Essentiale 55 +10.5 >1 in the three months, with sales up by 53.8% to Enterogermina 36 +31.0 >1 C94 million at constant exchange rates. Lactacyd 32 +41.7 >1 Sanofi’snine top-selling Consumer Health- Dorflex27+55.0 >1 care brands had total sales of C388 million in Nasacort 26 –>1 the second quarter,just under half of the div- No Spa 25 +20.8 >1 ision’stotal. Maalox 23 +4.3 >1 On aregional basis, more than half –53% – Other Consumer Healthcarebrands 428 +9.8 5 of Consumer Healthcare’ssales were generated Consumer Healthcare 816 +20.2 10 in Emerging Markets, where turnoveradvanc- Diabetes 1,788 +16.2 22 ed by 36.4% in constant currencies to C434 mil- Genzyme 643 +29.1 8 lion (see Figure 2). In the US, sales of Nasacort helped to lift Generics 466 +65.7 6 turnoverinthe region by 23.2% to C177 million. Oncology/Other Pharmaceutical 3,107 –38 Sales in Western Europe remained flat at Pharmaceuticals 6,820 +7.2 84 C161 million, while turnoverinthe Rest of World Vaccines 718 -0.4 9 region slipped back by 25.0% to C44 million. Animal Health 537 +6.2 7 Consumer Healthcareaccounted for 10% Total Sanofi8,075 +6.4 100 of Sanofi’stotal second-quarter sales, which in- creased by 6.4% at constant exchange rates *CER is constant exchange rates to C8.08 billion. Figure1:Sanofi’s sales in the second quarter of 2014 broken down by business (Source –Sanofi) OTC

2 OTC bulletin 15 August 2014 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 3

COMPANY NEWS OTC

Mergers&Acquisitions Meda grabs Rottapharm for SEK21.2bn

eda is set to buyprivately-owned Italian Rottapharm had anumber of “highly-differ- uary 2017. The deal –which is expected to Mfirm Rottapharm in adeal worth SEK21.2 entiated brands”, he pointed out, and held a close in the fourth quarter of 2014 –would give billion (C2.30 billion) to create what it claims leading position in the doctor-recommended, Rottapharm’sowners, the Rovati family,a9% will be a“European speciality pharma leader”. clinically-provenconsumer healthcarespace. stakeinMeda. The Swedish firm said the deal –which is The combined business –with sales of ap- Cost synergies from the deal were expected worth around 4.6-times Rottapharm’s2013 sales proximately SEK18 billion –would have an to reach SEK900 million per year,Meda claim- of C500 million –boosted its consumer health- “improved balance” between prescription and ed, and would come into full effect in 2016. care business with arange of “clinically-proven” non-prescription products, Dierks claimed, and Synergies would be drivenby“efficiencies non-prescription brands. These had nearly no benefit from increased investment opportunities. in administration, sales and marketing, and re- generic competition and were sold primarily Furthermore, the deal would expand Meda’s search and development”, the firm said, with add- through doctors and healthcare professionals. reach in emerging markets, the companysaid, itional upsides outside of these areas from sell- Rottapharm’snon-prescription brands include thanks to Rottapharm’sestablished presence in ing Meda products in newmarkets as well as the Dona glucosamine range, Saugella feminine- regions such as South-EastAsia. repatriating certain licences to Meda. hygiene line and ArmoLIPIDnutraceutical. Meda has agreed to pay SEK15.3 billion in The deal comes just afew months after Jörg-Thomas Dierks, Meda’schief executive cash for Rottapharm, along with 30 million Meda rejected atakeoverapproach from gen- officer,said the acquisition marked an “impor- Meda shares valued at SEK3.3 billion and a erics specialist Mylan (OTC bulletin,9May tant step in creating astronger,improved Meda”. payment of SEK2.6 billion deferred until Jan- 2014, page 3). Having already turned down Mylan’sinitial approach in April (OTC bulletin,11April 2014, BusinessStrategy/Second-QuarterResults page 4), Meda rebuffed asecond approach in May,explaining that its decision had been based Mylan exploring opportunities in Europe on a“strong belief in the continued potential of Meda as astandalone companyand the as- ylan intends to explore opportunitiesto officer Heather Bresch told investors. sumption that atransaction cannot be completed Mbuild up an OTCoperation in Europe to “The Abbott transaction certainly givesus as it lacks sufficient support from Meda’slarg- complement the US firm’spending US$5.3 abeginning foothold on OTC,”Bresch stated. est shareholder”. billion (C4.0 billion) purchase from Abbott of “Wehavegot real opportunitiestolook at some Meda posted a5%rise in sales of its OTC aroster of more than 100 mature brands and of these brands that we are nowacquiring, as products to SEK3.13 billion in 2013, as its key branded generics in developed markets. well as perhaps to add some products that would brands entered newmarkets. OTCbrands ac- “Wethink OTCisaninteresting channel, be very strategic and would allowustobuild counted for 24% of Meda’s2013 sales, which in some respects even outside the US more upon the Mylan equity through all channels.” grewby3%toSEK13.1 billion. than inside the US,”Mylan’schief executive OTC OTC

15 August 2014 Number 427 published 20 times ayear –twice monthly, except Subscription enquiries: monthlyinJuly, August, December and January, and As left, or [email protected] Editor: Matt Stewart delivered by air mail –and afreeweeklyemail Editor-in-Chief: Aidan Fry newsflash news@OTCbulletin published at least 45 Te rms &Conditions: No partof this publication maybe Production Editor: Jenna Meredith times ayear.Individual annual subscriptions in Europe copied, reproduced, stored in aretrieval system, distributed or transmitted by anymeans, including electronic,mechanical, cost £715 (additional copies at the same address Assistant Editors: Liudmila Kotko, Marie McEvoy photocopying or recording, without the prior written Business Reporter: TomGallen £415); outside Europe £745 (£445). permission of the publisher,orunder the terms and conditions Contributing Editor: David Wallace The 20 OTC bulletin newsletters arenow available as a of aGlobal Site Licence or of alicence issued by the Copyright Licensing Agency (CLA) in London, UK, or rights bodies in Advertising Controller: Debi Minal digital edition, OTC bulletin-i,for either Apple or other countries that have reciprocal agreements with the CLA. Director of Subscriptions: ValDavis Android mobile devices at acost of £975.This Group Sales Manager: Anisa Shan subscription includes news@OTCbulletin. Neither maythis publication be exported, distributed or Awards Manager: Natalie Cornwell circulated by anymeans outside the staff who work at the Acombined annual subscription to OTC bulletin address to which it is sent by the publisher without the Managing Director: MikeRice (hard-copynewsletter plus weekly email newsflash)and prior written permission of the publisher. Editorial enquiries: OTC bulletin, OTC bulletin-i (digital edition)costs £1,175. 4Poplar Road, Dorridge,Solihull, While due carehas been taken to ensurethe accuracy of Single hard-copynewsletters cost £50 each. Subscription information contained in this publication, the publisher makes West Midlands B93 8DB, UK. rates maybeadjusted to coverany period and can be no claim that it is free of errorand disclaims anyliability Website: www.OTC-bulletin.com whatsoeverfor anydecisions or actions taken as aresult of backdated. Subscriptions mayonlybecancelled at expiry. Te l: +44 (0)1564 777550 its contents. Fax: +44 (0)1564 777524 Corporate subscriptions: Global Site Licences are ® Email: [email protected] ©OTC Publications Ltd.All rights reserved. OTC bulletin available to companies.These provide in-house electronic is registered as atrademark in the European Community. access forstaff to OTC bulletin or OTC bulletin-i Advertising enquiries: and [email protected] ask foraquotation. ISSN 1742-0784. As above,[email protected] Such licences aresupplied strictlyonthe condition that Companyregistered in England No 2765878. SUBSCRIPTIONS both publications arethe intellectual property of the Individual subscriptions: An OTC bulletin annual copyright holder,OTC Publications Ltd, and are Printed by Warwick Printing CompanyLimited, subscription includes this hard-copynewsletter protected by copyright, trademark and other laws. Leamington Spa CV31 1QD, UK.

15 August 2014 OTC bulletin 3 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 4

OTC COMPANY NEWS OmegaBusinessStrategy outlinesEuropean ambitions

mega Pharma is committed to becoming Lister told OTC bulletin that putting the insisted, as the companyhad been able to “bolt Othe third-largest OTCplayer in Europe right team in place, focusing on the pharmacist on” most of the assets to categories of products within four years, according to chief operating and educating the consumer had helped to it wasalready active in. officer Christoph Staeuble. propel Omega UK up the rankings and had left All of the assets acquired from GSK had Speaking exclusively to OTC bulletin,Staeu- the companywell-positioned to “accelerate” grown at double-digit rates, Staeuble said. Some blerevealed that the Belgium-based company’s its growth momentum going forward. brands, including the German natural rem- objective wastoreach C2.0 billion in annual Staeuble explained that the UK wasone of edy product Granufink, had doubled in size. sales by 2018. Omega had generated sales of the first of Omega’s businesses to undergo this Developing “razor sharp claims” –such as C1.2 billion in 2013, Staeuble pointed out, putt- structural and cultural transformation, with the “one 15-minute treatment is all that it takes to ing the firm in fifth place in the European OTC group planning to replicate this success in a kill 100% of head lice” for its Lyclear brand market, one place behind Reckitt Benckiser. number of markets including Germany. in the UK –and improving pharmacisttrain- “Our objective is to get to C2.0 billion, but Omega had been working on the German ingwere twoofthe methods Omega had used we have plans to takeusto C3.0 billion,”Staeu- business for 12 months, Staeuble said, and was to growthe GSK brands, Staeuble revealed. ble noted. “That is our ambition.” committed to turning it into atop-10 OTCcom- Asked if Omega had plans for further ac- Omega had spent the last four years build- panyinthe country by 2017. quisitions, Staeuble said if opportunitieslike ing the companyinto an “efficient machine” that Expanding on howthe group ran its 35 the GSK deal came along, Omega would “glad- could have a“transformational impact” on the national businesses, Staeuble noted that Omega ly go after them”. categories in which it operated, Staeuble said. made central choices concerning brands, cate- This strategy had involved bringing in new gories and best approaches, buteach country’s On the look-out for opportunities talent, putting in place the right culture and general manager had the freedom to “push Staeuble noted that the companywas also on developing a“five-year master plan” for the the envelope locally”. Lessons learnt in one the look-out for newconcepts and technologies, company’sbrands, he explained. “The group country could then be applied across the whole created by entrepreneurs or smaller enterprises, nowhas amachine in place that operates in 35 group, he explained. that it could fund and bring to the market. countries and in most cases can handle abusi- “What sets us apart from most of our com- In line with this strategy,Omega had in ness double or triple the size.” petitors,”Staeuble claimed, “is that our general 2012 acquired asmall Belgian sports nutrition Thecompany’sinvestment had already begun managers are entrepreneurs, running their coun- brand named Etixx, Staeuble explained. Omega to pay off, Staeuble noted, with Omega now try as if it were their ownbusiness.” planned to launch Etixx in nine markets in 2015 among the top-four OTCfirms in Belgium, “Weare avery flat organisation, we have and anticipated annual sales of around C25 mil- France, the Netherlands, Sweden and the UK. three people on the executive committee, we lion in the first year. have 25 general managers and we have our cor- “Wewill continue to do things likethis,” Transformation of the UK business porate staff, butthat is pretty much it,”Staeuble Staeuble insisted, “because we have the machin- Neil Lister,general manager of Omega explained. “Wedon’thaveacomplexmatrix of ery in place to commercialise newbrands rapid- Pharma UK, had led a“transformation” of the support organisations or middle management ly across the group.” UK business, Staeuble said, which had seen and that is part of the secret.” Turning to the markets Omega wanted to Omega move from thirteenth to the number-four Afocus across the group on delivering org- operate in, Staeuble said the companyhad re- spot in the country’sOTC market in three years. anic growth overthe past four years had helped sisted setting up subsidiaries outside of Europe. to lift Omega’s sales by 40% in the period to However, the firm wascurrently exploring C1.2 billion in 2013, Staeuble noted. thepossibility of establishing “alliances” with Omega had invested “amazing amounts of companies operating in countries likethe US time and money” into improving its innova- and Japan, Staeuble revealed. tioncapability,Staeuble said. This investment Omega had made a“conscious choice” a had created a“five-year funnel” of newproduct number of years ago to focus purely on Euro- development for each of Omega’s brands, and pean markets, Staeuble noted. “Each of the included line extensions and next-generation group’sEuropean countries has aplan in the molecules or technologies. next four years to at least double, butinmany Omega had also benefitted from gaining cases to triple or quadruple, its scale. We feel GlaxoSmithKline’s(GSK’s) non-core OTC that focusing on these markets will yield big- brands in Europe for C470 million in cash in ger rewards than if we start to spread our- 2012, Staeuble pointed out (OTC bulletin,16 selves too thinly.” March 2012, page 1). The basket of brands in- Commenting on the specific plans for the cluded Abtei vitamins, minerals and supple- UK business, Lister explained that Omega was ments; Lactacyd feminine hygiene products; aiming to become the third-largest OTCcom- Nytol sleep aids; Solpadeine pain relievers; and panyinthe country by 2017. Zantac indigestion and heartburn medicines. Omega had recentlyovertaken Bayer as the Christoph Staeuble, Omega Pharma’s chief operating officer,said the firmhad the “machineryinplace to The acquired brands had been a“phenomenal fourth-largest OTCcompanyinthe UK, Lister commercialise new brands rapidly across the group” fit” with Omega’s existing portfolio, Staeuble pointed out, reporting sales up by 19.5% to £127

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COMPANY NEWS OTC

million in the 52 weeks ended 14 June 2014. ond-biggest spender among its OTCcom- Noting that Omega UK occupied thirteenth petitors on advertising in the UK. position in 2011, Lister said he “hoped and By implementing this strategy overthe past expected” the growth recorded overthe past three years, Omega had created a“blueprint” three years would continue and accelerate going forfuture growth, Lister said. This model could forward. Each year since 2011, Omega UK had be applied across the company’sexisting cat- averaged like-for-likegrowth of 20%, he noted. egories to unlock the growth potential of its Omega’s existing portfolio of OTCbrands brands, he added. –including Buttercup cough syrups, Jungle Omega had already applied this blueprint Formula insect repellents and TCP first-aid to anumber of the brands acquired from GSK products –had been boosted by GSK’shouse- in 2011, Lister revealed. The brands that the hold names such as Hedexanalgesics and Phil- companyhad supported had grown by a“min- lips’ Milk of Magnesia upset-stomach remedies. imum of 10%”, Lister said, with sales of some But Lister played down the impact that the brands doubling. GSK acquisition –which had givenOmega Lister noted that Omega had been able to Neil Lister,general manager of Omega Pharma UK, UK 10 brands –had made on the growth of add value to some of the GSK brands by coupl- said the company had “cracked the code of self-care” the business. ing them with existing technologies in the com- 2012 to be the number-one slimming tablet “I knowthe GSK deal made alot of head- pany’sportfolio. in the UK, Lister explained. lines when it happened,”Lister said, “but actu- “Wehad for manyyears in the Omega “Globally,the UK is second only to the US ally there has been alot more to the success group afantastic anti-snoring product called in the obesity rankings,”Lister pointed out, “so of Omega than that.” Silence and we rebranded that as Nytol,”List- Ithink that this brand has along waytogo.” “IfIlook at the specific areas where we’ve er explained. “We’ve turned that product from Lister noted that Omega had experienced made adifference, the main element is in our nothing to £1.0 million (C1.3 million) in sales some difficulties in getting XLS-Medical to approach to self-care,”heexplained. within ayear.” market, as retailers were more interested in meal Omega had “cracked the code of self-care”, Omega had also picked up Beconase hay- replacements than slimming products. Lister claimed, and had established amodel fevernasal sprays from GSK, Lister pointed “Ithas taken us along time to unwind alot for delivering it in asustainable way. out, and launched an antihistamine tablet vari- of the miscommunication overthis category Expanding on the changes to Omega’s ap- antunder the BecoAllergy brand name. “We’ve that’sexisted for manyyears,”commented proach in the UK, Lister said the companyhad been able to leverage the scale of both of those Lister,“as well as public perceptions about side begun by investing in its regulatory affairs team. brands to create something that has grown the effects or ineffectiveness.” Omega’s “regulatory army” wasresponsible category and grown the share of the brand,” XLS-Medical had been clinically proven for generating health claims for brands and Lister noted. to work, Lister said, and higher sales figures putting together materials that the firm could Asked about howOmega planned to dev- recorded by Omega in the French market in- taketopharmacists and consumers, he noted. elopits UK brands going forward, Lister said dicated that the brand could growtobeupto the companywas focusing on opportunities four-times larger in the UK. Increased focus on pharmacy to growits categories as awhole, rather than Asked if Omega UK planned to develop Omega had also increased its focus on the individual brands. anynew brands in the future, Lister said that pharmacistand pharmacy, Lister revealed. “We Lister pointed out that there were still op- this wasdefinitely out of the question. “I cer- built the first in-housepharmacyfield sales- portunitiesin“mature categories” that had “ex- tainly don’twant to be creating newlocal brands force to focus on training rather than just sell- isted for manyyears and had been declining” because history would showit’savery ineffi- ing,”hepointed out. This had been supported to which Omega could apply its approach. The cient waytobegrowing categories.” by investments into brand and category train- firm had proventhat its model could introduce “So I’m looking to the group to launch Euro- ing for pharmacists. innovative products in mature categories, Lister pean and global brands which we will happily Noting that Omega had put the “first ever” said, pointing to the sleep-aid category with take,”Lister explained. “I am also looking at pharmacistontelevision in advertisements for Nytol and the allergy category with Beconase. the technologies that exist in Omega’s global its Prevalin allergy brand (OTC bulletin,12 What wasimportant, Lister said, wasto portfolio to identify ones that can be launch- April 2013, page 14), Lister insisted that the have brands with “disruptive”claims that chal- ed under our 40 existing brands in the UK.” companyhad “put the pharmacist first” in a lenged the status quo, and that consumers and Lister promised that Omega UK would con- number of its activities. pharmacists could buyinto. tinue to invest behind its brands to ensure contin- Omega had also adapted its approach to ued growth going forward. “Asweincrease our consumers, Lister pointed out. “The important Looking at untappedcategories brand portfolio, we’ll invest more and spend thing is our focus on educating consumers and Omega would also look at “untapped cat- more moneyonadvertising and training.” telling them more about the benefits of our egories” in the UK such as weight manage- Omega had already taken “significant strides” products,”heexplained. “When you see our ad- ment, sports nutrition and cholesterol, Lister towards becoming the third-largest OTCcom- vertisements, you’ll see abig focus on educa- said. “Weare experiencing phenomenal growth panyinthe UK by 2017, Lister said. tion, abig focus on factual comments about our in these categories that didn’treally exist 10 “We’ve done alot of work overthe last brands and howconsumers can use them.” to 20 years ago,”henoted. three years putting the machinery together and To get the message across to consumers, Weight management wasthe category of putting the team in place,”henoted. “This will Omegahad increased its marketing spending, products that presented Omega with the best allowustodeliverour products to consumers Lister pointed out. The companyhad estimated opportunity for growth, Lister said. The XLS- in ameaningful waygoing forward.” that so farin2014, Omega had been the sec- Medical brand had grown from its launch in OTC

15 August 2014 OTC bulletin 5 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 6

OTC COMPANY NEWS

BusinessStrategy/Second-QuarterResults GSK has no plans to spin offConsumer

laxoSmithKline (GSK) has insisted that Business Second-quarter sales Change 2013/2014 (%) Proportion Git has no near-term plans to spin offits (£ millions) £CER* of total (%) Consumer Healthcarebusiness, after the com- pany’schief executive officer,AndrewWitty, Oral health 434 -10 ±0 42 hinted at the possibility. Wellness 366 -18 -9 36 Speaking to the Financial Times newspaper, Nutrition 151 -7 +7 15 Witty said that the firm had the option to spin Skin health 71 -27 -19 7 offits Consumer Healthcare division if atime Consumer Healthcare1,022 -14 -4 100 came when it offered more value as astand- alone company. *CER is at constant exchange rates Responding to the comments, aspokesper- Figure1:GlaxoSmithKline Consumer Healthcare’s sales in the second quarter ended 30 June 2014 broken son for GSK told OTC bulletin that “there are down by business (Source –GlaxoSmithKline) no such plans to spin offthe Consumer Health- snap up GSK’soncology business for up to officer,said that the supply issues had impact- care business in the near term”. US$16.0 billion (C11.9 billion), including ed all three of the firm’skey regions –Europe, However, the company’srecent deal to est- US$1.5 billion contingent on adevelopment US and Rest of World –but remediation plans ablish aconsumer healthcarejoint venture with milestone. Meanwhile, Novartis will divest its had nowbeen put in place and supply levels Novartis (OTC bulletin,25April 2014, page 1) Vaccines business, excluding flu products, to had started to improve. had strengthened the value of the business, GSK for US$7.1 billion plus royalties, includ- “Overall we expect the consumer business the spokesperson added, and delivered “en- ingUS$1.8 billion in milestone payments. to be broadly flat at the top line this year,” hanced options for the long-run”. GSK reported Consumer Healthcare sales Dingemans reported. Witty’sremarks came afew months after down by 14% to £1.02 billion in the second The supply issues that hit sales of smoking- GSK announced that its Consumer Healthcare quarter.Atconstant exchange rates, the fall was cessation products and Alli pushed Wellness business would assume 63.5% control of the aless dramatic 4% (see Figure 1). turnoverdownby18% as reported –9%at Consumer Healthcare joint venture with pro- The companyblamed the decline on supply constant exchange rates –to£366 million. forma 2013 sales of £6.5 billion (C7.9 billion). issues which had hit sales of its smoking-ces- Wellness’ poor performance meant Oral The Consumer Healthcare joint venture is sation products and Alli weight-loss brand, as health maintained its position as the leading onepart of athree-partdeal between GSK and well as the Bactroban skin-care line in China. Consumer Healthcaresegment for the second Novartis. This will also see the Swiss firm Simon Dingemans, GSK’schief financial quarter running, despite sales falling by 10% as reported and remaining flat at constant exchange Region Second-quarter sales Change 2013/2014 (%) Proportion rates at £434 million. Sensodyne sales had risen (£ millions) £CER* of total (%) by 6% at constant exchange rates, GSK said, offsetting a19% decline in Aquafresh sales, Rest of World 536 -12 +3 52 due in part to supply issues related to amove Europe 291 -15 -10 28 to anew manufacturing site in the US. US 195 -18 -11 19 Commenting on the company’sOral health Total Consumer Healthcare1,022 -14 -4 100 franchise, Witty said that it remained “very strong”, butnow existed as almost twosepa- *CER is at constant exchange rates rate businesses. Figure2:GlaxoSmithKline Consumer Healthcare’s turnover in the second quarter ended 30 June 2014 broken Over the past fewyears, GSK’spriority in down by region (Source –GlaxoSmithKline) Oral health had moved awayfrom the base Second quarter Change 2013/2014 (%) Proportion Aquafresh brand –which operated in the gen- (£ millions) £CER* of total (%) eral toothpaste market –and towards the pre- mium sector,Witty noted, pointing out that Coresales Sensodyne and Parodontaxaswell as dry mouth Pharmaceuticals and Vaccines 4,539 -12 -4 82 and dentures brands, nowaccounted for 76% Consumer Healthcare 1,022 -14 -4 18 of the firm’ssales in the category. Total 5,561 -13 -4 100 Skin health sales, down by 27%, or 19% at constant exchange rates, to £71 million, had Coreoperating profit been primarily affected by lower turnoverof Pharmaceuticals and Vaccines 1,485 -21 -12 91 Bactroban in China. Consumer Healthcare 142 -29 -20 9 Sales of Horlicks rising by 5%, with parti- cularly strong growth in India, and of Boost Total** 1,407 -25 -14 100 growing by 11%, were behind the 7% constant- *CER is at constant exchange rates ** After corporate and other unallocated costs of £220 million currencyimprovement of the Nutrition segment

Figure3:GlaxoSmithKline’s ‘core’ sales and operating profit in the second quarter of 2014. Coreresults to £151 million. As reported, however, turn- exclude amortisation, goodwill, restructuring costs, legal charges and other items (Source –GlaxoSmithKline) overfell back by 7%.

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COMPANY NEWS OTC

Switches Legal Cases/Second-QuarterResults Flonase OTC to Valeant faces US lawsuit hit US in 2015 over alleged insider trading laxoSmithKline’s(GSK’s) Flonase Al- Glergy Relief nasal spray will soon be avail- aleant Pharmaceuticals is facing alawsuit Securities and Exchange Commission (SEC) in able without aprescription in the US after the Vin the US brought by ophthalmics special- the US, Valeant said Allerganhad “falsely assert- Food and Drug Administration (FDA) approved ist Allerganthat accuses the companyofviolat- ed”that its Bausch &Lomb eye-care business the prescription-to-OTC switch of the flutica- ing federal securities law. wasexperiencing stagnant or declining sales. sone propionate-based product. TheCanadian firm is involved in aprotract- Bausch &Lomb had performed “extremely Noting that fluticasone propionate wasthe ed takeovermove for Allerganthat beganin well”, Valeant noted, delivering 11% organic “number one prescribed allergy treatment in- April (OTC bulletin,25April 2014, page 5). growth overthe 11 months the companyhad gredient”, GSK said that Flonase Allergy Relief In June, Valeant took its bid hostile after owned the business. In May 2013, Valeant had been approved asanOTC treatment for the Allergan’sboard rejectedarevised takeover agreed to pay private-equity firm WarburgPin- “temporary relief of the symptoms of hayfever offer (OTC bulletin,27June 2014, page 3). cus US$8.7 billion for the global eye-health or upper respiratory allergies”. The lawsuit filed in California alleges that specialist (OTC bulletin,31May 2013, page 1). Aonce-a day treatment, the product wasthe Valeant, along with hedge fund Pershing Square Valeant pointed out that it had also con- first OTCmedicine indicated for all nasal- and its principal William Ackman, “violated tacted Canada’sAutorité des marchés financiers and eye-related allergy symptoms, GSK point- federal securities lawprohibitinginsider trad- in response to “comments made by Allergan’s ed out, adding that the product was“full ing, engaged in other fraudulent practices and management board about Valeant” at recent prescription strength” and provided “24 hours failed to disclose legally-required information”. investor meetings held in the country. of non-drowsy relief”. Allerganclaims that between February and Flonase Allergy Relief would be launched April 2014, Pershing Square purchased Aller- Allergan misled investors in stores in early 2015, the companynoted. ganstock and securities, which were then val- Michael Pearson, Valeant’schairman and Vidhu Bansal-Dev, vice-president of res- ued atoverUS$3.2 billion (C2.4 billion), from chief executive officer,said Allerganhad at- piratory health researchand development at shareholders “while fully aware of Valeant’s tempted to “mislead investors and manipulate GSK Consumer Healthcare, said Flonase Al- non-public takeoverintentions”. the market for Valeant stock” in both Canada lergy Relief provided allergy suffers with sim- This move,Allerganalleges, secured value and the US. pleand effective OTCrelief that would make for Pershing Square and “deprived the selling Valeant’sbid for Allergan, Pearson claim- thedifference between a“day lost to allergies stockholders of value appreciation, worth ap- ed, represented a“strategically compelling and and aday enjoying their favourite activities”. proximately US$1.2 billion, upon Valeant’sini- enormously value-creating opportunity for Al- Flonase Allergy Relief will enter an already tial takeoverbid on 22 April 2014”. lerganshareholders”. crowded US OTCallergy market, which was In responsetothe lawsuit, Valeant said that Pearson’scomments came shortly before recently bolstered by the launch of Sanofi’s Allergan’s“true purpose” behind bringing lit- Valeant reported second-quarter sales up by Nasacort Allergy 24HR (triamcinolone ace- igation wastointerferewith Allerganshare- 86% to US$2.04 billion, drivenbydouble-digit tonide) following the product’sswitch in 2013 holders’ efforts to call aspecial meeting. gains in its Developed Markets and Emerg- (OTC bulletin,25October 2013, page 1). In July,Valeant called on Allerganshare- ing Markets regions. OTC holders to hold ameeting to “remove six of Thedouble-digit growth of Bausch &Lomb thefirm’sdirectors and appoint newdirectors” had boosted sales in Developed Markets, which Constant-currencyshortfalls in European whocould “fully evaluate” Valeant’soffer. had risen by 85% to US$1.48billion, Valeant and US sales –of10% and 11% respectively – Valeant insisted that it wasconfident that said, as had turnoverincreases across its derma- had reflected the supply issues, GSK said, high- Allergan’s“desperate attempt” to delay the meet- tology prescription brands and its consumer lighting the 3% growth in Rest of World mar- ing by filing alawsuit would not succeed. and oral-health businesses. kets (see Figure 2). As reported, turnoverin Allerganfiled its lawsuit twoweeks after Turnoverhad jumped by 90% to US$561 Europe slipped back by 15%, in the US by 18% Valeant revealed it had contacted financial mar- million in Emerging Markets, Valeant noted, and in Rest of World by 12%. ketregulators in the US and Canada in re- thanks to double-digit advances across South- Consumer Healthcare contributed 18% of sponse to “false and misleading statements” East Asia, South Africa and the company’s GSK’score sales that declined by 13% –4% regarding its business made by Allergan. EMENAregion, which covers Eastern Europe, at constant exchange rates –to£5.56 billion in Explaining the reason for contacting the the Middle East and North Africa. thesecond quarter (see Figure 3). Core sales and OTC operating profit exclude amortisation, goodwill, restructuring costs, legalcharges and other items. Less than 10% of GSK’score operating IN BRIEF profit came from Consumer Healthcare after a ■ KRKA said turnoverfrom its non-prescrip- been offset by lower sales in its domestic mar- 29% drop to £142 million. At constant currency tionproducts –including self-medication lines ketdue to the weak cough and cold season. rates, Consumer Healthcare’soperating profit and cosmetics –had declined by 9.1% to C58.8 TurnoverinSlovenia had fallen by 19.4% to declined by afifth. million in the first half of 2014. The Slovenian C2.9 million, Krka reported. OTC firm said gains in its West Europe region had OTC

15 August 2014 OTC bulletin 7 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 8

OTC COMPANY NEWS

First-HalfResults RB sees opportunity in medical devices

eckitt Benckiser (RB) will look to takead- Business First-half sales Change 2013/2014 (%) Proportion Rvantage of the less heavily-regulated medi- (£ millions) £CER* of total (%) cal-device route to introduce innovative con- sumer healthcare products to the market, accord- Hygiene 1,825 -8 +3 39 ing to chief executive officer Rakesh Kapoor. Health 1,247 +4 +14 27 Speaking as RB announced its first-half re- Home 871 -11 –19 sults, Kapoor said that while the companywould RB Pharmaceuticals 344 -14 -8 7 continue to operate in the more tightly-regu- Portfolio Brands 228 -14 -7 5 lated licensed OTCmedicines space, it sawan Food 152 -5 +3 3 opportunity to introduce newproducts more quickly in categories such as sexual health by Total Reckitt Benckiser 4,667 -7 +3 100 using medical-device regulations. *CER is constant exchange rates

Explaining the advantages of the medical- Figure1:Reckitt Benckiser’s sales in the first half ended 30 June 2014 by business (Source –Reckitt Benckiser) device route, Kapoor said it allowed RB to makehealth claims for aproduct while also sixmonths of 2014. Health accounted for 27% said that the brand would sit beside its exist- creating enough barriers to entry for the com- of RB’stotal first-half sales, which fell back ing Durexline of condoms, lubricants and sex pany’scompetitors. by 7% to £4.67 billion (see Figure 1). aids to create a“unique portfolio of brands” Asked if the firm waslooking to avoid “Broad-based growth” across RB’sPower- in the sexual well-being market (OTC bulletin, heavily-regulated categories, Kapoor insisted brands –including Durex, Gaviscon, Mucinex 17 March 2014, page 4). that the companywas “just using regulation and Scholl –had been drivenbybrand inno- On aregional basis, only Europe and North appropriately” to introduce innovative products vation and the roll-out of existing products America reported arise in Health turnover. faster to market. into newmarkets, Kapoor said. Growth had been led by newproduct launches Kapoor recently criticised the strict regula- Scholl had delivered strong results, Kapoor under the Scholl and MegaRed brands across tion of OTCmedicines at the 50th Annual Meet- pointed out, with the launch of Scholl Velvet anumber of European markets, RB said. An ing of the Association of the European Self- Smooth Pedi “well received” across Europe. RB overall downturn in group turnoverinthe region Medication Industry,the AESGP.Hecalled for wasnow preparing to introduce the product had been due to negative currencyeffects, the OTCmedicines to be authorised for non-pre- intoChina and anumber of emerging markets companynoted (see Figure 2). scription sale globally as soon as safety,efficacy in the second half of 2014, he added. In the LAPAC region –consisting of Aus- and appropriate use had been established (OTC After the close of the period, RB announced tralia/NewZealand, Latin America, North Asia bulletin,16June 2014, page 1). that it had agreed to sell its Scholl footwear and South and South-East Asia –the “positive Conceding that it wastrue that the OTCin- business to German private equity firm Aurelius benefits” of RB’sOTC collaboration with Bris- dustry needed regulation to “ensure that only for an undisclosed sum. RB noted that it would tol-Myers Squibb in Latin America (OTC bul- safeand effective products get into consumers’ retain the rights to Scholl footcare. letin,22February 2013, page 1), had been daily lives”, he argued that the role of regulators Furthermore, Durexand Gaviscon had also offset by aslowdown in India and the “nega- should be “to protect supply chains, not to limit been stand-out performers during the six months, tive impact of currencymovements”. access or limit the market-place for consumers”. Kapoor said, with both brands demonstrating Health turnoverinRB’sRUMEA region “The goal should be to look for reasons to ap- “strong underlying growth”. –which covers the Middle-East, North Africa prove,not excuses to block,”Kapoor insisted. In addition to the continued growth of RB’s and Turkey,Russia and the Commonwealth of Turning to the company’sfirst-half results, established brands, “good progress” had also Independent States (CIS), and Sub-Saharan Kapoor reported sales at RB’sHealth division been made integrating the recent K-Y buyinto Africa –had been hit by the “volatility” of a up by 4% –14% in constant currencies –to its US and Canadian businesses, Kapoor noted. number of markets due to the political situa- £1.25 billion (C1.58 billion) during the first Announcingthe acquisition in March, RB tion in Eastern Europe. Meanwhile, RB has announced plans to Region First-half sales Change 2013/2014 (%) Proportion pursue a“de-merger” of its Pharmaceuticals unit (£ millions) £CER* of total (%) overthe next 12 months. Explaining the rationale behind the move,RBsaid it felt the division Europe and North America 2,375 -3 +2 51 had the “potential to deliversignificant long- LAPAC** 1,175 -8 +9 25 term value creation as astand-alone business”. RUMEA*** 621 -12 +5 13 Spinning offRBPharmaceuticals would Other**** 496 ––11 allowthe companytofocus on its core strategy Total Reckitt Benckiser 4,667 -7 +3 100 to be “a global leader in consumer health and hygiene”, RB claimed. The firm announced *CER is constant exchange rates ** LAPAC region consists of Australia/NewZealand, Latin America, North Asia, and South and South-East Asia the strategic reviewofits Pharmaceuticals busi- *** RUMEA consists of Middle East, North Africa and Turkey,Russia and the CIS, and Sub-Saharan Africa ness in October last year (OTC bulletin,8Nov- **** RB Pharmaceuticals and Food, which are not reported as part of anyregion ember 2013, page 12). Figure2:Reckitt Benckiser’s sales in the first half ended 30 June 2014 by region (Source –Reckitt Benckiser) OTC

8 OTC bulletin 15 August 2014 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 9

COMPANY NEWS OTC

BusinessStrategy/Annual Results Procter &Gamble starts culling brands

rocter &Gamble is to cut radically its portfo- ed. “Importantly this will be amuch simpler, of its OTCoperations internationally,Moeller Plio of brands and focus on just 70 to 80 core much less complexcompanyofleading brands said the companywas seeking to expand into brands organised into adozen business units, that is easier to manage and operate.” newmarkets that offered “smart, value-creat- according to chief executive officer AG Lafley. The firm planned to “harvest, partner-out, dis- ing opportunities”. Speaking as the consumer goods giant an- continue or divest” 90 to 100 brands, Lafleysaid, Meanwhile, Procter &Gamble noted that nounced its annual results, Lafleysaid that the noting that combined sales of these brands had sales at its Personal Health Care business – 70 to 80 core brands were “consumer preferred fallen by 3% per year overthe past three years. which includes its OTCoperations –had im- and customer supported”. However, he did not “Aswerationalise business and brand port- proved inthe 12 months ended 30 June 2014. provide alist of which brands would stay with folios, product lines and stock-keeping units, The firm said the rise in turnover–includ- the company. Procter &Gamble’sbrands and productswill ing sales from PGT –had been drivenby“inno- Aspokesperson for Procter &Gamble told be easier to shop,”Lafleyinsisted, “and more vation and market expansion” which had “more OTC bulletin that it wastoo early to say whether productive and profitable for our customers, than offset” aweak cough and cold season. the brand cull would impact on the company’s partners and for the company.” Sales at Procter &Gamble’sHealth Care wholly-owned US OTCunit or PGT Health- Lafley’sannouncement came just afew unit –including its Oral Care, Pet Care and care, the OTCjoint venture it established with months after Procter &Gamble said it was Personal Health Care businesses –edged up Teva Pharmaceutical Industries in 2011 (OTC looking for acquisitions to expand its OTCop- by 1% to US$7.80 billion (C5.82 billion). bulletin,16November 2011, page 1). erations (OTC bulletin,9May 2014, page 5). Procter &Gamble said that better Oral Care Lafleynoted that overthe past three years Speaking in April, Jon Moeller,the firm’s and Personal Health Care turnoverhad offset a the 70 to 80 core brands had accounted for 90% chief financial officer,revealed that the company fall in Pet Care sales due to product recalls. of the firm’ssales and over95% of its profits. wasconsidering adding to its OTCbusiness and The Health Care unit accounted for 9.4% “This newstreamlined Procter &Gamble wascurrently “looking for opportunities”. of Procter &Gamble’stotal annual sales, which will continue to growfaster and more sustain- Noting that PGT had enabled Procter & increased by 1% to US$83.1 billion. ably, while creating more value,”Lafleyclaim- Gamble to “accelerate significantly” the growth OTC

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OTC COMPANY NEWS

BusinessStrategy/Second-QuarterResults GNC’s Retail plan in doubtasCEO leaves

NC Holding’sturnaround plan for its US making less frequent visits to stores. goes on and into 2015,”headded. GRetail business has been cast into doubt To address the challenges facing its domes- Turning to GNC’ssecond-quarter results, following the sudden departure of the com- tic Retail business, Fortunato said GNC would Fortunato said the expansion of the company’s pany’schief executive officer Joe Fortunato. launch aprogramme of “strategic initiatives”. e-commerce business –consisting of gnc.com, Michael Archbold –former head of US GNC’sproduct pricing in its retail stores luckyvitamin.com and discountsupplements. clothing retailer Talbots and previously chief needed to become more straightforward, For- co.uk –had helped to push up sales at the operating officer of Vitamin Shoppe –has been tunato insisted. The companyplanned to re- Retail division by 0.6% to US$506 million. named as GNC’snew chief executive officer duce bundled product promotions, he said, and Growth in the Retail segment had also been with immediate effect. instead run event-drivenpromotionstodraw supported by the performance of GNC’snewly- The US-based nutritional supplements re- consumers into stores. opened stores, Fortunato noted, with 149 out- tailer made the announcementone week after Noting that GNC’score consumer base was lets added in the past 12 months. Fortunato had outlined afresh strategy to “turn male, Fortunato said the companywanted to The Retail performance had been hampered thetide” for the company’sRetail business in use“tailored products” to attract more females. by an increased dependence on bundled promo- 2014, based on “simplified pricing, more im- Therefore, protein-based drinks, probiotics and tions and afall in store traffic, Fortunato said. pactful marketing, and appealing to abroader cosmetics aimed at women would be intro- Meanwhile, GNC’sFranchise revenue had consumer base”. duced, he revealed. declined by 0.4% to US$110 million, Fortunato Asked ifGNC would still implement Fortu- reported, due to “regulatory and geopolitical nato’sturnaround plan, aspokesperson for the New marketing strategy factors” in anumber of international markets. firm did not rule out achange of direction. Going forward, GNC would utilise social Adecrease wasalso reported at GNC’s Speaking before his sudden departure –as media better to increase brand awareness, For- Manufacturing/Wholesale division, with sales GNCreported sales down by 0.2% to US$675 tunato said. This formed part of anew market- falling by 5.8% to US$59.6 million. million (C504 million) in the second quarter – ing strategy that would increase brand aware- As of 30 June 2014, GNC waspresent in Fortunato claimed that during 2014 the “broad- ness of GNC products among newconsumers. more than 8,700 locations, of which over6,500 er market” for supplements had “softened”. By pursuing this strategy,GNC would pro- –including 1,050 franchisesand 2,232 Rite There had also been a“broad shift in shop- tect its brand, and position the companyfor Aid in-store units –were based in the US. ping patterns” across the whole retail indus- future success, Fortunato claimed. “Weexpect The companyalso had franchise operations try for supplements, he added, with consumers to see progress on these fronts as the year in some 50 countries. OTC

BusinessStrategy/Second-QuarterResults Region Second-quarter Change Herbalife to expandChinese operation sales (US$ millions) (%) Asia-Pacific 306 +2.4 erbalife has announced plans to expand in Suzhou, Jiangsu province, and abotanical ex- North America 251 +1.2 Hits manufacturing capabilities in China traction plant in Changsha, Hunan province. EMEA* 227 +22 to meet increased demand for its products in The firm revealed its plans for China shortly South and Central 203 -8.5 the country. after it reported asingle-digit rise in second- America Located in Nanjing, Jiangsu province, the quarter sales to US$1.31 billion, as turnoverim- China 170 +44 “state of the art facility” would ultimately pro- proved infiveofits six global business regions. Mexico 149 +2.1 duce up to 65% of Herbalife’stotal product Herbalife’ssales advanced by 7.1%, led by requirements for China, the US-based direct- growth in China and the Europe, Middle East Total Herbalife 1,306 +7.1 selling supplement companysaid. and Africa (EMEA) region. *Europe, Middle East and Africa The plant wasexpected to be open by the China –Herbalife’ssecond-smallest market end of 2015, Herbalifenoted, with the company in terms of sales –was the stand-out performer, Figure1:Herbalife’s sales in the second quarter of 2014 broken down by region (Source –Herbalife) investing US$40 million (C30 million) into the with turnoverjumping by 44% to US$170 facility’sdevelopment. million (see Figure 1). the companysaid. This had included presen- Explaining the rationale behind the move, Meanwhile, Herbalife said it continued to tations criticising Herbalife’sbusiness model Richard Goudis, Herbalife’schief operating offi- face an “unprecedented and unrelenting attack” and offering financial incentivestoformer em- cer,said the companywas opening the plant in on its business from hedge fund Pershing Square. ployees to complain about their experiences, response to “steady and sustainable growth In December 2012, Pershing Square claimed the companyclaimed. in China”. that Herbalife wasanillegalpyramid scheme Despite the ongoing allegations, Herbalife “It is important that our infrastructure is ro- as it made more moneyfrom recruitment than said it had the “utmost trust” in the integrity of bust enough to meet the demand we are seeing from selling products (OTC bulletin,18Jan- its business model. Pershing Square’sclaims nowand expect to see in the future,”headded. uary 2013, page 5). would “crumble under serious and independent Herbalife already has apresence on the Pershing Square had continued to wage “a scrutiny”, the firm insisted. ground in China, with amanufacturing facility campaign of misinformation” against Herbalife, OTC

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COMPANY NEWS OTC

Second-QuarterResults Negative currency effects damage Bayer

egative currencyand portfolio effects had Business Second-quarter sales Change EBIT Change Noffset gains made by anumber of Bayer (C millions) 2013/2014 (%) (C millions) 2013/2014 (%) Consumer Care’skey brands, the German firm said, as it posted a1.9% fall in OTCsales in Pharmaceuticals 2,960 +4.6 656 +39.0 the second quarter of 2014. Consumer Care932 -1.9 –– Consumer Care reported turnoverof C932 Medical Care595 -9.4 –– million in the three months, as only one out Animal Health 358 -1.1 –– of the division’ssix best-selling brands –the Consumer Health 1,885 -4.3 310 +20.6 Bepanthen/Bepanthol skin-care range –report- ed an increase in sales. Total Bayer HealthCare4,845 +0.9 729 +32.5 However, excluding currencyand portfolio Figure3:Breakdown of Bayer HealthCare’s sales and earnings beforeinterest and tax (EBIT) in the second effects, Consumer Care’ssales improved by quarter of 2014 (Source –Bayer) 4.2%, with four of the company’sbest-sellers –Aleve analgesics, Canesten antifungals and lion in the second quarter.Adjusted for currency Supradyn had also performed well, Bayer Supradyn multivitamins, as well as Bepanthen/ effects, the decline was9.0%. Total Aspirin noted, with sales boosted by product launches. Bepanthol –all posting gains. sales –including Aspirin Cardio, which is part This had advanced the brand’sturnoverby7.8% Only sales of the division’sleading brand of the Pharmaceuticals division –were 7.5% to C38 million when adjusted for currencyef- Aspirin and the One-A-Day vitamin line failed lower at C209 million (see Figure 1). fects. As reported, Supradyn’ssales were flat. to deliverbetter constant-currencysales in the Consumer Care’sbest performer wasBe- Meanwhile, sales of the naproxen brand quarter,Bayer noted, adding that Aspirin’sturn- panthen/Bepanthol,whose sales improved by Aleve dropped back by 2.4% –arise of 4.5% overhad been impacted by aweak cough and 16.7% –22.4% adjusted for currencyeffects – when adjusted for currencyeffects –to C83 cold season in Europe. to C91 million. Turnoverhad been “consider- million, while Canesten posted turnoverdown As aresult, worldwide Consumer Care sales ably higher in all regions”, Bayer noted, but by 5.7% to C66 million, or up by 0.9% ex- of Aspirin slipped back by 16.4% to C92 mil- especially in emerging markets. cluding a4.8% negative currencyimpact. The Consumer Care business accounted Brand (business unit) Second-quarter sales Change 2013/2014 (%) for 49% of second-quarter turnoveratBayer’s (C millions) C CER* Consumer Health division, which dropped back by 4.3% to C1.89 billion. Sales edged up by Contour (Medical Care) 165 -16.2 -13.9 1.1% when adjusted for currencyand portfo- Advantage (Animal Health) 140 -5.4 -1.7 lio effects. Aspirin** 92 -16.4 -9.0 Bayer’stop-10 Consumer Health brands Bepanthen/Bepanthol 91 +16.7 +22.4 formed 45% of total divisionalsales, the same Aleve/naproxen 83 -2.4 +4.5 as in the prior-year period. Ultravist (Medical Care) 76 -12.6 -8.4 Europe remained Consumer Health’sbiggest Canesten 66 -5.7 +0.9 region in terms of sales, with turnoverimprov- Gadovist (Medical Care) 57 +16.3 +22.3 ing by 0.8% –2.9% adjusted for currency Supradyn 38 ±0.0 +7.8 effects –to C726 million (see Figure 2). One-A-Day 43 -4.4 -0.8 Turnoverinthe Asia/Pacific region shrank by 5.0% to C286 million. When adjusted for Top-10 total 851 -6.2 -1.3 currencyeffects, sales moved forward by 1.7%. Consumer Health total 1,885 -4.3 +1.1 However, turnoverinthe region is likely to *CER is constant exchange rates be boosted going forward following Bayer’s ** Total Aspirin sales –including Aspirin Cardio, which is part of the Pharmaceuticals division –were C209 million recent acquisitionofDihon Pharmaceutical in Figure1:Sales of the top-10 best-selling brands in Bayer’s Consumer Health division in the second quarter of China for an undisclosed sum (OTC bulletin, 2014. Brands arepartofthe Consumer Carebusiness unit unless stated (Source –Bayer) 17 March 2014, page 1). Region Second-quarter sales Change 2013/2014 (%) In North America, turnoverslipped back by ( millions) C CER* 8.5% –3.3% adjusted for currencyeffects – to C589 million. Europe 726 +0.8 +2.9 Consumer Health’ssecond-quarter earnings North America 589 -8.5 -3.3 before interest and tax (EBIT) jumped by a Asia/Pacific 286 -5.0 +1.7 fifth to C310 million (see Figure 3). Latin America/Africa/Middle East 284 -6.6 +10.2 The results were announced as Bayer pre- pared to complete its US$14.2 billion (C10.6 Total Bayer Consumer Health 1,885 -4.3 +1.1 billion) deal for Merck &Co’sConsumer Care *CER is constant exchange rates unit (OTC bulletin,9May 2014, page 1). Figure2:Breakdown of Bayer Consumer Health’s sales in the second quarter of 2014 by region (Source –Bayer) OTC

15 August 2014 OTC bulletin 11 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 12

OTC COMPANY NEWS

First-QuarterResults Taisho looks to increase demand for OTCs

apan’sTaisho Pharmaceutical said that it Business First-quarter sales Change Forecast sales Change Jwasworking to strengthen its sales and mar- (¥ billions) (%) (¥ billions) (%) keting activities and help drive demand for OTCproducts in what it described as aslug- Japan 34.0 -4.6 153.5 -0.2 gish domestic market. International OTCdrugs 4.0 +6.2 17.2 +11.1 Domestic turnoveratthe company’sSelf- International energy drinks 2.4 +3.8 9.6 +7.1 Medication division fell back by 4.6% to ¥34.0 International other 0.2 –0.9 – billion (C247 million) in the company’sfirst International 6.6 +5.6 27.7 +9.1 quarter ended 30 June 2014, as turnoverinthe Others 0.6 +3.3 3.1 +23.2 majority of product categories declined follow- Total Self-Medication41.2 -3.0 184.3 +1.4 ing tax-drivenprice rises. Prescription operations 27.2 +5.6 114.7 +0.4 To help drive demand, the Self-Medication division was“increasing coordination between Total forTaisho 68.4 +0.3 299.0 +1.0

marketing and sales activities”, Taisho pointed Figure1:Taisho Pharmaceutical’s sales in the first quarter ended 30 June 2014. Forecasted sales arefor the out, “and working to enhance direct communi- year ending 31 March 2015 compared with actual sales in the previous year (Source –Taisho Pharmaceutical) cation with consumers by expanding into new distribution channels, such as mail-order”. switch products in Japan in the coming years to Philippines from Roche for an undisclosed sum Furthermore, the companywould continue help revive the domestic OTCmarket and ad- (OTC bulletin,17March 2014, page 4). to respond to the growing consumer need to dress growing concerns surrounding the coun- Commenting on the deal at the time, Taisho “age healthily and beautifully” by developing try’slow birth rate and ageing population (OTC pointed out that Flanax –which it described newproducts to tackle “lifestyle diseases”,such bulletin,11October 2013, page 4). as one of the leading brands in the local an- as metabolic syndrome. Overall turnoveratTaisho’sSelf-Medica- algesics market –reinforced its position in a In April last year,Taisho successfully claim- tion division fell back by 3.0% to ¥41.2 billion, category where it already offered the Tempra ed Japan’sfirst prescription-to-OTC switch of despite a5.6% rise in international sales to range of anti-inflammatories. amedicine indicated to treat high cholesterol ¥6.6 billion (see Figure 1). Other sales added Meanwhile, domestic sales of Taisho’score with the launch of Epadel T(600mg ethyl ico- the remaining ¥0.6 billion to the total. Lipovitan brand of tonics and nutrient drinks sapentate), and said it would continue to broad- International sales of the division’sOTC slipped back by 3.3% to ¥16.3 billion during en its range of category 1medicines –OTC products grewby6.2% to ¥4.0 billion, while the three months (see Figure 2). products deemed to hold the greatest degree international turnoverfrom energy drinks im- Turnoverfrom Lipovitan Dfell by 4.3% to of risk –byidentifying further switch candi- proved by3.8% to ¥2.4 billion. ¥10.5 billion, while sales of other Lipovitan dates (OTC bulletin,26April 2013, page 1). Earlier this year,Taisho expanded its inter- products dropped by 1.3% to ¥5.8 billion. Later in 2013, Taisho explained that it in- national offering by acquiring the rights to the The decline in sales of other Lipovitan prod- tended to introduce further prescription-to-OTC Flanax OTCnaproxen-based analgesic in the ucts had been drivenbylower sales of both the 100ml variant and 50ml variant, Taisho noted, Business First-quarter sales Change Forecast sales Change although the firm expected turnoverfrom both (¥ billions) (%) (¥ billions) (%) sizes to improve in the remainder of the year. Sales of Pabron cold remedies declined by Lipovitan D10.5 -4.3 43.2 -2.6 2.5% to ¥4.1 billion, as apoor performance from Other Lipovitan 5.8 -1.3 23.7 +2.2 mainstay general cold remedies offset agood Total Lipovitan brand 16.3 -3.3 66.8 ±0.0 showing from nasal decongestants. Turnover Cold remedies (Pabron brand) 4.1 -2.5 26.0 ±0.0 from the Vicks brand of cold remedies dropped Hair treatments (RiUP brand) 3.0 -8.1 14.2 -8.9 even faster,falling by 10.4% to ¥0.4 billion. Biofermin1.6 +0.6 6.8 +2.1 The RiUP minoxidil-based hair-regrowth Livita series 1.0 -14.7 4.8 +1.9 brand posted first-quarter sales down by 8.1% Gastrointestinal treatments 0.9 -3.0 4.2 -2.4 to ¥3.0 billion, as demand slumped after con- Analgesics (Naron brand) 0.9 -8.3 4.1 -1.3 sumers stocked up before aprice rise took ef- Laxatives(Colac brand) 0.8 -10.4 3.6 +1.1 fect in April. Zena brand 0.7 -6.6 3.2 -1.0 Meanwhile, sales of the Livita brand in Cold remedies(Vicks brand) 0.4 -10.4 3.4 +6.4 Japan’s“food for specified health use” category Tokuhon 0.3 -33.4 1.4 +6.1 dropped by 14.7% to ¥1.0 billion, while turn- overfrom gastrointestinal treatments declined Other Self-Medication products 4.0 –15.0 – by 3.0% to ¥0.9 billion. Total Domestic Self-Medication 34.0 -4.6 153.5 -0.2 The Naron brand of analgesics fell by 8.3% to ¥0.9 billion, while the Colac range of laxa- Figure2:Breakdown of Taisho Pharmaceutical’s Self-Medication sales in Japan in the three months ended 30 June 2014. Forecasted sales arefor the year ending 31 March 2015 compared with actual sales in the financial tivesposted sales down by 10.4% to ¥0.8 billion. year ended 31 March 2014 (Source –Taisho Pharmaceutical) OTC

12 OTC bulletin 15 August 2014 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 13

COMPANY NEWS OTC

Second-QuarterResults Pfizer committedtoConsumer Healthcare

great store of value” exists in Pfizer’s Business Second-quarter sales Change Proportion “A Consumer Healthcareunit, according to (US$ millions) 2013/2014 (%) of sales (%) chairman and chief executive officer Ian Read. Asked by financial analysts if the recent Global Established Pharmaceutical 6,513 -6 51 consolidation in the industry –that has seen Global Innovative Pharmaceutical 3,547 -5 28 Bayer snap up Merck &Co’sConsumer Care Global Vaccines 1,097 +13 9 division (OTC bulletin,9May 2014, page 1), Consumer Healthcare912 +14 7 and GlaxoSmithKline and Novartis announce Global Oncology 570 +16 4 an OTCjoint venture (OTC bulletin,25April Global Vaccines, Oncology and 2,579 +14 20 2014, page 1) –had prompted the US-based Consumer Healthcare companytoreviewthe future of its Consumer Other 134 –1 Healthcare division, Read insisted that the OTC Total Pfizer 12,773-2100 medicines space wasabusiness that Pfizer “wanted to be in”. Figure1:Pfizer’s sales in the second quarter of 2014 broken down by business (Source –Pfizer) Expanding on the value that existed in Pfizer’sConsumer Healthcareunit, Read point- Sturman, president of Pfizer Consumer Health- tusinthe country (OTC bulletin,25July 2014, ed out that the firm had an “active prescription- care, said the OTCavailability of Nexium 24HR page 12). If approved, Nexium Control would to-non-prescriptionswitch strategy”. in its domestic market marked the “first step” be the first PPI available GSL in the UK, and Pfizer wascontinuing to “evaluate anumber in the company’sefforts to “build astrong the first medicine effectively to be switched of prescription drugs for potential switch to global position in digestive health”. directlyfrom prescription-only to GSL status non-prescription status”, aspokesperson for the without an intervening period of market avail- companytold OTC bulletin.Categories of European launch of Nexium Control ability restricted to pharmacy. drugs that would have “the greatest positive Pfizer is preparing to launch Nexium OTC Meanwhile, Pfizer’splan to switch the chol- impact on people and healthcaresystems” were in the European Union (EU) under the Nexium esterol-lowering drug Lipitor (atorvastatin cal- Pfizer’spriority,the spokesperson added. Control name (see page 19). Authorised as a cium) from prescription-to-non-prescription This active switch strategy sawthe com- non-prescription medicine in all 28 member status in the US had continued to progress at pany launch in the US on 27 May 2014 an OTC states last October –after becoming the EU’s a“good pace”, aspokesperson for the company version of AstraZeneca’s proton-pump inhibitor third centrally-switched medicine –Nexium told OTC bulletin in February (OTC bulletin, (PPI) under the brand name Nexium 24HR Control is for the short-termtreatment in adults 7February 2014, page 8). (OTC bulletin,30May 2014, page 1). of reflux symptoms (OTC bulletin,11Octo- Astatin has neverbeen granted OTCstatus Indicated for the treatment of frequent heart- ber 2013, page 11). in the US before and it is nowmore than a burn, Nexium 24HR (20mgesomeprazole) had In July,the UK’sMedicines and Health- decade since Bristol-Myers Squibb and Merck been approved for OTCuse by the US Food care products Regulatory Agency(MHRA) &Coattempted to switch Pravachol (pravas- and Drug Administration (FDA) in March. issued aproposal to switch Nexium Control tatin) and Mevacor (lovastatin) respectively Speaking at the time of the launch, Paul from pharmacytogeneral-sale list (GSL) sta- (OTC bulletin,30June 2000, page 16). Read made his comments on Pfizer’sCon- sumer Healthcare business as the companyre- ported second-quarter sales at the unit up by Second-QuarterResults 14% to US$912 million (C681 million). Pfizer said that the double-digit growth re- Church &Dwightgets boost from Avid corded by Consumer Healthcare in the three ncreased sales of Vitafusion vitamins helped gains”, rolling out newproducts and increased months had been primarily due to the launch Iraise turnoveratChurch &Dwight’sUS marketing support behind the Vitafusion and of Nexium 24HR in late May. Personal Care Products business by 1.3% to L’il Critters brands. Launching Nexium during the quarter helped US$244 million (C182 million) in the second US Personal Care Products –which includes to drive up Consumer Healthcare’sUSsales quarter of 2014. First Response pregnancytests and Trojan con- by 33% to US$449 million. Church &Dwight added Vitafusion, along doms, as well as Avid –accounted for 41% of In contrast to the growth recorded in the with the L’il Critters vitamin brand, to its Per- Church &Dwight’sConsumer unit’sdomestic US, international Consumer Healthcare turn- sonal Care unit when it acquired vitamins, min- sales, which rose by 0.7% to US$599 million. overremained flat at US$463 million. erals and supplements (VMS) business Avid The company’sUSHousehold Products Consumer Healthcareaccounted for 35% Health in October 2012 (OTC bulletin,14Sept- business made up the remaining 59% of the of Pfizer’sGlobal Vaccines, Oncology and Con- ember 2012, page 1). Consumer division’sdomestic turnover. Inter- sumer Healthcare unit’ssales, which increased James Craigie, Church &Dwight’schair- national Consumer sales advanced by 2.9% to by 14% to US$2.58 billion (see Figure 1). man and chief executive officer,said the “con- US$137 million. Total group sales improved With Pfizer’sother twounits losing ground, tinued growth” of Avid during the three months by 2.6% to US$808 million. total group sales fell by 2% to US$12.8 billion. had been drivenby“significant distribution OTC OTC

15 August 2014 OTC bulletin 13 OTC15-08-14p2-14_Layout 1 12/08/2014 18:19 Page 14

OTC COMPANY NEWS

First-HalfResults Celesiotosoon see McKesson benefits

elesio will soon start to benefit from its Business First-half sales Change EBITDAChange CtakeoverbyUSpharmaceutical wholesaler (C millions) 2013/2014 (%) (C millions) 2013/2014 (%) McKesson as anew “coordination team” be- gins to identify the areas for potential synergies, PharmacySolutions 9,150 +1.1 162.7 -9.7 according to the pan-European wholesaler and Consumer Solutions 1,781 +6.0 137.8 +8.8 retailer’snew chairman of the management Other ––-65.4 – board Marc Owen. Total Celesio 10,931+1.8 235.1 -12.1 The companyhad already begun integrating itself into the Distribution Solutions division of Figure1:Celesio’s sales and earnings beforeinterest, tax, depreciation and amortisation (EBITDA) in the first half of 2014, broken down by business (Source –Celesio) McKesson, Owen said, after McKesson in Feb- ruary acquired over75% of Celesio’sshares on, has nowtaken overHelmes’ role of chief best practice at its existing pharmacies, and com- following aprotracted takeoverprocess (OTC financial officer. pletely newdevelopments (OTC bulletin,18 bulletin,7February 2014, page 1). First-half sales at the Celesio’sConsumer December 2012, page 1). Nowthe takeoverwas virtually complete, Solutions division increased by6.0% to C1.78 The aim of the concept, Celesio said, wasto the “companyitself, its partners, customers and billion in the period (see Figure 1), as the com- develop a“competitive pan-Europeanpharmacy employees” would all start to benefit from the panycontinued to roll out its European Phar- network” that unified the company’sown phar- “added value generated by sharing procurement macyNetwork concept. macies and its partner pharmaciesto“offer activities, expanding the product range and In March, Helmes revealed that the pilot comprehensive patient services”. opening up newsales channels”, Owen insisted. phase of the European pharmacyconcept under In the UK, the Lloydspharmacychain – “Future development will hinge on how the ‘Lloyds’ banner had “provedasuccess” and which accounts for the bulk of Consumer Solu- quickly the international platform can be set would be expanded further in 2014 (OTC bul- tions’ turnover–had performed well in the six up,”hewarned, “so the coordination team will letin,28March 2014, page 5). months, Celesio pointed out, with an increase in therefore be tasked with identifying areas of revenues from services to hospitals and the pro- potential, laying the groundwork and then effect- Rolling out pharmacy concept vision of homecare. Improved sales of generic ing agradual alignment with McKesson’sorg- The firm has nowstarted rolling out the key drugs had also offset government price cuts. anisation structure.” elements of the concept in the rest of its 2,175 Across the rest of Europe, sales at the com- The combined McKesson/Celesio entity will pharmacies, and has also started to invite partner pany’sNorwegian pharmacychain –its second have annual sales in excess of US$150 billion pharmaciesinFrance and Germanytoadopt biggest after the UK –had advanced signifi- (C110 billion), approximately 81,500 employees the concept in line with national regulations. cantly in local currencies, Celesio noted, as bet- worldwide and operationsin20countries. Focused on offering “newand comprehen- ter sales of OTCproducts, especially allergy Owen took overaschairman of Celesio’s sive advisory and other healthcare services”, medicines, and higher revenues from services management board on 16 July,after McKesson the concept –which had already been intro- countered the poor cold and flu season. made sweeping changes to the management duced to over100 stores –had helped “streng- In Italy,the firm had seen a“pleasing in- team (OTC bulletin,30May 2014, page 27). then the role” of pharmacists as both “competent crease” in sales of OTCproducts, Celesio said, Formerly presidentofMcKesson Specialty healthcareadvisors” and as service providers thanks to implementing the European Phar- Health, Owen wasdrafted in to replace Dr fornational healthcare systems, the firm said. macyNetwork concept. This had completely Marion Helmes as head of Celesio. Helmes Launched in late 2012, the newEurope-wide offset the impact of lower prescription sales –who had held the joint positions of speaker Lloyds concept featured “innovative service caused by government cut backs, it added. of the management board and chief financial formats, high-qualityproducts and the latest Celesio’s“expansive strategy” for its Swed- officer –had nowleft the firm. technologies”, the companyexplained, and had ish pharmacycontinued to be drivenforward, the Another McKesson executive,Alain Vach- been based on “comprehensive”market studies, firm pointed out, butalthough higher sales and better cost management had improved margins, earnings still remained lower than expected. Consumer Solutions’ earnings before interest, BusinessStrategy/Third-QuarterResults tax, depreciation and amortisation (EBITDA) had “surged” by 8.8% to C138 million in the six Nutraceutical focuses on materialcosts months, Celesio noted. Adjusted for special utraceutical International will manage rawmaterials and components in order to pro- effects, EBITDAmoved forward by 9.8%. Naggressively its rawmaterial costs and duce over7,500 stock-keeping units. The Consumer Solutions division accounted inventory levels to lower its overheads in the “Aggressively managing these purchases for 16% of Celesio’ssales in the quarter,which future, according to chairman and chief ex- helps ensure timely production and customer crept up by 1.8% to C10.9 billion. EBITDA ecutive officer Bill Gay. delivery,” Gay insisted. slipped back by 12.1% to C235 million. Noting that the US-based nutritional supple- Gay’scomments came as Nutraceutical post- Celesio’sdominant PharmacySolutions ments firm’sfinancial success was“heavily im- ed sales up by 9.5% to US$55.6 million (C41.5 wholesale division posted a1.1% rise in sales pacted by rawmaterial and packaging costs”, million) in its third quarter ended 30 June 2014. to C9.15 billion in the period. Gay pointed out that it sourced over4,000 OTC OTC

14 OTC bulletin 15 August 2014 OTC15-08-14p15-18_Layout 1 12/08/2014 19:02 Page 2

GENERAL NEWS OTC

International Self-CareDay Regulatory Af fairs Industrypushes MHRA callsfor proposals to self-care habit put OTC drugs on black list here has neverbeen amore urgent need “Tto focus the world’sattention on the he UK’sMedicines and Healthcare prod- “Products could be included in the black importance of better self-care”, according to Tucts Regulatory Agency(MHRA) is one of list without presenting adocumented incident Erica Mann, chair of the World Self-Medi- theagencies seeking proposals for which non- of falsification,”the AESGP pointed out. cationIndustry (WSMI) and president of Bayer prescription medicines should be added to a “Furthermore, such aprovision could lead Consumer Care. ‘black’ list of OTCproducts intended to carry to amismatch between the existing risks and Speaking at an event to celebrate Interna- the safety features introduced by the European the establishmentoftools that effectively ad- tional Self-Care Day on 24 July 2014 in Wash- Union’s(EU’s) Falsified Medicines Directive. dress such challenges,”itadded, “while it will ington, US, Mann said that the day served as Under the terms of Directive,which entered generate significant costs not contributing to an “opportunity to highlight the importance of into force in January 2013, non-prescription theobjective of the legislation to establish pro- making self-care alifelong habit”. medicines listed as having been “assessed to be portionate measures.” “Empowering consumers and patients to at risk of falsification” and featured on the black The association also said that entries on the become active shapers of their health and well- list will have to bear the required safety fea- black list should only be based on incidents of being,”Mann insisted, “is the single most effec- tures, including aunique identifier. falsification that have taken place within the tive,common-sense waytoimprove health, re- legalsupply chain. duce healthcarecosts and relieve the grow- Five selection criteria for black list It would not be reasonable,itnoted, to con- ing burden on health professionals.” The list will be compiled by the European sider incidences outside the legalsupply chain Sponsored by the Consumer Healthcare Commission based on five criteria: –such as through an internet-based pharmacy Products Association (CHPA) and the WSMI, ■ price and sales volume of the product; outside the EU –when defining possible entries the event wasthe first in the US to celebrate ■ number and frequencyofpast incidentsof on the black list. International Self-Care Day and served to high- falsification; Inclusion on the black list should also not light to US policymakers the value of self- ■ specific characteristics of the product; be based on just one single or afew falsification care and the role of non-prescription products ■ severity of conditions treated by the product; incidents, particularly in the case of asub- as self-care tools. ■ other potential risks to public health. stance-based approach, the AESGP added. As part of the celebrations, the CHPAan- The European Commission has asked all The AESGP also called for measures in- nounced that the US Senate had passed ares- member states to submit their proposals for the troduced by the Directive not to be implemented olution to designate 24 July as International list by 3October 2014. before 2020. Self-Care Day. Member states have also been asked to sub- “Significant investments need to be under- The 24 July –or24/7 –had been chosen mit proposals for which prescription medicines taken concerning the adjustment of production to remind people that self-care can be practis- should be placed on a‘white’ list of medicines lines to the newrequirements,”the AESGP ed 24 hours aday,seven days aweek. that should not have to carry the safety features. pointed out, “while previous experienceswith Dr Gerald Dziekan, WSMI director-gen- The Directive also provides for member verification systems at national levelshowed eral, said the senate resolution wasan“impor- states to notify the Commission when theybe- considerable problems and delays due to the tantstep” in recognising the value of self-care. lieve anon-prescription medicine is at risk of number and the complexity of the interven- “The benefits of self-care are well docu- falsification based on the five criteria. tions needed, as well as the number of stake- mented,”Dziekan pointed out, “but we’ve only The Association of the European Self-Medi- holders involved in the implementation of the begun to harness its enormous potential to im- cation Industry,the AESGP,said it understood newprovisions.” prove individual health and makehealthcare that the European Commission would require more sustainable.” all five criteria to be fulfilled for anon-pre- Companies need to be ready and able “Even incremental adoption of afew simple scription medicine to be included on the list. Consideration needed to be giventothe measures can have adramatic, even life-saving Updating its position on howtocompile capacity and to the readiness of all stakehold- impact,”headded. theblack list, the AESGP said it believedthat ers involved in the introduction of the newpro- Commenting on the success of this year’s the Commission should populate the proposed visions, the association said. Self-Care Day,the CHPAsaid that in the US list only with “specific marketing authorisa- Therefore, deadlines for the application of it had gained wide-ranging media coverage, tions/products”. the measures introduced by the Directive should through use of print, social and digital media, Noting that currently there were primarily not be “unnecessarily tight” and should take as well as outreach activities to generate grass- twopossibilities for populating the black list into account the “capacity of industry and roots support for the day. –bymarketing authorisation (product) or by national authorities to respond to such modifi- Furthermore, more than 55,000 people had active substance, which meant by the Inter- cations”, it argued. emailed the US Congress through the CHPA’s national Non-Proprietary Name (INN), possi- “Based on the feedback receivedfrom our online platform,the association noted, calling bly along with the pharmaceutical form and members, it would be reasonable to have an for OTCmedicines to be reimbursable through the strength –the AESGP claimed that by set- implementation not before the year 2020,” insurance plans. ting the active substance as the main criterion, the AESGP said. OTC significant risks would arise. OTC

15 August 2014 OTC bulletin 15 OTC15-08-14p15-18_Layout 1 13/08/2014 09:10 Page 3

OTC GENERAL NEWS

RussiRegulatory Af fairs aconsiders non-pharmacy sales

anyOTC drugs could soon be sold in Antihistamines Topical emulsions, Iron preparations Capsules MRussia’sgrocery stores and supermarkets. gels and ointments Chewable lozenges Adraft list of OTCdrugs for non-pharmacy Antiseptics for Aerosols and sprays Film-coated tablets sale has been drawn up by the Ministry of Health sorethroats for topical use at the request of first deputy prime minister, Solutions for oral use Buccal tablets Igor Shuvalov. However, the PharmacyGuild Syrups Drops for oral and of independent community pharmacies and the Tablets topical use Russian Pharmaceutical Association represent- Medicinal charcoal Capsules ing pharmacychains have both objected strong- Lozenges ly to the proposal, which is likely be consider- Pastilles Granules ed by the government this autumn. Solutions for Powder and paste The draft list –based upon several criteria topical use for oral use including lowhealth-risk for consumers and Antivirals Creams and ointments Powder for minimum standards for product storage –con- for external use suspension tablets tains sevencategories of products: antihista- Cough and cold External ointments Nasal preparations Nasal aerosols, mines, antiseptics, antivirals, cough and cold preparations Lozenges based on seawater drops and sprays preparations, iron preparations, medicinal char- Nasal inhalers and sodium chloride coal and nasal preparations. No specific active Figure1:Russia’s draft list of OTC drugs for non-pharmacy sale is based on the anatomical and therapeutic ingredients are mentioned. chemical (ATC) classification system (Source –Russian Pharmacy Guild) Last year’sbiggest-selling OTCcategory in Russian pharmacies –cough and cold prepa- lead to an uncontrolled flowofcounterfeit of the Ministry of Industry and Trade, com- rations (OTC bulletin,16June 2014, page 8) medicines, endangering public health. mented that making alimited number of med- –islisted in the form of external ointments, icines available outside pharmacywould ben- lozenges and nasal inhalers. Antihistamines are Political decision will hurtpharmacy efit both large and smaller retailers, and that present as topical gels, ointments and emul- Meanwhile, Alexander Apazov, chairman of expanding distribution channels would encour- sions for external use, while seawater nasal the Russian Pharmaceutical Association, insist- age newbusiness development. sprays are also included. ed: “This political decision will hit pharmacy Non-prescription medicines may currently Antiseptics for treating sore throats are listed very badly.” At ameeting of the association, be sold outside pharmaciesinRussia, butsuch in all their various forms, includingaerosol solu- called to discuss ways of preventing the change, sales are limited to licensed ‘pharmacykiosks’. tions, lozenges and topical sprays (see Figure 1). he stressed that pharmacychains needed to Sales of OTCproducts through Russian phar- Serious concerns have been raised, how- define aclear “line of defence” that would con- macies increased by 9% to RUB9.2 billion ever,byRussia’spharmacists. Elena Nevolina, vincesociety and the government that change (C19 million) at retail prices in 2013, as higher executive director of the PharmacyGuild, be- wasunnecessary. prices drove up consumer spending (OTC bul- lievessuch amove outside pharmacycould Meanwhile, Victor Evtukhov, deputy head letin,16June 2014, page 8). OTC

IN BRIEF Regulatory Af fairs ■ BARMER-GEK health insurance fund said FDA looks at antiseptics and sunscreens that more than four-fifths of homoeopathyusers in Germanyreport improvedphysical and men- he US Food and Drug Administration patient and pre-injection skin preparations. tal well-being, according to asurvey of almost T(FDA)has announced aseries of meetings Meanwhile, on 4 and 5September,NDAC 7,000 people that it insured. According to the to discuss the standards used to demonstrate will tackle the need for various types of safety survey –conducted in conjunction with the that OTCantisepticsused in healthcare settings data, including clinical and non-clinical data, BertelsmannFoundation –87% of homoeo- are safe and effective,aswell as the scope of for sunscreensused chronically in individuals pathyusers believe such remedies can succeed safety testing required for sunscreen ingredi- overthe age of 6months to help prevent where conventional medicine has failed. Almost ents marketed as OTCmedicines. skin cancer and skin ageing. half of those questioned cited ‘general com- On 3September,the agency’sNonprescrip- The meeting comes three years after the plaints’ as areason for visiting ahomoeopathy tion Drugs Advisory Committee (NDAC)will FDAtightened its controls on sunscreen prod- practitioner,with chronic and acute complaints discuss OTCantiseptics, with afocus on active ucts. The tighter restrictions mean that only cited by 43% and 32% respectively.Similarly, ingredients marketed as OTCproducts and used sunscreens with aSun Protection Factor (SPF) around half of the participants said homeo- for avariety of functions in professional health- value of 15 or higher can claim to reduce the paths offered relief that patients had not found care settings. risk of skin cancer and early skin ageing; while elsewhere and devoted more time to patients These functions, the FDAnoted, includ- claims the products are “waterproof”, “sweat- than other doctors. ed such uses as: healthcare personal hand proof” or “sunblock” are banned. OTC washes and rubs; surgical hand scrubs; and OTC

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GENERAL NEWS OTC

Regulatory Af fairs Switches EFSA rejects Asthma use worries lead Clasadoclaim Singulair safety concerns lasado’sappeal to the European Food CSafety Authority (EFSA) relating to its ff-label use of Merck&Co’sOTC ver- Some committee members also claimed that Bimuno GOS food constituent, which is claim- Osion of Singulair (montelukast) by asthma there would be “significant” unapproveduse ed to reduce gastrointestinal discomfort, has patients may lead to adverse outcomes, accord- of OTCSingulair in the paediatric population. again receivedanunfavourable opinion from ing to members of the US Food and Drug Ad- These members expressedconcernthat children the authority’sPanel on Dietetic Products, Nutri- ministration’s (FDA’s) Non-prescription Drugs could be givenafull 10mg adult dose, or that tion and Allergies (NDA). Advisory Committee, who recently voted to re- parents could attempt to “split tablets” to ob- Noting that all butone of the studies provid- ject apartial switch of Singulair to OTCstatus. tain the 5mg dose indicated for children in the ed by the firm –via the Maltese competent At its meeting in May –the minutes of prescriptionsetting. authority –had been submitted in previous un- which have only recently been made public – In addition to reviewing off-labeluse, the successful applications for the same claim (OTC the committee said Singulair’ssafety as an committee also addressed the potential for Sin- bulletin,23August 2013, page 18), the NDA OTCmedicinefor the relief of allergy symp- gulair Allergy to cause neuropsychiatric events. said no further (scientific) substantiation had toms, “consideringpotential off-labeluse”, The committee noted that there wasa“low been supplied for acause-and-effect relation- had not beenadequately demonstrated (OTC frequency” of abroad set of neuropsychiatric ship between Bimuno and the claimed effect. bulletin,9May 2014, page 1). events associated with montelukastbut that Lack of substantiation wasalso the reason It voted 11-4 against the switchof10mg these risks neededtobe“addressed sufficiently whyafurther three applications made under montelukast film-coated tablets under the brand in the OTClabelling prior to aswitch”. Merck Article 13.5 of the health claims Regulation name Singulair Allergy for adults aged 18 years shouldconducta“prospective placebocon- 1924/2006 were rejected by the EFSA Panel. and older for the temporary relief of hayfever trolled trial”, the committee recommended, to All had included requests for the protection and other upper respiratory allergy symptoms, assess neuropsychiatric events. of proprietary data. namely nasal congestion, runnynose, itchy The body also voted 11-4 that the risk/ben- Natural Alternative International had pro- watery eyes, sneezing, and itchingofthe nose. efit profile of montelukast wasnot supportive vided 11 human intervention studies in its While prescription Singulair wasindicated of OTCuse in adults for the nasal indication application through the UK’scompetent auth- to treat asthma, off-labeluse for the condition proposed by Merck. ority.Despite this, its claim relating to the wasofconcerninthe OTCsetting,some com- While safety issues and the risk/benefit consumption of beta-alanine leading to an in- mittee members argued, because patients would profile with off-labeluse for asthmainthe OTC crease in physical performance during short- “not be able to adequately self-assess the sever- population were the committee’smain concerns, duration, high-intensity exercise wasturned ityoftheir asthmacondition”. Asthmapatients the body also noted that the complexity of the down. The proposed consumers were healthy could also potentially “under- or over-treat” OTClabel could makeitdifficult for the aver- adults aged between 19 and 71 years. their condition, the members added. age adult to understand. Meanwhile, DSM Nutritional Products and OTC Kemin Foods –applying through the French competent authority –had also been unable to Regulatory Af fairs establish acause-and-effect relationship, the EFSA Panel pointed out, between acombina- ASMI seeks complementaryprogress tionoflutein and zeaxanthin, and improved vision under bright light conditions in the omplementary medicines regulation [in medicines as theywere not provenmedicines. “general healthypopulation”. “CAustralia] needs to be rigorous butcon- The article referenced a2010 study that The Panel also rejected Swedish company sistent with risk, as well as timely and balanced, had shown up to 90% of complementary medi- DoubleGood’sclaim relating to the effect of if the industry is to build consumer confidence,” cines reviewed by the country’sTherapeutic acombination of L-threonine, L-valine, L-leu- according to the Australian Self-Medication Goods Administration (TGA) to be “non-com- cine, L-isoleucine, L-lysine and chromium Industry’s(ASMI’s) regulatory and scientific pliant”. It also noted that only 31% of comple- picolinateonthe reduction of post-prandial affairs director Steve Scarff. mentary medicines randomly tested between glycaemicresponses in adults. Noting that Australian regulators had mech- September 2012 and December 2013 had not OTC anisms in place to ensure claims made about breached regulatory requirements. complementary medicines were “accurate, bal- Scarffsaid building consumer trust in com- IN BRIEF anced and not misleading”, Scarffargued that plementarymedicines required manufacturers there was“room for improvement”. The reg- to be able to substantiate claims for individ- ■ REGENECA –adivision of VivaCeuticals – ulatory process needed to be transparent so ual products. has issued avoluntary recall of certain lots of its consumers could have confidence in the health Consumers needed to have access to evi- RegenESlim appetite control dietary supple- claims made for individual products, he added. dence-basedinformation about complementary ment in the US. The recall wasissued after Scarffmade his comments in response to medicines, Scarffsaid, and called on the gov- thestimulant DMAA wasfound in the product. an article published in The Australian that call- ernment to invest in research. OTC ed on pharmacists not to sell complementary OTC

15 August 2014 OTC bulletin 17 OTC15-08-14p15-18_Layout 1 12/08/2014 19:02 Page 5

OTC GENERAL NEWS

Regulatory Af fairs Regulatory Af fairs EFSA says no to Bodyweight is no issue for InQpharmclaim emergency contraceptives nQpharm Europe cannot claim that astan- Idardised aqueous extract of white kidney mergencycontraceptives containing levon- Pharma had already altered the product’spatient bean (phaseolus vulgaris L.) –the active in- Eorgestrel or ulipristalacetate are effective information leaflet to advise against its use by gredient known as PhaseLite in Omega Phar- in all women regardless of body weight, accord- overweight women, the CHMP recommended ma’sXLS-Medical Carb Blocker –can reduce ing to Europe’sCommittee for Medicinal Prod- that these statements should be deleted. body weight, the European Food Safety Auth- ucts for Human Use (CHMP). HRA Pharma altered the leaflet for Nor- ority (EFSA) has stated. Following areviewofthe efficacyofemer- levo in November 2013 to include the state- Responding to an application via the UK’s gencycontraceptives in overweight women, the ment: “In clinical trials contraceptiveefficacy competent authority,EFSA’s Panel on Dietetic CHMP concluded that the products could “con- wasreduced in women weighing 75kg or more, Products, Nutrition and Allergies (NDA) said tinuetobeused in women of all weights as the and levonorgestrel wasnot effective in women the firm had not provided sufficient evidence benefits are considered to outweigh the risks”. who weighed more than 80kg.” to establish acause-and-effect relationship be- In February,the CHMP said it would review In responsetoHRA’s move,France’smedi- tween food consumption and the outcome. emergencycontraceptivescontaining levonorg- cines agency, ANSM, advised women weighing The claimed effect was“helps to reduce estrel and ulipristal acetate. This wasinresponse over80kg to “seek another method of emer- body weight”, while the proposed target pop- to the release of “newdata suggesting that a gencycontraception” (OTC bulletin,13Decem- ulation was“the general population that wants high body weight could impair the effective- ber 2013, page 11). to lose or manage their weight”. ness” of such products (OTC bulletin,7Feb- The CHMP recommendation will nowbe InQpharm claimed that the extract –which ruary 2014, page 14). sent to the European Commission, which will is also marketed under the brand names Glu- The emergencycontraceptivesunder review takealegally-binding decision throughout the cosanol, Glycolite, Phase 2and Starchlite – were the levonorgestrel-based Norlevo,Lev- European Union’s28member states. could achieve the claimed effect in three ways. odonna and Levonelle, as well as Ellaone, which Earlier this year,Health Canada ruled that These were: reducing the digestion of starch contains ulipristal acetate. emergencycontraceptivesavailable OTCinthe and therefore the absorption of dietary glycae- The reviewwas triggered by the Swedish country must carry awarning advising against mic complexcarbohydrates by the body; de- medicines regulatory agencyunder Article 31 theiruse by overweight women (OTC bulletin, laying gastric emptying; and reducing feel- of European Union Directive 2001/83/EC. 11 April 2014, page 13). ings of hunger. Explaining its decision, the CHMP said the Health Canada said the label and packaging InQpharm had also requested that the pro- available evidence to suggest that the effective- leaflet of levonorgestrel-based emergencycon- prietarydata behind its Article 13.5 “newfunc- ness of emergencycontraceptives wasreduced traceptivesshould be updated to warn consumers tion” health claim –based on newly-developed with increased body weight was“too limited that the products were “less effective in women scientific evidence –should be protected under and not robust enough”. weighing 165-176 pounds (75-80kg) and not ef- the provisions of the health claims Regula- Noting that for ulipristal acetate there exist- fective in women weighing over176 pounds”. tion 1924/2006. ed some data from clinical trials to suggest a The leaflet would also advise women weigh- Although the NDAacknowledged that one possible trend for areduced effectiveness in ingover165 pounds to “ask ahealthcare pro- human intervention study out of the four sup- overweight women, the CHMP concluded that fessional for advice on alternative methods of plied had shown areduction in body weight this data was“too limited and insufficiently pre- emergencycontraception”, the agencyadded. when the extract wasconsumed for 12 weeks, cise to drawdefinite conclusions”. This wasalso Meanwhile, Australia’sTherapeutic Goods it pointed out that the study had been “at risk the case for levonorgestrel, the CHMP added. Administration (TGA) and NewZealand’sreg- of bias” through “unblinding”. The product information for emergencycon- ulator Medsafe are currentlyreviewing the Furthermore, asupporting study had suf- traceptivesshould be updated to include the re- efficacyofemergencycontraceptivesinwomen fered from “methodological limitations”, the sults of these studies, the CHMP said. weighing more than 70kg (OTC bulletin,17 EFSA Panel noted, and “no evidence waspro- Pointing out that Norlevo manufacturer HRA March 2014, page 10). vided for amechanism by which the standard- OTC ised aqueous extract from white kidneybean couldexert the claimed effect”. Regulatory Af fairs OTC EFSA decides niacin DRVs for infants IN BRIEF nfants aged between sevenand 11 months Values (DRVs) for niacin, EFSA concluded ■ PUBLIC CITIZEN –aUS-based consumer Ihave the same niacin requirements as adults, that the average requirement of 5.5mg niacin group –has petitioned the Food and Drug Ad- theEuropean Food Safety Authority (EFSA) has equivalent (NE) per 1,000 kcal and Population ministration (FDA) to revise the proposed label- decided. This is also true of children and adoles- Reference Intakeof6.6mg NE per 1,000 kcal ling for OTCbenzocaine oral health prod- cents, as well as pregnant and lactating women. –which have been in place since 1993 –“also ucts and remove the infant teething indication. Following arequest from the European applied to these age and life-stage groups”. OTC Commission to determine DietaryReference OTC

18 OTC bulletin 15 August 2014 OTC15-08-14p19-21_Layout 1 12/08/2014 18:28 Page 2

MARKETING NEWS OTC

ProductLaunches ProductLaunches German Nexium Infirst to make global debut sets zerotarget with Dr Cocoa launch in US fizer Consumer Healthcare is promising P“a large-scale, attention-grabbing television nfirst Healthcare’sDrCocoa chocolate-flav- campaign” to accompanythe launch of its Nex- Ioured cough-remedy brand is set to makeits ium Control heartburn remedy in Germany. global debut at the beginning of September. As the central message of the campaign for Three liquids are to be launched onto the US the 20mg esomeprazole tablets, Pfizer has cho- paediatric cough/cold remedy market that is said sen “1 Tablette am Tag, 24 Stunden Schutz, to be worth in excess of US$350 million (C262 Ziel: Null Sodbrennen”. This translates as “One million) at retail. tablet during the day,24-hour protection, Goal: Designed for children aged between four and Zero heartburn”. 13 years, the range of patent-protected cough APfizer spokesperson told OTC bulletin liquids comprises Long-Acting Cough Relief, that the German commercials for the pharmacy- Daytime Cough and Cold Relief and Night only medicine would be adapted from apan- Time Cough and Cold Relief variants. These European template. She declined to comment contain ingredientssuch as dextromethorphan, on the duration or budget of the campaign. phenylephrine and diphenhydramine. The Dr Cocoa line of three chocolate-flavoured cough Intended targets for the 24-hourprotection Noting that manyparents struggled to get liquids is said to be formulated with 10% real cocoa to improve dosing compliance in children message are frequent heartburn sufferers, name- their children to takemedicine as directed, the ly those who experience the condition more UK-based companypointed out that the prod- Infirst secured the rights to Dr Cocoa from than twice per week. uct line wasformulated with 10% real cocoa Pernix Therapeutics at the end of last year,after The same messages appear on launch trade- to improve dosing compliance. thefirm –which developed the products using Packaging for the cough liquids features the some of Infirst’sintellectual property –said Dr Cocoa owlcharacter,which is said by In- it did not have the “discretionary resources” first to depict afamily doctor speaking to child- to “prudently and effectively” takethe brand ren and parents in a“knowledgeable and cred- intothe US OTCmarketplace (OTC bulletin, ible way”, and will appear across all market- 13 December 2013, page 7). ing for the range. Pointing out that Infirst wascurrently “ex- The launch will be supported by amulti- ploring other markets”, Barickman said the com- media campaign, with the message that Dr pany anticipated extending Dr Cocoa’sreach Cocoa provides “relief with asmile”. beyond the US in 2016. OTC Nexium’s German launch will be supported by a “A suite of social-media platforms wasin Speaking to OTC bulletin in December last “large-scale, attention-grabbing television campaign” development”, James Barickman, general man- year,Manfred Scheske, Infirst’schief execu- press advertising, which also highlights the ager of Infirst’sUSarm, told OTC bulletin, tive officer,said that if the milestones laid out television campaign and features the headline and would include the Dr Cocoa Facebook page. were met, the firm also hoped to launch its own “Die Nr.1 der Säureblocker jetzt rezeptfrei”, The brand website wasalso being “expanded cocoa-flavoured cough liquid in one Euro- or “The number-one acid blocker is nowavail- and updated” with news of the roll out. pean country in “late 2014”. able without aprescription”. OTC According to the trade advertising, Nexium Control offers “better acid control compared AdvertisingCampaigns to other proton-pump inhibitors”, delivering 70% more acid blockers to the proton pump. Omega Pharma’s Lyclear makes UK return “The launch of Nexium Control will be ac- companied by an attention-grabbing, integrated mega Pharma’sLyclear head-lice treat- Thanks to Omega’s increased marketing campaign that, through a360-degree commu- Oment is returning to UK television screens spend, the firm claimed Lyclear nowheld a nication strategy,combines television spots from 18 August to highlight the 100% effec- 22.3% share of the UK head-lice market. This with both print and online advertising,”the tiveness of the brand. The 30-second creative wasworth £25.3 million at retail according to spokesperson stated. aired earlier this year as part of the firm’sdou- IRI, making it the second-biggest brand in the Pfizer –which is also rolling out the brand bled annual investment in television advertis- market behind Thornton &Ross’ Hedrin. in France, Italy and the UK following apan- ing to £2.0 million (C1.5 million) (OTC bul- The campaign would continue to be support- European centralised switch procedure (OTC letin,28March 2014, page 16). ed by public relations activity and pharmacy- bulletin,26July 2013, page 1) –has given Set to run until 21 September,the advertise- training materials, Omega noted. Lyclear will the German version recommended retail prices ment will emphasise howthe ‘dual-action’ for- also continue its partnership with parenting web- of C7.59 for apack of sevenenteric-coated tab- mula of the Lyclear Sensitive and Treatment site Netmums, sponsoring head-lice forums and lets, and C11.97 for apack of 14. Spray products –which are both classed as med- ‘back-to-school’ pages. OTC ical devices –suffocate and dehydrate lice. OTC

15 August 2014 OTC bulletin 19 OTC15-08-14p19-21_Layout 1 12/08/2014 18:28 Page 3

OTC MARKETING NEWS

BayeProductLaunches/LrbineExtensolsterions sBerocca in US and UK

ayer is extending the reach of its Berocca Berocca had previously been tested as an Bvitamin supplements with the nationwide orange variant in Duane Reade stores across US roll-out of aformulation developed specif- NewYork City. ically for the gapinthe local market between To help launch the range nationwide, Bayer energy products and multivitamins. The firm hascreated acampaign in partnership with actor has also launched amango-flavoured addition and comedian Joel McHale, who plays afic- to its UK line of effervescent tablets. tional brand ambassador called Brock Spedwell. Positioned as an energy-support product, the The 15- and 30-second television spots show US-specific formula contains guarana and caf- Spedwell –who also featuresinvideos on the feine in addition to the B-vitamins,magnesium brand’sYouTube channel –asamotivational Comedian and actor Joel McHale plays afictional and zinc in the original effervescent tablets speaker inspiring people to try Berocca. brand ambassador called Brock Spedwell in Berocca’s that are currently available in around 70 other Bayer is supporting the launch further with television advertising markets. The recommended daily dose of one arefreshed brand website, buyberocca.com,as letin that the latest variant provided aspecific US tablet is claimed to provide “about as much well as updated Facebook and Twitter profiles. exotic fruit flavour for consumers in addition caffeine as acup of coffee”. There will also be anationwide sampling tour to its existing tropical-fruit option. Berocca wasbeing targeted at US consumers and public-relations activity. Currently available at Boots, the tablets aged between 25 and 49 years that liveda“full, would be widely available across the grocery, fast-paced life”, the companynoted, with the Mango flavour to deliver £1mn in UK pharmacyand convenience sector from Sept- claim that it supported “mental sharpness and Meanwhile, in the UK, the firm expects the ember,the firm noted. physical energy”. addition of the mango-flavoured effervescent Themango variant will feature in the brand’s Bayer added that the tablets –available in tablets to deliverover£1.0 million (C1.3 million) most recent television sponsorship campaign both orange and mixed-berry flavours –came at retail within the first year of launch. with Channel 5(OTC bulletin,16June 2014, in two- and 10-count packs to fitwith the target Noting that mango-flavoured products were page 14). It will also be promoted via Berocca’s audience’sbusy lifestyle. The US version of “very much on-trend”, Bayer told OTC bul- Facebook page and through in-store activity. OTC

AdvertisingComplaints NJOY spot did not imply e-cigarette benefit UK television advertisement for NJOY other in various situationssuch as moving house, Aelectronic cigarettes –e-cigarettes –did before one friend wasshown giving the other not misleadingly imply that smoking the prod- the NJOYproduct to stop them from smoking. uctwas healthier than smoking tobacco cig- Avoiceoverstated: “For everything that friends arettes, the UK’sAdvertising Standards Author- do for each other,return the favour.Givea ity (ASA) has ruled. friend an NJOYKing electronic cigarette.” “Friends don’tlet friends smoke” wasthe While the advertisement implied that the message in the 30- and 60-second versions of product waspreferable to smoking tobacco the advertisement, which waslaunched at the cigarettes, the ASA noted, there might have beginning of the year as part of the US-based been anumber of reasons whyafriend might firm’sUS$50 million (C37 million) promo- suggest smoking e-cigarettes in place of tobac- tional spend outside of its domestic market co products. Furthermore, no express health (OTC bulletin,17January 2014, page 15). claims related to the product had been made, Thornton &Ross’ Hedrin head-lice brand is looking to The spot showed twofriends helping each the watchdog added. remind UK parents that children arejust as susceptible OTC to head-lice infestation when playing with their friends as they areatschool. It aims to do this through a nationwide campaign in 125 indoor play centres. Set to last for four weeks –ahead of the IN BRIEF ‘back-to-school’ period –the campaign will include wall postersencouraging consumers to “Defend your ■ RB –Reckitt Benckiser –has entered into Red, with “rapid expansion of the relationship” family from head lice”. Discount leafletsoffer parents a“multi-year,nine-figure global partnership” planned overthe next three years. The partner- £1.50 (C1.89) offthe price of the Hedrin Protect & with social networking site Facebook to “ef- ship will also bring together employees from Go leave-in conditioning spray launched last year (OTC bulletin,23August 2013, page 23). fectively reach consumers in their digital the global sales, marketing and creative Through the leaflets, Thornton &Ross added, lives”. The twofirms will collaborate initial- teams of the twofirms, which will hold joint parents would also be directed to enter their details on ly in Australia, Brazil, Canada, India, Italy, recruiting events at universities to find “the the Hedrin website. This would give them the chance to win a£1,000 ‘Dream Ticket’ voucher. the UK and the US to connect Facebook best talent for both companies”. OTC users with brands such as Mucinexand Mega- OTC

20 OTC bulletin 15 August 2014 OTC15-08-14p19-21_Layout 1 13/08/2014 09:14 Page 4

MARKETING NEWS OTC

ProductLaunches ProductLaunches Prestige offers Australians can access dairydefence Merck’s Nasonex OTC restige Brands claims it is offering US con- Psumers the first OTCoption to relieve the ustralianconsumers are nowamong some symptoms of lactose intolerance or sensitivity, Aof the first in the world to be able to buy as well as trapped wind –‘gas’ –with the addi- mometasone furoate OTC–inthe same strength tion of aPlus Dairy Defense product under its as aprescription variant –for their allergic Beano line of gastrointestinal remedies. rhinitis symptoms with the launch of Naso- Anational survey of women aged over 55 nexAllergy spray by Merck &Co’sCon- years conducted on behalf of the brand –which sumer Care business. also comprises the original Beano tablets, Beano Containing 50µg per actuation, the spray Meltaways and aBeano to Go travelpack –had wasswitched by the Australian Therapeutic Goods Administration (TGA) last October. It nowholds schedule 2–pharmacy-only –status. Mometasone furoate has been available as a non-prescription medicine in Sweden since 2004. It also gained OTCstatus in Finland in 2013. Nasonex Allergy was approved as schedule 2 (pharmacy-only) medicine by the TGA in October 2013 Suitable for adults and children aged 12 years and overwho suffer from limited aller- with the condition, AndrewJenkin, regional gic rhinitis, NasonexAllergy is indicated for director for Merck Consumer Care Australia, relief from sneezing,congestion and itchyand said the OTCavailability of NasonexAllergy runnynose. offered patients “easier access to an effective It is still available –asNasonex–onpre- and trusted therapeutic choice for relief of scription for allergic rhinitis in adults, adole- their symptoms”. scents and children aged between three and 11 This wasconsistent with the firm’sgoal of Beano Plus DairyDefense is said to relieve both trapped years. The prescription variant is also indicated “working with pharmacyinsupporting good wind and symptoms of lactose intolerance or sensitivity for acute rhinosinusitis and nasal polyps in those patient health outcomes through self-care”, highlighted that 46% of respondents frequently aged over12and 18 years respectively. he added. suffered from gas, pressure or bloating after Merck said it aimed “significantly” to grow Atelevision campaign will air in September consuming dairy products, the US-based com- the Australian OTCintranasal corticosteroid to support the launch, along with apublic-rela- panypointed out. market –claimed to be worth A$18.4million tions campaign, point-of-sale materials and Three-quarters had said theyavoided “prob- (C12.8 million) at retail –bylaunching the spray pharmacytraining. The firm said that addi- lem foods” such as vegetables, beans and whole in time for the spring/summer allergy season. tional product information could be found on grains due to “digestive issues”, Prestige added. Noting that over15% of Australians suffered the newwebsite, nasonexallergy.com.au. As Beano Plus Dairy Defence contained two OTC natural food enzymes, the firm explained, the raspberry-sorbet-flavoured chewable tablets could break down both these problem foods andthe lactose found in dairy products. Con- sumers are advised to takeone tablet before meals that contain such ingredients. The survey had also found that nearly two- thirds of people would be willing to try anew product that relievedboth gasand lactose sen- Busy people who suddenly notice that their pain has sitivity,Prestige added. gone featureinlaunch German television advertising for Dutch firmYouMedical has entered into an exclusive OTC Bayer’s next-generation Aspirin tablets, contain agreement with US-based Prestige Brands to launch 500mg acetylsalicylic acid as microparticles (OTC in the US and Canada its Wartie technology for the bulletin,25July 2014, page 16). treatment of warts and verrucas. Running on major channels from early August, the Under the terms of the deal –which is partofthe IN BRIEF 28-second commercial created by Düsseldorfagency “international commercialisation” of Wartie –Prestige ■ ETIXX –the sports nutrition brand owned BBDO shows abusinessman, afemale train passenger has been granted the exclusive rights to market and and amale office worker. sell the technology under its CompoundWbrand, while by Omega Pharma –will become the official During acomputer-generated cutaway,avoiceover YouMedical –which also owns the Footner foot-care sponsor of the Quick Step cycling team from explains how the tablets’ “micro-active technology” line and the Nailner range for treating nail fungus – 2015. Currently known as Omega Pharma enables users to experience anoticeable reduction in will assume production and supply responsibility. pain twice as quickly as people taking standard Suitable for those aged four years and above, Quick Step, the team will be called Etixx Aspirin tablets. The advertisement ends with the Wartie’s ‘precision tip’ is said only to freeze the wart, Quick Step until the 2017 season. sign-offmessage “Not just quick, but twice as quick”. leaving the surrounding healthy skin unharmed. OTC OTC OTC

15 August 2014 OTC bulletin 21 Generics Awards Ad 4/8/14_Layout 104/08/2014 14:30 Page 1 OTC15-08-14p23Events_Layout 1 12/08/2014 18:01 Page 2

EVENTS OTC

Tel: +65 6508 2401. SEPTEMBER 7-8October Email: [email protected]. 17-20 September ■ AESGP Conference Website: www.otcpharmachina.com. Expopharm2014 Brussels,Belgium ■ ‘Herbal (medicinal) products,food supplements and self-care medical Munich,Germany devices: Paving the waytowards acoherent system’ is the theme of this NOVEMBER Afour-day internationalpharma- two-day event run by the Association of the European Self-Medication ceutical trade fair and conference. 5-8November Industry,the AESGP. Contact:Expopharm. ■ CRN’s Annual There will be sessions on: ‘Finding the right balance for herbal (med- Tel: +49 6196 928 830. Symposium for the icinal) products, food supplements and self-care medical devices’; ‘Ensur- Fax: +49 6196 928 404. DietarySupplement ing the right assessment of food supplements and health claims’; and Email: [email protected]. Industry ‘Adjusting the medical device legislation to consumer needs’. Website: www.expopharm.de. California, US Speakers will include: Basil Mathioudakis and Paola Testori Coggi of Afour-day conference organised the European Commission; Werner Knöss of the Committee on Herbal 22-23 September by the US Council for Responsi- Medicinal Products (HMPC); and Ioanna Chinou of the European Med- ■ China: RegulatoryAffairs ble Nutrition (CRN). icines Agency(EMA). for Pharmaceuticals Contact:CRN. Contact:AESGP.Tel: +32 2735 51 30. Fax: +32 2735 52 22. London, UK Tel: +1 202 204 7700. Email: [email protected]. Website: www.aesgp.eu/events/Brussels2014/. Variations, registrationsand renew- Fax: +1 202 204 7701. als in China will be discussed at Email: [email protected]. this two-day meeting. Tel: +44 20 7510 2560. 28-29 October Website: www.crnusa.org/2014events/. Contact:Informa UK. Fax: +44 20 7537 2003. ■ Pharmaceutical Tel: +44 20 7017 7481. Email: [email protected]. Labelling 13-14 November Fax: +44 20 7017 7823. Website: www.topra.org. Berlin,Germany ■ 9th International Email: [email protected]. Speakers from Boehringer Ingel- Alliance Conference 26-27 October Website: www.pti-europe.co.uk. heim, GlaxoSmithKline, Meda, Berlin,Germany ■ Natural Products Merck Sharpe &Dohme, the This two-day meeting will bring Scandinavia OCTOBER Proprietary Association of Great together manufacturers, outsource Malmö, Sweden Britain (PAGB), Reckitt Benckiser sales and marketing service provid- 1-3October Atwo-day trade showfor natural and Sanofiwill attend this this ers (distributors) and industry opin- Vitafoods Africa ■ products, health foods, natural two-day seminar. ion leaders in health and beauty. Johannesburg, SouthAfrica beauty and organic products. Contact:Informa UK. Contact:Ceuta Healthcare. This three-day event is claimed to Contact:Diversified Business Tel: +44 20 7017 7481. Tel: +44 1202 449 709. be the leading nutraceutical meet- Communications UK. Fax: +44 20 7017 7823. Email: lorian.pitman@ceuta ing for Africa’sfunctional food, Tel: +44 1273 645 141. Email: [email protected]. healthcare.com. dietary supplements and comple- Email: [email protected]. Website: www.informa-ls.com/ Website: www.ceutaalliance.com/ mentary and alternative medicines Website: www.naturalproducts pharmalabelling. 2014_conference_berlin.html. (CAMS) industries. scandinavia.com. Contact:IIR. 28-31 October 17-18 November 28-29 October Tel: +27 11771 7222. ■ OTC Pharma China EuroPLX 56 Pharmaceutical ■ Email: [email protected]. ■ Shanghai,China Nice,France Website: www.iir.co.za/vitafoodsafrica. RegulatoryAffairs Topics to be discussed at this four- This two-day conference will pro- in the Middle East day conference will include mar- vide aforum for business devel- 7October Dubai,UAE keting and branding strategies for opment decision makers for dis- & ■ Global Generics Countries to be covered at this newlaunch products; prescription- cussing and negotiating collabor- Biosimilars Awards 2014 two-day meeting will include Bah- to-OTC switch strategies and op- ative agreements in licensing, mar- Paris,France rain, Egypt, Iran, Iraq, Kuwait, portunities;regulatory strategies keting, and distribution of patented These newAwards will recognise Lebanon, Libya, Qatar,Saudi Ara- for herbal OTCproducts; aspecial medicines, generics, biosimilars, the achievements of the global gen- bia, Syria, and Yemen. focus session on traditional Chinese OTCproducts, medical devices erics and biosimilars industries. Contact:Management Forum. medicinal products; and expansion and food supplements. Organised by Generics bulletin, Tel: +44 1483 730071. strategies from Asia and beyond. Contact:RauCon. theywill reward business develop- Fax: +44 1483 730008. OTC bulletin subscribers can en- Tel: +49 6222 9807 0. ment initiatives, cleverlicensing Email: registrations@management- joya15% discount by quoting Fax: +49 6222 9807 77. deals and smart legalmanoeuvres. forum.co.uk. P46252OB during registration. Email: [email protected]. Contact: Generics bulletin. Website: www.management-forum.co.uk. Contact:IBC Asia. Website: www.europlx.com. Tel: +44 1564 777 550. Fax: +44 1564 777 524. 21-22 October 18 November Email: natalie.cornwell@generics- ■ Maximise Self-CarePotential: ■ ASMI Annual Conference bulletin.com. Through Asia RegulatoryHarmonisation Sydney,Australia Website: www.generics-bulletin.com. Phuket,Thailand ‘Self-Care: Abrighter and health- ier future’ is the theme of this 13-15 October The 10th World-Self Medication Industry (WSMI) Asia-Pacific Regional Conference will form part of this two-day event, which will include sessions one-day conference organised by ■ 11th TOPRA on: ‘Asia self-medication market trends, health policyand consumer prac- the Australian Self-Mediation In- Annual Symposium tice’; ‘Value and potential of OTC’; ‘Communication, education and part- dustry (ASMI). Brussels,Belgium nership in self-care’; ‘Regulatory challenges and opportunities in the OTC Contact:ASMI. Athree-day event run by The Org- industry’; and ‘Prescription-to-OTC switches and borderline products’. Tel: +61 29922 5111. anisation for Professionals in Reg- Contact:WSMI. Tel: +33 450 284 728. Fax: +33 450 284 024. Fax: +61 29959 3693. ulatory Affairs (TOPRA). Email: [email protected]. Website: www.tsmia.or.th/Phuket2014 /main.html. Email: [email protected]. Contact:TOPRA. Website: www.asmi.com.au/events/.

15 August 2014 OTC bulletin 23 OTC15-08-14p24-27_Layout 1 12/08/2014 19:36 Page 2

OTC MARKET RESEARCH OTC marketgrowth remains fragile

While OTCsales in the UK grew in 2013, trends forsome of the largest Category Sales Change product categorieshavedemonstrated aneed to guard against complacency (£ millions) (%) in what remains adelicately balanced market. Matt Stewart reports. Adult oral analgesics 353.4 +1.1 Topical analgesics 82.9 +12.2 alk of an ageing and growing pop- of society including among the better-off.” Paediatric analgesics 74.0 -3.1 ulation may be fuelling confidence in Discounters and pound stores –which gen- Oral lesions &toothache 33.5 +1.4 the future of the global OTCindus- erally only offer avery limited range of OTC Ttry,but in the UK, population growth medicines and account for only avery small part Total pain relief 543.9 +2.1 has slowed somewhat and the after effects of of the OTCmarket –had taken sales away from Figure4:Breakdown of the UK OTC pain-relief market in the global recession have changed consumer some of the UK’sbiggest retailers, including the 12 months ended 28 December 2013 (Source –IRI) behaviour.All of this has put the OTCmar- supermarket giants such as Tesco, Wood noted. ketinadelicate position. This rise in the popularity of discounters had Furthermore, this had also applied to the Although overall retail value sales in the UK led to more sales of low-priced OTCproducts, UK OTCmarket as awhole, Wood insisted. OTCmarket had improvedby2.2% to £2.45 mainly store-brands, Wood said, and ade- “Consistently overaperiod of years, RB billion (C3.08 billion) in the 12 months ended cline in OTCsales through some of the “big focused on afew keybrands and made sure 28 December 2013 (see Figure 1), “all the OTC four” supermarkets. it had asystematicapproach to newproduct categories, along with the whole fast-moving With achange in consumer behaviour had development which kept the pipeline of inno- consumer-goods (FMCG) market have strug- also come changes in the promotional mix, vation coming through every year for its big gled”, according to Martin Wood, head of strate- Wood pointed out. With people not buying brands,”he pointed out. gic insight –retail at market researcher IRI. the same quantities on multi-buys as previously, “However, RB seems to have run out of “We’ve seen volumes across food, health retailers themselves had been “moving away steam when it comes to line extensions on its and beauty decline overthe past year or two,” from multi-buys to price-led promotions”. big brands,”Wood claimed. “In addition, it has Wood pointed out, “basically because of people “These are general statements really on the hadtoabsorb anumber of SSL brands acquired cutting back.” recession,” Wood admitted, “but theyplay out in 2010 (OTC bulletin,30July 2014, page 1) Population growth had not been quite as across all categories, including OTC.” –which involved tackling regulatory issues strong as it had been previously,Wood noted, and disposals –and the firm’sentry into the primarily due to migration factors, with levels Decline in volume sales UK vitamins market is yet to have anymea- of inward migration overthe past fewyears not As Figure 2shows, volume sales of OTC surable impact.” as high as the levels seen in the previous decade. products had fallen back by 0.9% to 942 mil- “All those things drain management time This had been compoundedbythe recession, lion packs in 2013, reflecting the tougher mar- and limit the opportunities to go and present Wood noted, which had had alasting impact ketconditions and ahigh levelofcold and newthings to retailers,”he added. on UK consumer behaviour. flu incidencesinDecember 2012. It needed to be recognised, Wood said, that While some people had not been affected The delicate nature of the OTCmarket could when RB launched agood newsub-brand or at all, others had dramatically cut their spend- be summed up by what happened to the indi- variant it “materially” impacted on the total ing and had been happytoswitch from the gestion remedies segment in the gastrointest- market. As other firms had not done this to the major mainstream retailers to hard-discounters, inal category overthe past 12 months. same extent, the whole market suffered”. such as Aldi and Lidl. While overall sales of gastrointestinal prod- “My contention would be that arelative ab- “It’snot just about price,”Wood pointed out, uctsticked up by 0.7% to £260 million –driven sence of growth from RB is one reason whythe “the discounters have improvedtheir product by products for irritable bowel syndrome and total market has not been growing as much range and quality,and opened manynew stores.” antidiarrhoeals –the category’spowerhouse as it was,”Wood pointed out, “and no one else “Together with cleveradvertising and use indigestion remedies segment declined by 0.5% has been able to step up and fill the hole.” of social media,”he added, “the discounters to £120 million (see Figure 3). Turning to the keyproduct categories in have increased penetration across all sectors Wood said that while avariety of factors the market, pain relief remained the biggest con- were in play,the keywas that the indigestion tributor to the UK’sOTC market, with value Category Sales Change remedies segment relied too heavily on one key sales rising by 2.1% to £544 million in the 12 (£ millions) (%) brand to drive market growth: Gaviscon. months (see Figure 4). “Reckitt Benckiser (RB) would consistently Topical analgesics wasthe standout variant Decongestants 227.6 +0.4 bring out avariation of Gaviscon which would in the pain-relief category,with sales advancing Medicated 119.7 -2.6 bring something newtothe market,”Wood said, by 12.2% to £82.9 million. confectionery “and there is no doubt RB has not been doing Wood said that the topical analgesicssector Cough liquids 96.7 -5.9 as much of that overthe past fewyears.” had for almost adecade “overperformed” for Total cough, cold 444.0 -1.8 The prevailing trends in the UK around pop- awhole variety of reasons. and sorethroat ulation growth and economic uncertainty, com- “Sports heat rubs, such as Mentholatum’s bined with the slowdown in innovation from DeepHeat, have consistently performed well,” Figure5:Breakdown of retail sales the UK OTC cough, cold and sorethroat market in the 12 months RB on Gaviscon, had led to stagnation in the Wood pointed out, “while the introduction of ended 28 December 2013 (Source –IRI) indigestion remedies segment, Wood explained. heat patches wasabig innovation in the mar-

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MARKET RESEARCH OTC

ket. Although theyhavebeen around for awhile Category Sales Change Proportion now, theyhavedone well overthe period.” (£ millions) 2012/2013 (%) of total (%) One of the biggest reasons, especially in the past fewyears, had been the switch of Novar- Pain relief 543.9 +2.1 22 tis’ diclofenac-based Voltarol brand, Wood said. Cough, cold and sore throat 444.0 -1.8 18 “Wehaveseen Voltarol adding alot of Skin care 415.4 +2.4 17 value to the market as Novartis has launched Vitamins and minerals 352.2 +1.8 14 first pharmacy-only and then general-sale list Gastrointestinal 259.6 +0.7 11 (GSL) products”Wood pointed out. Smoking cessation 135.5 +4.2 6 Voltarol products were nowmuch more Hayfeverremedies 107.6 +21.9 4 widely available, he noted, and as all variants – Weight management 59.0 +0.3 2 including Voltarol Pain-eze Emulgel, Voltarol Eye-care treatments 57.9 +2.0 2 Emulgel-P and Voltarol Heat – carried quite Sleep aids 42.5 +7.5 2 ahigh price tag, theycontributed significantly Medicated mouthwashes/sprays 32.5 +8.3 1 to value growth in the topicals category. Novartis claim Voltarol is the biggest- Total OTC2,450.1 +2.2 100 selling topical pain-relief brand in the UK and – including its oral formulations – the second- Figure1:Retail sales in the UK OTC market in the 12 months ended 28 December 2013. Figures exclude sales in Northern Ireland, and through health-food stores, mail-order/internet only vendors and discounters (Source –IRI) biggest selling pain-relief brand overall. In 2013, the companybolstered its UK OTCpacks sold OTCOTC packs dispensed Prescription-only packs Voltarol range by launching Voltarol 12 Hour on prescription 3,000 Emulgel-P and backed the whole range with significant marketing activity including a£6.0 million television campaign. Twomillion people had bought atopical 2,000 Voltarol product in 2013, Novartis said, noting 1,220 1,238 +1.5% that half amillion people had tried aVoltarol gel product for the first time in the 12 months.

Furthermore, another big pain-relief brand 288 260 -9.6% 1,000

had entered the topicals space in 2013, Wood lume sales (million packs)

pointed out, with RB rolling out arange of Vo -0.9% topical variants under its best-sellingNurofen 951 942 brand name. 0 Launched early last year,RB’sfour Nuro- 2012 2013 fen topical productshad been designed to meet the “number-one consumer need” in the UK’s Figure2:Annual volume sales in the UK pharmaceuticals market in 2012 and 2013 (Source –IRI/IMS) topical products market –“speed of relief” – In contrast to the pain category,the cough, Category Sales Change according to the UK-based consumer goods cold and sore throat category could not escape (£ millions) (%) giant (OTC bulletin,29March 2014, page 13). the impact of aweak season. Wood pointed The launch of the topicals range waspart out, however, that as the data only covered the Indigestionremedies 119.5 -0.5 of abigger shift in RB’smarketing for Nuro- end of the 2012/2013season and the start of Antidiarrhoeals 49.5 +3.9 fen. The companywants to turn its range of the 2013/2014 season, the comparison season- Laxatives48.9 ±0.0 pain relievers into a“brand people love” by to-season washampered somewhat. Stomach upset remedies 17.1 -0.3 presenting aconsistent brand image through Sales in the category as awhole had dropped Infant gastro 9.3 -1.8 the “Livesbigger than pain” campaign, launch- by 1.8% to £444 million in the 12 months, Wood IBS* treatments 7.9 +10.9 ed in February 2013 (OTC bulletin,22Feb- said, butthis wascompared to avery strong ruary 2013, page 17). cough and cold season at the end of 2012. Travel sickness 6.9 -1.0 “December 2012,”Wood explained, “was Total gastrointestinal 259.6 +0.7 Fall in paediatric analgesics aparticularly spectacular month for cold and *Irritable Bowel Syndrome By contrast to the topicals market, sales of flu sales, thanks to apeak in incidence of illness paediatric analgesics slipped back by 3.1% to combined with colder weather.” Figure3:Breakdown of retail sales in the UK OTC £74million, adecline Wood blamed on aweak- In product category terms, decongestants gastrointestinal market in the 12 months ended 28 er cold and flu season than in 2012. were the only major product type to post arise December 2013 (Source –IRI) “Paediatric analgesics always correlates in sales and even then it wasonly amodest drivenbyretailers rationalising the range that more strongly with winter remedies compared 0.4%jump to £228 million (see Figure 5). This theycarried, following araft of newproduct with adult analgesics, where sales improved by hadbeen drivenbythe launch of Nurofen Cold development, Wood noted. 1.1% to £353 million,”Wood explained. “This and Flu – which contains the decongestant This wasespecially true around the mucus- is because colds and flu is the overwhelming rea- pseudoephedrine combined with ibuprofen – relief area, he said, adding that Johnson&John- son for purchasing for children, whereas adults and astrong performance from Johnson & son’sBenylin brand and Stada’sCovonia range buypainkillers more often for less seasonal Johnson’spremium-priced Sudafed line. had suffered particularly badly. ailments, such as headaches and back pain.” Thebig fall in cough liquid sales had been OTC

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NEW IDEAS BETTERWAYS NEWIDEAS BETTERWAYS NEW IDEAS BETTERWAYS INNOVATIONSNEWIDEAS BETTERWAYS NEW IDEAS BETTERWAYS NEWIDEASNEWIDEAS BETTEREditionWAYS 1,BETTER July 2014WAYS NEW IDEAS NEW IDEASNEW IDEAS Analyse BETTERNEWWAYS IDEAS BETTERWAYSBETTERWAYS NEWIDEAS NEWIDEASNEWIDEAS BETTERBEWAYTTERS WAYS BETTERWAYSBETTERWAYS NEW IDEAS NEW IDEASNEW IDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWIDEASHowOTC leaders NEWIDEASNEWIDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWvie IDEASwinnovation NEW IDEASNEW IDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWIDEASThe first-ever edition of our NEWIDEASNEWIDEAS quarterly OTC Innovations review BETTER–NWAYEW IDEASS BETTER WAYS – BETTERWAYSBETTERWAYS NEW IDEASdiscusses the need for abroad NEW IDEASNEW IDEAS BETTERinnovationWAYS strategy in the global BETTERWAYSBETTERWAYS NEWIDEASnon-prescription market, explores NEWIDEASNEWIDEAS thepast… BETTERviewsWAY on innovationS at some of the BETTERWAYSBETTERWAYS NEW IDEASleading global OTC players, and NEW IDEASNEW IDEAS BETTERlooksWAY at approachesS to early-stage BETTERWAYSBETTERWAYS NEWIDEASinnovation in consumer healthcare. NEWIDEASNEWIDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEW IDEAS NEW IDEASNEW IDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWIDEAS NEWIDEASNEWIDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEW IDEAS NEW IDEASNEW IDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWIDEAS NEWIDEASNEWIDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEW IDEAS NEW IDEASNEW IDEAS BETTERWAYS BETTERWAYSBETTERWAYS NEWIDEAS NEWIDEASNEWIDEAS Produced by Deborah Wilkes, BETTEREditorWAY&PublisherS of the OTCToolbox website BETTERWAYSBETTERWAYS NEW IDEASwww.OTCToolbox.com NEW IDEASNEW IDEAS Deliver BETTERWAYS BETTERWAYSBETTERWAYS NewIdeas BetterWays is a newquarterly OTCInnovationsreview from OTCToolbox,which will keep you informedabout news,views, thefuture technologicaldevelopmentsand innovative products. Edition1discusses theneed fora broadinnovation strategy in theglobal non-prescription market,exploresviews on innovation at some of theleading global OTCplayers,and looksat approaches to early-stageinnovation in consumer healthcare. Think Inside The Box JUST Visit www.OTCToolbox.com PUBLISHED

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PEOPLE OTC

Manufacturers Wholesalers&Retailers Nelsonsnames Walgreens Boots Alliance Hinton as CEO appoints leadership team K-based natural health products firm Nel- Usons has appointed David Hinton –for- regory Wasson,chief executive officer merly presidentofits US business, Nelson Bach Gof Walgreens, will lead the combined Wal- USA –aschief executive officer.He replaces greens/Alliance Boots business once the US Najib Fayad,who has retiredafter just over drugstore chain’sfull takeoverofthe UK-based sevenyears at the helm. wholesaler and retailer is completed. The deal As head of Nelson Bach USA –which also is expected to close in the first quarter of 2015, covers Canada and Latin America –Hinton subject to shareholder and regulatory approvals. hadexpanded distribution of the Rescue range Wasson has been named president and chief of stress-relief remedies and Nelsons H+Care executive officer of the enlarged business, which haemorrhoidcream into mainstream drug out- will be called Walgreens Boots Alliance and lets, Nelsons pointed out. be headquartered in Chicago, US. He had also, Nelsons said, driventhe launch Meanwhile, Stefano Pessina,currently exec- of the Pur-Absorb Iron liquid iron supplement utive chairman of Alliance Boots, will take on Stefano Pessina (pictured left), and GregoryWasson into mass-retail channels. the role of executive vice-chairman with respon- (pictured right) Robert Wilson, the company’schairman, sibility for strategy as well as mergers and ac- UK and Ireland, taking charge of the Boots unit. said Hinton’s“experience and successes in the quisitions. Pessina will also chair anew strategy Other senior appointments include Jeff Berk- US” made him the “right person to take Nel- committee of the board of directors. owitz,who will be president of Pharma and sons into the newera globally”. Walgreens will pay US$9.5 billion (C7.1 bil- global market access at the combined firm, hav- Commenting on his newrole, Hinton said lion) to acquire the remaining 55% stake in ingserved as president of the Walgreens Boots he was“looking forward” to making Nelsons Alliance Boots it does not already own. The Alliance Development division since the part- “more efficient, more innovative and ultimate- companycompleted its initial investment in nership wasestablished in 2012. ly bigger”. Alliance Boots at the start of August 2012, pay- TimMcLevish,Walgreens’ chief financial OTC ingUS$6.7 billion in cash and shares for a officer,will take onthe same role in aglobal 45% stake inthe privately-owned firm (OTC capacity at Walgreens Boots Alliance. bulletin,10August 2012, page 8). BusinessStrategy The combined companywill also benefit Positive step for the industry RB starts revolution from the joint agreement between Walgreens, Commenting on the formation of Walgreens Alliance Boots and US pharmaceutical whole- Boots Alliance,Pessina said that the “expected with R&D investment saler AmerisourceBergen, which wassigned last creation of the newenterprise”represented a year (OTC bulletin,29March 2013, page 1). “very positive step for the future of the health- ■ Continued from front page Walgreens Boots Alliance, the twocom- care industry as awhole”. of stakeholders from other companies, regu- panies noted, would consist of four divisions: Wasson explained that athree-year“next lators, keyopinion leaders and patient groups” Walgreen Co, the largest drugstore chain in chapter” plan for Walgreens Boots Alliance had to join forces. the US; Boots, the leading health and beauty already been laid out, with the aim of maximis- This would create an environment where retailer in the UK and Ireland; Pharmaceuti- ing “the scope and scale of the newcombin- people would be “empowered to take owner- cal Wholesale and International Retail, which ed company”. ship of their owneveryday health needs”, he would include the Alliance Healthcare wholesal- The plan would provide a“differentiated added, echoing his keynote speech at the recent ing business; and Global Brands, which would retail experience” that would transformthe re- meeting of the Association of the European coverBoots brands sold through third parties. tail model for health and wellness, while also Self-Medication Industry,the AESGP,where he Ornella Barra,currently chief executive changing the waywomen shopped for beauty called for OTCmedicines to be authorised for officer of Alliance Boots’ wholesale business, products, the firms claimed. non-prescription sale globally as soon as safety, will take charge of the enlarged company’s Furthermore, it would see the combined efficacyand appropriate use had been establish- Global Wholesale and International Retail oper- business develop an “integrated pharmacyand ed (OTC bulletin,16June 2014, page 1). ations, while Alex Gourlay –who movedto healthcare” offering. This would “advance the “I don’tbelieve,with the growing and ageing Walgreens from Alliance Boots last year (OTC role of pharmacists and provide access to innova- population, our healthcare systems will be able bulletin 23 August 2013, page 31) –has been tive services”, theynoted, adding that it would to cope with the everyday needs of people,” named president of Walgreens. also“reinvent the pharmaceutical value chain and Kapoor pointed out, “and Ithink that aregula- Another Alliance Boots executive, Ken deliveraseamless speciality pharmacymodel”. tory framework that allows people to take care Murphy,managing director of Health &Beauty With the plan in place, the combined busi- of their ownailments is going to be an impor- Internationaland Brands, will take onthe role ness wasexpected to generate sales of between tantpart of RB’sdrive to create arevolution of president of the Global Brands division, with US$126 billion and US$130 billion in 2016, in consumer health.” Simon Roberts,currently managing director of Walgreens and Alliance Boots noted. OTC Alliance Boots’ Health &Beauty business in the OTC

15 August 2014 OTC bulletin 27 Do you know what your OTC bulletin print OTC competitors are doing and thinking?

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