Michael Sawicz
Client Director
ACNielsen

Self-medication may be just the ticket to keeping Baby Boomers mobile and productive during their reluctant march toward retirement. A quick review of the most popular categories of over-the-counter (OTC) drugs suggests that Boomers already play a significant role in this trend, contributing to 2003 OTC sales of more than $16 billion, projected to reach almost $20 billion by 2008.

Top OTC sellers include nutritional products, heartburn drugs and pain analgesics, with new product entries such as menopoause testing kits attracting interest. Authorities predict that cholesterol-lowering drugs like Pravachol will be the next category to break through the prescription barrier. Some 15 blockbuster drugs form a queue of proven winners slated to lose patent protection through 2008, with oral contraceptives and statins already under FDA review.

A Popular Option
How popular are OTC drugs? In a word: very. According to Applied Clinical Trials magazine, more than 77% of Americans in a recent survey had treated themselves using OTC medications in the last six months, roughly twice the number who reported seeing a physician during the same period. Causal factors underlying the continued popularity of OTC options include:

• The federal government’s flexible spending programs that financially support OTC alternatives.
• Increased FDA budget allocations to accelerate RX- to-OTC reviews, making more drugs available at retail.
• Heavy sampling and detail activity directed at physicians to encourage OTC recommendations.

Point of View
To date, the pharmaceutical industry has focused primarily on physicians, pharmacies and categories. Consumers got lost in the shuffle. Until now. IMS Health, along with sister VNU companies like ACNielsen, can develop a complete, integrated picture of the impact and interaction between ethical pharmaceuticals and OTC products, including the consumer viewpoint.

Whether the category is food or drugs, success at retail is always dictated by the consumer. Together, IMS and ACNielsen track billions of transactions involving more than a million products from 3,000+ pharmaceutical manufacturers, longitudinally monitor the purchasing behavior of 36,000 individuals and 15,000 households, along with 4,800 stores representing more than 800 retailers in 52 major markets.

Medicating Circumstances
Complicated issues continue to swirl around the Rx-to-OTC process, with consumer advocates expressing concerns about self-medication, including continuity of use and regimen compliance, prescription replacement choices, market reaction to consumer advertising for prescription drugs, and the changing roles of physician and pharmacist with respect to medication options.

Painful Choices
The pain relief category represents an excellent case in point regarding consumer medication choices, which differ with the medical issue. More than three-quarters of consumers use OTC treatments such as Tylenol, Aleve, Bayer aspirin, Excedrin or Motrin to address general pain symptoms. However, when it comes to arthritis pain, only 62% use OTC treatments most often.

A significant percent of the population are “dual users” who seek relief from a combination of prescription and over-the-counter drugs. Among allergy sufferers, 71% rely exclusively on prescription medication, while 29% use both. Among indigestion sufferers, 64% take prescriptions only, while 36% opt for a combination of OTC and Rx remedies [See chart 1].

Leveraging the Lead
Interestingly, sales leadership in the ethical pharmaceutical arena does not necessarily translate to equal dominance in the OTC marketplace. For example, Zantac held a 54% share of Rx digestive sales, but less than a 10 share when the category converted to OTC status. Zantac underperformed competitive brands like Pepcid and Tagamet on the promotional front and paid the price by yielding market share.

Environmental Factors
There’s more to the OTC success story than a triumphant prescription sales history. Sometimes, unanticipated market events can derail an OTC launch. When Merck announced the voluntary withdrawal of its COX-2 entry Vioxx from the global marketplace in September 2004, competitor and consumer response was instant.

Short-term sales experienced losses across the board, as consumers reconsidered their use of pain medication, possibly awaiting an FDA update on safety and usage guidelines. Not unexpectedly, sales declines were most dramatic for brands specifically cited in FDA questioning—Vioxx, Celebrex, Bextra and Naproxen (Aleve).

As the newest, and most expensive, entries in the pain relief category, these brands in large part accounted for dramatic losses in analgesic dollar sales ($4 billion or 19.8% of sales), extended units (22.9 billion or 2.3%) and therapy days (3.7 billion or 8.4%).

The Promotional Response
Sampling activity for plain anti-arthritic treatments almost doubled from 740,000 to 1.35 million, driven in large part by Mobic. Corresponding COX-2 sampling was slashed in half. Activity was highest during the October and November period immediately following the announcement, then returned to normal levels [See chart 2].

During the same period, medical journal advertising for plain anti-arthritic treatments grew by 360%, again led by Mobic in an aggressive bid for the top spot. Mobic’s hard-hitting conversion strategy paid off, almost doubling sales at the expense of Vioxx.

Tylenol bumped up its ad outlay by 52%, spending $74,000 on journal ads. Advil and Aleve made virtually no changes to advertising plans. Other COX-2 offerings cut their professional journal ad schedules by almost three-quarters.

Regarding the third measure of promotional activity, trade support, Tylenol and Advil were the only OTC brands to increase budgets.

Consumer Outreach
In the wake of the Vioxx decision, prescription brands increased direct-to-consumer (DTC) advertising efforts, with Celebrex almost doubling its schedule and Mobic and Bextra undertaking their first brand advertising efforts since the initial product launches. On the OTC front, Advil and Aleve funded significant increases in ad spending, while Tylenol merely maintained ad levels [See chart 3].

The Itch to Switch
While only 18% of consumers 49 years or younger expected to use other COX-2 drugs in the future, scared off by the FDA ruling, fully 44% of older consumers said they would still use a COX-2 for pain relief.

Where did Vioxx customers migrate after the drug was removed from the shelf? More than one-third of users switched to a competitive prescription drug such as Celebrex (12%), Bextra (6%) or Mobic (7%). On a relative increase indexed scale, Mobic benefited the most from switching behavior with an index score of 1,319, compared to an index of 361 for Bextra and 210 for Celebrex [See chart 4].

Another cluster of users swapped out to an OTC brand, including private label pain offerings (8%), Aleve (4%), Tylenol (3%) or Advil (1%). Index switching gains for OTC drugs shows Aleve with a score of 79, Tylenol 62, Private Label 49 and Advil 25.

The overall category contracted by 38.1%, while another 8.2% of consumers simply decided not to treat pain, exiting the category altogether.

Physician Response
Many factors influence physician pain relief prescribing behavior. Chief among them are formulary acceptance, overall efficacy, safety record, risk of cardiovascular event and patient trial/failure rates. Mobic, the winner in the race for category switchers, performed well on all the key attributes valued by doctors [See chart 5].

Physicians attached a special perceived attribute or benefit to each of the Vioxx alternatives. NSAIDs were seen as the best value and lowest overall cost. Celebrex earned high marks for its safety record. Mobic received praise for its tolerability. Bextra was touted for its better
gastrointestinal side effects and overall efficacy.

Healthy Outcomes
Arthritis hurts, and regular pain medications aren’t perceived as strong enough to provide meaningful relief. The proof of that statement resides in the large number of patients over 50 who would continue to use COX-2 drugs—and those who refused to switch from Vioxx—despite the headlines.

Doctor-targeted messaging shifted from efficacy and pain treatment to safety on the heels of the Vioxx withdrawal. One lesson learned by pharmaceutical manufacturers was to keep crisis communications plans current in the event of a negative FDA ruling.

Mobic organized a concerted, multi-pronged promotional campaign to encourage physicians to write scripts, and was handsomely rewarded with a 185% jump in new prescriptions and a 134% hike in total prescriptions.

At the end of the day, it appears that both consumers and physicians are able to sort through the facts about drug complications and develop an individual cost/benefit analysis that balances the patient need for pain relief against efficacy, safety and tolerance issues.

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