Internal analgesics:
Where even small changes are meaningful

The Hamacher Resource Group provided the information for this article. The Milwaukee company provides marketing services and business intelligence to the healthcare industry. Wholesalers, manufacturers, and retailers partner with Hamacher Resource Group to improve their profitability. For more information, visit www.hamacher.com.

The internal analgesics market grew 2.6% in 2000, and analysts at D.P. Hamacher & Associates (DPH&A) believe that four factors are shaping this growth: The number of people with arthritis is increasing; The Food & Drug Administration approved migraine-relief claims of some existing over-the-counter analgesics; people are purchasing new product forms; and many consumers prefer private-label products.

The arthritis market

Demographics. As the population ages, the number of people battling the aches and pains of arthritis grows. Analysts expect the numbers to increase from the current 43 million to 60 million by the year 2020. Moreover, roughly 45% of current arthritis sufferers say they rely on an OTC product to manage their pain. Sales of arthritis products have risen 17%. In fact, arthritis products have expanded their share of the total internal analgesics category from 2.3% to 4.4%. The category’s growth–2.6%–was modest by comparison.

Outlook. The question is will this subcategory continue to grow? The answer: Only 45% of those suffering the discomfort of arthritis now use OTC products. The subcategory has plenty of growth potential.

Shift from relief to management. Consumers are shifting their interest from remedies that promise pain relief to those that promise to manage pain. Specifically, the focus is on the dietary supplements, glucosamine sulfate and glucosamine/chondroitin. Both supplements are producing double-digit sales gains in the dietary supplement category. The success of glucosamine products has been so great that the two largest analgesics manufacturers, McNeil and Whitehall, have developed their own supplements.

Merchandising shift. What’s more, these two companies are bucking traditional shelf placement, abandoning the dietary supplement shelves for life in the fast lane, seeking placement in the internal analgesics aisle. Our analysts block these products with their parent brands. McNeil’s Aflexa is merchandised with Tylenol, and Whitehall’s Flexagen occupies shelf space with Advil.

Name change. Here’s proof of the strength of the arthritis segment. Tylenol Extended Relief changed its name to Tylenol Arthritis Caplets and, in so doing, jumped from No. 105 to No. 6 in DPH&A’s rankings.

Migraine relief

An estimated 23 million Americans suffer from migraine headaches. Symptoms include a throbbing head, nausea, vision impairment, aura or flashing light, and sensitivity to light and sound. Hormonal changes, stress, alcohol, caffeine, lack of sleep, or missed meals can trigger migraines. Roughly 17.2 million women experience migraine headaches, while fewer men–5.8 million–undergo the same misery.

New FDA-approved indications have enabled manufacturers to enter products into the migraine pain market that are the same as the companies’ already-existing general analgesics. Advil, Excedrin, and Motrin donned new names and packaging mandated by the FDA to include migraine-specific directions and indications. With 15 million Americans choosing self-medication over outpatient care for migraines, manufacturers believe this new subcategory will produce $148 million in sales in its first year. Since 1998, when the first product of its kind, Excedrin Migraine, was introduced, sales have steadily increased. New geltab forms were released in September.

New forms

Of the 26 new internal analgesics introduced in 2001, seven were liqui-gels, gelcaps, or geltabs. The number underscores the increasing popularity of easy-to-swallow medications that dissolve quickly and provide faster relief. Tylenol Extra Strength Gelcap 50s and 100s both rank in the top 10 of DPH&A's analgesics category. Although caplets are still very strong sellers, gel forms are gaining ground.

Private label

Private-label products account for nearly 22% of the category’s dollar sales and 29% of unit sales. That’s 4% more than the top brand. Some cases in point: Private label now generates 32% of ibuprofen sales, 22% of aspirin volume, and 17% of acetaminophen sales. This trend is shored up by the rising cost of medications. To help patients economize, physicians recommend private-label and generic versions of popular brands.

How to merchandise

According to DPH&A analysts both large sizes and small sizes are selling well. Therefore, if you have to cut sizes to keep a good selection of forms, cut middle sizes first. Also, stock a variety of arthritis- and migraine-specific products. Make sure that private labels are getting their fair share on your shelves. Double facings of the top sellers will help build incremental sales–and produce bigger margins than brands.

The category has grown "only" 2.6%, yet what seems like a puny percentage translates into $76 million in such a huge category. If you want to succeed in this dynamic category, keep a well-organized department with a wide variety of specialty items and private-label products.

ADULT INTERNAL ANALGESICS CATEGORY SUMMARY

ADULT INTERNAL ANALGESICS NEW ITEMS

INTERNAL ANALGESICS NEVER-OUT LIST

Use this never-out list to monitor your in-stock condition. The items listed account for more than 50% of the dollar sales in the adult internal analgesics department. An out-of-stock on any of these items represents a significant loss of sales.

____ Advil Caplet 24

____ Advil Caplet 50

____ Advil Gelcap 24

____ Advil Liquigel 20

____ Advil Tablet 24

____ Advil Tablet 50

____ Advil Tablet 100

____ Aleve Caplet 24

____ Aleve Caplet 50

____ Aleve Tablet 24

____ Azo Standard Tablet 30

____ Bayer Aspirin Chewable Cherry 36

____ Bayer Aspirin Chewable Orange 36

____ Bayer Aspirin Low Regimen Tablet 120

____ Bayer Aspirin Tablet 24

____ Bayer Aspirin Tablet 50

____ Bayer Aspirin Tablet 100

____ Doan’s Extra Strength Caplet 24

____ Ecotrin Regular Strength Tablet 100

____ Excedrin Migraine Caplet 24

____ Excedrin Migraine Tablet 24

____ Motrin IB Caplet 24

____ Tylenol Arthritis Caplet 24

____ Tylenol Arthritis Caplet 50

____ Tylenol Arthritis Caplet 100

____ Tylenol Extra Strength Caplet 24

____ Tylenol Extra Strength Caplet 50

____ Tylenol Extra Strength Caplet 100

____ Tylenol Extra Strength Gelcap 24

____ Tylenol Extra Strength Gelcap 50

____ Tylenol Extra Strength Gelcap 100

____ Tylenol Extra Strength Geltab 24

____ Tylenol Extra Strength Geltab 50

____ Tylenol Extra Strength Geltab 100

____ Tylenol Extra Strength Tablet 30

____ Tylenol PM Extra Strength Caplet 24

____ Tylenol PM Extra Strength Gelcap 24

____ Tylenol PM Extra Strength Geltab 24

ADULT INTERNAL ANALGESICS COMPETITIVE SHOP LIST

This list includes the most popular and price-sensitive SKUs in the adult internal analgesics department. Use it to see if your prices on these key items fall within the average everyday retail range.

Sandra Levy. Internal analgesics: Where even small changes are meaningful.

Drug Topics

2002;6.