Alli Heads OTC Brand Cull at Glaxosmithkline

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Alli Heads OTC Brand Cull at Glaxosmithkline OTC29-04-11p1&24FIN.qxd 28/4/11 07:19 Page 1 29 April 2011 COMPANY NEWS 3 Valeant sets Cephalon 3 Alli heads OTC brand a May deadline J&J’s OTC sales drop 4 by a quarter in US cull at GlaxoSmithKline Atrium strikes deal 5 in Canada Omega encouraged by 6 laxoSmithKline Consumer Healthcare’s Brand Category opening quarter Gflagship weight-loss medicine Alli is one Novartis OTC sprints 7 of a number of OTC brands put up for sale Abtei VMS* ahead of market by the company because it has not got the Alli Weight management Bart Becht to leave 8 marketing clout to make them successful. Beano Gastrointestinal Reckitt Benckiser In a shock move,the firm has admitted that BC Analgesic North American sales rise 9 Alli – the first medicine to be switched cen- Beconase Respiratory tract boosts turnover at Boiron trally to non-prescription status in Europe and Debrox Excess ear wax Blackmores believes Asia 10 with launch sales of £110 million (C124 mil- Dequadin Cough/cold holds key to future growth lion) in 15 weeks in the US – could do better Ecotrin Analgesic Caffetin coaxes Alkaloid forward 10 in different hands. FiberChoice Dietary supplement GlaxoSmithKline has now turned its back GENERAL NEWS 11 on the orlistat-based weight-loss medicine in Goody’sAnalgesic a move to refocus its Consumer Healthcare op- Granufink Urological Consumer group demands 11 eration. Yet as recently as June 2007, the com- Lactacyd Feminine hygiene ban on Alli pany invested enormous sums to launch the Libenar Respiratory tract US FDA targets global supply chain 12 brand in the US – after paying Roche US$100 Nytol Sleep aid FDA takes action over 13 million (C68 million) plus royalty and mile- Phillips MOM Gastrointestinal MRSA claims in the US stone payments for the US OTC rights alone Solpadeine Analgesic MARKETING NEWS 14 in 2004 (OTC bulletin,30 July 2004, page 1). Tagamet/Stomedine Gastrointestinal Moreover, a few years later the company paid Valda Cough/cold supplement Dr Reddy’s and Perrigo gain 14 an undisclosed amount to Roche for the Euro- Zantac OTCGastrointestinal store-brand Allegra pean OTC rights (OTC bulletin,27 February Sanofi and Meda launch 15 2007, page 1), wrestled with the European auth- * Vitamins, minerals and supplements allergy brands in France orities for Alli to become the first successful Figure 1: Some of the brands to be divested by ASA raps Vitabiotics 15 pan-European switch, and then backed an im- GlaxoSmithKline with annual sales of over £5 million. GSK follows Piri revamp 16 mediate launch across 24 member states. The firm intends to divest the brands in all markets in with fresh commercials Alli is one of a basket of over 100 non-core which they are sold (Source – GlaxoSmithKline) McNeil reduces Reactine packs 16 OTC brands that GlaxoSmithKline is looking panies were “better placed to maximise the to divest, even though they have combined an- brands’ potential”, the company insisted. FEATURES 18 nual turnover of £0.5 billion (C0.6 billion), or The process of communicating with inter- about a tenth of the Consumer Healthcare divi- ested parties would begin over the next few Boehringer will fight 18 for OTC growth sion’s sales. weeks, GlaxoSmithKline said, with the aim of Boehringer Ingelheim’s strategy Other well-known brands for sale include divesting the products by late 2011, subject to for its Consumer Health Care Abtei food supplements, Beconase respiratory interest and realising the appropriate value for business is shifting under the products, Beano gastrointestinal remedies, Fib- shareholders. leadership of David Wright. erChoice dietary supplements, Goody’s pain The prospect of brand divestments was first Deborah Wilkes asks the new relievers, the Lactacyd feminine hygiene range, raised by the company in February,when chief global head of the world’s Nytol sleep aids, Solpadeine analgesics, and executive officer Andrew Witty said the firm sixth-largest OTC player about his plans. Zantac OTC heartburn drugs (see Figure 1). wanted to focus more effectively on its “prior- GlaxoSmithKline said the brands – primar- ity or global” brands as well as its operations REGULARS ily sold in Europe and the US – had “strong in emerging markets (OTC bulletin,11 Febru- heritage and good prospects”,but the firm lack- ary 2011, page 1). Events – Our regular listing 17 ed critical mass in some product categories, No mention was made at that stage, how- People – Commission puts AESGP 23 while certain brands had lacked focus due to ever,that a flagship OTC brand like Alli, which onto food advisory group other global priorities. As a result, other com- ■ Continued on page 22 Te ll the right people what youwant to in-license and out-license EKNOW the people who want to in-license, Wout-license, buy or sell your OTOTCCp products,roducts, brands or technologies. We knowthem because theyare registering with us at the SourceOTC website. Reach the SourceOTC community by posting your ownmessage. in association with The entry-level service means youcan post up to five business opportunities on the SourceOTC website for Current Opportunities Include three months forjust £495 (plus VATwhere applicable). And there is no success feetopay. ● Hyaluronic acid foam Ta ste-masked This gives companies of all shapes and sizes acost-effective ● ibuprofen wayofgetting their message across to the right people. ● Water-based vitamin D3 drops Visit www.sourceotc.com Visit www.SourceOTC.com to find out moreorcontact Deborah Wilkes on 01564 777550 or [email protected] DEALSTODRIVE YOUR BUSINESS rev 2011SourceOTC A4 ad.indd 1 17/01/2011 10:34 OTC29-04-11p3FIN.qxd 27/4/11 13:05 Page 3 COMPANY NEWS OTC Mergers & Acquisitions Valeant sets Cephalon a May deadline aleant has set a date of 12 May for Ceph- support a higher offer,” it added. revocation statement’ with the SEC, the US Valon’sshareholders to give their verdict Comparing its US$73.00 (C49.90) per share firm noted that its shareholders had “no obli- on removing Cephalon’s directors and electing “all-cash offer” – that values the US firm at gation to respond to [Valeant’s] deadline”. Valeant’s seven nominees in their place. US$5.7 billion (OTC bulletin,15 April 2011, Describing Valeant’s offer as “inadequate” “This vote is a referendum on whether Ceph- page 5) – with the “uncertainty of Cephalon’s and not in shareholders’ best interests, Cephalon alon’s shareholders want to pursue Valeant’s standalone plan, which relies on the successful noted that Valeant was acting in the best inter- offer,” the Canadian firm said as it filed a pre- commercialisation of a risky pipeline portfolio”, ests of its own shareholders, not Cephalon’s. sentation with the US Securities and Exchange Valeant warned that a transaction might only “Valeant is now attempting to replace all of Commission (SEC) in connection with its ‘writ- be possible with a new Cephalon board in place your current board with a slate of Valeant’s ten consent solicitation’. “given Cephalon’s rejection of Valeant’soffer hand-picked nominees, three of whom are re- “Valeant would be willing to increase its and refusal to engage in discussions”. cent Valeant directors,”Cephalon said. offer price modestly if Cephalon’s board of The Provigil prescription brand accounted Underlining a 0.5% compound annual de- directors would allow Valeant to conduct due for 41% of Cephalon’s net sales last year and cline in Cephalon’s share price over the past diligence and the results of such due diligence would face generic competition in 2012, Valeant five years, including a 19% decline in the 12 pointed out. This would cut Provigil’s earnings months before its offer,Valeant said its all-cash by more than 40%. “Cephalon’s value to Val- proposal was a 29% premium to Cephalon’s 30- OTC bulletin eant erodes each day Valeant is delayed in im- day trading average at the time of its bid. plementing its business strategy,” it said. Cephalon bought Mepha – the leading Swiss 29 April 2011 Number 361 Cephalon, however, urged its shareholders generics company with a portfolio of prescrip- to reject Valeant’s proposals. In filing a ‘consent tion and OTC drugs – from Merckle last year. Editor & Publisher: Deborah Wilkes OTC Associate Editors: Aidan Fry Mike Rice Licensing Agreements Business Editor: Matt Stewart Assistant Editors: Jenna Lawrence Oxford Nutrascience agrees Brazil deal David Wallace Advertising Controller: Debi Minal he UK’s Oxford Nutrascience has signed an target this sector by working closely with Aché.” Texclusive licensing and distribution agree- The deal with Aché also demonstrated that Marketing Manager: Val Davis ment with Aché Laboratórios Farmacêuticos the firm was capable of partnering with major Editorial, Subscription and Advertising to help the Brazilian firm expand its Inellare pharmaceutical companies that were “seeking enquiries should be addressed to: OTC bulletin, OTC Publications Ltd, 54 Creynolds Lane, Solihull, women’s health brand. product innovation”, Theobald claimed. West Midlands B90 4ER, UK. Under the terms of the seven-year deal, Ox- He added that “big pharma companies” were Tel: +44 1564 777550. Fax: +44 1564 777524. ford Nutrascience, using its own intellectual attracted to Oxford Nutrascience’s “ability to E-mail: [email protected]. property,would develop and supply a number apply novel pharmaceutic technology to extend Subscriptions of consumer healthcare products to Aché. These the lifecycle of existing branded generic medi- Annual subscriptions to OTC bulletin in Europe are £625.00 for single copies and £355.00 for additional copies to the same ad- would then be sold in Brazil under the Inellare cines” in which they had often invested heavily. dress, including delivery. Subscriptions to addresses outside Eur- brand name, the company said.
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