June 29, 2022
(press release)
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A rapidly aging population with a high risk of geriatric illnesses coupled with rising health costs due to COVID-19 make Australia a promising market for over-the-counter (OTC) healthcare. The launch of innovative non-prescription drugs and therapeutics, and smartphone apps for telemedicine is further driving the market growth. Consequently, the Australian OTC healthcare market is set to grow at a compound annual growth rate (CAGR) of 2.7% from A$6 billion ($4.5 billion) in 2021 to A$6.8 billion ($5.1 billion) in 2026, forecasts GlobalData, a leading data and analytics company. GlobalData’s report, ‘Australia OTC healthcare – Market Assessment and Forecasts to 2026’, reveals that the market will be primarily driven by the ‘vitamins and minerals’ category (3.9% CAGR), followed by the ‘traditional medicines’ category (3.4% CAGR) during the forecast period. Anush Shaw, Consumer Analyst at GlobalData, comments: “OTC medication, which is widely available and commonly used in Australia, has significantly reduced the country’s overall healthcare expenditure over the years. The market is benefitting from the development of smartphones and smart watches, which help in monitoring health vitals, and apps that provide consumers with round-the-clock access to telemedicine. New product launches, complemented by point-of-sale (POS), social media, and above-the-line marketing campaigns, are further driving the market growth.” According to the report, ‘drug stores & pharmacies’ was the leading distribution channel in the Australian OTC healthcare market in 2021, reflecting the strong consumer trust in the medical advice and products dispensed by pharmacists. Reckitt Benckiser Group, Suntory Holdings, and Bayer were the leading companies, and Panadol and Nurofen were the leading brands during the year. The per capita expenditure (PCE) on OTC healthcare in Australia increased from $56.6 in 2016 to $85.1 in 2021, far higher than the global average of $14.2, and the regional average of $8.1 in 2021. It is projected to reach $90.9 in 2026. Considering the COVID-19 pandemic, innovative OTC drugs with claims to boost immunity, aid in digestive health, and alleviate pain and inflammation are poised to gain more traction over the forecast period. Shaw concludes: “The ‘hypermarkets & supermarkets’ channel is expected to experience a stronger revival as consumers venture out of their homes more often for grocery purchases as COVID-19 restrictions are eased. This will provide a competitive advantage to leading brands with a widespread distributional network and higher incentive structures. The dominance of the market leaders will limit the entry of private labels into the market.”
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