Allegra and Chattem Inc. booming during allergy season

Allegra and Chattem Inc. booming during allergy season

April 15th, 2012 by Mike Pare in Business Around the Region

Leon Ford, a distribution clerk at Chattem Inc., sorts products behind pallets of Allegra at the company's Chattanooga warehouse.

Photo by

ALLEGRA PRODUCTS


• Allegra

• Allegra-D

• Children's Liquid

• Children's ODT

• Children's Tablets

Source: Sanofi

Chattem Inc. executive Bob Bosworth said he's sorry the Chattanooga area is caught up in a difficult allergy season.

That being said, having more buyers for its key allergy medicine, Allegra, is good for business, which helped to nearly double Chattem revenues in the past year.

After about a year of overseeing the marketing and shipment of Allegra, Bosworth said Chattem has federal regulatory approval to make one of Allegra's products here later this year for the first time, adding about a dozen jobs in the city.

"We're looking for continued growth in the business," said Bosworth, Chattem's president and chief operating officer.

Chattem, a subsidiary of French drug giant Sanofi, will produce children's liquid Allegra and package it in the city as well. Bosworth said shipment should begin in the third quarter from Chattem's South Broad Street plant.

Previously, all of Allegra's lines were manufactured in other locations, he said.

In the first 10 months in which the Allegra products were shifted from a prescription to an over-the-counter medicine, Chattem shipped more than $300 million worth, he said.

Paris-based Sanofi Chief Executive Officer Chris Viehbacher told financial analysts last month that those results vaulted Allegra to the No. 2 slot in its segment behind only Claritin.

He said the performance of the pharmaceutical titan's consumer health care division, of which Chattem is a key part, is the one he is most happy about.

Viehbacher said that "quite honestly this was a little bit of a hope and a prayer because we had a product here and a product there and nothing in the U.S., nothing in China."

But, he said, Sanofi was able to acquire companies such as Chattem to launch Allegra itself.

"We could have launched this with a more established partner," Viehbacher said. "But we actually exceed some of the sales projections from the more established players who are pitching to be our partner on this."

Hanspeter Spek, president of Sanofi's global operations, said the company made "a very good choice in acquiring Chattem."

"We can state that we have today a large, solid, strong position" in consumer health care.

The rollout of Allegra was Chattem's biggest product launch in its 130-year history, and one of the largest ever in the city.

Before Allegra, Chattem's sales for all its other products, such as Icy Hot and Gold Bond, were about $400 million.

"It was a very good year," Bosworth said. "It was great from an Allegra perspective."

Also, he said, Chattem will continue to modestly add to overall employment as its business continues to grow.

Bosworth said Chattem expects its annual volume of Children's Allegra allergy product should be in the range of 2 million units.

Chattem was acquired by Sanofi for $1.9 billion in cash in a deal that closed in 2010.