The Pharmaceutical Journal Vol 267 No 7158 p109-114
28 July 2001

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News summary

Sales slump after post-RPM peak

Sales of over-the-counter medicines, which rose sharply after supermarkets cut prices when resale price maintenance came to an end (PJ, June 16, p802), have slumped to below the level that existed before price controls were removed.

The value of the OTC analgesic market is now 9.5 per cent lower than when RPM was enforced.

Commenting on its own Pharmatrend figures, market researcher IMS Health says that the drop in sales after a surge suggests that there is no medium-term elasticity in the medicines market, ie, having stock-piled cut-price products at home, customers stopped buying.

More recent data now suggest that supermarkets are reacting to their overall loss of sales value by increasing prices again.

Pharmacies have fared less badly. IMS data show that pharmacy sales volumes and values have remained relatively stable because they have not altered their prices significantly. IMS concludes that the real battle for OTC sales might be fought between the major supermarket chains, rather than between the grocery and pharmacy sectors.

IMS Pharmatrend data are gathered from a panel of 450 independent pharmacies, 1,280 multiple pharmacies (excluding Boots and Superdrug) and 1,383 Asda, Safeway, Sainsbury’s and Tesco stores.

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