The New Switcheroo
Drugs that have recently switched from prescription to OTC status can generate excitement and dollars for the OTC drug category. “Switches help to drive the OTC category to new levels,” explains Lisa Buono, health care expert at Chicago-based market research firm IRI. “They generate growth because they are priced higher than existing products, they often create new categories, and they may attract consumers who have never considered an OTC product to self-treat a condition before.”
“Accessibility is the biggest win for patients when it comes to switched products,” says Dave Wendland, VP of Waukesha, Wis.-based Hamacher Resource Group. “A number of mitigating circumstances, such as high copays or access to a primary care physician, can act as a barrier to prescription products. When a product is switched, patients are able to self-treat with medications that have been proven to be effective.”
The biggest news in the category in 2015 was the switch of GlaxoSmithKline’s (GSK) Flonase Allergy Relief (fluticasone propionate 50 mcg spray). Lately, the allergy category has been a busy one for switched products: Chattanooga, Tenn.-based Chattem, Sanofi’s consumer health care division, launched Nasacort Allergy 24HR Nasal Spray in 2014, and McNeil Consumer Healthcare, in Fort Washington, Pa., is set to launch AstraZeneca’s Rhinocort in the next year. Both of these nasal steroids offer a significant treatment advantage over oral antihistamines, which have long been a source of consumer dissatisfaction.
While the Flonase switch was approved in July 2014, Clifton, N.J.-based GSK wisely waited until February to launch, so as to gain an advantage going into allergy season. “Nasacort had a strong launch and had the market to itself for eight months, so it was important for Flonase to go into the market with guns blazing,” notes Laura Mahecha, industry manager of health care at Parsippany, N.J.-based Kline & Co. “Waiting until February allowed GSK to go full-force. All of their messaging was consistent and they were able to have maximum impact in the market. It will be interesting to see what J&J’s McNeil will do with Rhinocort.”
Category Drivers
The allergy drug launches have had a big impact on the cough/cold and allergy segments of the category.
“Allergy is a big issue in the U.S., and incidence of year-round allergies has skyrocketed,” observes Wendland. “There has been tremendous growth in the allergy segment since the 2011 switch of Allegra. In fact, the upper-respiratory category has been reshaped since Claritin switched in 2002, and cough/cold has been overshadowed by allergy products.”
Wendland adds that a proliferation of products can lead to consumer confusion. “It can be a challenge for consumers to understand the difference between products,” he says. Retailers are using on-shelf education, such as an in-store video on Nasacort, to help consumers make decisions about which product to select.
Retailers have had to make some tough choices in terms of pace allocation, and are sacrificing products to make room for recent switches. “Cough/cold and allergy is a category that has had a high level of consumer dissatisfaction with products, so recently switched products take a particular toll on antihistamines, which have long been market staples,” asserts Mahecha. According to Wendland, retailers are adding space for new entries by reducing the space devoted to cough drops, “making outliers a dot.com-only play” and moving children’s formulas to a pediatric section.
The digestive health segment has also seen significant Rx-to-OTC switch action. The introduction of Pfizer’s switched Nexium 24HR in 2014 was the latest in a stream of proton pump inhibitor (PPI) switches. “The PPIs have really changed that category,” affirms Wendland. “Some of these products are approved for insurance reimbursement, and older, more traditional products have taken a huge hit.”
“When Nexium switched, it was big news,” says IRI’s Buono. “The ‘purple pill’ is so well known that it will be difficult for newer switches to gain traction.” Kline research shows that private label products represent 21 percent of all antacid sales and private label products represent half of all sales in the PPI segment of the category, largely due to the higher price tag of PPI products.
Not all switched products have been able to find an audience, however. Kenilworth, N.J.-based Merck’s Oxytrol for Women transdermal patch for the treatment of overactive bladder, which switched in 2013, has been discontinued. “Sales were disappointing for a first-of-its-kind product like this, but customers may have had a hard time finding the product on store shelves, since it was often positioned near feminine hygiene, and the transdermal patch delivery may not have been optimal for some consumers,” notes Mahecha.
Statins on OTC Horizon?
Upcoming switch candidates will have some hurdles to overcome, even as the FDA adopts a new paradigm for Rx-to-OTC transitions. Citing the large public health impact of the under-treatment of common diseases and conditions in increased cost and suffering, the FDA has launched the Nonprescription Safe Use Regulatory Expansion (NSURE) initiative, which will allow the agency to explore how health care professionals and innovative technologies can contribute to the safe use of drugs in a nonprescription setting. Hypertension and chronic obstructive pulmonary disease (COPD) are two conditions on the FDA’s radar.
“The FDA has sent a letter to the pharma industry stating that it is open to new indications for switches, and the agency is positioned to be less conservative than it has been in the past,” says Mahecha. This could mean that prescription drugs once considered poor candidates for a switch could possibly get a green light.
Rye Brook, N.Y.-based Pfizer will likely seek a switch for the erectile dysfunction (ED) drug Viagra. Because of concerns regarding a dangerous drop in blood pressure that can occur when men with pre-existing heart conditions use the medication, the ability for consumers to self-select must be proved before the FDA will consider a switch. ED can also be a symptom of other serious health conditions, so patients would need to rule out other diseases before using the drugs. Recreational use by consumers who don’t qualify for ED drugs is also a potential problem.
A switch for cholesterol-lowering statin drugs would depend on how patients can be monitored once they begin using the drugs. Kiosks, apps and human interaction in the form of a pharmacist could help get tricky switches the go-ahead from the FDA.
“We know that Pfizer is on record for pursuing a switch of the cholesterol-lowering statin Lipitor,” notes David Spangler, SVP, policy, and general counsel and secretary at the Washington, D.C.-based Consumer Healthcare Products Association (CHPA). “Others have tried and not made it over the finish line before, but if they have the right data, they may get approval.”
“Merck’s Mevacor has been denied a switch three times and Bristol-Myers Squibb’s Pravachol was also denied. High cholesterol is a complex [condition] to manage, but Pfizer is putting a lot of money behind the push for a switch and will likely plan to use technology that wasn’t available when the other switch applications were being considered,” says Mahecha. “If statins are switched, all bets are off as to what other classes of drugs can be switched as well.”
Further Switches Ahead
Other categories likely to see switches are migraine medications and sleep aids. “Sleep issues are almost an epidemic in our culture,” asserts Buono. “Products that don’t represent major safety concerns are likely to see a switch.” Mahecha expects Japanese pharmaceutical company Takeda’s Rozerem to be a likely switch candidate in the sleep aid segment.
“With sleep aids as one of the fastest-growing categories, there are several products likely to be considered for a switch,” agrees Wendland. “The challenge will be to create a totally new section that really addresses sleep aids. I’d like to see a 4-foot section that would include branded and private label products alongside eye masks, ambient music machines and products for restless leg syndrome.”