Sanofi relaunches Zantac as consumer sales fall by 7.3%

Sanofi relaunches Zantac as consumer sales fall by 7.3%
New Zantac 360° contains famotidine as the active ingredient instead of ranitidine

5 May 2021 - Deborah Wilkes

Sanofi Consumer Healthcare is relaunching its Zantac brand in the US with famotidine as the active ingredient instead of ranitidine. The news comes as the business reported worldwide sales down by 7.3% at constant exchange rates in the first quarter of 2021.

Julie Van Ongevalle – executive vice president of Sanofi and head of Sanofi Consumer Healthcare – said Zantac 360° would be available nationwide with full distribution in June 2021. The omnichannel launch in the US is already underway.

Zantac 360° comes in two versions – Original Strength containing 10mg famotidine per tablet and Maximum Strength with 20mg famotidine per tablet.

Packaging highlights that the products have a “New formula” and points out that “Just one tablet prevents & relieves heartburn due to acid indigestion”.

Sanofi Consumer Healthcare voluntarily recalled Zantac in the US and Canada in October 2019. The recall came after the US Food and Drug Administration (FDA) and Health Canada said some ranitidine medicines, including Zantac OTC, could contain a probable human carcinogen called N-nitrosodimethylamine (NDMA) at low levels (click here to read the News story).

In 2020, the business recorded no sales of Zantac.

First-quarter results released

News of the relaunch came as Sanofi's Consumer Healthcare business reported worldwide sales of EUR1.11 billion (USD1.35 billion) in the first quarter of 2021, representing a fall of 7.3% at constant exchange rates. Sales as reported were down by 14.4%.

The company said the fall reflected a “weak cough and cold season due to social distancing measures and wearing of masks as well as a high base for comparison in the first quarter of 2020 which benefited from pantry loading related to the COVID-19 environment”. Divestments of non-core products had also impacted the results, added the company.

As can be seen from Figure 1 below, Sanofi Consumer Healthcare’s worldwide sales of Cough, Cold and Flu products dropped by 59.4% at constant exchange rates to EUR55 million in the first quarter of 2021. The company noted that sales of Cough, Cold and Flu products in Europe had fallen by 68%.

Figure 1: Worldwide sales by Sanofi’s Consumer Healthcare business in the first quarter of 2021, broken down by product category. Change in sales is compared to the first quarter of 2020. *CER is at constant exchange rates (Source – Sanofi/OTCToolbox)

 

The largest product category for Sanofi Consumer Healthcare was Digestive Wellness, with sales up by 14.6% to EUR283 million.

Van Ongevalle pointed out there had been strong demand for brands in the wellness categories – including Dulcolax, Essentiale and Magne-B6 – and through e-commerce.

The second-largest category, Pain Care, recorded sales down by 11.6% to EUR253 million.

The Allergy category also fell back, with sales dropping by 6.2% to EUR195 million. Sanofi noted that US Allergy sales had increased by 4%, driven by the Xyzal brand.

Looking at geographic regions, the largest in the first quarter of 2021 was the Rest of the World, but sales were down by 3.6% at constant exchange rates to EUR496 million (see Figure 2 below).

Figure 2: Worldwide sales by Sanofi’s Consumer Healthcare business in the first quarter of 2021, broken down by geographic region. Change in sales is compared to the first quarter of 2020. *CER is at constant exchange rates (Source – Sanofi/OTCToolbox)

 

Sanofi said lower sales in three categories – Allergy; Cough, Cold and Flu; and Pain Care – had been partially offset by growth in the Digestive Wellness and Mental Wellness categories.

Sales in Europe were down by 19.3% at constant exchange rates to EUR334 million. Sanofi said the fall reflected the lower incidence of colds, the high base for comparison and divestments of non-core products.

On a positive note, sales in the US were up by 2.3% at constant exchange rates to EUR283 million. Sanofi said the rise reflected growth in the Digestive Wellness, Mental Wellness and Allergy categories, partially offset by a decline in the Pain Care category.

Operating income down by 18.4%

Sanofi Consumer Healthcare's operating income dropped by 18.4% as reported to EUR394 million, representing 35.4% of sales. At constant exchange rates, the operating income was down by 8.9%.

Expenditure on research and development during the quarter was down by 12.5% to EUR28 million, representing 2.5% of sales.

Consumer Healthcare accounted for 13.0% of Sanofi’s total worldwide sales in the first quarter of 2021, which were up by 2.4% at constant exchange rates to EUR8.59 billion. As reported, sales were down by 4.3%.

Van Ongevalle recently announced plans to divest around 60% of Sanofi Consumer Healthcare’s brands over the next two years, reducing its portfolio from more than 250 brands to roughly 100 (click here to read the News story).

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