Alternative pain relievers fuel growth
The lion’s share of the analgesics business may be in internal analgesics — sales of which totaled $3.6 billion, up 1.1% for the 52 weeks ended June 15 across total U.S. multi-outlets, according to IRI — but it’s alternative pain relievers that may represent the growth opportunity.
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Novartis’ Voltaren Gel, an NSAID indicated for the relief of joint pain, already is available over the counter in many countries and may soon be switched in the United States. “Voltaren actually is now one of the top 10 over-the-counter drug brands globally,” Joseph Jiminez, Novartis CEO, told analysts earlier this year. “And it’s also growing double digits. So this is a testament to the fact that we can grow brands in that over-the-counter drug business.” If and when Voltaren does switch, it could potentially contribute to growth of 15% a year for three or four years, suggested one executive in the pain space.
TENS therapy products are expanding the external analgesics category. Omron entered with a TENS therapy product a couple of years ago, but now there are a number of competitors. Chattem is bringing a TENS therapy device to market under its IcyHot banner, featuring IcyHot spokesman Shaquille O’Neal. And Carex Health Brands recently introduced AccuRelief Pain Relief Systems. With more TENS devices to come, the consumer communications around this relatively new therapy will soon reach a fever pitch, driving incremental sales.
Today, sales of external analgesics is up 6.7% to $486.9 million. And with the number of new product introductions being placed on external analgesic shelves, that growth trend may take on a sharper trajectory. “[Topical pain relievers] is really an emergent area in the United States,” noted John Incledon, president and CEO of Hisamitsu America. “There is great value to that shopping [trip].”
Another alternate format: Prestige Brands was one of the first over-the-counter manufacturers to utilize an “energy shot” format to deliver an active OTC ingredient with its Goody’s Headache Relief Shot. “Liquid [also] is trending,” said Leah Mitchell, OTC VP marketing GM Pharmaceuticals. “The shots we have to market toward … the 18- to 34-year-old market. They’re familiar with the format and don’t mind paying the extra price for convenience.
New health economy, patient-centric system yield opportunities for tech providers
As health care in the United States continues to move toward a patient-centric system, new opportunities are opening up for technology providers.
(For the full chain pharmacy section of DSN's Aug. 25 issue, click here.)
According to “Healthcare’s new entrants: Who will be the industry’s Amazon.com?” a report released this spring by the PricewaterhouseCoopers Health Research Institute, the United States’ $2.8 trillion healthcare industry is being upended by “companies attuned to the needs and desires of empowered consumers.”
These emerging players, the report noted, are setting the stage for what researchers call the “New Health Economy” that has the potential to alter how the country ‘s healthcare dollars are spent, and give more companies a piece of the pie.
“These new entrants are poised to shake up the industry, drawing billions of dollars in revenue from traditional healthcare organizations while building lucrative new markets,” a team of PwC analysts wrote in the 20-page report that was released in April.
“Within a decade, health care will feel very different than it does today,” the report said. “The players may be different, with partnerships between new entrants and traditional organizations.”
PwC, which surveyed 1,000 people across the country as part of its research, said that many of the companies that will drive this revolution will be able to provide healthcare providers with cutting-edge technologies that will make delivering patient care more efficient and convenient.
The report stressed that these technology providers are in a particularly good position to play a central role in the New Health Economy. Many of those polled for the study said they are ready to abandon traditional care models for ones that more closely resemble experiences in banking, retail and entertainment. Many of the healthcare services that would be directly affected by these new models are ones that are already being offered in pharmacies and in-store clinics.
“Respondents were presented with a series of familiar medical tests and treatments, from strep throat diagnosis to administration of chemotherapy, in new settings closer to home and often enabled by technology,” the researchers wrote. “About half indicated they were likely to choose these alternatives.”
PwC noted that people between the ages of 35 years and 54 years, and those struggling to cope with rising healthcare costs, were most likely to choose the new possibilities.
Many of the technology companies that will become more central players in providing health care in the future are already staking their claim. PwC said that 38 of the Fortune 50 companies with a major stake in health care, 24 are new entrants, with eight of them being technology and telecommunications firms.
Armed with consumer prowess, brand recognition and digital savvy, these companies already have begun making forays into health care. Many of them have centered their efforts on mobile technologies, something the report said will be a centerpiece of the New Health Economy.
Earlier this year, for example, Samsung included a built-in heart-rate monitor in its new Galaxy S5 smartphone. That comes on the heels of Apple being given a patent last year for a “seamlessly embedded heart-rate monitor” for such devices as its iPhone.
Meanwhile, AT&T, Time Warner Cable Business Class and Google have formed spinoff companies or entered into joint ventures with established healthcare providers, melding traditional services with new technologies to make health care more convenient for consumers.
“These players arrive on the health scene with strong consumer credentials,” the PwC report noted. “Many have deep relationships with millions of customers and rich databases of information on them.”
The researchers said that as the possibilities of these new ventures become apparent and they find their way into everyday use, investors are becoming more willing to back further game-changing technologies.
“At a time when venture capital investment in life sciences is down, money is pouring into start-ups targeting digital health, price transparency, workflow and electronic medical records systems and population health management,” PwC said. “In some cases, these companies are looking for a piece of the $2.8 trillion pie. In others, they hope to entice customers to other parts of their business with quality health care.”
The newest entrants into the healthcare arena are creating new markets and making inroads to controlling costs, the report said.
“[They are] helping customers make wise, cost-effective health choices.” the authors wrote. “And with the array of mobile apps, online e-docs, neighborhood retail clinics, urgent care clinics, primary care doctors and hospital emergency departments, the appetite for smart customer guidance will grow.”
Backlog of generic drug applications at FDA
Despite creating a detailed plan to speed up the rate at which generic drug applications are reviewed, experts say a backlog has developed at the Food and Drug Administration’s Office of Generic Drugs.
(For the full chain pharmacy section of DSN's Aug. 25 issue, click here.)
“They are buried,” Robert Pollock, a former acting deputy director of the OGD, told the Wall Street Journal earlier this month.
“They are on track to receive more than 1,500 [applications] this fiscal year,” he said. “The estimates were for between 800 and 850 applications, and the funding was based on assumptions of a workload that were far below what they are seeing. I believe that OGD needs to change the way it reviews applications.”
Pollock, who is now with Lachman Consultants, where he advises generic drug makers on regulatory issues, said the FDA needs to find ways to boost staffing even as it faces budgetary constraints.
Two years ago, the agency was authorized to start collecting fees from generic drug makers in order to increase the number of facility inspections — especially those overseas — and speed up application reviews in order to ensure safety and bring new generics to market faster.
This summer, however, the FDA has seen an unexpected number of applications that have not been processed. Regulators say the situation was created partly by a deadline for submitting applications that reflected required changes in testing medicines.
However, some in the industry contend that the backlog is due to a more fundamental problem, as the FDA struggles to deal with a growing amount of paperwork.
Pollack said he feels OGD’s problems could worsen if the number of applications from companies based in China starts to accelerate. Any further slowdown in approvals, he said, could result in generic drug makers and the FDA sparring over the next round of fees that are used to fund the program.
The number of generic drugs approved by the FDA has been relatively stable over the past few years. In fiscal 2010, the agency approved 426 medicines. A year later, the total hit 458, and the number of approval topped out at 517 in fiscal 2012. Last year, the FDA approved 330 generics.
The number of applications received, however, has not kept pace with the approval rate. The FDA said that in the current fiscal year, it already has received 1,440 approval requests, including 600 in July alone.
While not causing any disruptions in the market so far, some have suggested that further approval delays could adversely impact efforts to control healthcare spending.
According to the IMS Institute for Healthcare Informatics, 86% of all prescriptions in the United States last year were for generics.