Wellness is the next trillion dollar industry. OTC drug sales lead the way!
November 3, 2016
The consumer health industry is anticipated to have a fast growth within the next few years and companies need to be aware of three (3) major trends, as outlined in a recent McKinsey report:
The consumer market is changing: expect developing economies to dominate in growth of consumer health spending – approximately 70% of over-the-counter (OTC) drug sales growth is expected to come from emerging markets, half of that from Brazil, Russia, India, and China.
Consumer behaviour and attitudes are changing: consumers use the internet to research a broad array of health options – 96% of American adults who use the internet use it to look up health information- and are open to many different health options, including ‘alternative’ medicine – the North American market for alternative medicine is $16.4 billion.
The business landscape is changing: Retailers across all industries are expanding into health and wellness. Direct to consumer products and services are particularly ripe for disruption. A broad range of traditional and non-traditional healthcare players are diversifying their offerings in consumer health.
In Greece, OTC drugs are a special category. Sold, almost exclusively, through pharmacies, although, prescription is not required.
This market has shown important growth over the last five years. Recent legislation promises a more dynamic business environment, where, branding, marketing & advertising tools can be effectively applied. Consumers-patients tend to be well informed and demanding and thus responsive to modern and sophisticated, communication approaches.
Three (3) parameters are the driving forces for the growth of the OTC drugs market in Greece:
Contemporary consumers-patients, following the global trend, practice self-treatment when it comes to minor/mild health conditions. They have more information to take initiatives in this direction, also considering the significant financial benefit, as this choice reduces medical costs.
Pharmacists are under great market pressure due to price reductions and the decrease in the number of prescriptions. In their effort to boost sales, their focus has already shifted towards OTC drugs. Moreover, through the OTC drugs sale, the pharmacist can play an upgraded role, the "scientific advisor" one, often replacing the role of the doctor. This in turn, can potentially strengthen the pharmacist’s relationship with his/her customers.
Pharmaceutical companies make their medicines more accessible to the consumer-patient, through the status change from Rx to OTC, after patent expiration. At the same time, big pharma that invest in research such as Novartis, Pfizer, Sanofi-Aventis, GSK, BI, J&J, Bayer, Pharmaserve-Lilly and several local pharma companies have expanded their OTC drugs portfolio and offer novel & improved products to the public.
Last but not least, the deregulation of the OTC drugs retail prices, effective from 01.01.2017, will rapidly transform the OTC drugs market to a typical consumer market, with its pros & cons. Companies will have to modify strategies & adapt to a new marketing scene, most likely “fast-moving”, vibrant, open and free, however, aggressive and competitive.
The Greek OTC drugs market is definitely heading to Change. Change, if not feared, can be fascinating & fruitful and as Darwin said: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”