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Is an ounce of prevention taking a pound of cure out of the pharmacy?

BY Michael Johnsen

WHAT IT MEANS AND WHY IT’S IMPORTANT — More people had gotten their influenza vaccine by November 2011 than they had by November 2010, according to the Centers for Disease Control and Prevention, and last year’s triumvirate virus was a good match for the predominant flu strains in circulation. All of this leads into the lowest flu season on record, and that begs the question: As more retailers continue to build out their vaccination programs, particularly using the influenza vaccine as a potential gateway to its more comprehensive vaccine offerings, are they sacrificing their cough-cold sales to make that happen?

(THE NEWS: CDC: 2011-2012 influenza season lowest on record. For the full story, click here.)

The answer, in fact, might be yes. "I do think, in fact, that as vaccine coverage increases, we ought to see less disease in the United States," said Joseph Bresee, chief of the epidemiology prevention branch at the CDC’s Influenza Division during a wrap-up with reporters on the 2011-2012 season. "So I think although this season has been mild and the onset has been late and that can’t be attributed solely to vaccine practices, I do think increasing vaccine coverage in the United States will certainly — and probably is certainly — playing a role in less transmission and less disease this year," he said. "Second, what we know, and as I said, the vaccine coverage rates continue to trend upward. That should lead to less transmission over time and less severe disease over time, especially if high-risk people continue to get vaccinated in higher numbers."

The reality is a little more convoluted, of course. Even as flu vaccines expand, those vaccines have no impact on rhinoviruses, which is the cause behind the common cold. And that means, theoretically at least, you can have a low incidence of flu in a season and yet still a high incidence of the common cold.

And even coming out of the lowest flu season on record, trailing 52-week sales of cough-cold remedies were still up in food, drug and mass (without Walmart) some 5% across both liquid and tablet remedies. In liquids, Procter & Gamble’s Vicks Nyquil was up 3.9% to $111.6 million for the 52 weeks ended April 15, while Reckitt Benkiser, which launched Mucinex Fast Max in the past year, realized sales increases of 330.9% to $53.6 million across its Mucinex liquid offerings (data courtesy SymphonyIRI Group).

Those cough-cold remedies also include allergy, more of a year-round ailment, as evidenced by the strong performance of the allergy remedy Allegra that predominated cough-cold tablet sales — up 506.9% to $182.6 million.

But the question remains: Does a stronger position in influenza vaccine at retail mean taking a hit in both pharmaceutical (antibiotics for upper respiratory bacterial infections and antivirals for the flu) and nonprescription upper respiratory remedies? Don’t get us wrong: Flu shots, and vaccinations in general, are important to community pharmacy, both in terms of the public health role and in terms of generating new sources of revenue for pharmacy beyond dispensing. But the OTC sales related to cough-cold remedies is an important part community pharmacy’s present and future, too. Is that ounce of prevention taking a pound of cure out of the pharmacy?

What do you think? Is there some risk in shifting from a sick care to a well care model? Will that change the merchandise mix someday? Post your comments below.

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Has the supercenter format seen its day?

BY Antoinette Alexander

WHAT IT MEANS AND WHY IT’S IMPORTANT — Meijer runs great stores and is a market leader in the areas its serves. Meijer customers love Meijer. But, numbers don’t lie.

(THE NEWS: Meijer celebrates 50th anniversary of supercenter concept. For the full story, click here)

Trips to supercenters are down as consumers afraid to plunk down large sums of cash at once to do big pantry fill shopping trips are trading those trips for more quick trips, and those trips — at least, according to the numbers — are going to drug and dollar stores, and (to a lesser extent) club stores, where the people who aren’t afraid to spend a lot at once are sure they are at least getting the sharpest value.

To underscore this point, SymphonyIRI Group released a report in the second half of 2011, which indicated that cross-channel shopping is alive and well. The report found that, across CPG channels, purchase frequency increased 2% during the past year, with grocery, dollar and club channel trends closely mirroring industry average. Across other channels, though, trends significantly vary. For example, frequency within the drug channel accelerated sharply within the last year, increasing by 6.7%. This growth is being driven by a number of factors, including shifting trip mission trends.

Quick trips, small “need-it-now” excursions with an average basket size of less than $40, have become more common as consumers look to minimize large one-time outlays of cash, reported SymphonyIRI SVP marketing John McIndoe.

Meanwhile, the big-box retailers are experimenting with smaller formats — including Meijer. Target, for example, has developed CityTarget and Walmart has several variations of smaller formats in play, ranging from its Walmart.com test sites in California — which showcase its online merchandise in small stores — to Walmart Express, which is a further downsizing of the supercenter and Neighborhood Market formats.

So, what do you think? Has the supercenter format seen its day? Do retailers need to think small? Post your comments below.

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Target unveils new goals with release of 2011 corporate responsibility report

BY DSN STAFF

MINNEAPOLIS — Target has released its 2011 corporate responsibility report, and while the company was happy to offer insight into its past performance, its focus is on the future. In that vein, the company has introduced new corporate responsibility goals:

  • To increase its sustainable seafood selection by ennsuring its fresh and frozen seafood offerings are 100% sustainable and traceable by the end of fiscal year 2015;

  • Make at least 50% of its own-brand packaging designs more sustainable by 2016;

  • Increase the percentage of team members and their families enrolled in a Target health plan completing diabetes HbA1C testing to 87% by the end of fiscal year 2015; and

  • Improve reading proficiency in the United States by completing school library makeovers, providing grants to past makeover recipients and implementing innovative literacy pilots in two additional school districts.

When Target launched its corporate responsibility goals in 2011, we reinforced our longstanding commitment to creating a brighter future for our team members, our communities, and the world we live in,” Target EVP, general counsel and corporate secretary Tim Baer said. "Target’s corporate responsibility goals foster greater transparency and accountability on initiatives that help put more U.S. children on the path to graduation, reduce our impact on the environment, and help Target team members and their families live healthy, balanced lives."

Click here to read the full report.

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