New formulations, ingredients heat up external analgesics sales

Drug Store News, July 6, 1998 by Tina Kyriakos

However, the fact that sales of external analgesics reached only about $175 million wholesale and just more than $220 million at retail this year is hardly indicative of the category's potential or importance to pharmacies. Not only are external pain relievers growing faster than many other product groups, including the $2.5 billion internal analgesics market (which dipped by almost 2 percent for the year ended Dec. 26, 1997, according to Information Resources Inc.), but there are some industry projections that by the year 2001 their worth will almost double to about $350 million.

For drug chains, this is good news. Not only did they post a 5.3 percent gain to $78 million last year, but combined with independent stores, they continue to edge out other competitors with about 53 percent market share, or $122 million in sales. The down side is that mass merchants are quickly gaining ground with a reported increase of 15 percent, which pushes their total share to 26 percent on sales of $57 million. The food channel saw more lackluster results, showing sales at $57 million and a gain of 5 percent, pushing total share up to 20 percent. By contrast, the drug store trade class, while holding the lion's share of the business, edged down by 0. 2 percent.

This could be a good wake-up call for drug stores to become more aggressive in pushing the category. Since external analgesics cater to the needs of an aging but active and fitness-oriented consumer, it stands to reason that the category is a more pivotal category than its size would indicate, said industry insiders. The continuous roll-out of new formulations with ingredients such as capsaicin (an active ingredient derived from hot chili peppers) and even shark cartilage targeted at arthritis sufferers is also expected to drive the category over the next few years. New delivery systems that are faster and more convenient for users are also making headlines.

Capsaicin still hot

While the excitement has died down somewhat since GenDerm, which was recently bought out by Medicis, launched Zostrix, and Thompson Medical first rolled out its Capzasin P, there's consensus that the introduction of these and more recent capsaicin entries have provided a much-needed spark to the 300-plusSKU external analgesics market. Among the features of these newcomers to the pain game is that they work entirely differently from the hot and cold rubs led by household brands such as Pfizer's BenGay and which together make up the largest segment of the market. Also known as icy hots, these mostly menthol-based products give an immediate sensation of hot or cold and work by forming an irritation on the skin to get blood flow-and hence pain relief-to the sore muscle.

The new capsaicin entries are also competing against the traditional or true topical analgesics. These products are reportedly seeing the least activity on the market.

If capsaicin formulations have grown in just a few years to capture almost 20 percent of the category, it's because of their efficacy in providing relief to a growing number of the 11 million estimated arthritis sufferers in the United States. 'These products are targeted at the joint pains associated with arthritis and less at activity-related sore muscles," said Al Springer, director of Medicis' consumer products group. Like its competitors, Zostrix, Medicis' premium-brand capsaicin, has received much attention from the medical community as a No. 1 line of defense in providing relief for osteoarthritis. These formulations all work by blocking the neurotransmitter Substance P from sending pain messages to the brain.

One of the biggest challenges for marketers and health professionals is to educate consumers that capsaicin must be applied on an ongoing basis and at least three or four times a day so that it builds up the pain blocking effect. "It's like filling a reservoir whereby you continually fill it in order that it can spill over and provide the benefits," said Springer, whose company introduced Zostrix Sports about three years ago for those with chronic joint and tendon problems relating to sports, such as golf and tennis.

This compliance issue coupled with the high price of premium-brand creams such as Zostrix are contributing to a flatter-than-expected sales picture.

"There's been some falling out of consumers who tried the capsaicin and became disillusioned because they didn't get immediate relief," said Jamie Devine, director of marketing at W. F. Young Inc., maker of the 100year old Absorbine line of external analgesics. Then, she added, there's the price issue, where the consumer faces paying out $13 to $18 for a product that has to be purchased regularly in order to provide relief. "The end result was that these products got a lot of trial, but little follow-up usage."

For its part, Medicis is backing its Zostrix regular and Zostrix extra strength with a heavy media support program aimed at building brand awareness and educating consumers of the products' proper use. Working directly with the Arthritis Foundation, Medicis is using 45 of its 60 radio seconds for brand sell, with the rest devoted to announcing local arthritis events in each market and telling listeners where to go for samples and educational materials on Zostrix and capsaicin products.