PAGB members manufacture branded over-the-counter (OTC) medicines, self care medical devices and food supplements. These are the types of products that help you to self care when you’re feeling unwell but you don’t need to see a doctor. In fact, many minor conditions can be treated very successfully through informed use of OTC medicines and with the support of a pharmacist who can advise people about the best way to manage their symptoms.
2022 was another difficult year, despite the recovery seen in 2021 and the worst of the pandemic being behind us, new threats emerged. Inflationary pressures grew throughout the year rising to a high of 11.7% in October and while by the end of the year we started to see a modest reduction, inflation remained stubbornly high.
High inflation resulted in an increase in interest rates throughout 2022, placing pressure on consumers’ disposable incomes and contributing to a cost-of-living crisis, which has been compounded by the war in Ukraine, and the increase in the cost of energy. Supported by inflation the nominal value of fast-moving consumer goods (FMCG) sales grew by 1.4%, however unit sales fell by -4.6% as consumers reduced consumption to try to manage their budgets.
Total value sales grew 11.0% with unit sales increasing by 7.8%
Figure 1 – total market and key categories
Inflationary pressures contributed to this growth but the OTC sector is still experiencing the effects of the pandemic. The beginning of the year saw the peak of the Omicron variant in the UK with the government having reintroduced limited restrictions in December 2021. OTC sales remained high during this period as consumers continued to focus on their health and wellbeing.
Figure 2 – weekly sales vs previous year
As we approached September, there was increasing concern around the upcoming winter. With both Covid-19 and seasonal flu circulating, the lack of immunity in the population meant conditions were set for a so-called ‘twindemic’. These concerns were heightened by the rising pressures facing the NHS including a lack of capacity, shortages of medical staff and disputes over pay driven by the cost-of-living crisis. These concerns were not unfounded as the number of patients with flu needing intensive care ‘skyrocketed’* in comparison to the previous year.
The end of the year saw increased media focus on health issues; in addition to flu and covid, there were rising concerns around the rise in cases of Strep A in children. OTC sales accelerated at the end of the year driven by the pain relief and cold, cough and sore throat categories as consumers focused on self-care to manage symptoms. In addition, there were widespread media reports around potential shortages of OTC products which accelerated demand further.
Ongoing pressures on the NHS, along with the cost-of-living crisis are forcing consumers to make different and difficult decisions when it comes to their finances. However, physical and mental wellbeing remain a priority for consumers, regardless of their financial situation (NielsenIQ State of the Nation 2022). Given the performance of the OTC sector during the year, we can see that OTC is more insulated than other categories and consumers will continue to prioritise their health in 2023.
The role of the pharmacist has steadily expanded in recent years, offering additional services such as stop smoking and weight loss services.
In June, pharmacies saw over 100,000 patients, an 83% increase on the previous year**
The role of pharmacists will continue to expand, playing a key role in relieving pressure on the NHS. Pharmacists are well placed to support consumer priorities around physical and mental wellbeing, demonstrating the vital role pharmacies can play in our community. Ensuring distribution into this channel will be even more important as the role continues to expand.
*NHS England » Two thirds increase in hospital flu cases amid rising staff absences and pressure on NHS 111
**NHS England » High street pharmacists treat thousands more people for minor illnesses
NielsenIQ. Total Market MAT to WE 31.12.22 NielsenIQ’s OTC read was defined by NielsenIQ in agreement with PAGB and its members. It covers over 75,000 stores, including multiple and independent chemists, grocery retailers and in-store pharmacies, as well as impulse stores.
NielsenIQ (formerly known as Nielsen Global Connect) is a business unit of Nielsen holdings plc (NYSE: NLSN), a global measurement and data analytics company that provides the most complete and trusted view available of consumers and markets worldwide www.niq.com
Data and insight referenced in this review is taken from NielsenIQ’s different sources
NielsenIQ is an associate member of PAGB.
*Source: NielsenIQ. Total Market MAT to WE 31.12.22
| Category | Value Sales WE 01.01.22(£) | Value Sales WE 31.2.22 (£) | value % change YA |
|---|---|---|---|
| Pain relief | £693,151,486 | £756,109,863 | 11.0 |
| Vitamins and minerals | £454,156,240 | £461,475,431 | 9.1 |
| Cough, cold and sore throat | £420,928,799 | £572,384,061 | 1.6 |
| Gastrointestinal | £320,168,632 | £350,022,899 | 36.0 |
| Skin treatments | £304,120,413 | £324,356,581 | 9.3 |
| Smoking cessation | £219,444,346 | £232,579,191 | 6.7 |
| Hayfever | £148,244,603 | £165,604,111 | 6.0 |
| Eye care | £78,057,184 | £84,013,386 | 11.7 |
| Sleeping aids | £62,909,153 | £63,898,838 | 7.6 |
| Other | £196,617,813 | £205,046,564 | 1.6 |
| Total market | £2,897,798,669 | £3,215,490,924 | 4.3 |
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