ZANTAC: A SUCCESS STORY THAT TURNED TO AN END

Ranitidine, sold under the brand name Zantac is a medication known to inhibit the production of stomach acid. It is used to treat stomach conditions like peptic ulcer disease, and gastroesophageal reflux disease.

In 2020, The FDA declared it was requesting manufacturers to remove all prescription and over the counter (OTC) ranitidine drugs from the market instantly due to the formation of N-Nitrosodimethylamine (NDMA) – an impurity found in ranitidine – that increased over time when kept at higher than room temperatures. It was found that it is a potential human carcinogen. The FDA decided that it should not be obtainable by consumers anymore unless they assure its quality.

However, we do not want to forget the favor of Zantac over GSK. Let’s start at the beginning and how the best-selling drug of all time was behind the shift that helped the well-known company get to where it is now.

How It All Started

In the 1970s, GSK – Glaxo then – was a midsized UK pharmaceutical company. Companies in the pharma industry were racing to create an anti-ulcer drug before which, surgery was the only cure. Until Smith Kline launched Tagament in 1976 after which it became the world’s best-selling drug.

The Stumbling Blocks

Glaxo had not launched Zantac until 1981. Being a late arrival would make it a challenge to break into the market, prove its worth and reach more consumers.

Setting a price was another question. They had three strategies in mind. Low price and high volume, high price and low volume, and medium price and medium volume.

The last and the most challenging part was the US market and how to utilize the company’s sales force to expand more. Back then, their sales team consisted of three hundred people. Which was not enough to make a massive impact.

Due to the previous challenges, Glaxo had a few questions to tackle. How to convince people that they are not just another antacid but even a better option. How to reach out to more people with a relatively small sales team. The company had a few approaches.

Read: PHARMA AND HEALTHCARE DIGITAL MARKETING STATISTICS THAT WILL BLOW YOUR MIND

Three Unusual Strategies to Expand More

First, the medicine worked similarly to Tagament but had a couple of more advantages like needing fewer dosages per day and fewer side effects. In addition to that, people were already familiar with how it worked. The company emphasized the idea that they are the best in terms of dosage and side effects.

Another approach was to charge a package higher for wholesale. Paul Girolami, the CEO wanted to charge high to connect high price with high quality. This way, the product would appear as something more valuable rather than just the new kid on the block.

One more unusual strategy was to team up with someone to support them with their salesforce team. Hoffmann-La Roche was interested because there was a mutual interest. The patent protection for their most important product Valium was about to expire and they needed to break new ground. As a result, a sales team of 1,000 was more than enough to market Zantac.

By 1985 the market share in the UK reached up to 50 percent and global sales reached £432 million.

So, does an ingredient in Zantac cause cancer? The legal battle to answer that question is not over and could cost dozens of defendants billions of dollars but anyway let’s not forget it was the reason for the big shift that the company has reached so far.

Read: METAVERSE & HEALTHCARE

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