The allergy treatment and relief medicine category is estimated to be an $18 billion worldwide market, growing at over 10% per annum.

In the US alone, there are approximately 50 million people suffering with airborne allergies. Outside the US, estimates are that in any given country, approximately 25% of the population has allergic rhinitis (airborne allergies).

Further, with the continued industrialization of underdeveloped countries, carbon dioxide levels have increased dramatically. High levels of CO 2 trigger excess pollen generation from plants such as ragweed, thus expanding the number of allergy sufferers worldwide. In August 2000, the US Department of Agriculture released research results indicating that in the last 40-50 years, pollen production increased nearly 400% (primarily in ragweed). Much of this increase may be attributed to a CO 2 increase of almost 200% in the United States during that period.

Allergy Market Overview

Several different research sources estimate that in the United States, allergies affect approximately 20% of the population or about 50 million people. That number includes 10%-30% of all adults and up to 40% of children. Similar rates are found in other industrialized countries.

Furthermore, there is an alarming worldwide trend towards higher rates of IgE-mediated allergic diseases including:

Seasonal Allergies

Seasonal (periodic) allergic rhinitis, also known as outdoor allergies or hay fever, affects more than 36 million people, including over 6 million children, and predominantly occurs during pollen seasons in the spring, summer and autumn. Ragweed, which has the longest pollen season (Aug.-Nov.), affects more people than any other allergen, in the range of 20-40 million people.

A 1999 American Academy of Allergy, Asthma and Immunology (AAAAI) report estimates that seasonal allergies cause over 8.2 million days of restricted activity, 3.8 million lost school and work days and 16.7 million medical office visits. Absenteeism and reduced productivity due to allergic rhinitis, specifically, was estimated, in 1998, to cost US companies and the health care system more than $6 billion per year.

Year-Round Allergies

Perennial (continuous) allergic rhinitis, also known as indoor allergies, caused by pet dander, dust mites, cockroaches and indoor mold spores; has year-round impact and tends to worsen during the winter months when most indoor environments are sealed tightly.

Skin Allergies

Skin allergies include eczema, or atopic dermatitis, which is marked by itchy rashes and oozing blisters; hives or urticaria involving swelling, redness and itching; and contact dermatitis which produces rashes and itching after touching poison ivy or certain foods.

Allergic dermatitis (itchy rash) is the most common skin condition in children younger than 11 years of age. The percentage of children diagnosed with it has increased from 3% in the 1960s to 10% in the 1990s.

Contact dermatitis and other eczema were diagnosed at over 7.1 million office visits to physicians and 430,000 hospital outpatient visits.

Urticaria (hives) and angioedema (swelling of the deeper layers of the skin) together affect approximately 15% of the U.S. population every year. (Source: aaaai.org)

Food Allergies

Adverse reaction to food is a general term that describes any abnormal reaction to a food or food additive that is eaten. A few specific foods seem to cause a majority of food allergies. Some of the most common food allergens are cow's milk, eggs, peanuts, wheat, and soy.

Eight percent of children younger than six years experience food intolerances. Of this group, 2% to 4% appear to have allergic reactions to food. In adults, an estimated 1% to 2% are sensitive to food or food additives.

Peanut and/or tree nut (e.g. walnut, almond and cashew) allergies affects about three million Americans, or 1.1% of the population. (Source: aaaai.org)

Asthma

More than 17 million people in the United States, including close to five million children, have asthma. Asthma is a chronic disease in which airflow in and out of the lungs may be blocked by muscle squeezing, swelling and excess mucus. (Source: aaaai.org)

Side Effects Are Common Occurrence with Antihistamines

Extensive studies, interviews and published articles have documented the consumers’ desire to have a product that will curb their allergies, but has no side effects, regardless of the effect. Drowsiness is the most common, yet nausea, headaches and many other effects mitigate the satisfaction with virtually all OTC allergy products. For children, parents are even more concerned about side effects, especially when having steroids prescribed.

Allergy trends Show Increasing Number of Sufferers

For reasons that are not entirely understood by immunologists, allergic diseases are increasing worldwide. A study of Danish adults showed an increase of adults with allergies moving from 26.5% in 1990 to 33.9% in 1998. Pediatric and young adult allergies are also on the rise.

In a 2002 survey conducted by Harris Interactive, 45% of adults surveyed reported they had been diagnosed with some type of allergy, with 81% saying they were allergic to pollen. In the same study, adults said they believed that if not treated, allergic rhinitis could lead to other illnesses (93%), sinus infection (87%) and/or asthma (48%). Allergic rhinitis and asthma frequently co-exist in patients and there is evidence that allergic rhinitis is a risk factor for asthma. There are an estimated 11 million asthma patients whose symptoms are allergic in origin. Also, allergies are the sixth leading cause of chronic disease.

In September 2002, the Employee Benefits Journal referred to a study suggesting that 80% of allergic rhinitis sufferers self-treated with OTC medications.

A 2002 Trend Watch study found that over 60% of the hay fever sufferers were female. It also showed that most hay fever sufferers are 18-44 years old, and that females were the dominant sufferers in each of the age brackets measured.

Consumer expenditures on allergy medications is increasing dramatically, rising 67% from 1994 to 1997 and 89% from 1997 to 1999, with volume being 53% and 77% respectively. Pricing increases represented only 14% and 11% in each time frame. IMS Health’s 2001 estimate for US sales of all allergy products (both Rx and OTC) was $4.73 billion, up from 2000 sales of $3.76 billion, a 25.8% increase. In the 2002 Harris Interactive study, 35% of allergy drug buyers purchased OTC products, even though volume and prices have grown dramatically.

Outside the United States, most countries average about 25% of the population as allergy sufferers. To that end, the global allergy market (including the US) is almost $18 billion. Internationally, CO2 levels associated with global warming have doubled the amount of pollen production from ragweed over the last 40-50 years…and will double again over the next half century. In the studies, it was found that with CO2 increasing 200%, ragweed pollen has increased 400%. This effect is most prevalent in Asia; where the proliferation of manufacturing has taken China to the point where it generates 21% of the world’s CO2, number two behind only the United States.

There is new technology that blocks production of immunoglobulin E (IgE) antibodies. By reducing IgE production, the immune system is prevented from overproducing histamines as part of an unnecessary overreaction to an allergen’s presence. Leading the charge is an injectable, genetically-engineered antibody called Xolair. Novartis, Genentech and Tanox jointly invested an estimated $500 million to develop this “anti-IgE” drug which was launched by Genentech in mid 2003, as a treatment for asthma. Xolair currently has an indication for moderate to severe asthma, via bi-weekly injections, and has a potential indication for allergic rhinitis. It's high cost and restricted reimbursement criteria from insurance companies makes it prohibitively expensive for allergy sufferers. The focus for Genentech when launching Xolair has been to educate the clinicians, weaning them from their penchant for prescribing steroids or allergy shots. Their aggressive focus on educating the doctors about IgE modulation will create significant awareness of preventative treatment for allergies.

NOTE:
Xolair is a registered trademark of Genentech, Inc.

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