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Cough-cold category preps for presumably weak season

BY Michael Johnsen

There are three factors that will help shape the upcoming cough-cold season: supply chain, illness rates and regulatory climate.

First, there is the supply chain. Before last year, retailers had been drawing back on their initial stock buys for cough-cold supplies on account of a number of consecutive soft seasons, bringing supply much more in line with demand. Last year, the H1N1 scare caused many retailers to heavily buy early in the season. According to suppliers, many retailers were carrying approximately five additional weeks of inventory at the beginning of 2010 as compared to late January and early February 2009. Retailers began curtailing their cough-cold buys in December in anticipation of selling through inventory to historical levels by the end of the season.

However, the second half of the 2009-2010 cough-cold season never actually materialized. And without an H1N1 pandemic this year, cough-and-cold medicines will be going up against high sales hurdles over the first half of the season, and relatively weak comparable cough-cold sales over the second half.

Illness rates, the second factor, may continue to drop, thanks in part to an increase in cold-flu prevention awareness. Last year, the fear behind H1N1 may have resulted in a significant uptick in sales of cough-and-cold medicines, at least at the start of the season, but it also drove a significant amount of prevention awareness. In his public appearances around H1N1, CDC director Thomas Frieden emphasized the importance of having a sanitizer on hand. Sales of hand sanitizers since have been up significantly and may have even earned a permanent placement within future cough-cold planograms—or at least seasonal endcaps, as evidenced last year by the number of retailers who dedicated entire endcaps to sanitizers. A Target store in central Pennsylvania already has gotten a head start in this regard; an endcap of nothing but Germ-X hand sanitizer faced directly opposite the pharmacy pick-up counter in late July.

And projections for 2010-2011 illness rates suggested there will be relatively little change overall as compared to last year. “The recent indication from [Surveillance Data Inc.’s] FAN: They are predicting that [illness rates] will be the same level as this past year,” said Matrixx president and CEO Bill Hemelt during a recent conference call. “So that assumes a relatively weak season [for 2010-2011].”

Cough drop sales

*Only vendor level data was available from SymphonyIRI Group; brands identified represent a leading brand for that vendor† In millions; do not represent brand sales Source: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
VENDOR (BRAND)* SALES† %CHANGE VS. LAST YEAR
Cadbury Adams (Halls) $165.9 -2.0%
Private label 72.5 3.8
Ricola (Ricola) 68.8 14.9
Quigley (Cold-Eeze) 21.4 -14.1
Blacksmith Brands (Luden’s) 19.7 -0.1
TOTAL COUGH DROP SALES $399.9 0.4%

Cough-cold/allergy liquid sales

*In millionsSource: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
BRAND SALES* %CHANGE VS. LAST YEAR
Private label $155.2 10.9%
Vicks Nyquil 88.9 4.4
Children’s Tylenol 34.7 -15.4
Theraflu 32.1 13.3
Benadryl 30.9 0.4
TOTAL LIQUID SALES $605.7 0.1%

Chest rub sales

*In millionsSource: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
BRAND SALES* %CHANGE VS. LAST YEAR
Vicks Vaporub $37.0 -7.0%
Private label 11.2 4.1
Vicks Baby Rub 6.1 -3.2
Mentholatum 3.4 -12.8
Theraflu Vapor Patch 1.7 -21.7
TOTAL CHEST RUB SALES $60.2 -6.1%

Hand sanitizer sales

*In millionsSource: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
BRAND SALES* %CHANGE VS. LAST YEAR
Private label $77.4 40.9%
Purell 30.7 -12.8
Germ-X 11.8 85.1
Gold Bond 4.7 NA
Dial 3.9 335.8
TOTAL HAND SANITIZER SALES $148.7 33.9%

Cough syrup sales

*Only vendor level data was available from SymphonyIRI Group; brands identified represent a leading brand for that vendor† In millions; do not represent brand sales Source: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
VENDOR (BRAND)* SALES† %CHG VS. LAST YEAR
Reckitt Benckiser (Delsym) $88.0 13.9%
Pfizer Consumer (Robitussin) 84.9 -4.8
Private label 77.2 9.3
Procter & Gamble (Vicks Dayquil/Nyquil) 42.1 6.4
Novartis Consumer (Triaminic) 6.3 69.3
TOTAL COUGH SYRUP SALES $316.4 6.7%

Cough-cold/allergy tablet sales

*In millionsSource: SymphonyIRI Group for the 52 weeks ended June 13 across food, drug and mass (excluding Walmart)
BRAND SALES* %CHANGE VS. LAST YEAR
Private label $729.6 13.1%
Zyrtec 223.4 -2.8
Claritin 160.3 6.5
Mucinex 142.9 -3.2
Mucinex DM 141.2 6.5
TOTAL TABLET SALES $2,630.6 3.6%

On the regulatory front, last year Matrixx had to contend with a springtime product recall. This year, it’s McNeil Consumer Healthcare that has had to initiate a number of voluntary recalls, as well as close a manufacturing plant. McNeil has suggested supply won’t be up to normal levels until the first half of 2011. “We do not anticipate having alternate sources of supply before the end of 2010 for most of the products that were produced at [the Fort Washington, Pa.,] site,” Louise Mehrotra, Johnson & Johnson VP investor relations, told analysts in July. “Alternate supply of the remainder of these products is projected to start in the first quarter of 2011 and continue to expand throughout the year.”

Currently, store-brand equivalents of those recalled products are benefiting in their absence, Joe Papa, Perrigo president, CEO and chairman, suggested to analysts in June. “Prior to the Tylenol recall, the average share for Perrigo—or for store-brand acetaminophen—was somewhere in the 38% [range],” he said, with regard to the analgesics category. Since the recall, store-brand equivalents to Tylenol have gone up to about 47.9% share, “or about a 9.7 share point gain since some of the problems that have occurred with Tylenol,” Papa said.

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BioMarin Pharmaceutical acquires ZyStor Therapeutics

BY Alaric DeArment

NOVATO, Calif. BioMarin Pharmaceutical has acquired privately owned biotechnology company ZyStor Therapeutics for $22 million, BioMarin said.

The drug maker said it also would pay ZyStor up to $93 million in milestone payments. The main gem in the deal was ZC-701, ZyStor’s investigative treatment for the lysosomal storage disorder Pompe disease and a potential competitor to Genzyme Corp.’s Pompe disease treatment Myozyme (alglucosidase alfa). A phase 1/2 clinical study of ZC-701 in late-onset Pompe disease is expected to begin in first quarter 2011.

“The acquisition of ZyStor gives us the opportunity to introduce a superior product to fulfill an unmet medical need and is a perfect fit in our core business,” BioMarin CEO Jean-Jacques Bienaime stated. “It not only provides us with a promising product candidate for Pompe disease, but also an exciting new platform technology.”

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Nurse practitioners are vital to a healthy U.S. healthcare system

BY Antoinette Alexander

WHAT IT MEANS AND WHY IT’S IMPORTANT The USA Today article highlighting nurse-managed centers as one “innovative” program that could help fill the primary care physician void is important because it underscores the important role that nurse practitioners play in delivering quality healthcare services.

(THE NEWS: Nurse-managed centers may fill primary care physician void. For the full story, click here)

It is no secret that the healthcare system has been, and will continue to be, under great strain as healthcare costs soar and a shortage of primary care doctors largely contributes to the bottle-necking taking place within emergency rooms.

According to numbers provided by the Convenient Care Association, as few as 2% of medical students coming out of U.S. medical schools intend to pursue a career in general primary care. Also, between 30% and 60% of convenient care clinic patients reported not having a primary care physician. Plus, as many as 40% of convenient care clinic patients said they would have sought costlier care or would have foregone care completely if there had not been a convenient care clinic available.

Clearly, there’s a gap that needs to be filled, and convenient care clinics and such clinics as the Family Practice and Counseling Network in Philadelphia highlighted in the USA Today article, are striving to help fill that gap.

The good news is that the importance of nurse practitioners, as well as the retail-based clinic setting, is not going unnoticed. In fact, Senators Dan Inouye, D-Hawaii, and Thad Cochran, D-Miss., in July introduced the Senate resolution officially designating Aug. 2 to 8, 2010, as National Convenient Care Clinic Week.

Now, with about 30 million uninsured gaining healthcare coverage under healthcare reform and patients making fewer physician visits, either because they can’t afford it or can’t get an appointment in a timely fashion, the U.S. healthcare systems needs “innovative” programs and needs nurse practitioners.

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