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Pharma industry hikes adspends on OTC products

16-November-2004
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Pharma industry hikes adspends on OTC products

This is one category that has not been caught sneezing. Even as fast moving consumer goods (FMCGs) and consumer durables are showing a dip in advertising spends, the pharmaceutical sector is quietly upping its advertising spends. Cough syrups, lozenges, rubs and balms are some of the over-the-counter (OTC) products that have increased their television ad spends.

According to estimates by AdEx (a division of TAM India), OTC brands have increased their television budgets from Rs 36.76 crore during the first six months of 2003 to Rs 54.39 crore during the same period this year, a 47.9 per cent growth. The category spent over Rs 112 crore last year on television alone with Moov, Vicks, D-Cold and Benadryl emerging as the top brands.

Mr Atul Phadnis, Vice-President, TAM India, said, "The pharmaceuticals industry is moving in the upward direction, both across television and print. And categories such as cough syrups and lozenges have been doing well. Some new advertisers such as Ranbaxy with Olesan, Elder Pharmaceuticals (AM-PM mouth freshener) and even Panacea Biotec have entered the scene."

However, advertising industry officials said that spends here are much lower than the money spent by pharmaceutical companies in the developed markets of the US. "We have not even scratched the surface. In the US, the pharma industry is among the top five advertisers. There, not only OTC products are advertised but advertising of ethical products is also permitted, albeit with a cautionary note. Doctors overseas are also permitted to solicit clients," said a Mumbai-based media planner.

With the product patent regime coming into effect next year, pharmaceutical companies will have to get market savvy. Currently, only simple remedies are being advertised on television. Mr Shanta Kumar, Managing Director, Saatchi & Saatchi, which had previously handled Pfizer's Benadryl, said, "The reason why OTC has not picked up is because we have a whole variety of ayurvedic options available and home remedies are commonly known. Unlike the West, there is no pill-popping culture in India. The pharma market is still in a nascent stage but with organised retailing growing, we expect the sector to grow."

Currently, there are restrictions on advertising of drugs and pharmaceutical products with the Government prohibiting ads for treatment of major diseases.

However, advertising of some products takes place in the home remedies categories. In fact, the pharmaceutical industry led by the multinational companies have been asking the Government to come up with an exhaustive list and also permit certain prescriptive drugs to move into the OTC category.

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