Who needs an MD when you’ve got a CVS? There are many theories why the over-the-counter (OTC) category is rolling along and posting good gains while so many other fast-moving consumer goods sectors fell on hard times when times got tough.
Some observers point to a health care system in flux. Others insist that cash-strapped consumers are finding their own, often less expensive, solutions. Finally, there are those who say it’s related to that can-do, do-it-yourself attitude. But whatever’s driving sales, the results have been very good for many players in the OTC market. Sales for OTC products topped $8.3 billion during the past year in food, drug and mass markets, according to Information Resources, Inc., but many OTC categories, such as bedwetting remedies and motion sickness treatment, are beyond Happi’s ken. However, in markets served by our readers, like topical pain relievers, sales are surging.
“With an aging population in the US, people will continue to have aches and pains as they get older,” observed Scott Gorley, CEO of Perfecta Products, the maker of Zim’s Max Freeze and Zim’s Maximum Heat pain relief products.
And there’s plenty of room to grow, say industry experts.
“The US is a pill-popping culture,” explained Pat Carroll, VP-sales and marketing at Hisamitsu, the maker of Salon Pas pain relieving products.
According to Carroll, 50% of Japanese consumers rely on topical treatments for pain relief. In Europe, 25% of consumers use topicals, but in the US, the usage rate is just 12%. A great opportunity and the perfect time to take advantage of consumers’ drug concerns said Carroll.
“During the past couple of years there have been a number of pill recalls in the US. Plus, there is growing concern among consumers about what they are putting into their bodies,” he noted. “More people are starting to realize that maybe it’s not such a good idea to pop a pill at the first twinge of pain.”
Taking a closer look at categories of interest to Happi’s readers, IRI reports that external analgesic rub sales have risen nearly 7% during the past year (see chart). Leading the charge is Hisamitsu’s Salon Pas lineup. Carroll said his company has already surpassed Ben Gay to become the No. 2 brand in the segment and has its sights set on Icy Hot—the Chattem brand that is the long-time leader in the segment with a 23% share, according to IRI.
“We’re expecting double-digit growth for the next 3-5 years to catch up to Icy Hot,” said Carroll. “We expect to double sales in the next three years.”
To help the Salon Pas brand to get there, Hisamitsu added Deep Relieving Gel to bring its product lineup to eight. The gel contains three active ingredients, camphor (3.1%), menthol (10%) and methyl salicylate (15%). Carroll said the launch of Deep Relieving Gel is just the latest example of Hisamitsu’s pain-relieving technology. The company’s pain relieving patches are one of only two products on the market to make 12-hour pain relieving claims. What’s more, Salon Pas promises to relieve mild to moderate pain. In contrast, competitor products only relieve mild pain, according to Carroll.
Some Painless Choices
When it comes to alleviating pain, there are plenty of products to choose from on drug store shelves. A fast-moving natural option is Perfecta Products’ Max Freeze; sales rose 20% during the past year to crack IRI’s Top 10 list (see chart). Gorley credited the gains to some new items as well as additional promotional activity and wider distribution. For example, Zim’s Max-Freeze Continuous Spray has been added to Walmart shelves. Like other Perfecta Products, it relies on natural ingredients such as organic ilex, aloe vera and arnica.
“We still see the whole natural segment continuing to grow,” said Gorley. “Baby Boomers are getting older and people are reading more labels than ever before. So we’re delivering quality and value, which is especially important in tough economic times.”
Spots Before Your Eyes
On one end of the OTC market, you’ve got aging Baby Boomers coping with aches and pains they’ve never experienced. At the other end, there’s a new crop of teenagers who may be going through the trials and tribulations associated with breakouts and other forms of acne. Although sales of acne treatments actually declined 2.9% to about $625 million in food, drug and mass markets for the year ended Jan. 26, 2014, there’s plenty of activity in the category—and plenty of consumers who are looking for an effective OTC treatment, according to physicians.
“A lot of patients are developing acne at an earlier age and we’re not sure why,” said Dr. Emmy Graber, a Boston-based dermatologist and assistant professor at Boston University School of Medicine. “It could be due to the fact that young women are reaching puberty at a younger age.”
At the same time, there’s been an increase in the incidence of acne among adult women. And while Dr. Graber couldn’t point to a specific reason, she did note that stress often plays a role in these outbreaks and OTC products can play a key role in treatment.
“The average wait time to see a dermatologist in the US is 34 days, and it’s even longer in rural areas,” explained Dr. Graber. “With the increasing costs of health care, OTC formulas can play an important role in saving some trips to the dermatologist’s office.”
Waltman Pharmaceuticals, Jackson, MS, has been saving consumers trips to the dermatologists office for more than 25 years with its Zapzyt brand.
“People can’t afford to go to the dermatologist and spend $200 on products,” explained Whitney Burns, vice president, Waltman. “We’ve worked closely with dermatologists and found that benzoyl peroxide prescriptions are no longer covered by insurance. We have a 10% benzoyl peroxide preparation that retails for $4.99-5.99.”
This year, the company expanded its Zapzyt skin care line with a Pore Treatment Gel that promises to cut through skin sebum and penetrate pores to bring the medication where it can be most effective. According to the company, the formula is especially effective for people with sensitive skin, as it contains aloe vera and other botanicals that help reduce stinging, burning redness that are caused by other treatments.
To promote the four-item Zapzyt line (two treatments and two cleansers), Waltman has expanded distribution across the US, partnered with WebMD and had mentions in Health and Marie Claire magazines.
“Our advertising is geared toward mothers (since) she’s the one who goes out and purchases the product for the teen,” explained Burns.
Burns agreed that the OTC acne treatment category may be down, but sales are up for Zapzyt due to its efficacy.
“The formulas are effective and consumers tell us via email and Facebook that they tried other products but that Zapzyt works and does what it says it will do,” she told Happi. “In this economy, you can’t keep purchasing product after product trying to find one that works.”
But even when OTC acne treatments work, there’s still room for improvement, said Dr. Graber who recommends OTC products be used in combination with topical antibiotics that are prescribed by a dermatologist. Specifically, she recommends a benzoyl peroxide/clindamycin combination that can attack acne from different directions.
She suggests patients use a benzoyl peroxide (<5%) wash once a day with a moisturizer to keep the benzoyl peroxide from drying out the skin. At night, routines vary, but Dr. Graber suggested a glycolic acid-based formula that is less irritating and drying than other treatments. At the same time, she recommended incorporating an OTC vitamin A-based formula to improve acne.
“But if there is no improvement in two or three weeks, consumers should see a dermatologist,” Dr. Graber added.
While she is a fan of OTC acne treatments, she offered a few suggestions to improve formulas such as creating a benzoyl peroxide-based formula that won’t bleach towels and pillowcases, a topical vitamin A formula that doesn’t dry or irritate the skin and even the creation of an OTC zinc supplement, as zinc has been shown to improve acne.
“Skin allergies are a problem, too,” she noted. “Patients think that because they’ve used the same cream or wash for years that they can’t develop an allergy to it.”
Similarly, natural ingredients aren’t always the wonders that marketers and consumers make them out to be.
“The biggest issue that we face is that patients think because they are purchasing an all-natural product that it can’t possibly cause skin problems. Then patients show up in our office with a rash on their face or eyelids.”
As for probiotics, Dr. Graber doesn’t recommend them, and said more studies are necessary. And as for those devices that are flooding the market and creating a billion-dollar business, they have their limits, noted Graber. Although mechanical brushes are good for exfoliating, they haven’t been proven to be effective against acne, according to Dr. Graber, who added that while LED may help a pimple go away a bit faster, it won’t make a blemish vanish in hours.
“OTC products do a good job, but it would be even better if they were less irritating to the skin,” she concluded.
Got an Itch?
Products that irritate the skin can cause temporary itching. Aside from scratching, most folks opt for OTC anti-itch treatments. Sales of these products jumped more than 7% during the past year to over $521 million, according to IRI. Category leader Chattem Inc., which makes such brands as Cortizone 10 and Gold Bond, led the way with sales of $151 million, a sales gain of more than 20% during the past year.
But what about consumers who suffer from debilitating itching? The kind that is resistant to cortisone cream other OTC products?
Now, in the US, tormented consumers can choose between two itching research and treatment centers at Temple University in Philadelphia and Washington University in St. Louis. Why the interest in itching?
“Itch is now where pain was probably 20 years ago,” Dr. Lynn Cornelius, chief of dermatology, Washington University School of Medicine, recently told The New York Times. “It used to be lumped together with pain.”
Washington University researchers discovered a receptor in the spinal chord that was specific to itching. This gastrin-releasing peptide receptor helped prove that pain and itching signals travel different pathways.
Similarly, older people often have an itch on their backs between the shoulder blades—but it’s not dry skin. Those same Washington University researchers discovered that the condition, nostalgia paresthetica, is linked to spine and disk problems.
Clearly, when it comes to itching, researchers have only scratched the surface.
Whether it’s kids suffering from acne, backyard gardeners with a bad case of poison ivy or weekend warriors hampered by muscle soreness—when you’re going through hell, you gotta keep going in today’s economy.
“In the past, if your back hurt you might take a day off from work,” recalled Carroll. “Today, people are showing up at the workplace because that job might not be there when you get back.”
And that’s the kind of pain that no topical formula can soothe.
• The over-the-counter category is heating up—and it’s not because some new capsaicin cream is making its debut. The Food and Drug Administration plans to overhaul the way it approves OTC medical products, a move that will change how tens of thousands of medicines and personal care items reach US store shelves. The move will have a major impact on marketers of pain relievers, sunscreens, antifungal medicines and many other products.
“The current system isn’t working well for the public or for us,” Dr. Janet Woodcock, director of the FDA’s center for drug evaluation, said in an interview with The Wall Street Journal. “We would like monograph drugs to have the same safety framework as prescription drugs.”
Revamping the approval path would have big implications for the over-the-counter medical products industry, which in 2012 recorded $29.3 billion in annual U.S. sales, according to the Consumer Healthcare Products Association. The industry could introduce new forms of products more quickly as researchers discover better ingredients.
The current approval framework was created in 1972 and now needs a complete revision to become a more agile and responsive process, the agency said. The FDA plans to hold a public hearing March 25 and 26 to consider ideas from the public.
“We want to get the word out that we’re looking for creative ideas about how to improve the process,” Dr. Woodcock said.