Claritin

You really can't touch off a conversation about the cough-cold/allergy/sinus category this y ear without talking about the imminent switch of the second-generation, non-sedating antihistamine Claritin (loratadine).

In fact, according to several sources who attended NACDS Marketplace last month, retail buyers already are preparing their cough-cold sets for the day they can slip an OTC version of Schering-Plough's blockbuster allergy drug inline with the rest of the category. Unfortunately, most expect the move will come at the expense of other vendors in the category. One supplier told D Drug Store News that an unnamed national retailer is carving out a space that's 4 feet wide and five shelves high.

Schering-Plough currently has switch applications for all five of its Claritin formulations in front of the Food and Drug Administration. Advisory panels for the FDA last year determined Claritin safe for over-the-counter usage and this year added their support of Claritin as an OTC treatment for chronic idiopathic urticaria (hives of unknown cause). The FDA has targeted Nov. 28 to rule on the Rx-to-OTC switch of loratadine, just as the cold-cough season is moving into full swing, and the prevailing prognosis is that the FDA will approve it.

However, Schering-Plough's OTC loratadine windfall may be short lived. OTC competition in the loratadine field is percolating, as Schering-Plough is still pursuing two patent lawsuits against the consumer health care divisions of both Wyeth and McNeil Consumer Healthcare, a unit of Johnson & Johnson. The two companies have filed separate applications to the FDA for permission to market their own versions of OTC loratadine. The big question is where will that space come from.

Beyond acknowledging the pending litigation against Wyeth and McNeil, Schering-Plough representatives declined to comment on the pending Claritin switch.

The buzz is that Claritin may be the biggest drug to switch since Novartis' Lamisil AT in 1999. Indeed, market research firm Ipsos-NPD randomly sampled 1,000 adults and found that many allergy patients plan to use OTC Claritin when it hits retail shelves. A little more than 4-in-10 said they will buy Claritin when it's available OTC.

Busy season predicted

The Claritin switch is expected to cause some confusion among cough-cold customers as they cross over to the allergy section. However, the actual impact on sales in the category should be nominal, said Gerald Kress, president and chief executive officer of Surveillance Data Inc., which tracks seasonal illness and allergy activity across the United States.

Looking forward to the 2002-2003 cough-cold season, Kress predicted the illness rate to increase 8 percent to 16 percent over last year. "And we are being very conservative," Kress said. This will translate into a sales lift ranging from 4 percent to 8 percent based on illness rates alone, he said.

However, even if this year swings mild in terms of illness rates and sales, the category should still be up versus year-ago results.

In addition, people purchased fewer items because of the economic recession. "They bought [cough-cold], but they bought less; they bought smaller," Kress said.

Further, people traveled less last year. "We think that's one of the reasons disease did not spread as much," he said. With travel approaching normal levels, more people will interact with one another and consequently fuel illness rates.

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COPYRIGHT 2002 Gale Group