Topline review of Alli

Implications: Glaxo Smith Kline is trying to reposition Xenical Here is a quick review of the past.  It should be a solid indicator for the new initiative. Historical evolution of Alli: 1] GSK sales for Xenical $115.6 mil in 2004, down from $154.5 mil in 2002 2] Gastrointestinal side effects caused slow down in sales 3] For 2006 GSK plans to introduce OTC version of Xenical “Alli” 4] Q1 2007 GSK received approval for Alli 5] Expected launch in Q2/Q3 of 2007  Expectations by GSK: 6] Supported by $100 mil ad campaign 7] Expected $1 bil business within 10 years will reshuffle category What will truly happen: 8] High initial trial rate will impact big players in the category 9] However, impact will not be as big as 1994 DSHEA impact !

Analysis: Summary:

A lot of hype for something already proven "not working". People want the magic pill, but this is not it, since you still have to diet and exercise while you make sure you bring a second pair of pants - three things people do not want to do!
Trial rate will be good but GSK picked the worst time to introduce a diet pill.  The summer month are a down cycle for the diet market!  By the time the season heats up (Jan 2008) the trialers are gone and go back to other solutions.  The big players (WTW, JC, NTRI) should have nothing to worry about.