CHPA conference highlights need for new avenues
The 2018 CHPA Annual Executive Conference, held last week at Turnberry Island north of Miami made news, provided the OTC industry with actionable insight, reorganized leadership, expanded its scope and honored one of its own. On the content side, the conference focused on the how to leverage disruption for innovation and growth.
There was a strong recurring theme throughout the conference; the OTC industry truly needs new growth avenues.
One of the staple industry presentations, IRI’s Changing Competitive and Retail Landscape, clearly showed slower growth and industry disrupters. The U.S. OTC industry reached $44 billion in revenues in 2017 (compared to the Rx market of $451Bn.) but recorded an anemic 5-year low 2.4% growth even with the strong flu season’s tailwinds. Even perhaps more surprising, U.S. OTC market growth outpaced Rx growth which came in at a recent low of 1.2%. Several ongoing growth trends — store-brand products, lack of major Rx-to-OTC switches and fewer innovative new products—all contributed. Meanwhile, brand owners had to continue to adjust to other unrelenting challenges, with drug chains visits dropping 6% and e-commerce’s share, now at 17% of consumer healthcare sales led by VMS and Weight Management, increasing. If the huge U.S. flu season impacting 10-12% of the country or over twice the 2016 rate hadn’t occurred, 2017 would have been a tough year for most conference attendees.
IRI did provide a roadmap for growth or at least focus areas. The overall trends point towards three core consumer groups providing growth potential: millennials, Boomers and Hispanics. And the go-to-market norms will be further disrupted by the continued growth of “click and collect” and the refinement of voice activation purchasing.
Within the CHPA vision and mission, CEO Scott Melville outlined several new CHPA initiatives and a new organizational structure. Notably, the trade group will now welcome non-Rx Medical Devices while reorganizing into three councils covering OTC Drugs, Supplements and now, Medical Devices. On the ongoing meeting front, the general Marketplace Exchange will be transitioned into two focused meetings: Marketing and Supply Chain.
Meanwhile, the industry’s long-desired Monograph Reform does seem to be gaining some traction in a difficult political environment. In a CHPA leadership discussion, Barbara Kochanowski, CHPA’s senior vice president of regulatory and scientific affairs, was quite positive about Food and Drug Administration commissioner Scott Gottlieb’s openness with the Policy Roadmap initiative providing clearer rules and a publicly available dashboard for tracking FDA progress on various issues. CHPA also is supporting a return for OTC eligibility within health savings accounts while continuing the industry’s long-standing consumer communication goals of safe usage, storage and disposal of OTCs.
CHPA also saw a changing-of-the-guard with the election of the CEO of Clarion Brands, Gary R. Downing replacing Jeffrey Needham, Perrigo executive vice president and president of U.S. consumer healthcare. Clarion is a Swander Pace Capital company and Downing brings 30+ years of domestic and international OTC experience. Lastly, the CHPA’s highest honor, the Ivan Combe Award was bestowed on John Hendrickson, the retiring CEO of Perrigo.
Ed Rowland is a Drug Store News Contributing Editor covering global issues. As the principal of Rowland Global LLC (www.rowland-global.com) he believes in the promise of global business and supports companies in their strategy, tactics and execution of international growth initiatives.
Dr. Reddy’s launches private label version of allergy remedy Xyzal
Princeton, N.J.-based Dr. Reddy’s Laboratories last week launched levocetirizine dihydrochloride tablets USP, 5 mg, an over-the-counter therapeutic equivalent private label version of Sanofi Consumer Health’s Xyzal Allergy 24HR Tablets in the United States market as approved by the U.S. Food and Drug Administration.
“This first-to-market launch for the store brand is the testament to the deep capabilities of our store brand OTC business,” Milan Kalawadia, vice president and head, U.S. OTC and speciality Rx businesses, Dr. Reddy’s Laboratories, said. “We look forward to collaborating with our customers to bring high-quality, affordable store brand alternatives to the market.”
The Xyzal generic equivalent is an over-the-counter antihistamine used for 24-hour relief of allergy symptoms such as watery eyes, runny nose, itching eyes/nose, and sneezing. The branded Xyzal Allergy 24HR Tablets had U.S. sales of approximately $71 million for the most recent 12 months ending in January 2018 according to IRI, Dr. Reddy’s reported.
iHEAR Medical, Atlazo pair on hearables product development
iHEAR Medical, a provider of direct-to-consumer and OTC hearing solutions, on Tuesday partnered with Atlazo to develop an advanced digital hardware platform to power iHEAR’s next generation of hearing aids and hearables. The ultra-low power System on Chip platform will offer machine learning, analytics, connectivity and integrated power management capabilities enabling unprecedented energy efficiency, size reduction and cost savings.
The digital hardware platform is designed to power a new Hearing of Things standard offering real-time health tracking, voice commands and seamless connectivity to other smart devices, including mobile phones and home appliances.
“iHEAR’s technology and IP will expand the hearing aid market and lead the emerging hearables market,” John Luna, COO of San Leandro, Calif.-based iHEAR. “The collaboration with Atlazo and the HoT standard will accelerate the growth of hearables devices market expected to reach $23 billion by 2023.”
The Hearing of Things operating system intends to shift personal computing and devices from reliance on traditional visual displays to the auditory domain, offering direct communications into the ear with complete privacy and reduced distraction. Consumers will be able to selectively listen to and send communications to their social media and text messages using hearing devices instead of their cell phone or computer, eliminating the need to be tethered to traditional computing devices for sending and receiving information.
“Consumers will not only benefit from improved hearing in challenging listening situations, but also from more natural interactions with smart devices compared to traditional methods of visual and touch-based user interfaces,” Adnan Shennib, CEO of iHEAR Medical, said.
The new HoT standard will offer bi-directional wireless connectivity to everyday devices, from mobile phones to home appliances. Hearing devices powered by HoT OS will streamline the user experience for mobile phone functionality, including phone calling and control of home appliances, with a voice user interface. In addition, HoT devices will monitor and relay personal and health information into the ear privately and discreetly. iHEAR Medical and Atlazo have 19 pending and issued patents for the HoT standard, targeting smart hearing devices.
Atlazo will design and manufacture the highly integrated single-chip hardware. “We are pleased to join forces with iHEAR Medical to develop intelligent ultra-lower power SoC solutions for hearing aids and hearables, leveraging iHEAR’s extensive domain experience in hearing health,” Karim Arabi, CEO Atlazo, said. “We see our collaboration with iHEAR as a first step towards entering the broader market of consumer health and fitness to enable connected digital health.”
The World Health Organization estimates 5% of the world’s population, or approximately 360 million people, suffer from a disabling level of hearing loss. While 95% of those with hearing loss can be readily treated with a hearing aid, less than 10% of them use one. Hearing loss has become increasingly prevalent in the U.S., and is now the third most common health problem after heart disease and arthritis. With the average cost of hearing aids reaching $5,000 for a pair, only 14% of Americans with hearing loss currently own a hearing aid due to excessive cost and limited access to hearing care.