The OTC Animal Health Global Market Opportunity

Summary

Traditionally sales of animal health products have been via a small number of different retail channels, limited by the regulatory classification of each specific product. Thus, products classified as being suitable for "over-the-counter" (OTC) sales have been widely available across all outlets (including supermarkets, pet superstores, garden centres, pet shops, pharmacies and veterinary clinics), while those restricted to being only available with a prescription have been limited to distribution through the so-called.

"ethical" channel of either a vet clinic or a pharmacy.

The different retail outlets represent separate marketing channels, and historically certain companies are predominantly active in particular channels. Reputations are built up over time and once forged these commercial relationships can provide a large degree of inertia within each channel of distribution. Companies are continually seeking new product opportunities. One potential opportunity for increasing sales volume would be to expand the number of pharmaceutical products available on the OTC market.
Given the inherent difficulty and expense of developing new compounds, the simplest route is via the reclassification as OTC of pharmaceuticals formerly requiring prescriptions. This would then allow a much greater distribution across the range of retail outlets.
For the manufacturer this offers the potential for increased volume and for the distributor, range expansion via new product launches.
However, apart from the need to obtain regulatory approval, the switch into the general OTC market may conflict with existing ethical sales and cause manufacturers to have to rethink their relationship with those veterinarians who have previously supported a particular product. Nevertheless, for manufacturers with brands nearing the end of the product lifecycle, wider distribution via the OTC channel represents a potentially valuable method of extending profitable sales and generating revenue for re-investment into new compound development.

Recently an additional dynamic has been introduced into the established market through the ever increasing acceptance of Internet sales by the general public. Sales over the "Net" may comprise OTC products, but increasingly these sites represent online pharmacies and are able to retail pharmacy/prescription products as well. Furthermore, since the Internet does not readily recognise international boundaries, products that are given a certain classification in one country may be promoted to a second country where they are classified differently. Thus, products which actually require a prescription in a particular country may appear to be readily available from a web-site. Policing such potentially illegal activity is notoriously difficult for regulatory authorities and one of the effects of the existence of such sites is to expose price differentials between territories. The challenges provided by the presence of these Internet operators has caused manufacturers and retailers to reappraise their operations and seek new opportunities, to ensure that their current market position is maintained or enhanced.

The interplay of the different commercial forces within each distribution channel provides barriers to potential new entrants. As products come to the end of their patent life and generic manufacturers seek to capitalise on the commercial opportunities of supplying a newly available compound, the reclassification of an existing prescription veterinary medicine as an OTC product offers additional commercial opportunities. The outcome of such repositioning may be optimised by working in partnership with an established company within a particular distribution channel.
This report examines the various market forces acting within the distribution of veterinary medicines. Factors at play in the different retail channels are explored to identify key drivers and consideration is given to the regulatory environment. In order to implement a successful strategy when considering repositioning a product from the ethical to the OTC market, it is essential that insight into successful marketing is obtained and the core elements of potentially winning tactics are recognised. Leading companies with major stakes in the OTC market are reviewed and existing products are profiled to provide historical examples of the outcomes of different strategies
By exploring the move between distribution channels as a viable option in brand lifecycle management, this report will examine the developing major themes that present new opportunities and increase the challenges for managers involved in this market.

Readers with responsibility for strategic planning will find this report an invaluable resource, providing both a market overview and identification of the important issues to be considered in the decision making process.

Contents

• CHAPTER 1 INTRODUCTION
  • 1.1 Background
  • 1.2 Managing the product life-cycle
  • 1.3 Available OTC distribution channels
  • 1.4 Distribution costs
  • 1.5 On-line pharmacies
  • 1.6 OTC products: key market drivers
• CHAPTER 2 ANIMAL HEALTH MARKET
  • 2.1 Global Overview
  • 2.2 Europe
    • 2.2.1 European pet market overview
    • 2.2.2 France
    • 2.2.3 Germany
    • 2.2.4 Spain
    • 2.2.5 United Kingdom
    • 2.2.6 Other countries
  ... Hungary ... Ireland ... Italy ... The Netherlands ... Scandinavia
  • 2.3 North America
    • 2.3.1 Canada
    • 2.3.2 United States
  • 2.4 South America
    • 2.4.1 Argentina
    • 2.4.2 Brazil
  • 2.5 Far East/Asia
    • 2.5.1 China
    • 2.5.2 India
    • 2.5.3 Japan
  • 2.6 Australasia
    • 2.6.1 Australia
    • 2.6.2 New Zealand
  • CHAPTER 3 LEGISLATION
    • 3.1 Europe
      • 3.1.1 EMEA
      • 3.1.2 France
      • 3.1.3 Germany
      • 3.1.4 The Netherlands
      • 3.1.5 Spain
      • 3.1.6 United Kingdom
    • 3.2 North America
      • 3.2.1 Canada
      • 3.2.2 United States
      • 3.3 Australasia
        • 3.3.1 Australia
        • 3.3.2 New Zealand
    • CHAPTER 4 OTC ACTIVES
      • 4.1 Overview
      • 4.2 Ectoparasiticides
        • 4.2.1 Pyrethroids
        • 4.2.2 Organophosphorus compounds
        • 4.2.3 Carbamates and amidines
        • 4.2.4 Insect growth regulators
        • 4.2.5 Neonicotinoids
        • 4.2.6 Fipronyl, selamectin and ivermectin
        • 4.2.7 Others (repellents)
      • 4.3 Endoparasiticides
    • CHAPTER 5 CASE STUDIES
      • 5.1 OTC spot-on ectoparasiticides
        • Historical perspective
        • Lessons to be learnt
      • 5.2 OTC endoparasiticides
        • Historical perspective
        • Lessons to be learnt
    • CHAPTER 6 COMPANY PROFILES
      • 6.1 Alfamed S.A.S.
      • 6.2 Armitages Pet Products Limited
        • Flea products
        • Wormers
        • Other animal health products
      • 6.3 Battle, Hayward & Bower Ltd
      • 6.4 Bayer Animal Health
      • 6.5 Beaphar Nederland B.V.
      • 6.6 Bio-Tech Solutions Ltd
      • 6.7 Bob Martin (UK) Ltd
      • 6.8 Central Garden & Pet Company
      • 6.9 Denes Natural Pet Care Ltd.
      • 6.10 Dorwest Herbs Ltd
      • 6.11 The Hartz Mountain Corporation
      • 6.12 Intervet UK Ltd
      • 6.13 Janssen Animal Health
      • 6.14 Johnson's Veterinary Products Ltd
        • Dog and cat products
        • Small animal products
        • Cage bird products
        • Pigeon products
      • 6.15 Masterfoods (Complementary Petcare)
      • 6.16 Merial
      • 6.17 Novartis Animal Health Inc.
      • 6.18 Petco Animal Supplies, Inc.
      • 6.19 Pets at Home Limited
      • 6.20 PetSmart, Inc.
      • 6.21 Schering-Plough Animal Health
      • 6.22 Sergeant's Pet Care Products, Inc.
        • Grocery/mass merchant ranges
        • Specialist pet store ranges
      • 6.23 Seven Seas Pet and Animal Heath Care
      • 6.24 Sinclair Animal & Household Care Ltd
      • 6.25 Virbac S.A.
      • 6.26 Wellmark International
      • APPENDIX A - Overseas Distributors for Dorwest herbs