The OTC Outlook to 2007: Extending revenue streams and product lifecycles after patent expiry

• Introduction to OTC pharmaceuticals 12
• OTC market dynamics 13
• Current activity in the OTC market 14
• Future drivers of the OTC market 16
• Future trends within the OTC market 17

• pharmaceuticals 20
• Summary 20
• Definition of OTC pharmaceuticals 21
• Definition of OTC pharmaceuticals in the US 22
• Definition of OTC pharmaceuticals in Japan 22
• Definition of OTC pharmaceuticals in the UK 23
• Definition of OTC pharmaceuticals in Germany 24
• Definition of OTC pharmaceuticals in France 25
• Evolution of the OTC market 25
• Historical drivers of the OTC Market 26
• Healthcare cost containment 27
• Costs incurred by national healthcare providers 27
• Increased revenues for pharmaceutical companies 29
• Increase in the pharmaceutical lifecycle 30
• Distribution of OTC drugs 31
• Direct distribution 33
• Case study: Taisho ? Direct distribution 34
• Mail order distribution 36
• Wholesale distribution 37
• Distribution by agencies 39
• Pharmacies as retail outlets for switched products 39
• Impact of the Internet on pharmaceutical distribution 40
• Summary 44
• The current OTC market 45
• Geographical breakdown of the OTC market 45
• Emerging markets 47
• Major players within the OTC market 47
• Introduction 47
• Size matters 48
• Strategic positioning 48
• Geographical presence 49
• Product portfolio 49
• Pipeline potential 50
• Leading companies 50
• Johnson & Johnson 51
• Introduction 51
• Consumer healthcare 53
• OTC product portfolio 54
• Major brands 55
• Other brands 57
• Conclusion 57
• Pfizer 58
• Introduction 58
• Consumer healthcare 59
• OTC product portfolio 59
• Major brands 59
• Conclusion 61
• GlaxoSmithKline 62
• Introduction 62
• Consumer healthcare 63
• OTC product portfolio 63
• Major brands 64
• Conclusion 66
• Wyeth 66
• Introduction 66
• Consumer Healthcare 67
• OTC product portfolio 67
• Conclusion 69
• Bayer 69
• Introduction 69
• Consumer healthcare 70
• OTC product portfolio 71
• Conclusion 73

• market 76
• Summary 76
• Growth potential within the OTC market 78
• OTC pharmaceutical market: the United States 78
• Characteristics of the market 78
• Market size and growth 80
• OTC pharmaceutical market: Japan 82
• Characteristics of the market 82
• Market size and growth 84
• OTC pharmaceutical market: Germany 85
• Characteristics of the market 85
• Market size and growth 90
• OTC pharmaceutical market: the UK 91
• Characteristics of the market 91
• Market size and growth 93
• OTC pharmaceutical market: France 95
• Characteristics of the market 95
• Market size and growth 97
• The OTC market by therapy areas 98
• Analgesics 98
• Cough & cold remedies 99
• Vitamins & dietary supplements 100
• Antifungals 101
• Gastrointestinal 102
• Smoking cessation 102
• Anti-allergenics 104

• Summary 108
• Introduction 109
• Rx-to-OTC switching 111
• Introduction 111
• Differences in switching policy across countries 112
• Drivers for Rx-to-OTC switching 113
• Revenue protection 113
• Patent expiry 114
• Extension of product life 115
• Umbrella branding 116
• Dual Regulatory Status 116
• Increase in consumer acceptance of self-medication 118
• Healthcare cost containment measures 120
• Case study: Blue Cross and antihistamines
• New indications 121
• Oral and emergency contraceptives 121
• Cardiovascular drugs 123
• Allergy and asthma drugs 125
• Antibacterials 127
• The impact of technology on the OTC market 127
• Patient management systems 127
• New marketing channels ? The Internet 128
• The impact of the Internet on OTC manufacturers 129
• Information gathering 130
• ePharmacies ? Online drug stores 131

• market 134
• Summary 134
• Introduction 135
• Direct-to-consumer advertising across Europe 135
• Consolidation in the OTC market 137
• The online healthcare market 138
• The importance of establishing a global brand 139
• The changing role of pharmacists 141
• Market growth forecasts 142
• Geographic trends 144
• Worldwide market share 148

Index 150

List of Figures

Figure 1.1: The structure of prescription and non-prescription pharmaceuticals in Germany 24

Figure 1.2: Historical drivers of the OTC pharmaceutical market 26

Figure 1.3: World population ageing above 65 years 28

Figure 1.4: Impact of a Rx-to-OTC switch on the lifecycle of a pharmaceutical product 31

Figure 1.5: Distribution channels for OTC products 32

Figure 1.6: Impact of the Internet on self-care industry 41

Figure 2.1: Breakdown of the global OTC pharmaceutical by region, 2001 46

Figure 2.2: Breakdown of GSK s OTC product sales 64

Figure 2.3: Geographical breakdown of Bayer s Consumer Care division sales, 2001 71

Figure 3.1: Timeline of major events in the US OTC pharmaceutical market, 1985?2005 81

Figure 3.2: Breakdown of the OTC pharmaceutical market 84

Figure 3.3: Health insurance coverage of the German population 87

Figure 3.4: Distribution of funding sources for healthcare in Germany 88

Figure 3.5: Evolution of the UK pharmaceuticals market 94

Figure 3.6: Distribution of funding sources for public healthcare in France 97

Figure 4.1: Future drivers of the OTC pharmaceutical market 110

Figure 4.2: Factors driving Rx-to-OTC switching 111

Figure 4.3: Increase in self-medication in consumers 119

Figure 4.4: Asthma-sales by product groups 126

Figure 5.1: Growth in the value of the global OTC market, 1997?2007 143

Figure 5.2: Growth in the value of four geographical OTC markets, 1997?2007 144

Figure 5.3: Geographical breakdown of total OTC market sales, 1997?2007 145

Figure 5.4: Market shares by geographical region between 2001 and 2007 148

List of Tables

Table 1.1: Legal classification of pharmaceutical products in major markets 21

Table 1.2: World population ageing 27

Table 2.1: Geographical breakdown of the global OTC market, 1997?2002 45

Table 2.2: The five major companies in the OTC market, 2001 51

Table 2.3: Major OTC subsidiaries of Johnson & Johnson 54

Table 2.4: Approvals of Rx-to-OTC switches of J&J products by FDA 55

Table 2.5: J&J s major OTC brands 56

Table 2.6: Major OTC brands of Pfizer 61

Table 2.7: Sales of GSK s leading OTC brands in the US, 2001 65

Table 2.8: Wyeth s leading OTC brands 68

Table 2.9: Bayer s late stage OTC pipeline and recently launched products, 2002 73

Table 4.1: Comparative status of active ingredients in key pharmaceutical markets 112

Table 5.1: Top 10 DTC products by advertising spend, 2001 136