August 8, 2017
Bayer, which is already struggling with falling consumer health sales, also has a recall with which to contend. It has been retrieving more than a million cartons of its Alka-Seltzer Original.
The German drugmaker recalled 1,048,256 cartons of the product after confirming consumer complaints of holes or cracks in blister packs. The Alka-Seltzer was manufactured at a plant in Germany.
The recall included 1,067,520 12-count, cartons; 24,672 24-count cartons: and 56,064 36-count cartons, according to the U.S. Food and Drug Administration (FDA) Enforcement reports. The recall was actually issued some months ago, but it was not posted by the FDA until last week.
Bayer bet heavily on the strength of the over-the-counter (OTC) business when it shelled out $14 billion to buy the consumer health business of Merck & Co. in 2014 to become the global OTC leader. But in its quarter 2 earnings, Bayer reported that sales of its consumer health business were off 2.2% to €1.5 billion because of competition in the United States and a weak allergy season which sent sales of Claritin down 12.3%. GlaxoSmithKline, which saw growth in its consumer business slow in quarter 2, reported similar concerns.
Much of the problem was in sales of some of the brands that Bayer got from Merck. At the time of the deal, some analysts thought Bayer would be better off unloading some of those brands, saying they didn’t really fit into the Bayer portfolio.
But Bayer’s Marijn Dekkers, who was CEO at the time, said selling off a couple billion-plus sellers was counterproductive to the company’s aim to be the world leader in the category and having the brands should improve its bargaining power with drugstore chains. Some watchers thought another reason Bayer was holding onto those brands was that Bayer had overpaid for the business, and the prices they would elicit would make that clear.
Original headline: Bayer recalled 1.1M Alka Seltzer cartons as sales in consumer health business slid
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