By Product Type:
On the basis of product type, the market is segmented further into cough, cold and flu products, analgesics, dermatology products, gastrointestinal products, vitamin, minerals and supplements (VMS), weight-loss/ dietary products, ophthalmic products, sleeping aids and other product types.
The weight-loss and dietary products segment is believed to show the highest CAGR of 8.10% during the forecast period. This is majorly attributed to the rising awareness of the general population about health and rise in the consumption of junk food, which is leading to the rise in lifestyle-related diseases. The VMS (vitamins, minerals, and supplements) segment is believed to have the largest market share.
VMS and weight loss OTC drugs contribute the most to the overall market. In fact, nearly 1/4th of the market belongs to this segment. The reason for this major share is the vast customer base for various products under this category. Unlike other conditions, which are intense in nature, the VMS and weight loss conditions are not very bothersome. OTC products for these conditions are more of precautious nature than that of treatment or cure. And this is why the number of customers is relatively high than the ones for other indications. Large customer pools give rise to high demand, which, in turn, results in high revenue generation. VMS products are very popular in developed countries because of the increasing unhealthy population.
By geography, the OTC drugs market is segmented into North America, Asia Pacific, Europe, South America, and Middle East & Africa.
North America currently dominates the market for over the counter drugs and is expected to continue its stronghold for a few more years. This region is expected to increase its market share in the future, owing to the leading trend among pharmaceutical companies to switch from Rx to OTC drugs. Report of the National Institute of Health has stated that 93% of adults in the United States prefer to treat their minor ailments with OTC medicines before seeking professional care, and 85% of parents in the United States prefer to treat their children’s minor ailments with an OTC medicine before seeking professional care. This is resulting in the formation of the bigger market.
Top Major Players
The over the counter drugs market is highly competitive and consists of several major players. In terms of market share, few of the major players currently dominate the market. However, with technological advancements and product innovation, mid-size to smaller companies are increasing their market presence by introducing new products with fewer prices. Companies, like Johnson and Johnson, Novartis AG, Bayer AG, Glaxosmithkline PLC, and Pfizer, holds significant market shares in the over the counter drugs market.
Some of the players are seeking portfolio expansion strategies to cater growing OTC drug market
Companies in this market are adopting strategies such as partnerships, acquisitions and collaborations to expand business performance. For instance, in July 2020, Stada AG, a Germany-based pharmaceutical company, announced the acquisition of 15 of deep-rooted OTC brands from GlaxoSmithKline in Europe. The acquisition will strengthen the company’s portfolio and presence in the consumer health business.
Factors driving future growth
Trends in the market
Cough, cold & Allergy: Alcohol, dry-free, or honey-containing cough / cold oral liquids
Digestive & Intestinal: Raft-forming oral suspensions gaining popularity (Ex. Gaviscon)
Pain: Increase in OTC oral and topical analgesics due to safety concerns with Rx analgesics like oxycodone
Topical: Rise of newer formats, often to accommodate on-the-go lifestyles, such as sprays and roll-ons