CONSUMER HEALTH IN AUSTRALIA - ANALYSIS

Country Report | Sep 2023

EXECUTIVE SUMMARY Market Sizes

Consumer health in 2023: The big picture Sales of Consumer Health
Retail Value RSP - AUD million - Current - 2009-2028
With the ending of lockdowns, border closures, and other COVID-19-related restrictions
over the course of 2022, Australia has begun to see a return to normality in 2023, with
Australians settling into their new hybrid routines and lifestyles. Pandemic fatigue 7.818 Forecast
after over two years of taking precautions has resulted in Australians reducing infection 10.000
prevention measures. Reduced social distancing and mask use, along with increased
rates of travel, increased in-person work and social interaction, greater footfall in
public transport, and reduced vaccination rates in 2023 have resulted in a widespread 8.000
and severe cold and flu season. The higher incidence of respiratory illnesses and
viruses such as influenza has driven demand for consumer health products this year
across cough, cold and allergy (hay fever) remedies, analgesics, as well as 6.000
herbal/traditional products. By contrast, as consumers are shifting away from immune
support, the boost to sales of vitamins and dietary supplements related to immunity
has slowed down from the pandemic highs. 4.000

Rising cost-of-living pressures and squeezed disposable incomes are placing short-term
pressures on consumers, as well as manufacturers, as the market is seeing significant 2.000
impacts on discretionary spending. Manufacturers are also facing rising input costs from
inflationary pressures on ingredients prices, as well as on supply chain and logistics
costs, resulting in unit price hikes. Even as inflation begins to slow down in the second 0
half of 2023, as the interest rate hikes implemented by the Reserve Bank of Australia 2009 2023 2028
begin to take effect, it is expected that the inflationary environment will remain sticky
going into 2024, and will continue to impact consumer spending, slowing volume
growth for the industry. However, despite consumers becoming increasingly value- Sales Performance of Consumer Health
driven, most categories are not seeing a major shift to private label, with many % Y-O-Y Retail Value RSP Growth 2009-2028
consumers opting to reduce their frequency of purchase instead of switching from
brands to private label alternatives.
6.5% Forecast
2023 key trends 14%

The pandemic has led to growing interest amongst Australian consumers in their health 12%
and wellbeing, with a focus on managing their wellness holistically. With lifestyles
becoming increasingly hectic, consumers are seeking to simplify their health and 10%
wellness routines, and are drawn to products which view wellness through a broader
lens, including physical health, beauty from within, nutrition, and mental wellbeing.
8%
This is driving growth for a variety of consumer health categories, as consumers seek
products that address traditionally underserved need states and functionalities in
terms of mood modulation, relaxation, and stress management, as well as sleep 6%
problems.
4%
Australia’s growing life expectancy and stagnant birth rate are resulting in an ageing
population, which is expected to increasingly impact the consumer health industry, as 2%
older Australians are more vulnerable to chronic illnesses. Along with overall growth in
the incidence of chronic illness in Australia, with the Australian Bureau of Statistics 0%
reporting that 79% of Australians had at least one long-term health condition and 2009 2023 2028
nearly half had at least one chronic condition in 2020-2021, this is expected to drive
demand for consumer health products in 2023, including analgesics, cough, cold and
allergy (hay fever) remedies, digestive remedies, and eye care.
The resumption of pre-pandemic habits and routines has resulted in an upswing in
exercise and outdoor activity. With gyms reopened in 2022, consumers have returned
to their workout routines, which is stimulating continued growth in demand for sports
nutrition. In addition, the resumption of outdoor sports and activities is also increasing
exposure to allergens such as dander, pollen, and grass, which is also driving demand
for antihistamines/allergy remedies and allergy eye care for symptom relief.

Competitive landscape
The competitive landscape in consumer health remains highly fragmented, with many
players carving out space in speciality categories or functionalities. Multinational
consumer health company GSK Consumer Healthcare (Haleon) is expected to remain
the overall leader in consumer health in value terms in 2023, benefiting from robust
demand for analgesics due to a prolonged cold and flu season supporting its leading
analgesics brand Panadol. However, as the Therapeutic Goods Administration (TGA) in
Australia has outlined regulations to reduce the size of paracetamol (acetaminophen)
packs sold in Australia from February 2025, which will reduce the maximum limit for
paracetamol products in supermarkets to 16 tablets in a pack, and in pharmacies to 50

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tablets in a pack, this is expected to impact the competitive landscape for analgesics
over the forecast period, as it may result in reduced volume sales, or switches to
Sales of Consumer Health by Category
Retail Value RSP - AUD million - Current - 2023 Growth Performance
alternative analgesics.
Most of the remaining top 10 players in consumer health in the Australian market are OTC
3.354,1
made up of other multinationals, due to their advantages in terms of scale and
resources, particularly in the OTC space. 2023 has also seen the acquisition of the Sports Nutrition
1.135,0
Australian vitamins and dietary supplements giant Blackmores, by the Japanese
conglomerate Kirin. This acquisition leaves Pharmacare Laboratories as one of the last Vitamins and Dietary Supplements
2.884,4
major Australian-owned players in vitamins and dietary supplements, which is
expected to impact the competitive landscape in this category. Despite the continuing Weight Management and Wellbeing
444,8
cost-of-living crisis placing downwards pressure on consumer spending, brands have
been less impacted than expected across most categories, with the largest players Herbal/Traditional Products
702,9
benefiting from strong consumer brand loyalty and brand trust even in the face of
heightened financial stress and price sensitivity. Allergy Care
352,2

Retailing developments Paediatric Consumer Health

260,6
Pharmacies is set to remain the dominant retail channel for consumer health in 2023, -5% 0% 15%
largely due to the high barriers to entry for retailing of such products, due to regulatory CURRENT % CAGR % CAGR
CONSUMER HEALTH 7.818,3
requirements around the processing of prescriptions, market prices of medicines, and YEAR % 2018-2023 2023-2028
even the location of pharmacies. In addition, Chemist Warehouse’s competitive pricing GROWTH
strategy, wide product range, and promotions are drawing increasingly value-driven
consumers to the pharmacies channel, as they seek the savings offered by this
pharmacy. Most major pharmacies are also expanding their portfolios outside of
consumer health, in beauty and personal care, for instance, which increases their role Competitive Landscape
as a convenience retail channel. However, from September 2023, changes to the
Pharmaceutical Benefits Scheme (PBS) will introduce the option of a 60-day
Company Shares of Consumer Health
prescription for nearly 100 medicines listed on the PBS, with the scheme planned to roll
% Share (NBO) - Retail Value RSP - 2023
out to more than 300 medicines by its completion in September 2024. These changes
are aimed at reducing the cost of medicines by halving the number of visits to doctors GSK Consumer Healthcare 9.2%
and prescriptions, as well as pharmacy visits, thus reducing the dispensing fees to
patients. However, the reduced footfall in pharmacies resulting from this scheme is Johnson & Johnson Pacifi... 6.5%
also expected to impact the pharmacies channel, and could potentially drive some Blackmores Ltd 6.2%
growth for supermarkets in consumer health in Australia over the forecast period.
Reckitt Benckiser (Austr... 5.3%

What next for consumer health? Sanofi-Aventis Australia... 4.3%

Swisse Wellness Pty Ltd 4.1%
In the near-term, inflationary pressures and the cost-of-living crisis are expected to
continue to impact consumer health. Rising costs on the supply side, and tightening Pharmacare Laboratories ... 3.8%
volume sales on the demand side will result in much of the expected current value Bayer Australia Pty Ltd 3.6%
growth for the industry being driven by unit price increases.
Herbalife Australasia Pt... 1.9%
However, as consumers in Australia become increasingly focused on their health and Nature's Care Pty Ltd 1.9%
wellbeing, and seek to invest in their wellness routines in a holistic manner, this is
expected to support continued growth for consumer health over the forecast period. iNova Pharmaceuticals (A... 1.7%
This proactive approach to health and wellness will drive growth for lifestyle categories Nestlé Australia Ltd 1.5%
which align with consumer values and need states, such as vitamins and dietary
supplements, herbal/traditional products, and sports nutrition, which are expected to Vitaco Health Australia ... 1.3%
lead growth for the industry in Australia. There is an increasing appetite for natural and Procter & Gamble Austral... 1.1%
herbal products which support consumers in their health and wellness goals. This trend
Metagenics (Aust) Pty Lt... 1.0%
is also leading to a blurring of the lines between functional/fortified foods and drinks
and consumer health categories, particularly vitamins and dietary supplements and Alcon Laboratories (Aust... 0.9%
sports nutrition. Functional food and drink products are expected to drive competition Nutrition Systems 0.9%
with consumer health as Australians seek wellness from within.
Allergan Australia Pty L... 0.9%
Another important trend which will continue to evolve over the forecast period is the
Other Private Label 1.7%
growing focus on sustainability. While younger consumers are drawn to all-natural
“better for you” products, they are also seeking out brands that align with their values, Others 42.3%
such as “better for the planet”. This is expected to drive innovation in packaging,
formats, and even ingredients, as consumer health brands develop vegan and
sustainable product alternatives, such as vegan collagen.

APPENDIX

OTC registration and classification

The Therapeutic Goods Administration (TGA) is Australia’s regulatory authority for
therapeutic goods. The TGA is part of the Australian government’s Department of
Health, and regulates the import and supply of drugs in Australia in accordance with
the Therapeutic Goods Act 1989 and the Therapeutic Goods Regulations 1990.
Medicines are grouped into schedules according to the appropriate level of
regulatory control over their availability to consumers. The scheduling of drugs is a
matter for the States and Territories, but all States and Territories adhere either
closely or exactly to the national standard.
OTC products can be supplied as pharmacy medicines (included in Schedule 2 to the
Poisons Standard), which are only available at pharmacies; or pharmacist-only
medicines (included in Schedule 3 to the Poisons Standard), which can be can only
be sold after speaking to the pharmacist; or general sales medicines, that are not
included in any of the Schedules to the Poisons Standard, which are available
through any retailer that wish to stock these. OTC products in Australia are largely
out of pocket, whilst prescription products are subsidised through the

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 Pharmaceutical Benefits Scheme (PBS). Brand Shares of Consumer Health
% Share (LBN) - Retail Value RSP - 2023
A new Therapeutic Goods Advertising Code came into effect in January 2019. Key
changes under the new code included: Blackmores 6.2%

New requirements for the advertising of products that consumers are not able to Swisse 4.1%
examine before purchasing, notably online sales Panadol 3.7%

Only messages critical to the consumer when selecting a product for self-treatment Nurofen 3.3%
need to be “prominently displayed” Nature's Way 2.3%
Additional guidance on the distinction between scientific claims and scientific Herbalife Nutrition 1.9%
representations has been provided, and in what circumstances specific research Healthy Care 1.9%
must be identified and/or cited in a therapeutic goods advertisement
Codral 1.3%
Endorsements of any kind must not be included in therapeutic goods
Nicorette 1.3%
advertisements
Voltaren 1.3%
Evidence of traditional use can now be mentioned in advertisements.
Zyrtec 1.1%
Requirements for child-resistant packaging are outlined in the Therapeutic Goods Bioglan 0.9%
Order 80, with the new version (Therapeutic Goods Order 95) coming into effect in
October 2018. Under these requirements, child-resistance is associated with an Caltrate 0.9%
overall pack type, rather than an individual component, such as a bottle closure. A Difflam 0.8%
substance will generally require child-resistant packaging if the amount contained in
Telfast 0.8%
a maximum prescription quantity, or the largest retail pack size, is likely to produce
significant harm in a typical 18-month-old child. This requirement is not restricted to Musashi 0.8%
medicines that are ingested, but also to medicines that may cause serious harm Claratyne 0.8%
through inadvertent contact with the eyes, skin or mucous membranes. Medicines
that require child-resistant packaging are included in a list of substances under the Nature's Own 0.8%
Therapeutic Goods Order. In the new version of the Therapeutic Goods Order only Other Private Label 1.7%
two additional substances were added: podophyllum/podophyllotoxin and alpha
blockers. Others 64.1%

5-Year Trend
Labelling requirements for Australian medicines were updated in 2016, and aimed to Increasing share Decreasing share No change
improve the readability and usability of medicine labels by emphasising the active
ingredient and critical health information of a medicine. In the case of OTC
medicines, more substances that could cause an allergic reaction needed to be listed
on labels, e.g., crustacea, fish, eggs, soya, milk, and tree nuts. The TGA adopted a
four-year transition period to minimise the cost and impact of these changes on the
industry, and to align with the International Harmonisation of Ingredient Names
(IHIN) labelling reform work which commenced in April 2016.
The TGA published new regulations in May 2023 to restrict the pack sizes of
paracetamol (acetaminophen), which come into effect from 1 February 2025. The
new restrictions will reduce the maximum size of paracetamol packs available for
general sale in supermarkets and convenience stores from 20 to 16 tablets or
capsules. The maximum pack size to be sold in pharmacies without the supervision
of a pharmacist will also be reduced from 100 to 50 tablets or capsules, and 100 tablet
or capsule packs will be available only under the supervision of a pharmacist (as
pharmacist-only medicine).
Pholcodine cough medicines were cancelled by the TGA and recalled from
pharmacies in February 2023, following a safety investigation.

Vitamins and dietary supplements registration and classification

In March 2018, the TGA implemented a list of permitted indications, which refers to
statements that describe the specific therapeutic use for complementary medicines.
In this way, TGA has abolished the “free text” box for indications; and sponsors
applying to list a complementary medicine will be required to select from an
approved list of indications that has been determined by the regulator.
Furthermore, under the new regulation there is a distinction between scientific
evidence and traditional evidence supporting claims about complementary
medicines. For instance, for a sponsor claiming that a medicine has traditional
evidence, it must have a history of medicinal use of the ingredients or medicines
that exceeds three generations (or 75 years), and it must be extensively recorded in
internationally recognised sources.
In Australia, medicinal products containing ingredients such as herbs, vitamins,
minerals, nutritional supplements, homoeopathic and certain aromatherapy
preparations are referred to as “complementary medicines”. They are regulated by
the Therapeutic Goods Association and are consequently subject to tougher
regulations in terms of safety than in most other markets in the world; a factor which
has led to a high degree of consumer confidence in the safety of vitamins and
dietary supplements. The TGA requires all therapeutic goods available in Australia or
exported from the country to be listed with the Australian Register of Therapeutic
Goods.
The Therapeutic Goods Regulations 1990 define a complementary medicine as a
therapeutic good consisting principally of one or more designative active ingredients
listed in Schedule 14 of the regulation. Lower-risk medicines can be listed on the
Australian Register of Therapeutic Goods (ARTG), while higher risk medicines must
be registered on the ARTG. Some herbs are prohibited, and all herbs permitted for
therapeutic use are recorded and listed on the Australian Herbal Names (AHN) list.

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 The TGA states that the marketing and advertising of therapeutic goods, including
complementary medicines, must be socially responsible, cannot mislead or deceive
consumers, and has to promote the quality of use of the product.
Tariff classification of vitamins and food supplements has been changed by the local
government, with some products treated as dutiable as food supplements (unless
they are imported from a free trade partner, and eligible for free trade agreement
preferential duties). These include vitamin gummies, weight loss gummies, and
similar products, which are now being classified as food preparations or food
supplements instead of medicaments. The government enacted the Customs Tariff
Amendment (Incorporation of Proposals and Other Measures) Act 2021 to amend the
Customs Tariff Act 1995.
The Therapeutic Goods Administration (TGA) has made changes to the regulation of
certain sports nutrition products with specific higher-risk ingredients, such as added
substances banned by the World Anti-Doping Agency and substances scheduled in
the Australian Poisons Standard, which may include prescription medicine
ingredients, amongst others. The decision looks to reduce risks from potentially
dangerous ingredients following a sequence of supplements-linked deaths
internationally and in Australia. From 30 November 2020, certain sports supplements
are therefore regulated as therapeutic goods (medicines).

Self-medication/self-care and preventive medicine

Self-medication and preventative care continue to be common in Australia, as
consumers look to avoid costly medical treatments. Similarly, the daily consumption
of vitamins and dietary supplements continues to be entrenched in the routine of
many Australians, due to the tradition of naturopathic practices in Australian culture.
However, in 2019, changes to regulations, including in relation to the ways in which
companies can promote or describe complementary medicines, as well as the
government’s removal of private health fund rebates for natural therapies, may
have impacted the way Australians perceive and approach these types of medicines
and therapies in the long term.
Herbal/traditional products have become increasingly popular in consumer health,
delivering consistent growth year-on-year. Many consumers view herbal/traditional
products as more effective and less harmful to their bodies than standard products.
With recurring illnesses resulting from seasonal or environmental influences, many
Australians are turning to preventive measures to stop the symptoms from
becoming full-blown conditions. This is especially evident for complaints pertaining
to coughs, colds, and allergies. Vitamins and dietary supplements are often
purchased by Australians to help maintain their health and prevent the degenerative
conditions associated with ageing.

Switches
There have been no switches from prescription (Rx) to OTC, or BTC (pharmacy) to
OTC, and no reverse switches of OTC to Rx (prescription), or BTC (pharmacy) to
prescription (Rx) between 2022 and 2023.

DISCLAIMER
Forecast and scenario closing date: 4 September 2023
Report closing date: 22 September 2023
Analysis and data in this report give full consideration to consumer behaviour and
market performance in 2023 and beyond as of the dates above. For the very latest
insight on this industry and consumer behaviour, at both global and national level,
readers can access strategic analysis and updates on www.euromonitor.com and via the
Passport system, where new content is being added on a systematic basis.

DEFINITIONS
The total market size given for consumer health is the sum of OTC, sports nutrition,
vitamins and dietary supplements and weight management and wellbeing.
The sum of these categories is greater than actual market size because allergy care is a
duplicate of categories found in cough, cold and allergy (hay fever) remedies,
dermatologicals and eye care; paediatric consumer health is an aggregate of paediatric
categories in OTC and vitamins and dietary supplements; and herbal/traditional
products is an aggregate of herbal/traditional categories in OTC and vitamins and
dietary supplements.
2023 data are provisional and based on part-year estimates.

SOURCES
Sources used during the research included the following:

Summary 1 Research Sources

Official Sources Australian Bureau of Statistics

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 Official Sources Australian Bureau of Statistics
Aus tra lia n Depa rment Of Hea lth & Aging
Aus tra lia n Government-Na tiona l Hea lth & Medica l Res ea rch Council
Better Hea lth Cha nnel
Complementa ry Medicines Aus tra lia
Thera peutic Goods Act
Trade Associations Arthritis Aus tra lia
As s ocia tion of the Europea n Self-Medica tion Indus try (AESGP)
Aus tra la s ia n Pedia try Council
Aus tra la s ia n Sleep As s ocia tion
Aus tra lia n As s ocia tion of Smoking Ces s a tion Profes s iona ls
Aus tra lia n Regula tory Guidelines for OTC Medicines
Aus tra lia n Self-Medica tion Indus try
Aus tra lia n Tra ditiona l Medicine Society
Complementa ry Hea lthca re Council
Generic Medicines Indus try As s ocia tion
Medica l Indus try As s ocia tion of Aus tra lia
Medicines Aus tra lia
Na tiona l Community Pha rma cis ts ' As s ocia tion
Na tiona l Pha rma ceutica l Services As s ocia tion
NPS MedicineWis e
Pha rma ceutica l Ma nufa cturers ' As s ocia tion Aus tra lia
Pha rma ceutica l Society of Aus tra lia
Pha rma cy Guild of Aus tra lia
Roya l Aus tra lia n College of Genera l Pra ctitioners
TGA
World Self-Medica tion Indus try (WSMI)
Trade Press Aus tra lia Fina ncia l Review
Aus tra lia n Pha rma ceutica l Journa l
Pha rma cy Da ily
Pha rma cy News
Reta il Pha rma cy
Reta il World
Sydney Morning Hera ld
The Aus tra lia n

Source: Euromonitor Interna tiona l

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