Retail News Breaks
CVS addresses Tylenol supply issues
January 15th, 2013
NEW YORK – CVS Caremark Corp. has confirmed reports that supply shortages of McNeil Consumer Healthcare pain relievers, namely Tylenol, have led CVS/pharmacy to reallocate their shelf space at many stores.
A CVS spokesman said in a statement Tuesday that the drug chain has been working with Johnson & Johnson's McNeil unit to address supply issues since a series of product recalls beginning in 2009 — and including such brands as Tylenol and Motrin — led the manufacturer to shut one of its plants.
On Monday, Reuters reported that CVS, which operates over 7,400 drug stores, has stopped stocking some of its stores with Tylenol because supply shortfalls left empty spaces on shelves. The report said CVS would try to have the product in stores in each market.
"CVS/pharmacy has a long-standing, cooperative relationship with McNeil Consumer Healthcare, and we are committed to offering their pain relief products in as many of our stores as they can support," CVS spokesman Mike DeAngelis stated Tuesday. "CVS and McNeil are committed to increasing the number of stores offering McNeil pain relief products as they become available. In fact, this month, the number of CVS stores in which these products are sold is doubling to approximately half of the stores in our chain."
DeAngelis said that as CVS and McNeil have worked to resolve the supply problems, the drug chain has regularly adjusted its merchandising based on the products' availability.
"This is not a new strategy," he explained. "Last year, we made the decision to minimize out-of-stock issues for McNeil pain relief products by resetting shelf space in stores where McNeil could not supply product. This helps to ensure that in the CVS stores where McNeil pain relief products are merchandised, we will be in-stock for customers.
"We believe this is a unique solution in a retail channel where many of our competitors are still contending with empty shelves where McNeil products are normally sold," he added. "We look forward to continue working with McNeil to return their pain relief products to all of our locations in the future."
McNeil voluntarily closed its plant in Fort Washington, Pa., in April 2010, following extensive recalls of children's and adult over-the-counter medicines.
In March 2011, McNeil finalized terms of a consent decree with the Food and Drug Administration in which remediation efforts at the plant would need to be certified by an independent expert before the FDA could clear the facility to be reopened.
Johnson & Johnson has indicated that it expects the Fort Washington plant to restart production in 2013.
Meanwhile, the products' return to store shelves has progressed slowly. Pharmacy operators and other over-the-counter medicine retailers have responded to customer demand, in part, by boosting their private-label and store-brand offerings.
For the 52 weeks ended Dec. 2, 2012, drug store dollar sales of Tylenol internal analgesic tablets were down 33.2% year over year, and unit sales were down 31.1%, according to data from SymphonyIRI Group.
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