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Flu Vaccine Innovation and Coverage – Potential Impact on Cough and Cold Remedies

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While drawing to a close in the Southern Hemisphere, the cold and flu season has just begun in the Northern Hemisphere.  The severity of the 2013-2014 season is difficult to predict.  There are many factors to consider, including constantly evolving influenza strains.  While last year’s 2012-2013 flu season was particularly severe, especially in North America according to the World Health Organization, this year was relatively mild in the Southern Hemisphere.  However, given regional considerations, there is no way to know if the north will follow suit. One thing is clear, and that is health officials’ message: get your flu shot.  The flu vaccine has the potential to decrease the yearly influenza incidence and with innovations in vaccine formulations and formats, as well as increased publicity and coverage, the possible impact on cough and cold remedies is at an all-time high.

The Impact of the Flu

The flu does not just mean bothersome ailments during the winter months.  It has a much broader impact, both economically and personally.  According to the Walgreens 2013 Flu Impact Report*, adults in the United States missed 230 million work days during the 2012-2013 flu season.  Also, 6 million workers had to cancel a business trip.  This translated into a direct economic impact of US$30.4 billion to employers.  22% of sick days also went uncompensated, costing employees US$8.5 billion in lost wages.  Outside of the workplace, 42% of adults missed a planned activity, resulting in 42 million missed holiday functions, vacations, or romantic dates.  The flu didn’t spare children, who missed 91 million days of school.

The severe 2012-2013 flu season was not all bad news, however.  A harsh flu season can translate into a strong performance of cough and cold remedies.  Preliminary Euromonitor International data for cough and cold remedies indicates a current value growth of 6% in the US, reaching sales of US$5.4 billion in 2013, excluding allergies remedies. This doubled the 2012 sales growth.  Last year’s bad flu season was especially profitable for The Procter & Gamble Co, whose Vicks brand is projected to see a year-over-year retail sales increase of US$36 million.  Also, early estimates of 2013 US retail sales growth for Novartis AG’s Theraflu and Johnson & Johnson Inc.’s Sudafed, both tracked by Euromonitor under combination products, are 55% and 23%, respectively.

Influenza Vaccination Innovation and Publicity

In a continual effort to minimize the penetration of the influenza virus, scientists have been working on new vaccine formulations and formats.  Several new variations of the flu vaccine will be available this year.  According to the Center for Disease Control and Prevention (CDC), the traditional trivalent vaccine, which protects against the three strains of virus that are expected to be most common this year with antigens for an influenza A (H1N1) virus, an influenza A (H3N2) virus, and an influenza B virus, will be available as:

  • A standard-dose injection approved for use in people ages 6 months and older, including those with high-risk medical conditions and pregnant women.
  • A high-dose injection approved for use in people 65 or older.  This injection contains a higher concentration of the antigen.
  • An intradermal injection that is approved for use in people 18 through 64 years of age and uses a much smaller needle than the regular flu shot.
  • A recombinant, egg-free injection approved for use in people between 18 and 49 years and suitable for those with egg allergies.
  • A nasal spray, approved for healthy people ages 2-49

Along with the traditional trivalent vaccine, a quadrivalent vaccine with an additional B antigen is offered in the form of an intramuscular and intradermal injection.   This variety is aimed at addressing the needs of the majority of the public population so that almost everyone can get a flu shot.

A potentially large step has also been taken towards discovering “the Holy Grail” of flu vaccination, “a universal vaccine that would be effective against all strains of flu."  According to Professor Ajit Lalvani, chair of infectious diseases at the National Heart and Lung Institute at Imperial College London, the key is in CD8 T-cells.  The recent H1N1 pandemic in 2009 provided Lalvani and his team with a “natural experiment” where they were able to identify higher levels of the CD8 T-cells in the blood of participants that showed only mild symptoms of the flu when compared to those in worse condition (“Cellular immune correlates of protection against symptomatic pandemic influenza” – “Nature Medicine,” Sep. 22, 2013).  These CD8 T-cells hold “the key to the blueprint for a universal flu vaccine.”  Lalvani estimates that the universal flu vaccine could be developed in as little as 5 years. For now, scientists continue to rely on guesstimates of what strains might emerge each season to develop the yearly flu vaccine.

Apart from the advances, the flu vaccine is receiving an increasing amount of publicity.  From the National Influenza Vaccination Week sponsored by the CDC to public service announcements, flu campaigns are focused on increasing awareness of the seriousness of influenza and the importance of getting a flu shot in the US.  Retailers and consumer goods firms are also joining in.  Walgreens just wrapped up its “Get a Shot Give a Shot” campaign in which the drug-store giant matched every flu shot administered in one of its outlets to a measles or polio vaccine for a child in a third world country through a partnership with the United Nations Foundation.  Online tracking applications for cold and flu symptoms presented by various firms are also gaining popularity.  Procter & Gamble Co.’s Vicks website has a tracker that provides the level of flu penetration by postal code on a scale of “normal” to “severe”.  Robitussin Cough Cast presented by Pfizer Inc. has a similar service, while Kimberly-Clark Corp.’s MyAchoo.com provides 21 day predictive forecasting of flu incidence.

Additionally, companies are becoming more aware of the economic impact of the flu on business and a growing number are facilitating the flu vaccine by providing in-office flu shots for their employees.  It is also increasingly common that hospitals require personnel to get flu shots not only for their own benefit, but also to reduce the risk of transmitting the virus to co-workers and patients.

Due to the new varieties of format and formulation, coupled with more information and publicity, flu vaccine coverage rates are on the rise.

Flu Vaccine Coverage

According to the CDC, flu vaccine coverage in the United States grew 7% among adults age 18 and older and 10% among children between the ages of 6 months and 17 years over the 2011-2012 and 2012-2013 flu seasons.  While growth over the past 4 seasons, 2009-2010 through 2012-2013, was just 3% for adults, it was an impressive 30% for children.

US Seasonal Flu Vaccination Coverage by Age and Season

US Seasonal Flu Vaccination Coverage Graph.gif

Source: Center for Disease Control and Prevention (CDC)

Despite strong growth, overall coverage rates are still modest.  Only about 4 in 10 adults and just over half of children received the flu vaccine in the U.S. during the 2012-2013 season.

Coverage rates also varied greatly depending on age, race and gender.  Coverage for adult males between the ages of 18 and 49 was only 28% for the 2012-2013 season.  Hispanic adults were also less likely to get a flu vaccine at 34% coverage.

Another important consideration is the effectiveness of the flu vaccine.  There are many different strains of flu and the vaccine is developed using estimates of what strains are most likely to be in circulation during the upcoming year.  Therefore, a recipient of the flu vaccine is not invincible all strains of the flu virus.  Vaccine efficiency rates over the past several years have been about 60% on average.  This means that those who receive the flu vaccine are 60% less likely to get the flu that year.

There are also many ideas regarding influenza and the flu vaccine that have proven difficult to overcome, ranging from minor misinformation, like the young and healthy are not susceptible to the flu, to more drastic beliefs, like flu vaccines may be linked to autism.  These ideas will continue to present a challenge in efforts to continually increase coverage of the flu vaccine.

The Potential Impact on Cough and Cold Remedies

New innovations and increasing coverage of the flu vaccine are leading the way in an effort to decrease the prevalence of influenza. This has the potential to negatively impact sales of cough and cold remedies.  Put quite simply, fewer sick people means less demand for remedies.  However, the size of the potential impact is difficult to predict.  Increased coverage of the vaccine does not necessarily mean fewer cases of the flu.  There are many factors that determine the severity of a flu season, making the profitability of cough and cold remedies inherently unpredictable and volatile.  The industry will continually be at the whim of natural factors that can have a larger impact on sales than the flu vaccine.  People will always get sick, so there is no need for cough and cold remedy providers to overreact to an increase in flu vaccine coverage.  It may be a different story, however, when the universal flu vaccine hits the market.

US Cough and Cold Remedies – Retail Value (RSP) 2010 - 2013


Chart US Sales CCA.gif

Source: Euromonitor International

* The 2013 Flu Impact Survey was conducted online within the United States by USamp on behalf of Walgreens from August 27 to September 4, 2013, among 1,200 nationally representative adults ages 18 and older. Flu Impact Report results were balanced on key demographics to allow projection of results to the entire U.S. adult population. Results are based on self-reported instances of the flu and flu-like symptoms.

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