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Innovation drives brands' competition


Despite significant challenges coming from private label, Procter & Gamble is still attempting to innovate the No. 1 brand in all of digestives — Prilosec OTC. The company launched a wildberry-flavored Prilosec OTC earlier this year, not to be chewed, but to improve the experience in taking a Prilosec OTC tablet versus an unflavored, generic equivalent.

But Prilosec's biggest challenge to its digestive dominance is still on the horizon. There is still one proton-pump inhibitor to be switched — Pfizer bought the rights to Nexium from AstraZeneca last year for a whopping $250 million. Nexium prescription sales dwarfed those of Prilosec, and Prilosec OTC reached upward of $700 million in total sales its first year. "Just the magnitude of what Pfizer spent to acquire the [Nexium] rights, it tells you that it's a big opportunity," Perrigo chairman, president and CEO Joe Papa told analysts after the deal was announced.

Tums may be better equipped to handle a Nexium introduction. To put it simply, GlaxoSmith-Kline's Tums is still cheaper than its H2-blocker and PPI cousins, and it works much faster. That may explain why other marketers are moving into that tried-but-true calcium carbonate space. Bayer Consumer recently launched Alka Seltzer Fruit Chews, and Chattem is planning a relaunch of the venerable Rolaids brand later this year.

The No. 2 brand in the digestives space is Merck's MiraLax laxative, which continues to sell well. The company is currently driving trial through its MiraLax Pledge campaign that offers a $1-off coupon up front and a $5 reward after purchase.


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