POST OF THE DAY
Johnson & Johnson
Tylenol a Victim of its Success?

Related Links
Discussion Boards

By stillwater9999
July 6, 2009

Posts selected for this feature rarely stand alone. They are usually a part of an ongoing thread, and are out of context when presented here. The material should be read in that light. How are these posts selected? Click here to find out and nominate a post yourself!

As many of you may have read, Tylenol and all products containing acetaminophen or APAP (the active ingredient in Tylenol) are facing some significant issues.

http://www.ajc.com/health/content/shared-auto/healthnews/arth/628586.html

It is not clear of course at this point if the FDA will follow the panel recommendations. The one to lower the daily dose could be quite significant to the Tylenol business.

Just some history here, Tylenol came out with an Extra Strength version (500 mg) many years ago, before I started working at McNeil (the J&J company that markets Tylenol) in 1984. I would guess that Extra Strength started in the go-go Wayne Nelson era. WN was the president of McNeil when Tylenol went through its first major growth spurt. The evidence that extra-strength was really more effective was pretty limited and unclear. The problem with it is that it pushed dosing much closer to the upper safety limit. The safety margin (difference between the effective and toxic doses) is narrower for acetaminophen than many other drugs. So the extra-strength version was pushing the limits.

Then in the Jim Lenehan era, Tylenol saw another major growth period. Lenehan's idea was to extend the Tylenol brand into other OTC health categories such as Cold, Allergy, Sleep, Cough etc. He even launched one version designed to go into the antacid category. The latter failed but the other initiatives were mostly big successes. But then all of the other major OTC brands tried the same trick. Cold brands put APAP into their products (at the extra-strength level of course) to go into other categories etc. The problem in the end is that there are many, many products out there with 500 mg of APAP per pill under many, many brands. Consumer confusion was of course bound to happen and along with it consumers often wind up with way more APAP than they need or should have to treat their symptoms.

Tylenol has been a mature brand with flat to down sales in recent years. Still the total sales across all the products (including Tylenol PM, Allergy Sinus etc.) are about 2 billion dollars/year. So still significant even to today's J&J. They will try to hold to as much as possible. The other alternatives (aspirin, ibuprofen and naproxen) have their own safety issues. So Tylenol will not go away but it is likely to lose share perhaps significantly.

Tylenol in many ways is a victim of its own marketing success, pushing extra strength and category proliferation. Those initiatives produced billion in extra sales over the years, but now they are resulting in a major threat to the brand.

sw