Out-of-Sight Pretty Much Means Out-of-Stock on Grocer’s Cold Meds
By George Anderson
According to research by Information Resources, Inc. (IRI) performed in Oklahoma and Illinois, laws in those states that require retailers keep products containing pseudoephedrine
(PSE) behind the counter has affected the sale of allergy and cold medicines to varying degrees.
In Oklahoma, pills containing PSE experienced a decline in sales volume of 16 percent after moving behind the counter. Because space is limited, IRI said the number of items
available for sale to consumers was reduced by more than a third.
Sales of alternative products that do not contain PSE benefited from the restricted access to medicines containing PSE. According to IRI, non-PSE product sales increased 24 percent
in food, drug and mass (excl. Wal-Mart) in Oklahoma over the same period. Consumers, evidently, would prefer to find an easy alternative on the shelf than wait to be served at
the pharmacy.
IRI’s research also found that not all sales channels were hit equally hard by the ban in Oklahoma. According to a company press release, “PSE product sales actually increased
significantly in drug stores in the weeks following legislation, but suffered major declines in grocery stores, where item reduction was more dramatic and opportunity was more
limited due to the number of stores without pharmacies. The net result has been a shifting in volume share of PSE products from grocery stores to drug stores. This
is bad news for grocery stores, which are likely missing out on the sale of other products, as well, when consumers go to drug stores instead for their allergy/cough/cold products.”
The law passed in Oklahoma banned all pills containing PSE as an ingredient but the legislation passed in Illinois was less restrictive with the behind-the-counter designation
applying to single-ingredient PSE products only.
In Illinois, items with and without PSE are both trending upward.
Robert Doyle, senior vice president of IRI’s Healthcare Solutions Group, said in a released statement, “The allergy/cough/cold category is in a state of flux. Both manufacturers
and retailers are struggling to accurately assess demand for both PSE and non-PSE alternatives and need to quickly implement strong consumer marketing and communication programs
to ensure that they protect and grow share within this incredibly valuable consumer segment.”
Moderator’s Comment: What is your take on IRI’s research into the sale of cough, cold and allergy medicines in Oklahoma and Illinois? What can retailers
and manufacturers do to keep sales strong in light of the legal and, in some cases, voluntary restrictions being placed on items containing PSE?
Robert Doyle called greater collaboration between manufacturers and retailers an “imperative” in light of the challenges posed by the current situation.
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George Anderson – Moderator
If there were a warning label for cannabis, how lengthy would it be? Would it be as extensive as the accordioned labels attached to bottles of many OTC drugs? Unlikely. Yet, OTC drugs are legal and cannabis isn’t and we are left to wonder why.
I offer this thought-starter to illustrate the use of feelings rather than thoughts in determining public policy. A California State Senator, in response to a question about why Californians are determined to self-govern through referenda, said that Legislators are notoriously ineffective because they operate with the conviction that “true is what you feel.” Instead of approaching real issues with facts, they prefer to rely on feelings.
Oklahoma and Illinois have chosen to disregard the facts of PSE in favor of using emotion to create public policy — with weird and unsatisfactory results. What would happen if our elected representatives did their homework? What if they resolved to distinguish between facts and feelings in their deliberations? Don’t they owe it to us to examine issues in the clear light of day rather than in the murky confines of ever-changing emotions?
Retailers and manufacturers have only facts — in this case regarding the proven safety of PSE — with which to influence lawmakers. But if lawmakers are unused to, incapable of, or unwilling to take facts into consideration, decisions like those in Oklahoma and Illinois will continue to be made.
You tell them, Ben. It is nonsensical to move these products behind the counter purely as a precaution against the small minority of people who will misuse them. So long as they remain legal and do not do any harm when used for the purpose for which they are manufactured, they should be available to anyone who wants to buy them. What manufacturers and retailers can do is get their act together and stop harrassing their legitimate customers. Otherwise, they deserve to lose business.
Retailer and manufacturer cooperation can only go so far. The real issue here is that perfectly legitimate manufacturers and retailers are being denied the opportunity to competitively present a perfectly legal product to perfectly legitimate consumers — all because criminals do something criminal with it.
Our real concern must be whether this intrusion of commerce-strangling, protectionist legislation into our world of consumer products retailing will become a trend.
Certainly our industry has a responsibility to offer consumers safe products. And we do a very good job of that. Witness the swift removal of PPA from these same products a few years ago, even though the research used to push that move was incredibly thin. And many of our members suffered significantly as they were absent from the shelf for long periods as they reformulated their products. And in a true show of manufacturer/retailer cooperation, most retailers “held” that shelf space until the reformulated products were available.
In this case, there is NO evidence, or even assertion, that these products are harmful in their legal use. Why should their manufacturers and retailers be penalized commercially by what criminals do?
This issue is not just going on in states where legislation has passed. As a big-time allergy sufferer, I’ve been in several stores recently looking for Sudafed to add to my self-prescribed pharmaceutical mix, only to buy something else when it wasn’t on the shelf. Only about the third time (slow learner, yes, but when you have real bad allergies you can’t think clearly) did I realize it must be behind the counter. The suggestion of “sunsplashed” to have tear off cards would make it much easier to know the product is available, and purchase it on the way out. Simple signage would help, too. It’s easy to say we shouldn’t put it behind the counter but this is a huge problem, especially in the Midwest, so it’s hard to fault legislators for trying to reduce a serious crime.
Having lived in Oklahoma when the law was first passed — neither group has handled this well. Two things: 1) You go to a 24 hour supermarket where the pharmacy is closed. You can’t get the product. 2) The shelves are empty where these products used to be. Neither group has made it easy to identify what you want: No upright POP’s to help you recognize the product, no tear off “I want this one” sheets to hand to a clerk and get what you want. It’s as if everyone is staring at each other shrugging their shoulders. This challenge is surmountable if some people would focus on it.
This entire issue has a ripple effect throughout the supply chain to which no one is immune. We have struggled with how to advise pharmacies (and food/drug combos) on dealing with this tumultuous situation.
We have devised several over-the-counter and behind-the-counter strategies that will serve to mitigate the negative impact of this state by state regulatory approach. It is unfortunate, as pointed out by several other BrainTrust contributors, that the actions of a few are subjecting the majority from accessing helpful remedies to their allergies and colds.
There is definitely a sea change occurring at retail and within the OTC market that may shift other products to a yet-to-be-determined third class of drugs. With an international operation in the UK where a third class of drugs exists, I must admit this may not bode well for American consumers or free enterprise. Stay tuned.