Thursday, May 10, 2012

OTC Drug Sales Not Recession-Proof


Results over the past few years may put to bed the theory that OTC drug sales go up during recession. It was something broadly predicted, including in our own reports. It turns out that OTC drugs were affected by consumers having less cash in their pockets, just as much as other products were. Some of the reasons for this are complex, and some are simple. Less money in your pocket?, Skip the visit the doctor. Don't visit the doctor, don't think you need any medicine, even OTC. But there's more than that... 

Despite predictions that consumers in recessionary times would flock to cheaper OTC drugs, the world over the counter drug market grew little in the past few years. The market grew just 3.5% since 2008, according to our latest report on the subject, The World Market for Over the Counter (OTC) Drugs.


According to the report, the 78 billion-dollar market for over-the-counter pharmaceuticals behaved as many products in the recent recession: almost no sales growth in 2009, and slowly increasing but below average growth in the past two years. OTC drug products are sold worldwide and the growth rates are highly fragmented by region and type of drug category. OTC drugs largely due to differences in economic conditions, perception of self-medication, education, access to medical advice and products, demographics, product availability, and incidence of diseases and medical conditions.


There are a couple of reasons. Consumers reduced doctor visits and sought to trim all medical expenditures since 2009, which dampened the benefit from customers preferring the lower prices. Lower-priced drug store brands competed well with brand products, reducing prices paid. And increasing numbers of patients insured through Medicaid and Medicare were better able to purchase prescription products, reducing the need for OTC purchases. 

Some regions showed faster or slower growth than average, and some drug categories also showed better performance.  These segments are detailed in Kalorama Information’s report, The World Market for Over The Counter (OTC) Drugs.  


The report can be obtained at: http://www.kaloramainformation.com/Counter-OTC-Drugs-6923618/

Monday, May 7, 2012

Tough Year for Clinical Lab Services

Reimbursement woes slowed down the market for clinical laboratory services in the United States, our latest report in this market.   We have the market was worth approximately $52.1 billion in 2011, increasing at just 1% from $50.6 billion in 2010. 

The clinical lab services market includes hospital and physician labs billing for tests performed on patients in their care, and lab chains who perform services hospitals and physicians outsource, most notably LabCorp and Quest Diagnostics. The report indicated that the despite the several positive trends drive growth in this lab services - the aging and longer-living population and an increase in volumes, the recent overhaul of the fee schedule with reductions for almost all tests. 

The overall word in the industry is that this has been a difficult time for billers. The new schedules reduce most fees, which will continue to reduce revenue growth. For instance, the CPT code for FISH testing declined from $252 in 2007 to $202 in 2011.

A few positive trends were noted in our report: volume is up, and this provided what revenue growth was achieved last year. A trend toward preventive and risk factor testing has been noted in several disciplines, particularly in the areas of oncology, endocrinology, and gynecology. Physicians in these areas are taking full advantage of testing for early detection and disease prevention. Hospital length of stay’s in the United States have been reduced to approximately 4.7 days on average, compared to 5.4 days in 1995 and 4.9 days in 2000. This reduces the physician-patient contact and places a larger role on laboratories to gather, interpret, and deliver information to the physician for the purpose of monitoring a patient’s condition and overall health.