GSK Consumer to step up focus on new products

Company MD Manoj Kumar says that existing brands offered enough room for growth in these categories

GlaxoSmithKline Consumer Healthcare, the maker of brands such as Horlicks and Boost, will step up its focus on new products. Voltaren pain reliever and Otrivin nasal drops, which come from the joint venture with Novartis, will be integrated into the GSK system.

In a conversation with Business Standard, GSK Consumer's MD Manoj Kumar said that the integration process would be completed in the next few months, paving the way for the company to begin sales and marketing of the two brands. "Globally, Otrivin and Voltaren are big brands. Their inclusion into the OTC portfolio will be key additions," he says.

The integration comes after the sale last year of Novartis's OTC business to GSK Consumer for nearly Rs 110 crore. This followed the divestment of Novartis AG’s global OTC business, including all of Novartis AG’s major OTC patents, trade-marks and R&D assets to GSK in a three-part transaction. Other parts of the deal included the creation of a global joint venture in consumer healthcare and the sale of GSK's cancer drugs portfolio to Novartis as well as the movement of Novartis's vaccines business to GSK.

GSK Consumer, for the record, derives a fee for its sales and marketing activities on OTC and oral healthcare, which is reported as other operating  income or auxilliary income by the company in its books.

For the quarter ended December 2015, auxilliary income grew 9.11% to Rs 40.7 crore for the company. In the September and June 2015 quarters, auxillary income was higher at Rs 51 crore and Rs 54.7 crore, a growth of 31% and 23.1% respectively over the corresponding periods a year ago.

In the last few years, GSK Consumer has increased its presence in OTC and oral care, launching brands such as Sensodyne and Parodontax (in oral care), while brands such as Iodex (in OTC) was relaunched to make it relevant to the consumer.

In the past, GSK Consumer had indicated that it was keen to beef up all its portfolios. While Kumar did not indicate which other new products would be added to segments such oral healthcare, he did say that existing brands offered enough room for growth in these categories.