J&J OTC products remain MIA until Q4
NEW BRUNSWICK, N.J. — McNeil Consumer’s absence from cough-cold and analgesic aisles, including several pediatric formulations, will extend into the fourth quarter, Johnson and Johnson executives told analysts in January.
While retailers are likely to restore the Tylenol real estate once distribution is back online and McNeil begins supporting the brand again, right now that empty space is ripe for planogram expansion by rival over-the- counter companies. “It’s a mixed bag for [retailers],” Kline Group healthcare analyst Laura Mahecha suggested. “A lot of what J&J lost went to private labels; I’m sure [that] has helped retailers’ margins in a lot of the categories.”
The first hurdle will be restoring consumer confidence in the brand, a campaign that doesn’t look likely until 2012 now. “At the appropriate time, we will be investing in market support for our over-the-counter brands, such as Tylenol, Motrin and many others,” J&J chairman and CEO William Weldon told investors. “And we will be introducing product and packaging innovations for many products, especially for those for young children.”
U.S. sales across J&J’s OTC pharmaceuticals and nutritionals dropped 52.8% over the fourth quarter. The McNeil recalls impacted the fourth-quarter sales by approximately $300 million and total year sales by approximately $900 million, the company reported.
J&J hands over germ protection
Gojo Industries this past fall reacquired its Purell hand-sanitizer brand from Johnson & Johnson and is currently putting the pieces in place to reassume a category leadership role for waterless hand washing.
The endeavor is not without its challenges. Today, hand sanitizers are a highly commoditized category. And though sanitizers certainly benefited from increased awareness associated with last year’s H1N1 pandemic, that awareness didn’t translate into sales; the $100-million-plus category is down 35.4% in 2010, according to SymphonyIRI Group data.
And retailers currently are holding an overabundance of inventory, all of which is expected to soon flood the clearance racks in the dollar store channel as the sanitizers move closer to their expiration dates.
“It’s really about driving household penetration through education and innovation,” said Tim Cleary, who joined Purell Consumer as VP sales this past fall. “There’s great brand-name recognition. Aided is 82%; unaided is 58%,” Cleary said. “But household penetration is only 29%. You’ve got this huge gap there.”
Cleary is looking toward opportunities across the 2011-2012 cough-cold season now and plans to relaunch the brand with new packaging and line extensions in 2012.
CHPA, Congress propose dose of clarity for kids
HUNTINGTON, N.Y. — Concerns over kids’ medicines and proper dosing is still a prominent issue. Children between the ages of 2 years and 12 years are inaccurately dosed up to 73% of the time, according to a report published by the American Medical Association. This increases emergency room visits in two-thirds of the cases.
In January, N.Y. Rep. Steve Israel, D-Huntington, sparked debate over proper pediatric dosing when he announced plans to introduce new legislation to homogenize medicine cups and other dosage devices commonly used to give medicine to children. Israel cited a study published in the December 2010 Journal of the American Medical Association, which found that 99% of medicine cups and dosage devices were flawed, as the impetus behind the bill.
However, the need for such a bill may be moot as the over-the-counter industry is already initiating guidelines that will standardize dosing directions and units of measuring that dose by year’s end.
The Consumer Healthcare Products Association has approved voluntary guidelines, including the uniform use of tables to communicate dosing guidelines as opposed to only text, and the use of milliliters as the preferred unit for dosing with the abbreviation to read “mL.”