Fledgling bioceutical firm moves fast to market

A fledgling Reno company a fledgling, however, with well-heeled parents is ready to roll out a $7 million national advertising campaign to support its introduction of four over-the-counter medicines.

American Bioceuticals Inc. has won shelf space from CVS/Caremark, which operates 6,200 retail pharmacies nationwide, for a product that fights muscle cramping.

Michael Nelson, president of American Bioceuticals, says the company is involved with talks to get its three other products medications for cold sores, canker sores and shingles on the shelves of CVS/Caremark and other pharmacy chains this spring and summer.

Deals already are in place with major pharmacy wholesalers as McKesson Corp. and Cardinal Health to stock American Bioceuticals products.

With distribution in place, the next step is an aggressive consumer marketing campaign to drive demand.

Along with consumer magazine ads in venues such as Cosmopolitan, Vogue and Prevention, the company will spread the word through sponsorships of events such as the New York City Marathon. It also is investing heavily to support newspaper advertising by regional and national pharmacy retailers, Nelson says.

The sales pitch: The products developed from research by an Australian team allow consumers to swallow capsules to deal with cold sores and other maladies. Competitive products are topical applications that require consumers to smear a cream on a sore.

The company's marketing research, Nelson says, found that many consumers feel conspicuous enough when they have a cold sore and feel even more conspicuous when they're applying a shiny cream.

"It's all about how you get the consumer to understand what you've got," Nelson says.

About 85 percent of the American population suffers from at least one of the maladies addressed by American Bioceuticals products, the company says.

For retailers, American Bioceuticals positions itself as an expansion to the category products that are likely to boost retailers' business rather than merely cannibalize the sales of other products on the shelf.

The company draws on the resources of its parent company, Wingfield Nevada Group, to support its aggressive campaign to win space on retailers shelves' and consumers' shopping lists.

Wingfield Nevada Group, the vehicle of Reno entrepreneur Harvey Whittemore, numbers companies ranging from a 7-Up bottler to media outlets among its 50 holdings valued at more than $2 billion.

Whittemore's charge to Nelson was simple after he decided a mere eight months ago to commercialize the research team's formula.

"We put the pedal to the metal," says Nelson. "We went from zero to 60 in six months."

Along the way, Nelson dealt with issues great and small.

He got approval from the Food and Drug Administration and Federal Trade Commission. (The products, which have been used in clinics in Europe and Australia, didn't require full-blown FDA testing.)

He lined up a manufacturing deal with a company in Irvine, Calif.

And he decided small issues such as whether the product boxes should be designed to hang as well as stack. (The hangar design won out.)

The company expects complete rollout of the first products will take 18 months to three years, Nelson says. In the meantime, it's developing more over-the-counter medical products.