A SWITCH IN TIME

JANICE ZOELLER

The launch of Aleve (naproxen sodium) has focused supermarkets' attention on switches of prescription drugs to over-the-counter status as never before, say supermarket pharmacy directors. In the process, communication between pharmacy and health and beauty care directors and managers has improved markedly. The rollout of Aleve also is expected to forever alter how supermarkets handle future switches.

Supermarkets' aggressive efforts are paying off. Aleve sales through supermarkets for July totaled $4.6 million, compared with $5.4 million for drug stores, according to Towne-Oller & Associates, New York, a subsidiary of Information Resources Inc., Chicago. Aleve has a 4.8% share of the $1.3 billion OTC analgesics market sold through food stores.

Pharmacy directors credit the following factors:

Increased awareness on the part of supermarket executives that a concerted effort was needed to build sales of switched products, along with more awareness of the profit potential of switched items.

Involvement of pharmacists in recommending the switch to customers and in educating in-store personnel as to the importance of the switch.

A major push by the General Merchandise Distributors Council, Colorado Springs, Colo., that included information and training programs directed at all levels within supermarkets.

Efforts by Syntex, Palo Alto, Calif., which manufactures naproxen sodium, and Procter & Gamble, Cincinnati, Syntex's OTC marketing partner, to include pharmacists in promotional efforts for Aleve by preparing a pharmacy kit and calling on supermarket pharmacy directors as well as HBC buyers.

"We've had more cooperation between pharmacy and HBC over Aleve than with any previous switch," says Terry Cater, director of pharmacy at Save Mart Supermarkets, Modesto, Calif. "It was incredible. We had training sessions with both our GM department heads and our pharmacy managers."

"We had a closer tie-in with pharmacy than with previous switches," says Ron Foster, director of pharmacy at Finast, Maple Heights, Ohio. "We would handle a future switch in a similar way by tying it to pharmacy," he adds.

"We're using the switch as a vehicle to get our pharmacists involved with our front-end people," says a pharmacy executive at an East Coast supermarket chain. "There has been some improvement," he says. For this switch, "we brought in special counter displays for the pharmacies. We also asked our pharmacists to be involved and work closely with the HBC merchandisers to make sure they have the information and keep it in stock."

The Aleve introduction "magnified the need" to have this type of cooperation, and has encouraged weekly meetings of store managers, pharmacy managers and HBC managers, says the East Coast director.

Supermarket chains moved quickly to get the new analgesic into their warehouses, in some cases, within days of the product's launch. Some chains also altered their normal distribution procedures to force distribution of Aleve into the stores.

"We will continue our emphasis on switches," says the East Coast director. "We will initiate our action plan every time a switch comes across that we think has potential at all. We feel strongly that being first in the market with new items is very important to build business.

"We approached this switch more aggressively," says Foster. "About a week before the product actually hit, we ran an ad in the pharmacy section of our circular saying the product was coming. Then we put the kits [provided by Procter-Syntex Health Products Co., the joint venture formed by Syntex and Procter & Gamble to market Aleve] in all of our pharmacies. Our pharmacists were involved in this switch."

"We made much more of an effort than with previous switches," says Cater. "It was a combination of everything," citing efforts by GMDC, as well as Syntex and Procter & Gamble, and a general heightened awareness. "It was also the fact that, at least in our company, we know we need to cooperate more. We know that we're really one department, and that a successful pharmacy needs a good HBC department, and for HBC to succeed, it needs a good pharmacy.

"It doesn't necessarily happen," Cater acknowledges, that HBC and pharmacy will work together on a switch. "But I think supermarkets are now convinced that switches are an opportunity for them. It should happen more in the future."

"We tried with this switch to lay the groundwork for future switches," says Cater. "With another product, we won't necessarily have training meetings. But we'll get a bulletin out about the product. "We'll have it. We'll advertise it. We'll price it right. We'll have a schematic. And we'll probably do it through the pharmacy, because the pharmacists have the background and can sit down with people at store level and communicate about it."

Pharmacists already are predisposed to recommend a switched product, and they like having the option of another ingredient to recommend, pharmacy directors agree.

Pharmacists will recommend Aleve to people who can benefit from a 12-hour product, says Louis Giannotti, director of pharmacy at Mayfair Super Markets, Elizabeth, N.J. "For someone with arthritis pain, compliance is going to be better. And if that person doesn't have pain for 12 hours, he or she will perceive it as a better product."

"We recognize that the pharmacy plays a key role in recommending over-the-counter products, especially products that were at one time only available on prescription," says Kristin Burbank, spokeswoman for Procter & Gamble. "We felt very strongly about the need to promote to health professionals on this product.

"Oftentimes, drug chains are a first source for switches," says Burbank. "We've seen with Aleve that supermarket retailers have really gotten behind this, and are getting their share of initial purchases. Our numbers show that [the business] is spread out fairly evenly and supermarkets are doing quite well even vs. drug chains."

Supermarkets' handling of the Aleve launch will likely boost share of OTC medication sales, which have declined slightly in recent years to 39%. More important, supermarkets' new aggressiveness is likely to have a major impact on their share of switched products, which was estimated to be 20% prior to the Aleve launch.

Contributing to supermarkets' new confidence in marketing a switch was the unprecedented wealth of information provided separately by the General Merchandise Distributors Council, with assistance from the Food Marketing Institute, and by Procter-Syntex.

Pharmacy directors commented favorably about the Aleve pharmacy kit prepared by Procter-Syntex. Two pharmacy directors even credited Syntex and Procter & Gamble with helping to promote closer pharmacy-HBC ties in how they promoted Aleve to supermarkets with pharmacies.

"The kits, with the tear-off flier pad and counter display brochures containing a $1-off coupon, were very well done," says Foster of Finast. "It made our pharmacists more aware."

"They did a good job with the kit," agrees Paul Schneider,

director of pharmacy operations at Food Circus Supermarkets, Middletown, N.J. Food Circus keeps the Aleve "Pain Talk" brochure in its consumer information rack in front of the pharmacy.

"Our pharmacists have certainly been involved," says Giannotti. "They are recommending Aleve. P&G went the right route" in detailing not only HBC merchandisers, but pharmacy directors as well, he says.

Giannotti recalls that P&G called on him to discuss the launch immediately after meeting with his HBC counterpart. "They almost forced the communication." He says that after the meetings, the next time he saw his HBC counterpart, they naturally talked about it.

While other companies have called on pharmacies concerning switches, it's typically more of an afterthought. None of the pharmacists interviewed could recall being involved to such an extent in the initial launch of a switch product.

"Other companies have realized they needed to get the pharmacist more involved, but only after the marketing program has been rolling along," says Giannotti. "P&G knew [to call on pharmacists] from the start. That's how it should be done in the future."

Cater of Save Mart, which like Syntex, is based in northern California, was pleased that representatives of both Syntex and Procter & Gamble jointly called on him and his HBC counterpart. "That's commitment," he says.

Cater also described as "top notch" the "Rx to OTC Tool Kit" developed by GMDC. Save Mart used the GMDC information to educate its nonfood managers about the market and the profit potential. The GMDC kit includes educational videos directed at HBC buyers and store personnel; training information for buyers and store personnel; results of a consumer study conducted by Willard Bishop Consulting, Barrington, Ill.; and an "executive summary" directed at top management. A separate 48-page booklet, "The ABCs of Rx to OTC Merchandising," details how three supermarket chains successfully handled the Tavist switch.

"The supermarket industry, from what I hear, did a very effective job with Aleve," says Ron Turner, vice president of member affairs and education at GMDC. "I think it will carry over. Next time there's a switch, I think you'll see supermarkets give it priority status. That may be a normal occurrence now where in the past it was not.

"We think switches are important to our industry," says Turner. "We will continue to support the manufacturers in future switch releases."

Now that supermarket companies realize the importance of switches, there is some concern that the process at the Food and Drug Administration, which ultimately decides whether a prescription product can safely be switched and when, is bogged down and slow.

"The concern that we all have is that the switches have been slow in coming," says Turner. "There are a lot of items out there waiting to hit the street, and it looks like the FDA, especially the committees, are moving at a slow pace. I had expected Rogaine, Tagamet and some of the others to move a little faster."

FDA advisory panels in July recommended against switching OTC versions of Upjohn's Rogaine, SmithKline Beecham's Tagamet, and Pepcid from Merck. FDA, which is not bound by the recommendations of its advisory committees, had not yet acted on these switch applications as of early this month.

Allen Karpe, director of pharmacy and HBC at Valu Food, Baltimore, is optimistic that more switches are coming soon, and Tagamet will be next. "I think Tagamet is in the on-deck circle," he says. "Even though it was turned down by the advisory committee, I think SmithKline Beecham will get it through."

The expectations for future switches are, if anything, even higher. Aleve sales, while strong, have been held back by competitive moves, say pharmacy directors. (See related story.) "If Tagamet or Pepcid were to switch, there's not a product available OTC that is close," says the East Coast director, and the buildup would be much quicker. Will the Aleve switch have a lasting effect in improving pharmacy-HBC communications?

"This has helped to develop a team effort, and that's what it takes," says the East Coast director. Pharmacy directors are hoping, too, that the approach taken by Syntex and Procter & Gamble in involving pharmacists will serve as a model for other manufacturers in launching switch products.

The efforts of Syntex and Procter & Gamble in involving pharmacists "shows they are committed and that they appreciate the influence that the pharmacist has on the launch of a new product," says Giannotti. "The pharmacists appreciate it also. We certainly want to be in the loop."