Keeping afloat changing preferences
The carbonated soft drink business has had to adapt to shifting consumer preferences. Mark Docherty, VP drug accounts for Dr Pepper Snapple Group, believes there is still plenty of opportunity in carbonated and other beverages categories. He spoke to Drug Store News about how DPSG is meeting new challenges in the market.
Drug Store News: Dr Pepper Snapple Group recently won top honors in the Product of the Year USA awards for Canada Dry Green Tea Ginger Ale and Mott’s for Tots. What consumer needs do you think these innovative products fulfill?
Docherty: Mott’s For Tots and Canada Dry both answer consumer calls for great flavor and functionality in their beverages. Mott’s for Tots was developed in response to doctor recommendations for mothers to dilute juice for their toddlers to cut down the sweetness. We saved Mom the step by pre-diluting Mott’s apple juice with purified water, but the vitamins in each serving are the same as for a full-strength juice. Canada Dry Green Tea has brought the benefits of green tea and antioxidants to a soft drink, showing consumers that they can get functional benefits in a great-tasting carbonated soft drink.
DrSN: Will enhanced beverages become a bigger part of the category? What types of products are we likely to see in the future?
Docherty: As consumers continue to become more health-minded, they continue to look for beverages that fit into their healthy lifestyles. We have been focused not only on offering great-tasting beverages without the calories, but also on innovating new products with added functionality across different segments.
Our enhanced CSDs are helping drive excitement into the category. We see a lot of potential for this segment to continue to grow, based on the success of Canada Dry Green Tea Ginger Ale. We’re introducing a diet version of Canada Dry Green Tea Ginger Ale this year, as well as a new Cherry 7UP with Antioxidant. And outside the CSD category, we’ll continue to build on the success of functional beverages, [such as] Mott’s for Tots, Mott’s Plus for Kids/Mott’s Plus Lite and Snapple Super Premium teas and juices.
DrSN: Flavored carbonated beverages seem to have renewed popularity among consumers. Where is that trend going?
Docherty: Consumers are seeking variety and, as a result, they are gravitating to flavored CSDs, while colas continue to lose share. With a portfolio focused primarily on flavors, we’ve been able to grow our share of the CSD market for four consecutive years. We see that trend continuing to gain momentum going forward.
DrSN: What other segments of the beverage category are expected to grow in this tight economy?
Docherty: We continue to be optimistic about our flavored CSD portfolio, especially as consumers continue to look for value. In addition, as the economy tightened last year, we saw growth in multi-serve juice drinks, [such as] Hawaiian Punch.
Kroger to serve as exclusive supermarket sponsor of Fiesta Atlanta ’09
ATLANTA Kroger will serve as the exclusive supermarket sponsor of Fiesta Atlanta ’09, an outdoor Cinco de Mayo festival celebrating Latino culture, music and food.
Fiesta Atlanta ’09 takes place on Sunday, May 3 at Centennial Olympic Park in downtown Atlanta. For Kroger, the partnership represents the company’s commitment to the Hispanic community.
“We are very excited and looking forward to Fiesta Atlanta,” said Glynn Jenkins, director of communications and public relations for Kroger’s Atlanta Division. “Kroger has always made exceptional efforts to serve the Hispanic community and joining this celebration is another commitment to our Hispanic customers.”
Atlanta’s largest Hispanic outdoor family festival, Fiesta Atlanta attracted over 40,000 attendees last year. This year’s event will once again feature authentic food from many Latin-American countries, arts and crafts, sponsor displays with many free product samples and continuous live musical performances by national and local recording artists.
AARP cites big jump in Rx prices
NEW YORK A report by AARP indicated that prices for branded drugs have increased at a rate outpacing the rate of inflation by more than six percentage points.
The report found that manufacturers’ prices for branded drugs increased by 9% last year, compared with the general inflation rate of 3.8%. Meanwhile, prices of generic drugs decreased, on average, by 10.6%.
Generic drugs have already grown significantly over the years, accounting for 69% of all prescriptions dispensed in the United States, but 16% of money spent on prescriptions, according to IMS Health. In 2007, according to the National Association of Chain Drug Stores, the average price of a generic prescription drug was $34.34, compared to $119.51 for a branded drug.
Price increases for branded drugs significantly higher than the overall rate of inflation, mixed with the recession, are likely to drive more consumers to generics. According to AARP, nearly a quarter of all older Americans skip medication doses because of the cost, while other studies have shown that many Americans facing economic hardship don’t have prescriptions filled at all.
At the same time, many branded pharmaceutical drugs – not to mention biologics – don’t yet have a generic version. This could create difficulties for elderly and other patients who may be able switch to medications that are cheaper, but different from what they take, or who take biologic drugs or newer drugs that have no equivalent on the market.
The Generic Pharmaceutical Association said the report indicated that generic medicines are “the right choice for better health.”
“During these difficult economic times, it is truly disturbing to hear reports that our nation’s seniors cannot afford their prescription drug costs,” GPhA president and CEO Kathleen Jaeger said in a statement responding to the report. “No one should be forced to choose between putting food on their table and paying for needed medicines.”
Jaeger also said the report illustrated the need for a regulatory pathway for biosimilars.
“It’s time to do right by our seniors and all Americans struggling with healthcare costs by approving legislation that brings safe, effective and affordable biogeneric medicines to patients sooner rather than later,” Jaeger said. “GPhA also strongly believes that increasing funding for FDA would ensure the more timely approval of generic medicines, increasing the opportunity for consumers to save immediately.”