Chapter 2: Why Switch? Evaluating the Value of Switch Candidates
20
US retail sales of $133.3 million.24 The switch of
Mucinex provided extended-release benefits for
the expectorant guaifenesin. Prior to the switch,
there were multiple extended-release guaifenesin
products available as unapproved (desi) prescrip-
tion products. Over time, the OTC brand has
been extended with both NDA extended-release
and OTC monograph products total US retail
Mucinex brand sales today are $899.7 million.25
Imodium provided the benefit of rapid resolution
of diarrhea. Sales of Imodium as a prescription
product were not very strong because most
patients experienced relief of symptoms before
speaking with a healthcare provider. As an OTC
product, US retail sales of Imodium are now
$148.3 million.26
Appropriate media spending is a critical part
of building switch awareness business plans that
have failed to consider this key point have been
unsuccessful. Table 2-8 provides Year 1 and Year
2 media spends for certain Rx-to-OTC switches
and their resulting Year 1 retail sales.
The long-term success of Rx-to-OTC
switches require heavy, continued spending.
Generating awareness and garnering share-of-
voice often requires first year spending of $50
million to $100 million, and/or 50% of 100%
of first year sales. Brands that have underspent
at this critical time in their lifecycle, including
Oxytrol, have failed commercially. Brands that
have cut back on spending too quickly, such as
Prevacid, have also suffered. Ideally, spending for
the switch should begin pre-launch to generate
excitement and awareness.
While this high level of spending is not
typical for prescription brands, which tend to be
more profitable but whose sales diminish greatly
upon patent expiration, OTC brands that are
well-maintained, while less profitable, can live
into perpetuity, e.g., Advil, which was initially
switched to OTC in 1984 and today has US
retail sales of $674.4 million, or Claritin, which
was switched in 2002 and today has US retail
sales of $530.2 million.27
Adequate spending is important for the
long-term health of brands. Pepcid, part of a
joint venture between Merck and J&J, was the
first H2 antagonist approved in the US in 1995,
followed quickly by Tagamet and Zantac within
the same year. Pepcid initially secured the mar-
ket-leading position. When J&J acquired Pfizer
Consumer Healthcare (which marketed Zantac)
in 2006, the Federal Trade Commission (FTC)
required the divestiture of either brand for
antitrust reasons. While Pepcid was the market
leader, FTC noted in their analysis that the two
Table 2-8. Reported Media Spends and Year 1 US Retail Sales for Certain Recent Rx-to-OTC Switch
Brands
Estimated Year 1 Sales (in millions)a,b Media Spend (in Millions)
Year 1 Year 2 Brand
$116 $93 Zyrtec
$96 $109 Claritin
$68 $105 Prilosec
$134 $91 Allegra
$60 $66 Nexium
$118 $67 Alli
$87 $43 Prevacid
$70 n/a Nasacort
$29 n/a Oxytrol
a. Data courtesy Symphony IRI.
b. Recent OTC Innovation: Observations and Implications for Future Growth. IRI and Kline and Company website.
https://klinegroup.com/articles/recent-otc-innovation-observations-and-implications-for-future-growth/. Accessed
6 July 2021.
20
US retail sales of $133.3 million.24 The switch of
Mucinex provided extended-release benefits for
the expectorant guaifenesin. Prior to the switch,
there were multiple extended-release guaifenesin
products available as unapproved (desi) prescrip-
tion products. Over time, the OTC brand has
been extended with both NDA extended-release
and OTC monograph products total US retail
Mucinex brand sales today are $899.7 million.25
Imodium provided the benefit of rapid resolution
of diarrhea. Sales of Imodium as a prescription
product were not very strong because most
patients experienced relief of symptoms before
speaking with a healthcare provider. As an OTC
product, US retail sales of Imodium are now
$148.3 million.26
Appropriate media spending is a critical part
of building switch awareness business plans that
have failed to consider this key point have been
unsuccessful. Table 2-8 provides Year 1 and Year
2 media spends for certain Rx-to-OTC switches
and their resulting Year 1 retail sales.
The long-term success of Rx-to-OTC
switches require heavy, continued spending.
Generating awareness and garnering share-of-
voice often requires first year spending of $50
million to $100 million, and/or 50% of 100%
of first year sales. Brands that have underspent
at this critical time in their lifecycle, including
Oxytrol, have failed commercially. Brands that
have cut back on spending too quickly, such as
Prevacid, have also suffered. Ideally, spending for
the switch should begin pre-launch to generate
excitement and awareness.
While this high level of spending is not
typical for prescription brands, which tend to be
more profitable but whose sales diminish greatly
upon patent expiration, OTC brands that are
well-maintained, while less profitable, can live
into perpetuity, e.g., Advil, which was initially
switched to OTC in 1984 and today has US
retail sales of $674.4 million, or Claritin, which
was switched in 2002 and today has US retail
sales of $530.2 million.27
Adequate spending is important for the
long-term health of brands. Pepcid, part of a
joint venture between Merck and J&J, was the
first H2 antagonist approved in the US in 1995,
followed quickly by Tagamet and Zantac within
the same year. Pepcid initially secured the mar-
ket-leading position. When J&J acquired Pfizer
Consumer Healthcare (which marketed Zantac)
in 2006, the Federal Trade Commission (FTC)
required the divestiture of either brand for
antitrust reasons. While Pepcid was the market
leader, FTC noted in their analysis that the two
Table 2-8. Reported Media Spends and Year 1 US Retail Sales for Certain Recent Rx-to-OTC Switch
Brands
Estimated Year 1 Sales (in millions)a,b Media Spend (in Millions)
Year 1 Year 2 Brand
$116 $93 Zyrtec
$96 $109 Claritin
$68 $105 Prilosec
$134 $91 Allegra
$60 $66 Nexium
$118 $67 Alli
$87 $43 Prevacid
$70 n/a Nasacort
$29 n/a Oxytrol
a. Data courtesy Symphony IRI.
b. Recent OTC Innovation: Observations and Implications for Future Growth. IRI and Kline and Company website.
https://klinegroup.com/articles/recent-otc-innovation-observations-and-implications-for-future-growth/. Accessed
6 July 2021.