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Apr 24 2009

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Hangovers, Nurofen and product differentiation

In my horribly hungover state, the first thing I did when I got to work this morning was go looking for pain relief. Excellent, I thought, there is some Nurofen in the cupboard. My initial exuberance was soon allayed as I saw we only had Nurofen ‘Back Pain’ medication, not what I was after, while the Nurofen ‘Migraine Pain’ packet was cruelly empty. A closer inspection of the packets, however, revealed the two contained exactly the same ingredients!

About the author

goonix

Goonix is an economist working in industry. His classic liberal views means that he is typically the most skeptical of the TVHE authors when it comes to government intervention in a market.

Permanent link to this article: http://www.tvhe.co.nz/2009/04/24/hangovers-nurofen-and-product-differentiation/

16 comments

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  1. StephenR

    Different proportions of the same ingredients? Surely (?!)

  2. goonix

    Exactly the same: 200mg of ibuprofen!

  3. Brad Taylor

    I’ve always found this sort of thing slightly amusing. I can think of two ways such differentiation could be welfare-improving, though:
    1) The placebo effect might be stronger when you’re taking meds you think are specifically designed for your ailment.
    2) More importantly, it reduces search costs. If the company knows that ibuprofen is relatively more effective at easing the pain of migraines and hangovers, and that paracetamol more effective at regular headaches and muscle pain, having a specific packaging for each ailment would make it easier for you to find what you want. The alternative would be people knowing what medicine does what or wildly disjunctive product names.

  4. Matt Nolan

    This isn’t the first time we’ve talked about Nurofen Goonix:

    http://www.tvhe.co.nz/2008/05/04/why-cut-the-price-of-medicine-when-people-are-getting-ill/

    http://www.tvhe.co.nz/2008/05/05/what-was-that-about-tacit-collusion/

    I think they should start paying us for advertising ;)

  5. FreneticMonkey

    well you are all morons because you prefer the more expensive nurofen to the identical signature range ibuprofen, and WTF goonix imposing the costs of your choices on your non-degenerate workmates!!!!

  6. goonix

    I am not in charge of painkiller procurement. I would never fall for such trickery! :P

  7. Matt Nolan

    @FreneticMonkey

    Hey – when I grabbed nurofen from the supermarket it was because it was the only thing there.

    Also I like the pretty silver package :)

  8. rauparaha

    @Matt Nolan
    My Pam’s ibuprofen has silver packaging too, Matt.

    Besides, I think ‘moron’ is a strong term to use: we’re just boundedly rational and use heuristics to make decisions given our limited capacity for computing optimal choices. I don’t think Matt’s decision to go with the well known Nurofen is necessarily stupid or irrational. One has to take account of his mental computing constraints and the fact that it’s almost maxed out educating the world about economics!

  9. FreneticMonkey

    ;-) obv i dont think anyone here is a moron, i just think that banning advertisements for pharma would prob. improve welfare ;-)

  10. goonix

    Are you suggesting no labels on the product? How would that work practically, given the products are sold in supermarket aisles?

  11. FreneticMonkey

    just no TV/Print advertising for Pharma

  12. Dave

    According to Nurofen’s website the “Migraine” product has ibuprofen lysine, which has a more rapid onset of action than the plain ibuprofen in the back pain product.

  13. goonix

    @Dave
    Looks the same to me (this is from the Aussie site, the NZ one was unpopulated):
    http://www.nurofen.com.au/pain-relief/products/migraine-pain.php
    http://www.nurofen.com.au/pain-relief/products/back-pain.php

  14. Dave

    Ah OK, they are different on the UK site.

  15. goonix

    While at the supermarket the other day I noted that Nurofen ‘Back Pain’ was retailing for just under $14, while Pams Ibuprofen (exactly the same number of pills and ingredients) was retailing for just under $4.

  16. Geena Murphy

    Another great migraine article! I always like read your blog so I always come back for more.

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