Merck’s consumer health business counts on Latin America for growth

Demand in Latin America region fuels double-digit sales growth in Q2 2015.

“Along with a growing consumer demand, Latin America sees a rise in the need for healthcare products and a trend towards consumer goods making daily life more convenient,” said Uta Kemmerich-Keil, CEO and President of Merck’s consumer health business, at the Financial Times Latin America Healthcare & Life Sciences Summit, held on 29 September 2015 in Miami, USA. “Our business is well positioned to anticipating the region’s rapidly changing demographics and responding to consumers’ healthcare needs.”

She detailed the business answers to emerging consumer trends such as increased investments into digital communication, and to the consolidation in the wholesale and pharmacy sector. Also, she outlined the business propositions to meet the needs of the local emerging middle classes, for example the consumerization of the Neurobion and Floratil brands, as well as the geographic expansion of the Bion brand into Brazil. As a solid signal of Merck’s consumer health business commitment to the region, Kemmerich-Keil pre-announced the launch of a new innovative product across almost the entire Latin American region in 2016.

Latin America playing growth engine role

As the successful implementation of the 3x3 strategy in the region remains the focus — aiming at a minimum of 3% market share and at least 3 leading brands per market — Latin America has been showing the best performance for consumer health globally. The region is expected to see the majority of the business global strategic initiatives by the end of the decade. Consumer health is present in the three biggest categories in the region: a) vitamins, minerals and supplements; b) cough and cold; c) allergy and analgesics; all categories experiencing strong market growth of around 5%.

Latin America played a key role in the consumerization of Neurobion and Floratil from Merck Serono, the former most contributing to absolute growth in the region. In Brazil, the Floratil consumerization approach drove a 34% net sales growth in 2014 versus 2013 and the franchise is expected to be the second fastest growing in the Latin American portfolio by the end of the decade. Bion is expected to become the fastest growing brand in the region, after the successful launch of Bion3 in 2014 in Brazil. In Chile, thanks to a consumer approach with focus on digital already initiated in 2010, Bion3 has become the 2nd biggest OTC brand and the best-selling multivitamin with a market share of ~60%.

Q2 2015 organic sales growth

In the second quarter of 2015, Consumer Health reported net sales of €227.6 million, indicating a strong 16% organic growth versus the year-earlier period. Consumer health continues to be the fastest growing business at Merck. All global strategic brands outperformed versus last year with Neurobion, Dolo-Neurobion and Femibion being key contributors. Key geographies with strong growth momentum were Chile and Mexico for Latin America, as well as Indonesia and the Philippines for Asia Pacific.