Reckitt Benckiser Manages Its Heroin Habit

After losing U.S. patent protection in 2009 for its Suboxone tablet, designed to help heroin users quit, Reckitt Benckiser Group warned that the entrance of a generic competitor could erode its pharmaceutical sales and profit by 80 percent. That drew calls from worried analysts for Reckitt Benckiser, which gets the bulk of its revenue from selling home and personal-care products such as Lysol cleaners and Durex condoms, to sell the business before it hit that so-called patent cliff. Instead, the British company aims to forestall a generic showdown by switching users to a form of the drug delivered by a dissolvable strip that’s placed under the tongue. The patent on that version of the drug doesn’t run out until 2025.

To get people to switch, Reckitt Benckiser is thinking more like a consumer company than a drugmaker. It’s drawing on a marketing technique first pioneered by Coca-Cola more than 100 years ago: coupons. By offering up to $45 a month toward a user’s co-payment in the U.S., RB is making the film version—think Listerine Pocketpaks—close to free. That means patients who get the bill subsidized by health insurance have little incentive to transfer to a generic pill if one appears. Says Martin Deboo, an analyst at Investec Securities in London: “They’ve done a good job of making a silk purse out of a not very compelling situation.”