Glaxo injects Grey with big DTC ad dose

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Glaxo Wellcome has shifted an estimated $100 million in spending to Grey Advertising for its Zyban and Wellbutrin direct-to-consumer Rx accounts.

The windfall comes a month after the New York shop won Glaxo's $40 million assignment for migraine drug Imitrex. In total, about $175 million in DTC spending from Glaxo now is housed at Grey, including an estimated $35 million for respiratory drugs Flonase, Flovent and Serevent.

The Zyban/Wellbutrin shifts were said to be coordinated by marketing executive Lisa Gonzales, who recently joined Glaxo as VP-central nervous system marketing from Novartis, where she had a close relationship with Grey.

Grey referred calls to Glaxo, which couldn't be reached for comment by press time.

REINVIGORATING ZYBAN, IMITREX

In the case of Zyban, a smoking-cessation drug, and Imitrex, a migraine medication, Grey will be charged with reinvigorating two brands with sagging sales. For Wellbutrin, the agency is expected to continue the drug's recent positioning as an antidepressant that doesn't cause sexual side effects.

Glaxo is banking on that to give the drug a lift from its No. 4 position in the category.

Zyban had been handled by FCB Healthcare, New York and San Francisco, since its launch in 1997. But Ms. Gonzales is said to have grown disaffected with the agency as it prepared a new DTC effort that was launched Nov. 13, ahead of New Year's stop-smoking resolutions.

That campaign positions Zyban as a drug that doesn't require smokers to quit cold turkey. Grey is being asked to tinker with the creative, an executive close to the marketer said.

Wellbutrin, the No. 4 player in the U.S. retail antidepressant market, had been housed at Consumer Healthworks, New York, which last month launched an unbranded campaign that seeks to promote the drug as an option that will treat depression without affecting a person's libido. The agency recently announced plans to merge with Merkley Newman Harty, New York, in January.

STRONG RESPONSE

Consumer response measured in terms of calls to a special toll-free phone number was strong, another executive close to the marketer said. However, Wellbutrin still trails Eli Lilly & Co.'s Prozac, Pfizer's Zoloft and SmithKline Beecham's Paxil.

Grey is expected to move to a brand-focused effort that mentions Wellbutrin by name, perhaps next year.

Imitrex had been at Klemtner Advertising, New York. Grey has yet to launch new creative since it grabbed that business.

All six Glaxo accounts are handled internally by Grey's Over-the-Counter & Direct-to-Consumer Pharmaceuticals division, formed in late 1998 as healthcare marketing drew an increased emphasis from top agency executives.

John Edwards, Grey exec VP-account manager, and Mark Schwatka, exec VP-executive creative director, have spearheaded the account wins.

With Ms. Gonzales' leadership at Glaxo, Grey could be in line for future DTC assignments in the central nervous system category, including new migraine drug Amerge that's expected to hit the market next year and compete with the marketer's own Imitrex.

GONZALES' EARLIER MOVES

In 1997, Ms. Gonzales, then Novartis' VP-marketing, led a reconfiguration of the marketer's roster shops that proved to be a boon for Grey. Novartis reduced its agencies from eight to five, and in the process Grey--already on board for Maalox and Ex-Lax--added anti-fungal products Desenex and Cruex as well as Dulcolax laxative.

Back then, Grey also added the account for Lamisil athletes' foot medication, a prescription product moved over-the-counter this year with a $15 million to $20 million national campaign, as well as assignments for dietary supplement Perdiem and the small DTC account of Transderm Scop, a motion-sickness drug.

Glaxo is counting on DTC efforts to inject some vitality into its Zyban and Imitrex businesses. Sales of both are down this year and Glaxo has warned that it won't show double-digit sales and earnings growth this year.

After initial success with Zyban following its 1997 launch, the drug has struggled, perhaps because the initial buzz has slowed.

"It's a lifestyle drug, and the expectations [for such drugs] are usually higher than what the drug can do," said Sergio Traversa, an analyst with Mehta Partners.

ZYBAN DOWN 27.2%

U.S. retail sales of Zyban through October were down 27.2%, to $114 million, from the same period last year, according to consultancy Scott-Levin.

Some of the decline is attributed to increased interest by consumers in OTC competitors, such as SmithKline Beecham's Nicorette and Nicoderm CQ.

The products are No. 1 and No. 2 in the OTC smoking-cessation category; Nicorette's sales are up 11.2% to $336 million for the 52 weeks ended Oct. 10, according to Information Resources Inc., while Nicoderm CQ is up 5.2% to $224 million.

A third OTC product, Nicotrol, from Johnson & Johnson's McNeil Consumer Healthcare, posted $16 million in sales, up 49% over the same period. Nicotrol products also are sold in prescription form.

Copyright November 1999, Crain Communications Inc.

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