Over The Counter Drugs Market Size, Share & COVID-19 Impact Analysis, By Product Type (Analgesics, Cold & Cough Remedies, Digestives & Intestinal Remedies, Skin Treatment, Vitamins & Minerals, and Others), By Distribution Channel (Drug Stores & Retail Pharmacies, Hospital Pharmacies, and Online Pharmacies), and Regional Forecast, 2021-2028

The Over The Counter drugs market size was USD 148.0 billion in 2020 and is projected to grow from USD 157.0 billion in 2021 to USD 233.6 billion in 2028, exhibiting a CAGR of 5.8% in the 2021-2028. Based on our analysis, the market exhibited a steady growth of 6.8% in 2020 as compared to the average year-on-year growth during 2017-2019. The global impact of COVID-19 has been unprecedented and staggering, with OTC drugs witnessing a positive demand across all regions amid the pandemic. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

OTC or over-the-counter drugs are pharmaceutical products that are considered safe to buy without the requirement of a prescription from a medical professional. These products are available in hospital pharmacies, medical stores, and sometimes even grocery shops and are sold legally without any prescription. OTC medicines are used to treat some common symptoms, which include common cold, body pain, allergy and flu, heartburn, acne, and other basic health problems.

One of the key factors contributing to the market growth during the forecast period is the increasing self-medications. According to Pharmacoepidemiology and Drug Safety, approximately 20.0% of the total population in Spain relies on non-prescribed medication, and females are more inclined towards this practice. Furthermore, the switching from prescription drug (Rx) to OTC citing lower costs, and rising approvals for OTC drugs by regulatory authorities, is driving the market growth. For instance, in February 2017, Sanofi announced that the U.S. Food and Drug Administration (FDA) had approved Xyzal Allergy 24HR as an OTC product used for seasonal allergies.

Additionally, the availability and cost-effectiveness of OTC products are driving the growth of the market. For instance, according to the National Center for Biotechnology Information (NCBI) publication, it was reported that in the United States every year, over-the-counter drugs account for approximately USD 100.0 billion in savings. The above-mentioned factors would augment the market growth during the forecast period.

OTC Drugs Market to Witness a Positive Impact due to Increasing Demand for Nutritional Supplement amid the COVID-19 Pandemic

The COVID-19 pandemic has caused disruption in the import and export of healthcare products across the globe. However, some of the key players, such as Johnson & Johnson Services Inc., Bayer AG, Sanofi S.A, GlaxoSmithKline Plc, and others, have reported growth in revenue for their OTC or consumer health segment. For instance, Johnson & Johnson Services Inc., in its 2020 annual report, stated that there was an increase in the demand for TYLENOL, one of its OTC analgesic medicines. Furthermore, Bayer AG also reported a positive impact on its consumer health division, mainly through a sharp rise in the demand for products in the nutritional category.

The impact of COVID varied on different OTC products. For instance, the pandemic has raised awareness about the importance of self-care and accelerated the growth in categories, such as vitamins & minerals or nutritional supplements. At the same time, the growing precaution and hygiene measures resulted in the drop-down in sales for cough and cold products reported by most manufacturing companies. Also, skin treatment products and digestives & intestinal remedies experienced a decline in their sales. Analgesics are pain-relieving products that were in high demand during the pandemic.

LATEST TRENDS

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Increasing Shift from Rx to OTC and Growth in Private Label OTC Products are Vital Trends

One of the prominent trends in the market is the shift of manufacturers from prescription drugs to OTC. Many manufacturing companies are switching their products from Rx to OTC. For instance, Bayer AG states in their 2019 annual report that as a part of its strategy, the company will change some of its prescriptive products suitable for self-care to OTC. This is anticipated to lead to the higher availability of OTC drugs for various disease conditions in emerging and developed countries.

The other trends in the market include the increasing number of private-label OTC products. The share of private label OTC product sales in the U.S. increased from 26.0% in 2009 to 31.0% in 2018. Also, the rise in online sales in the OTC products and tie-ups between private label OTC manufacturers & e-commerce companies are developing new trends into the market. For instance, in February 2018, Amazon.com, Inc. announced the launch of OTC healthcare products of Perrigo, a private label manufacturer. These upcoming new trends will diversify the market growth during the forecast period.

DRIVING FACTORS

Strong Focus of Key Players in the Development and Launch of New OTC Products to Boost Global Market

There are large numbers of companies operating in this market, which include Johnson & Johnson Services Inc., Bayer AG, Novartis AG, Sanofi S.A, Dr. Reddy’s Laboratories Ltd., Pfizer, and many more. These key industry players are involved in R&D to develop and market new OTC drugs for various health conditions. For instance,

• In September 2019, Dr. Reddy’s Laboratories Ltd. announced the launch of an OTC Omeprazole Delayed-Release tablet in the U.S. market.


• In September 2020, Dr. Reddy’s Laboratories Ltd. announced the launch of an OTC eye allergy drop, Olopatadine Hydrochloride Ophthalmic Solution.


• In December 2020, Soma Pharmaceuticals and Crown announced their partnership to launch Microcyn technology-based spray and gel and anti-itching over-the-counter products in the U.S. market.

Such an increase in the number of product launches in the OTC product category will enhance the OTC drug market growth.

Accessibility and Affordability of OTC Products to Surge the Market Growth

One of the critical factors that are expected to drive the market growth during the forecast period is the accessibility, affordability, and the presence of a large number of retail stores offering OTC products. In developed and emerging countries, the increasing investment by the private sector to improve the supply chain through retail stores and other distribution outlets is leading to market growth. According to the Consumer Healthcare Products Association, there are approximately 54,000 pharmacies in the U.S. and more than 750,000 retail outlets selling over-the-counter products.

Additionally, the increasing approvals from regulatory bodies for switching prescription drugs to OTC drugs are fuelling the market growth. As the majority of prescription allergy medicines have changed to OTC, there has been a clear shift toward these more convenient and affordable options.  For instance, according to the Consumer Healthcare Products Association (CHPA), numerous prescription allergy medicines have changed to OTC, and there has been a shift toward these drugs owing to their lower costs.

RESTRAINING FACTORS

Wrong Medications due to Incorrect Self-diagnosis and Side Effects of OTC Drugs May Hinder Growth

Some limiting factors that are expected to restrain the global over the counter drugs market growth in the forecast period are the incorrect self-diagnosis leading to the consumption of wrong medicines. Many OTC cough and cold products have led to medication errors and caused adverse effects on the patient’s body. For instance, a study was published in Academic Pediatrics on the adverse effects caused by OTC cough and cold medicines (CCMs) on the U.S. pediatric population. The study reported that from 2009 to 2016, there were nearly 5,000 cases of adverse effects related to an OTC CCM ingredient. Out of these cases, more than 10.0% were caused due to medication errors.

Additionally, drug abuse and drug addiction practices also pull down the market growth. Cough medicines, diarrhea, and pain relief medicines are some of the common OTC medicines which are used for drug-abusing. According to the Addiction Center and a study published by the Substance Abuse and Mental Health Services Administration (SAMHSA), in the U.S., around 3.1 million young people between the age group of 12 to 25 have misused OTC medications (cold and cough medication) to get high. Furthermore, the use of traditional medicines also acts as a substitute or alternative for over the counter drugs market.

SEGMENTATION

By Product Type Analysis

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Cold & Cough Remedies Segment to Grow at a Faster Pace during 2021-2028

On the basis of the product type, the market can be segmented into analgesics, cold & cough remedies, digestives & intestinal remedies, skin treatment, vitamins & minerals, and others. 

The cold & cough remedies segment is anticipated to dominate the market. The segment is set to dominate the market owing to the increasing occurrence of common colds and coughs among the population due to seasonal variation. According to the Centers for Disease Control and Prevention, cold and cough are the most common conditions in children below the age of 10 years and geriatric populations above 65 years, which is leading to the increasing demand for therapeutics products.

Analgesics accounted for the second-largest market share in 2020. This is primarily due to the increasing geriatric population with the surging demand for pain relief drugs and also the launch of new pain-relieving OTC products in the market. For instance, in September 2020, Dr. Reddy’s Laboratories Ltd. announced the launch of OTC Diclofenac Sodium topical gel in the U.S. market.

Followed by analgesics, the vitamins & minerals segment is projected to be the third-largest market. The high demand from sports athletes and working professionals for energy products and weight management supplements are driving segmental growth. According to a survey conducted by the Council for Responsible Nutrition (CRN) in 2019, it was found that vitamins & minerals are the most commonly consumed supplement category, and around 76.0% of Americans consume these products to improve their health.

The digestives & intestinal remedies, skin treatment, and others segments are growing at a steady rate. The rising skin problems, such as acne, sunburn, severe allergic skin reaction, and skin infection due to fungi or bacteria, would surge the segmental growth. The others segment includes sleeping aids, weight loss/Diet, and OTC oral care products.

By Distribution Channel Analysis

Drug Stores & Retail Pharmacies Segment to Hold Dominant Share during the Forecast Period

Based on the distribution channel, the market is segmented into drug stores & retail pharmacies, hospital pharmacies, and online pharmacies. The drug stores & retail pharmacies segment is projected to account for the largest market share during the forecast period owing to the increasing number of retail pharmacies offering OTC products and the rising patient preference for stores & retail pharmacies for these products. The hospital pharmacies segment accounts for the second-largest market share owing to the increasing access to the OTC drug and availability of different OTC products.

The online pharmacies would expected to grow at a lucrative CAGR owing to the internet penetration in the emerging market and discounts offered by online pharmacies.  

REGIONAL INSIGHTS

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On the basis of region, the global market can be segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. By region, North America dominated the global OTC drugs market in 2020. The market size in this region stood at USD 58.4 billion in 2020. The dominance of the region is attributed to the increasing preference for OTC products compared to prescription products. According to the Consumer Healthcare Products Association, it was reported that 93.0% of U.S. adults prefer OTC medicines for minor health issues before seeking professional care.

Europe is expected to be the second-largest market in the forecast period owing to the high adoption of self-medication and the presence of a large number of OTC drug manufacturing companies in this region. Also, the rising awareness among the population about OTC products is driving the market growth in this region. 

The Asia Pacific market is anticipated to be the fastest-growing market showcasing the highest CAGR during the forecast period due to the shift in consumer attitude towards self-medication, a rise in the geriatric population, rapid shift from Rx to OTC, and affordability of OTC medicines. In India, 76.0% of the adult population preferred OTC pharmaceutical products over the prescribed medicines. The increasing preference for OTC products is enhancing the market growth. Also, the presence of pharmaceutical companies, such as Cipla Inc., GlaxoSmithKline plc, The Himalaya Drug Company, Procter & Gamble, and TajPharma, with their strong product portfolios and robust distributional channels are contributing to the market growth.

Latin America and the Middle East & Africa accounted for comparatively lower market share in 2020. In Brazil, despite a variety of national regulations, antimicrobials are used without prescription very frequently. The increasing preference for over-the-counter medications citing lower costs and the rising number of players entering these lucrative industries is poised to fuel the market's growth during the forecast period.

KEY INDUSTRY PLAYERS

Diversified Insurance Plans Offered by United HealthCare Services, Inc. and Centene Corporation to Support Their Dominance

The competitive landscape of the global industry has some of the dominant key players, such as Johnson and Johnson, Bayer AG, Novartis AG, Sanofi S.A, Pfizer, GlaxoSmithKline Plc, and Boehringer Ingelheim International GmbH that account majority of the market share. These key players are implementing different strategic initiatives to improve their shares in this sector.

Johnson and Johnson is one of the largest healthcare companies that operate across the globe. The company offers OTC products under its consumer health segments. As a key strategy, it markets its product to the general public and sells its products on online portals and retail outlets throughout the world. Similarly, Pfizer and GlaxoSmithKline Plc., the leading international pharmaceutical companies, have entered into a partnership in August 2019 to develop a joint venture. The aim of this agreement was to create a leading consumer healthcare business and become number one in the global OTC market.

Additionally, in April 2020, Takeda Pharmaceutical Company Limited announced that it would continue with the divestiture strategy with the sale of selected OTC products in the European region. Furthermore, in June 2020, Novartis AG launched a not-for-profit portfolio of medicines for the symptomatic treatment of COVID-19. The portfolio includes 15 generic and OTC medicines from the Sandoz division to fulfill the unmet needs of patients with COVID-19 symptoms.

Other prominent players in the global market include Reckitt Benckiser Group PLC, Takeda Pharmaceutical Company Ltd, Amway Corp, Procter & Gamble Co, Herbalife Ltd, Nature’s Bounty Co., and many more.

LIST OF KEY COMPANIES PROFILED:

• Johnson & Johnson Services Inc. (New Jersey, US)


• Bayer AG (Leverkusen, Germany)


• Novartis AG (Basel, Switzerland)


• Sanofi S.A (Paris, France)


• Pfizer (New York, US)


• GlaxoSmithKline Plc (Brentford, UK)


• Boehringer Ingelheim International GmbH (Ingelheim, Germany)


• Reckitt Benckiser Group PLC (Slough, UK)


• Takeda Pharmaceutical Company Ltd (Tokyo, Japan)


• Other Players

KEY INDUSTRY DEVELOPMENTS:

• June 2021 - Bayer announced the approval of Astepro Allergy from the U.S. Food and Drug Administration (FDA) as an over-the-counter (OTC) product for the temporary relief of nasal congestion, runny nose and itchy nose and other respiratory allergies. It is the only steroid free, antihistamine nasal spray for allergies available OTC in the United States for adults and children 6 years of age and older.


• March 2020 - GlaxoSmithKline announced that the company received the approval for Advil Dual Action with Acetaminophen from the U.S. Food and Drug Administration (FDA) as an over-the-counter (OTC) product for pain relief.  It is first FDA-approved OTC combination of ibuprofen and acetaminophen in the United States and will be available worldwide.


• July 2020 - Alcon announced that company has received the approval from the Food and Drug Administration (FDA) for Pataday Once Daily Relief Extra Strength for sale over-the-counter (OTC) in the United States. It is the only eye allergy itch drop which offers full 24 hours of relief without a prescription in the U.S.

REPORT COVERAGE

An Infographic Representation of Over The Counter (OTC) Drugs Market

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The global market research report provides a detailed OTC drugs market analysis and focuses on key aspects, such as the product type, distribution channels, and regional analysis. Additionally, it covers industrial insights and key development such as mergers, acquisitions, partnerships, and new product launches, along with the impact of the COVID-19 pandemic on this market. In addition, the report offers current market trends and highlights key industry dynamics.

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