No.1941
08/17/2018

OTC (Over-the-Counter Drugs) Market in Japan: Key Research Findings 2018

Yano Research Institute (the President, Takashi Mizukoshi) has conducted a survey on the domestic OTC (Over-the-Counter Drugs) market and has found out the market trends, the trends by segment, the trends of market players, and the future outlook.


Figure: Transition of Domestic OTC Market Size
Figure: Transition of Domestic OTC Market Size

Market Overview

The OTC market size (including designated quasi-pharmaceutical products) in 2017 grew by 1.0% to attain 828,000 million yen, based on the shipment value at manufacturers. The details are: OTC drugs grew by 1.5% to achieve 680,000 million yen, designated quasi drugs declined by 1.3% to 148,000 million yen.  The market has risen for 5 consecutive years since 2013, but the overall growth has slowed down.

OTC has become exempted from taxation since 2014, which encouraged inbound tourism demand to rapidly expand by 2015.  The demand has subdued by 2016 and beyond, but the market has continued its stable growth which was contributed by the favorable sales of eye drops, antipyretic analgesic, cataplasms/plasters, and vitamin preparations in conjunction with invigoration of the domestic market by means of launching new products.  On the other hand, energy drinks and small-bottled health drinks have continued being on the decline due to fierce competition with health beverages including Food for Specified Health Uses (FOSHU) and general beverages

Noteworthy Topics

OTC market in 2017 has grown against a backdrop of contribution of some drug efficacies becoming included in new OTC products to invigorate the market and continued stable growth of inbound tourism demand though it subdued from once frantic status.  On the other hand, the market in terms of domestic demand tends to be and continues slowing down.  Now that the impact of inbound tourism demand to the market has been on the decline, the market needs to be earnestly stimulated in order for it to keep on growing.

The following can be the solutions: 1) Introducing *switch OTC to the new area of demands, creating a new market using switch OTC that have new efficacies, 2) Generation of new demand by promoting new products with unprecedented angles, 3) Finding out potential demands from the existing efficacy by making an appeal from different point of view 4) Creating a system to communicate and consult with retailers, 5) expanding new opportunities of selling the products in association with increase of new entry from different retailing business.  These attempts of new product promotions and enhancement of providing information may improve awareness of self-medication and action reform.

*Switch OTC is a kind of OTC permitted by MHLW to include ingredients that used to be permitted to contain in ethical drugs that require prescriptions.

Research Outline

1.Research Period: From April to July, 2018
2.Research Object: Domestic leading OTC enterprises (manufacturers, wholesalers, retailers, etc.)
3.Research Methogology: Face-to-face research by the expert researchers, surveys via telephone/email, mail-in questionnaire, and literature research

What is OTC (Over-the-Counter Drugs) Market?

OTC stands for “Over the Counter Drugs” and means that the medicines sold to customers without any prescription from health care professionals, whereas the prescription drugs only sold on prescription to the patients.
Size of the OTC market in this research is calculated by totaling the shipment amounts of both OTC (including guidance-needed medicines, first, second, and third-category nonprescription drugs) and designated quasi drugs (which are items that became quasi drugs designated by Ministry of Health, Labour and Welfare).

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