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OTC Consumer Brand Loyalty Falters in Wake of Branded Recalls, Change in FSA Law, and Recession - Finds Kline
Date:7/24/2012

PARSIPPANY, N.J., July 24, 2012 /PRNewswire/ -- Significant product recalls and the ongoing recession have seen consumer behavior change when it comes to their OTC drug purchases, according to Nonprescription Drugs USA – Consumer Research recently published by global consulting and research firm Kline & Company. Consumers admit to seeking out lower cost nonprescription drug brands either by choosing the least expensive alternative, often private-label or store brand OTCs, or by shopping at value-focused retailers more often.

Since the FDA mandated plant shutdowns, product recalls, and oversight, Johnson & Johnson's market withdrawal from major OTC drug categories has affected purchasing patterns and crimped the company's market share. The vacuum left by the absence of the industry giant's popular brands from the market, including Tylenol, Motrin, Benadryl, and Sudafed, coupled with Novartis' recent Excedrin recall, have left consumers with fewer branded choices, particularly in the pain relief category.

Laura Mahecha, Kline's Healthcare Industry Manager, notes, "The impact and profound magnitude of ongoing economic uncertainty is borne out by more than half of respondents in Kline's survey disclosing that they've changed how they purchase OTC drugs. Specifically, nearly a quarter of those surveyed choose private-label OTC drugs whenever possible because of their perceived cost advantage." Other consumers note they are using coupons and stocking up on OTC drugs when they are on sale, regardless of need, as a result of the recession.

This shift is illustrated by private-label adult acetaminophen enjoying a near 14% sales increase over 2010, as the largest direct beneficiary of Johnson & Johnson's flagship brand Tylenol's being out-of-stock for extended periods in 2010 a
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SOURCE Kline & Company
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