SCHERING-PLOUGH CLARITIN DIRECT-TO-CONSUMER AD CAMPAIGN
This article was originally published in The Tan Sheet
SCHERING-PLOUGH CLARITIN DIRECT-TO-CONSUMER AD CAMPAIGN could begin with radio spots as early as the week of May 10, the company indicated during a May 4 meeting with securities analysts in Kenilworth, N.J. The company said it is planning print, television and radio ads for the prescription nonsedating antihistamine, as well as direct mail. Claritin (loratadine) was approved by FDA April 12 ("The Tan Sheet" April 19, p. 17). Marion Merrell Dow resumed direct-to-consumer print ads for its prescription nonsedating antihistamine Seldane (terfenadine) during April. However, because a boxed warning concerning potentially life-threatening cardiovascular side effects has been added to Seldane labeling, MMD will not be able to run TV ads under FDA's current policy. "The side effect profile" of Seldane and Johnson & Johnson's Hismanal "has no impact on our ability to go over the counter" with Claritin, Schering-Plough Chairman Robert Luciano maintained. The decision of if or when to switch the product will be based on "our assessment of how we think we can maximize our profit," Luciano said. The Claritin launch "is the biggest promotional effort in Schering-Plough history," Schering-Plough President Richard Kogan declared. The high level of spending on the launch means that Claritin will not contribute to earnings for 1993, Luciano said. "We expect a big return for this investment," Kogan added. International sales of Claritin in 1992 (including OTC sales in 13 countries) were $ 139 mil., Kogan said, up 38%. The company is planning several line extensions: NDAs for treatment of urticaria and a twice-daily Claritin/decongestant combo (Claritin- D) are pending. A once-a-day form of Claritin-D and an indication for perennial rhinitis are in Phase III clinical trials. The company expects to receive a two-year patent extension for Claritin running into 2000. The Schering-Plough execs cited OTC switch products as a key to reviving the company's consumer products business. Kogan called the healthcare products division "the switch wizard when it comes to shepherding products from Rx-to-OTC." The firm did not identify specific switch candidates but said its older antihistamines and dermatologicals provide a likely pool of choices. Schering-Plough's OTC pharmaceutical sales were $ 346 mil. in 1992, down 8% compared to 1991 ("The Tan Sheet" March 29, p. 12). First quarter 1993 sales were off 16% to $ 72.8 mil. "The OTC business has been weaker than we'd hoped," Kogan said, "showing the effects of the recession and new challenges from private label brands in the marketplace." Schering-Plough "continues to believe new products will be the key to success, both to generate growth and fight private label competition." R&D spending has been increased and "clinical trial activity [is] up three-fold over two years," Kogan said. Elaborating on Schering-Plough's strategy to combat private labels, HealthCare Products President David Collins said: "The key . . . is to deliver value to the customer. You do that through new products; you do that through product innovation; you do that through disciplined pricing increases; and you do that through providing services to your retailer that private label suppliers can't provide, such as just-in-time inventory services and computer-to-computer linkage." "We will continue to emphasize advertising as a means of building consumer awareness and brand loyalty," Kogan said. "Targeted promotional programs are another weapon in our marketing arsenal." The healthcare division has a total of 615 sales reps. "Finally," Kogan said, "we will continue to pursue strategic alliances with others in the industry to help enhance our product pipeline, increase our clout with customers and leverage our costs." The healthcare products division is "poised to benefit from opportunities created by favorable demographics and consumer trends," Luciano maintained. Acknowledging that creation of the division three years ago "has yet to reap huge rewards," Luciano declared that "it's enabled us to attract the talent to run the unit, and positioned us for success in the long term." Foot care products have fared better than OTCs recently. Foot care sales (including Dr. Scholl's, Lotrimin AF, and Tinactin) jumped 17% in the first quarter of 1993 to $ 53.6 mil. after the Dr. Scholl's line was revamped ("The Tan Sheet" March 8, p. 10). The firm is "aggressively promoting" its athlete's foot product offerings (see story below).
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