OTC Healthcare in Norway report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
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Get insight into trends in market performance
Pinpoint growth sectors and identify factors driving change
Identify market and brand leaders and understand the competitive environment
Product coverage
Adult mouthcare; Allergy care; Analgesics; Calming and sleeping products; Child-specific OTC healthcare; Cough; cold and allergy (hay fever) remedies; Digestive remedies; Ear care; Emergency contraception;
Executive summary
1. EXECUTIVE SUMMARY
Close vertical integration between wholesaler and pharmacy chain
A trend towards closer integration between wholesaler and pharmacy chain is growing. Two of the largest chains, Apotek 1 (Apokjeden AS) and Vitusapotekene (NMD AS), operate as vertically integrated wholesaling and pharmacy retailing units. Alliance Apotekerne followed suit and integrated itself with the wholesaler Holtung in 2004.
Retail chains and wholesalers are owned by leading multinational players in pharmaceuticals. Both Alliance and Holtung are owned by Alliance Unichem Plc (UK). Vitusapotekene AS is owned by NMD which is a subsidiary of Celesio AG (Germany). The leading chain, Apotek 1, and its distributor, Apokjeden Distribution AS, are owned by Apokjeden AS. Tamro Distribution (Finland)/Phoenix (Germany) have 49% ownership of Apokjeden AS.
The new distribution channels, grocery outlets and petrol stations, purchase OTC healthcare directly from full assortment wholesalers. This is in addition to the full assortment wholesalers and 26 wholesalers licensed to sell to non-pharmacy outlets. These wholesalers include the grocery chains’ own distributors such as Midelfart.
New distribution channels in place due to deregulation
Industry sources report that grocery outlets is considered to have excellent potential as a distribution channel, in the long term. However, promotion of OTC healthcare in grocery outlets is currently low key. OTC healthcare products are frequently “hidden” in locked cabinets or only available through vensafe machines where consumers insert plastic cards into the vending machine to make their purchases. Consumers must also be over 18 years old to be able to purchase OTC healthcare in Norway.
Value sales of OTC healthcare through new distribution channels are increasing. Deregulation in 2003 permitted distribution of OTC healthcare through new channels, such as grocery outlets and petrol stations, a move which was greeted unenthusiastically by chemists/pharmacies. Chemists/pharmacies threatened to boycott suppliers of OTC products sold in grocery outlets. Sale of OTC healthcare through the new distribution channels was delayed from November 2003 until the conflict was resolved on 15 December 2003.
Industry orientation key factor in increasingly competitive environment
The chemists/pharmacies channel is bundling products and focusing more on new ranges such as cosmetics and hygienic products. This new focus resulted in dynamic sales growth of cosmetics and hygienic products for this channel and challenged the industry share of grocery outlets in these areas.
Distribution of pharmaceuticals has changed dramatically since 2001 providing Norwegians with more choices. Differentiation among distribution channels is increasing which is reflected in the choice of channel in which consumers purchase their products. As chemists/pharmacies provides advice and answers questions, consumers visit this channel when they are choosing medication for a new health issue or have questions regarding the medication. Personnel in grocery outlets and petrol stations are expressly prohibited from providing advice to consumers regarding the suitability of medication. This means that consumers tend to only purchase products from grocery outlets when they are certain about what they need. For instance, nasal sprays such as Otrivin and analgesics including Paracet are examples of products that consumers feel safe buying without the need for advice. As consumers are increasingly likely to choose products for themselves, brand building of OTC healthcare products combined with consumer education therefore plays a more important role in helping consumers make their own selections.
Dynamic growth in vitamins
Vitamins and dietary supplements accounted for 55% of current value sales of OTC healthcare in 2005 making it by far the largest product range. Growth was driven by sales of multivitamins.
Quality of life is a major concern for citizens living in a wealthy country such as Norway. National policy prioritises preventative over corrective measures of keeping the population healthy. The government encourages Norwegians to eat well and keep physically fit through periodic campaigns to generate awareness as well as to provide information. The result is an increasing awareness and interest among Norwegians in their health which, combined with a general preference for natural products, stimulates value sales of vitamins and dietary supplements.
NRT smoking cessation aids
Surveys by the Norwegian Health Institute show that 25% of Norwegians smoke daily. The government wants to change this situation and has introduced campaigns to motivate smokers to break their habit as well as developing support programmes. Value sales of NRT smoking cessation aids, including the Nicotinell (Novartis) and Nicorette (Pfizer) brands, are benefiting from these activities. Nicorette is the leading brand and is especially strong in NRT gum.
Healthy growth forecast
The outlook for OTC healthcare products will remain positive over the forecast period. An ageing population combined with an increased interest in personal health and increased awareness about OTC healthcare will stimulate sales, which are forecast to rise by 21% in constant value terms over the forecast period.
Emergency contraception is forecast to be the fastest growing range, although growth will be from a low base. Among the larger ranges, vitamins and dietary supplements will be the most dynamic, rising by 24% over the forecast period benefiting from a continued interest in personal health. NRT smoking cessation aids will also be both dynamic and high profile and is forecast to outperform OTC healthcare as a whole, as more consumers are encouraged to stop smoking. Increased targeting of products will benefit child-specific OTC healthcare, which is relatively undeveloped in Norway, sales of which are forecast to increase by 28% over the forecast period in constant value terms.
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