U.S. Nonprescription Drugs Industry

Healthy Growth of the U.S. Nonprescription Drugs Industry Projected to Continue

Findings from the recently published Nonprescription Drugs USA study show positive signs of growth for the 2013 U.S. OTC market. Compared to 2012 when the market had flat sales performance, 2013 recorded healthy growth of 3.0% to reach $23.5 billion at the manufacturers’ level. The market is driven by the strong performance of several brands including Novartis’ Excedrin and Johnson & Johnson’s Tylenol and Motrin IB, as well as the continuous strong sales performance coming from nutritional brands, such as Vitafusion (Church & Dwight), Centrum (Pfizer), and Schiff (Reckitt Benckiser).

Another prominent contributor to the solid performance of the U.S. OTC market in 2013 was the approval of the Oxytrol for Women by Merck. This notable FDA approval created a new category in OTC, the overactive bladder, helping thus millions of women who struggle to deal with the OAB issues every day. The horizon looks favorable for increased switch activity and growth adding former prescription users to the OTC market with the following switches approved in 2013 and 2014: Nasacort 24 Hour allergy nasal spray, Nexium 24 Hour proton pump inhibitor, and Flonase nasal spray.

Increased marketing activities coming from the majority of OTC brands along with a strong cold and flu season in the first quarter of 2013, were other important factors contributing to the overall growth of this promising market.

Factors inhibiting OTC industry growth during 2013 include stagnating innovation and consumers’ price sensitivity as due to challenging economic times they seek out lower-priced private-label OTCs. Adapting to consumers’ demands, retailers feature private-label with nearly identical packaging, prominent shelf space, comparative shelf talkers, and other promotions. Private-label product sales grew nearly 5.0% in 2013 compared to the 3.0% growth of the overall industry.

Drug stores and mass merchandisers still control the vast majority of retail sales for OTCs; however, in some cases, online sales are rather sizeable. For example, nearly 40% of consumers surveyed note they shop for and buy vitamins and minerals online.

To find out more insights about the U.S. nonprescription drugs industry, refer to Kline’s Nonprescription Drugs USA study. In addition, with the OTC Consumer/Shopper Insights report, you will be able to better understand consumers’ preferences and shopping behaviors for OTC drugs.

Written by Marcela Chifu (Marketing Coordinator),  Insights by Laura Mahecha (Industry Manager – Healthcare Practice)

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