United States OTC Drugs Market

U.S. Over the Counter Drugs Market Size (2024 to 2032)

The U.S. Over the Counter Drugs Market size was worth USD 27.75 billion in 2024 and is estimated to grow at a CAGR of 6.2% to reach USD 44.90 billion by 2032.

Current Scenario of the U.S. Over the Counter Drugs Market

The United States over the over-the-counter drugs market witnessed notable growth in recent years despite facing multiple obstacles. The rising customer health consciousness, rising population and technological developments in drug discovery and e-commerce platforms are driving forward the market growth. Moreover, the industry also benefited from the surge in the trend of self-care with OTC medicines which further influences the demand for these products. According to research, it was revealed that a total of 167.1 billion dollars was the annual savings in 2022 as every dollar used for over-the-counter drugs on average saves 7.33 dollars for the US healthcare system. In all the yearly savings, the maximum amount was preserved from unnecessary doctor visits i.e. 110.3 billion dollars and the rest 56.8 billion dollars from the drugs.

However, the US OTC drugs market growth was hindered by the sluggish economy, strict costly and prolonged FDA approval procedure for Rx-to-OTC switches, intense competition from generic and store-brand OTC products and pricing pressures.

MARKET DRIVERS

Changes in cultural attitudes toward self-medication for minor health problems, the convenience of direct purchase, affordability of over-the-counter drugs, high adoption and acceptance in developing markets, savings enabled by the use of over-the-counter drugs, and drug innovations and developments are a few of the key factors driving the U.S. over-the-counter drugs market. In addition, the rising prevalence of ailments such as gastrointestinal disorders, dermatological infections, obesity, sleep disorders, and flu, to name a few, is driving up medicine demand.

In the United States, the growing tendency to switch from prescription to over-the-counter (OTC) drugs is expected to boost the market growth in the coming years. To improve and increase self-medication, companies are moving prescription medications to OTC drugs. In addition, the cost-effectiveness of OTC medications boosts demand for them even more.

The United States over the counter drugs market is believed to expand owing to the emerging pattern of enabling OTC healthcare items for sale from vending machines. For example, bandages, painkillers, sanitary and cold medicine products. This policy shift will support providing daily medal goods in a cheaper and more accessible way.

The market is also likely to propel further because of the new proposal of extending formulary lists to involve select OTC drugs.  to efficiently and safely address small diseases, and illnesses or augment prescription programs which will reduce expenditures. Likewise, opioid substitutes for pain relief acetylsalicylic acid to lower cardiovascular dangers and antihistamines for moderate sensitivities offer potential opportunities.

MARKET RESTRAINTS

Persistent presence and sales of unapproved and mislabelled drugs, gradually increasing pressure on pharmacists coupled with YoY rise in the dilemma of choosing between oath and job are some of the main factors impeding the United States over the counter drugs market growth. Companies such as Walmart, Rite Aid, CVS and Walgreens have constantly reduced pharmacy staffing levels while concurrently burdening their frontline workers with a growing list of extra duties. Moreover, the expansion of the regional market is also affected by the bad working environment and immoral practice of threatening discipline and job cuts. In addition, sluggish economic growth and lower customer spending power in the country in the last few years have significantly impacted the sales of OTC drugs. Additionally, the high cost of prescribed drugs has been another key issue derailing the local industry’s growth trajectory. For instance, the prices on average are 2.78 times inflated than those present in 33 other nations, as per a survey.

The United States over the counter drugs market growth is hampered by several factors including the highest drugstore closures and increasing hacking incidences for illegal prescriptions, high sales tax for OTC health products, supply chain issues like trade disputes, labour scarcity, recalls, extreme climate change or world crises and compliance failures. Moreover, difficulty in complying with the state’s supplemental labelling rules in addition to the lowest FDA requirements or USP levels besides this, certain states and districts are considering enforcing extra labelling rules for OTC medications are further obstacles in front of the US market.

SEGMENTAL ANALYSIS

U.S. Over the Counter Drugs Market Analysis By Formulation Type                             

• Tablets
• Liquids
• Ointments              
• Sprays      

The tablets segment secured the top spot in this category in the United States over the counter drugs market. This is attributed to its stability and simplicity of packing, transporting and distributing. Besides this, other main factors fuelling the high consumption of OTC tablets involve the rising incidence of diseases, growing investments in research and development projects and targeted strategies by market companies like product authorizations and introductions. Furthermore, the steady rise in the development and approvals of new OTC drugs is the result of consumer preference for tablets because of busy lifestyles. For example, In April 2024, Amneal Press released the approval by the U.S. FDA of its over-the-counter (OTC) Naloxone Hydrochloride Nasal Spray for an Opioid Overdose in case of emergency treatment.

U.S. Over the Counter Drugs Market Analysis By Product Type                     

• Cough, Cold, and Flu Drugs
• Analgesics
• Dermatologicals   
• Gastrointestinal Drugs
• Antiseptics             
• Anti-Allergy Drugs
• Smoking Cessation Aids    
• Ophthalmic Drugs
• Vitamins and Minerals      
• Sleep Aids            
• Weight Loss/Diet Products           
• Others (Ear Drops & Diuretics)    

The analgesics segment captured the largest portion of the United States over the counter drugs market share and is expected to gain further during the forecast period. The segment’s market size is largely comprised of analgesics internal including other pain which generated sales of 4916 million dollars and the external category registered 1370 million dollars in 2023. In addition, the US industry is the biggest revenue earner in this market and is expected to cross more than 7 billion dollars in 2024. However, the growth rate of the segment was derailed by inflation which led to changes in the consumption pattern. Also, the external analgesics witnessed lower market penetration because of the reduced buying incentives, customer preference for medicinal pain relief and the lack of innovation.

The cough, cold and flu segment gained the second position and holds a notable market share. As per the US government, it is forecasted that around 25 thousand die, approximately 390000 hospitalised and at least 35 million illnesses due to flu as of this season in 2024. Moreover, the segment’s market size is expected to expand owing to the increase in the pace of the development of new cough and cold syrups. This advancement is due to the US FDA in September 2023 declining to support the effectiveness of cold and cough syrups oral OTC medicine made with phenylephrine as an ingredient.

By Distribution Channel                        

• Pharmacies/Drugstores    
• Supermarkets/Hypermarkets        
• Convenience stores           
• Others (Online Drugstores)

The pharmacies/drugstores segment continues to be the leading category of the United States over the counter drugs market. This dominance can be linked to the high population density around community pharmacies. The segment’s market share was also boosted due to a significant increase in patients in the post-COVID-19 period.  According to a survey, there are over 67 thousand pharmacies in the country and more than 88 per cent of people reside under the 5-mile area with at least 1 pharmacy among them. This living pattern is boosting the sales and market size of the segment. Additionally, between early 2021 to May 2023 over 300 million COVID-19 vaccine doses were provided from community pharmacies i.e. greater than 2 in every 5 dogeneses managed in the country. Consequently, substantially boosting the reach of the segment.

Country Analysis

The United States over the counter drugs market experienced steady growth. This can be credited to the growing transition to online sales and e-commerce applications coupled with the surging pace of digital transformation of pharmacies. It also improves the availability of drugs, a major industry trend accelerating the market growth rate. However, the key constraint in front of this market is the extensive use of unbranded generic medicines because they capture about 90 per cent of the prescription volume and cost around 67 per cent of the average price against other countries. It was further discovered that the gap broadened for name-brand drugs in the United States and this was even on average 4.22 times higher in comparison to other countries, which significantly decreased the industry’s revenue generation abilities.

Key Market Players

A few major companies are Eu Yan Sang International Ltd, Bayer AG, Johnson & Johnson, GlaxoSmithKline plc, Merck Pte Ltd, Sunward Pharmaceutical Pte Ltd, Beacons Pharmaceuticals (Pte) Ltd.

Recent Market Developments

• In June 2024, Hikma Pharmaceuticals PLC acquired a stack of US injectable or finished dosage form (FDF) assets for 135 million dollars in cash and 50 million in potential milestones from Xellia Pharmaceuticals, a Copenhagen-based company. The assets purchased include a production factory in Cleveland (Ohio – USA), marketing and sales abilities, a research& development center in Zagreb (Croatia), a pipeline of differentiated goods and a commercial portfolio.
• In March 2024, the Food and Drug Association (FDA) issued letters to 6 market companies for promoting unauthorized, misbranded and mislabelled OTC analgesic goods.