• by Les Luchter , March 29, 2023

Wednesday’s Food and Drug Administration approval of opioid overdose antidote Narcan (naxolone) for nonprescription use brings its manufacturer, 25-year-old Emergent BioSolutions, into the over-the-counter drug market for the first time.

While pharma giants like Johnson & Johnson have been exiting the OTC/consumer business, “it makes a lot of sense for Emergent to enter this particular OTC market, as they already make both prescription and generic versions of Narcan," Benchmark Senior Research Analyst Robert Wasserman tells Marketing Daily. Emergent is "also the first to win OTC approval, and this puts them ahead of the field.”

That field includes naxolone competitors from Teva and Sandoz, the latter of which is actually a revenue-generator for Emergent, due to a deal between the two companies.

However, Emergent’s Narcan has seen revenue decreases since those competitors launched in December 2021.

Last month, the company announced sales of Narcan nasal spray -- the iteration approved by the FDA in a 4-mg version -- at $91 million in the fourth quarter 2022, down year-over-year. For all of 2022, sales declined 14%, following a 40% increase in 2021.

But Wasserman says that drop can be attributed to lower pricing by the generics, while Narcom unit sales likely increased.

On an earnings call with analysts last month, Emergent president and CEO Bob Kramer acknowledged that the competition had hurt Narcom sales particularly at retail pharmacies, but that the brand had stayed strong in its major market: community health customers. He explained that Emergent has had “a six-year head start in establishing really strong relationships with a rather fragmented public interest market that allows us to respond and to deliver on-service commitments in a very meaningful way.” 

The OTC entry, Kramer said, will give EBS “the opportunity to be back into and compete in the retail space…We have had really positive conversations with a number of the nationwide pharmacy retailers that are anxious to get the product into their stores.”

Emergent’s 2023 guidance, which accounts for the upcoming OTC launch, forecasts Narcan nasal spray sales at $290 million to $310 million this year -- but with the public interest market still accounting for a majority of sales, chief financial official Rich Lindahl told analysts.

Emergent said the OTC product won’t be available to consumers until late summer due to the need for manufacturing changes to support new labeling and packaging, as well as necessary supply chain modifications.

Not just OTC, but the retail pharmacy business itself, is relatively new for the company, which is largely in the business of supplying governments with stockpiles of medicines for potential public health emergencies -- like anthrax and smallpox vaccines, which accounted for an average of $620 million in annual revenues over the past three years.

And, while consumer OTC is new for Emergent, the company has already been in the direct-to-consumer business, selling its Reactive Skin Decontamination Lotion Kit via Amazon. That product, developed for the military to use in cases of chemical attacks, recently secured a $380 million contract with the U.S. Department of Defense.