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Room for Both Natural and Traditional OTCs, but Healthier Growth Rates for Natural OTCs Predicted, Reports Kline

PARSIPPANY, NJ, NOVEMBER 16, 2001 –

While the U.S. traditional nonprescription drugs industry registered an average CAGR of 2.5% between 2005-2010, the market for natural over-the-counter (OTC) remedies has grown at a CAGR of 5.9% per year from 2009 to 2011, according to the research study Natural OTCs 2011: Impact of Non-drug Products on the U.S. OTC Market by worldwide consulting and research firm Kline & Company.

With close to 40% of consumers currently using more natural OTCs than in the previous year the natural trend, already well established in the personal care industry, has set roots in the OTC market as consumers gravitate towards natural products across the board. This correlates with the finding that 47% of U.S. consumers believe natural OTCs to be as effective as traditional OTCs. With the growing popularity of natural remedies and the large number of retailers that embrace the market segment, the market is set to maintain healthy growth rates over the next five years and is forecast to reach nearly $750 million by 2016. By contrast, the traditional OTC market is forecast to grow as little as 3% per year. However, there is room for both types of OTCs on the market as 53% of consumers surveyed note that they use both natural and traditional OTCs to treat themselves or family members when sick.

Within this fertile environment, large branded and savvy OTC marketers might consider augmenting their traditional OTC portfolios with natural OTC brands where appropriate; Procter & Gamble’s Align, GlaxoSmithKline’s Breathe Right, and Bayer Groups Phillips’ Colon Health are telling examples of how seriously the natural OTC trend is being taken and tapped. Opportunities appear ripe for large and small OTC companies alike to market natural OTC brands which could offer mutually beneficial business propositions.

For those interested in seizing the potential offered by this relatively young market segment, Laura Mahecha, Industry Manager at Kline’s Healthcare practice, cautions that business opportunities vary in attractiveness across various product categories. For instance, while cough and cold preparations are expected to grow at a rate of only 5% to reach $320.9 billion in 2016, it is anticipated that sleeping aids will grow by about 18% per year to reach $54.0 million in 2016 from $23.5 million reported in 2011. Other product categories covered by Kline include analgesics, digestive products, sinus medications, allergy relief products, and topical products.

“Growth in natural OTCs,” observes Mahecha, “will be dependent on whether consumers continue to find them effective and safe.” Kline’s survey on the usage and perception of natural OTC reveals that presently more than 45% of the respondents find natural OTCs effective and over 40% consider natural OTCs to be safer or have fewer side effects than traditional OTCs.

Kline’s Natural OTCs 2011: Impact of Non-drug Products on the U.S. OTC Market is a comprehensive market assessment of non-drug products that compete with traditional OTCs. It includes analysis of market size, consumer perceptions, and company profiles.

About Kline
Kline is a worldwide consulting and research firm dedicated to providing the kind of insight and knowledge that helps companies find a clear path to success. The firm has served the management consulting and market research needs of organizations in the chemicals, materials, energy, life sciences, and consumer products industries for over 50 years. For more information, visit www.KlineGroup.com.

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