Slimming Down: Glaxo Fat Pill Has Thin Sales
4 CommentsBy Ed Silverman // June 12th, 2008 // 8:25 am
Introduced to much fanfare a year ago, the Alli diet pill isn’t fattening Glaxo’s bottom line. The over-the-counter weight-loss pill has been tried by about 4 million people since then, but that is less than some Wall Streeters were expecting.
Given the craving among Americans to lose weight, the preliminary figures are “pretty pretty underwhelming,” Steve Brozak, an analyst with WBB Securities, tells the Associated Press. The problem, he says, may be that the marketing campaign stresses the need to transform eating and exercise habits for it to be effective, which isn’t easy to do through advertising. And perhaps people who are willing to make lifestyle changs are less likely to be interested in diet pills, he adds.
But Joe Cadle, director of marketing for Glaxo’s consumer health division, insists, first-year sales point to a “healthy business” that can be sustained and grown as new users try the drug. “We’re the only company with an over the counter product that helps treat something that affects 140 million people,” he tells the AP, but declined to say how tally repeat users.
In clinical trials, people using Alli lost an extra 2 to 3 pounds for every 5 pounds lost through diet and exercise, although side effects include leakages and oily discharges. The marketing campaign warned that meals should be kept to less than 15 grams of fat to avoid effects and pamphlets recommended people bring an extra pair of pants to the office.
Now, though, Glaxo is focusing on telling people that side effects can be avoided if the drug is used properly. So you can keep the extra pants at home? Apparently, so. In fact, Cadle even says the side effects help some people by signaling when they’re not eating right. In other words, there is a silver lining in those orange undies. But don’t look too closely.
Dr. Sal Giorgianni
I do wounder if things would have been very diffrent for this product if it were introduced as an Rx product.
If this blog line is not already dead, I would be interested in what others might think.
Pharma Giles
Ed: It seems that declining sales have led to an Oops Experience in GSK sales division as well…
Goose Egg
Dr Giorgianni: Alli is merely the 60mg version of Xenical, which is an Rx product (indeed, the pills still say “Orlistat” on them). The difference apart from dosage is in the marketing - Roche hasn’t promoted it the way GSK has. Indeed, in some markets outside the US, Roche has signalled a full-scale retreat of Xenical, and offered it to GSK to promote
Dr. Sal Giorgianni
Ah, yes! I had forgotten that point, thanks for reminding me.
Does anyone know how has Xenical has not done in the market? Has it met projections? Has there been any market dynamic change in the Rx volume after the OTC marketing?