The U.S. OTC market is characterized lately by slow, steady growth of anywhere from 1% to 3% annually. There are small, independent companies, however, that have recently recorded double-digit sales growth. These companies often outpace market growth by offering unique brands, uncommon and often natural ingredients, focused distribution, and a strong online presence, frequently combined with compelling digital marketing that resonates with today’s OTC consumers. Identifying these market disruptors and learning the factors that make them resonate with consumers and retailers is crucial.Continue reading
The most recent merger impacting the OTC market was announced yesterday and involves Sanofi acquiring the consumer health unit of Boehringer-Ingelheim Pharmaceuticals in exchange for Sanofi’s Merial Animal Health business. This swap is still in negotiations; however, the addition of Boehringer-Ingelheim’s consumer health business will serve to broaden Sanofi’s global OTC portfolio in cough/cold, digestives, analgesics, and vitamins, as well as expand the company’s reach in key markets, such as Germany, Japan, and China. In 2014, Sanofi and Boehringer-Ingelheim had combined OTC sales of $942 million in the United States, ranking sixth in the market.
This deal follows several that have taken place over the past 14 months where major competitors in the OTC industry have merged or created joint-venture companies in an effort to expand their global reach, widen brand portfolios, achieve higher revenue growth, and seek cost synergies. Beyond strategic bolt-on acquisitions, such as Reckitt Benckiser’s acquisition of the Schiff vitamin and supplement business in October 2012, these recent mergers have made large competitors into global giants with portfolios that span nearly every consumer health category.Continue reading
There have been signs recently indicating that the environment is becoming ripe for more Rx-to-OTC switches. Since we last reported on this topic in August 2013, we saw the approval of two additional first-in-class switches in categories that would have been thought of as challenging five years ago. One is the first incontinence medication available for sale without a prescription, Merck’s Oxytrol for Women, and the other is the first nasal allergy steroid, Sanofi’s Nasacort Allergy 24HR.Continue reading