TV Ads for Rogaine to Sprout

Pharmacia & Upjohn is launching TV spots for its over-the-counter baldness treatment this weekend amid a high-stakes effort to fend off competitors to Rogaine.

The spots, aimed at men and women, aren’t hair-raising in themselves. In one commercial, a balding man uses Rogaine at the urging of his wife and sees modest results four months later.

“See, there’s room for growth in every relationship,” says his wife.

The spots are part of a broader effort to alert consumers to the drug, which until now has been available only by prescription. Pharmacia & Upjohn received government approval to begin selling it as a nonprescription treatment Feb. 9.

The company’s success in selling the drug depends in large part on its ability to keep competitors at bay.

Pharmacia & Upjohn on Monday obtained a federal court order temporarily preventing the sale of hair-loss treatments containing minoxidil, the active ingredient in Rogaine. Industry analysts said competitors could steal at least a third of Rogaine’s sales.

The company is suing the Food and Drug Administration for allowing competitors to offer the baldness treatments. The company contends it is entitled to a three-year monopoly on the drug in return for developing it.

Industry analyst Joseph Riccardo of Bear Stearns & Co. said competition could reduce Rogaine sales by up to half, because competitors are expected to charge less than Rogaine’s price of $29.50 for a one-month supply.

“They need at least a year to establish brand loyalty out there,” Riccardo said.

The FDA has not detailed its reasons for denying Pharmacia & Upjohn a monopoly on the drug.

Beth Hecht, general counsel for Alpharma, one of the companies seeking to sell minoxidil, accused Pharmacia & Upjohn of being anticompetitive. She said her company had already shipped its baldness treatment to stores, but can’t sell it because of the court order.

As a prescription drug, Rogaine never lived up to investor expectations, in part because the drug does not work on everyone. It is effective only with people who are in the early stages of an inherited baldness that begins with a thinning of hair at the top of the scalp.

Pharmacia & Upjohn estimates that 40 million men and 20 million women have the condition.

Rogaine requires diligence. It must be used four times a day and can take up to four months to see results. Rogaine’s effects wear off when the product is discontinued.

To encourage consumers to use the topical product, the company has established a toll-free number for advice and questions. The company also plans to send consumers a regular newsletter with tips on hairstyling and discount coupons on Rogaine.

Though the product is the same, it is being sold in a blue box to men and in a pink box to women. Bill Sever, marketing vice president for London-based Pharmacia & Upjohn, said women responded better to a product that appeared specifically for them.

Rogaine was initially marketed for men.

“The biggest challenge we have is to get people thinking about it as an everyday hair-care product,” Sever said. “We are trying to present it as part of the grooming process.”

Sever said he expects unit sales of Rogaine to at least double the $100 million from 1995, when it was available as a prescription drug. That would represent the same amount of revenue to Pharmacia & Upjohn, because the company has reduced the price of Rogaine by half.

Riccardo said Rogaine sales could hit $150 million this year if Pharmacia & Upjohn has the market to itself.