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Vetco finds profitable niche with additive-free O-T-Cs.

MELVILLE, N.Y. - Vetco Inc. is a young company that develops over-the-counter drugs designed to offer effective relief without the unnecessary and potentially harmful additives that are commonly used. It then packages the products for immediate recognition and prices them aggressively.

An example of the company's strategy is the cough medicine Clear Cough, whose nondrowsy, nonnarcotic formula combines the cough suppressant dextromethorphan (30 mg. per dose) with the expectorant guaifenesin (200 mg. per dose). Absent from the formula are dyes, sugar, alcohol, sodium, antihistamines and decongestants - additives unadvisable for people with heart disease, hypertension, certain allergies, diabetes, thyroid problems or alcoholism.

But the potential users of Vetco's products extend beyond even the estimated 80 million who suffer from one or more of those problems. "Our products are really for everyone who wants to avoid unnecessary additives, not just for diabetics," explains president Matt Kornberg. "They should be the choice of many people once they read the fine print on competing brands."

Vetco's most extensive line to date is a complete coordinated one for first-time parents and their young children called Little Products. The line is designed to attract first-time parents because the packaging tells them clearly what each product is for.

What has made it such a success, however, is the fact that the products contain no saccharin, dyes, sugar or alcohol. Parents, even more than consumers in general, are wary of unnecessary additives in products they buy for their children.

As a result of the success of Vetco's Little Noses saline spray/drops and Little Noses moisturizing gel, for example, the company recently added Little Noses 0.13% decongestant drops, for children from 2 to 5 years old with severely clogged noses.

The Little Products line also includes Little Tummy's gas relief drops, Little Bottoms diaper rash ointment and Little Teethers oral pain relief gel.

To help promote the line Vetco has produced guides containing helpful hints on child care and done an extensive mailing of the booklets to pediatricians and new parents. The guides, which come with $1 rebate coupons good on any Little Products item, are also part of the floor stand merchandisers for the line that the company makes available to retailers. Floor stand merchandisers are also available for Clear Cough products.

A pharmacist himself, Kornberg teamed up with fellow pharmacist Kenneth Wolk (who now serves as vice president of Vetco) in 1990 to market a supplier's remedies in the Northeast. Two years ago they purchased that company.

"Our goal," notes Kornberg, "has been to develop a full line of innovative niche products drawing on our background as pharmacists. We develop products that will be effective without unnecessary additives."

Vetco has enjoyed a significant increase in distribution in the last year, according to Kornberg, and its products have performed very well at retail. The company has gained placement in major drug-chains, discounters and supermarkets across the country. "We have come a long way in the last two years," adds Kornberg.

Repackaging its line was among Vetco's accomplishments, a process that also involved changing the cough medicine's name from Medatussin to the "more marketable" Clear Cough. The product's subsequent success has prompted the company to extend the line this fall with a nighttime formula.

Like the original, Clear Cough nighttime formula excludes the dyes, decongestants, sugar, alcohol and sodium that would make it unsuitable for many people. Decongestants and other additives can also be counterproductive in products designed to put coughers to sleep, notes Kornberg. Clear Cough nighttime formula, on the other hand, achieves that result simply and effectively through an antihistamine and a cough suppressant.

Another Vetco product finding growing acceptance among retailers is a mouth pain remedy called Medadyne liquid that's designed for canker sores, cold sores and fever blisters. Its triple-action formula provides not only an anesthetic to alleviate the pain of mouth sores, but also an antiseptic to prevent the infection from spreading and an astringent to shrink sores.

In addition, camphor menthol helps Medadyne liquid dry up lesions faster than most other brands on the market, according to Kornberg. And since it's a liquid Medadyne can also be used as an antiseptic rinse or gargle in cases of multiple lesions.

"Vetco's products perform best when they are merchandised next to the national brands in their respective categories," explains Kornberg. "There's no need to merchandise them separately. Our packaging tells people clearly what the products are for.

"The price difference between the company's products and national brands is also easier to appreciate when the two are merchandised side by side."
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Title Annotation:The 1995 National Association of Chain Drug Stores MarketplaceConference; Vetco Inc.; over-the-counter drugs
Publication:Chain Drug Review
Date:Jul 3, 1995
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