Merck KGaA counts on Latin America to Power Consumer-health future

Merck KGaA counts on Latin America to Power Consumer-health future

Lately, Latin America has been leading the growth ranks for Merck KGaA's consumer health unit. And that's not set to change anytime soon, its leader says.
 
The company expects the region to keep driving expansion for its OTC business as demand for consumer goods continues to rise, Uta Kemmerich-Keil, the division's CEO and president, said at Tuesday's Financial Times Latin America Healthcare & Life Sciences Summit.
 
"Latin America sees a rise in the need for healthcare products and a trend towards consumer goods making daily life more convenient," she pointed out, noting that "our business is well positioned to anticipating the region's rapidly changing demographics and responding to consumers' healthcare needs."
 
And just how will it do that? In part, through its 3x3 strategy in the area, which involves snagging a minimum 3% market share and at least three leading brands per market.
 
In some cases, it's already on its way there. Its Bion3, for example--a probiotics, multivitamin and mineral combo product--has become the second biggest OTC brand and the best-selling multivitamin in Chile, for example, boasting a market share of 60%. It's also seen success in Brazil, where converting diarrhea treatment Floratil over to a consumer product helped it last year record 34% net sales growth in the country.
 
Of course, it won't be without its competition. Last May, Bayer agreed to snatch up U.S. based-Merck's ($MRK) consumer health business for $14.2 billion, a move it said would make it the OTC leader in Latin America.
But keeping consumer health on the up-and-up will be important for the German pharma, whose prescription drug sales have sagged lately. The top-line haul for best-seller Rebif, an injectable multiple sclerosis therapy, have taken a hit thanks to competition from newer, oral rivals, including Biogen's ($BIIB) Tecfidera and Novartis' ($NVS) Gilenya.
 
Consumer health, on the other hand, recorded 16% in organic growth last quarter, turning out net sales of €227.6 million to retain the title of Merck KGaA's fastest-growing business.
 
And while Latin America may be a key driver for the Darmstadt-based drugmaker, it won't be the only place it looks for a boost. In the past, Merck has called the U.S. an emerging market, noting its "huge growth potential" there.

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