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Johnson & Johnson's Ortho Pharmaceuticals February introduction of the prescription skin cream Renova, with a marketing war chest of $20 million, has put cosmetics marketers on the alert.

An almost immediate blow will be felt by rival alpha hydroxy acid skin treatments, the fastest growing skincare category segment with 1995 sales of $500 million, up an estimated 35%. Major players include Estee Lauder Cos., Avon Products and Unilever's Elizabeth Arden Co. and Chesebrough Pond's USA.

AHA products, sold in retail cosmetics sections and direct to consumers, can only claim to affect the skin's surface. But Renova, with Food & Drug Administration approval, can say it works on all layers of the skin-reducing fine wrinkles and brown spots and slowing the natural aging process when used with a comprehensive skincare and sun avoidance program.

J&J's Neutrogena subsidiary is said to be working on a companion line of non-prescription skincare products.

Said David Cohen, category director at Chesebrough-Pond's: "Renova will have a major impact on the facial-care marketplace, though consumers need to be aware that it can cause sun sensitivity."

That sensitivity is a well-known side effect of Retin-A, a J&J prescription drug for acne and the forebear to Renova. Indeed, the marketer last year pleaded guilty to Justice Department charges of marketing Retin-A as an anti-wrinkle cream.

Renova's first-year sales should hit $100 million with consumers spending $60 for a slickly designed tube. Though J&J has indicated no plans for an OTC launch, competitors expect one by 2000, producing $200 million in incremental sales.

"It will be like when J&J's Tylenol went from prescription to OTC," said Allan Mottus, an industry consultant."They have [developed] the `cosmeceutical'... and a path for ethical [drugs to be moved] to global OTC product, using their Neutrogena and RoC subsidiaries."

He believes L'Oreal and Procter & Gamble Co. have competitive products in the works.

Ortho is expected to use both TV and print advertising. The company wouldn't disclose marketing plans, but said they would be submitted for FDA approval soon.

DDB Needham Worldwide, New York, handles direct to consumer ads. A direct marketing campaign is expected to play a major role. No agency has been named for the introduction, but DDB Direct and sister Omnicom Group agency Rapp Collins are said to have the inside track.

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