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Contract & Custom Manufacturing Update

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Contract and custom manufacturers work with formulators to create the latest and greatest products.

The dietary supplement industry is the perfect example of true synergy. On one hand, there are the creators, the formulators, the idea-drivers—and on the other is the expertise and capabilities of a number of contract and custom manufacturers. Together, they forge the latest excitement for new products that consumers can enjoy trying out.

The industry encourages continued innovation because consumers demand it. Laurel-resting is frowned upon as the voluminous research demonstrating and validating health benefits continues to cascade, motivating formulation renovations and fostering brand new creations.

Scott Ravech, CEO of Deerland Enzymes in Georgia, which specializes in contract/custom manufacturing of enzyme- and probiotic-based supplements, related that “brand marketers typically like to focus on their core competencies, which in the case of many of our customers, lies with driving their consumer connection and marketing the features and benefits of their products. The intricacies, complexity and cost associated with manufacturing can, in many cases, be a distraction away from what they do best.”

Deerland Enzymes, he added, provides value beyond expert blending, encapsulation and bottling, to include expertise in product formulation and regulatory support. The company begins its relationships at the concept phase of product development to ensure thorough understanding of the brand marketer of the benefits of the products, and then the company customizes the solution. “We call this no-cost service YourBlend,” he said. “We are seeing a significant increase in the number of new products we are developing with our customers, many of them new to enzymes. We’re fortunate that not only is our customer base expanding, but the number of new products being launched also continues to increase.”

The landscape of contract and customized manufacturing has grown to see two types of fulfillment. Tee Noland, CEO of Georgia-based Pharma Tech Industries explained that the larger ones are seeking strategic business partners to integrate with their supply chain organizations as well as to develop specialized technical solutions to streamline the process. “Smaller brand marketers tend to want a CMO that can own the supply chain and, as a result, they stay out of much of the detail. Both large and small brand marketers want to make their lives easier relative to supply chain management to allow them to focus on what they do best—marketing and selling their products to their customers,” he remarked. “And, all brand marketers are expecting more and more from their contract manufacturers.”

Beyond the expectation that the contract/custom manufacturer adhere to cGMPs (current good manufacturing practices), the demand for a variety of certifications has risen, as they convey quality to the consumer, and in tandem, a higher sense of trust. “Quality and safety are so important because they are the foundation of trust that brands make to the consumer and the manufacturer makes to the brand owner,” said Noland. The requirements of quality, safety and compliance, he noted, can and do “add complexity to the manufacturing process from an equipment and data gathering perspective to ensure the quality is consistent in real time. Items like fill weight tolerances often come into play, especially as you use more automation and higher speed equipment and must come up with a method to sample output for conformance.”

Another specialist is Nutritional Engineering Inc. in California, which focuses on nutraceutical liquid products, for which there is increasing demand from health-minded consumers who dislike tablets or capsules. And here, said Cesar Castaneda, safety director, new requirements and certifications are helping the company’s business grow by ensuring that all processes are performed correctly. Nutritional Engineering Inc. implemented new certifications, internal audits and safety programs that help establish GMPs. “Accidents can happen for any manufacturer,” he conceded, “which is why we perform ongoing hazard analysis and preventative practices to lower risks, by certifications that provides our employees with the skills and knowledge needed to achieve our companies quality and safety goals. Overall, our compliance with the increased requirements for quality and safety has set us apart from other companies in the same business.”

Reyna Montalvo, Nutritional Engineering Inc.’s quality assurance manager/GMP coordinator, added that the increasing requirements from FDA’s (U.S. Food and Drug Administration’s) new regulations include both raw materials and finished product testing, which may sometime delay the manufacture date or shipping date. In addition, its customers are requiring the company to have more documents and certifications, such as gluten-free and non-GMO (genetically modified organism). As such, she reported that “we have now become gluten-free certified and are required to be audited yearly by a GFCO (Gluten-free Certification Organization) company. We are also cGMP certified by NSF, which take our audits biannually.”

Since joining Deerland Enzymes in 2006, Ravech expressed that he has been pleased to see the importance its customers place on marketing science-supported products and compliance with FDA regulations. As an active member of the Enzyme Technical Association (ETA) and Council for Responsible Nutrition (CRN), Ravech has seen firsthand the industry’s commitment to increase regulatory compliance efforts, including more frequent on-site vendor facility audits, more companies seeking GMP certification and increased testing capabilities.

FDA first introduced GMP regulations for dietary supplements in 2007 with the intent of industry-wide compliance by 2010, reminded Ravech. “By now, all companies should be GMP compliant,” he emphasized. “As the marketplace demands more transparency, we have seen a significant increase in requests from customers to perform their own audits of our facility. Deerland Enzymes often hosts audits conducted by its customers, and encourages all of its customers to do so. The company grants full access to the facility for a complete audit, concealing only the identity of its other customers in order to ensure confidentiality.”

Innovations Continue

Nutritional Engineering Inc.’s latest technical innovation includes a new state-of-the-art, high-speed filling line to support bottle sizes of 1-, 2-, 4- and 6-oz. that can be made in plastic or glass, reported Ginny Laoudis, CEO and president of the company. “There is an increasing need for bottles of this size for both new and current customers,” she observed. “We are also able to pack in display cartons for retail businesses. The benefits in purchasing the new equipment not only include being cost effective for our customers in launching new products as well as increasing their needs for future orders.”

Pharma Tech, said Noland, has placed significant emphasis on enhancing customer service through IT integration. For example, the company is working to roll out electronic batch records with several key customers by the end of 2015. Pharma Tech also offers inventory replenishment from a forecasting and order management perspective, which Noland said, can save a lot of planning and coordination resources for its customers. “We are also innovating quite a bit on the process side with some state of-the-art, high-speed powder-filling equipment across a variety of dosage forms,” he added.

At Deerland Enzymes, one of the largest investments has been in state-of-the-art laboratory equipment to provide further insight into a raw material’s identity, purity or potency, said Ravech. These include a microplate reader, HPLC (high-performance liquid chromatography) and PCR (polymerase chain reaction) instruments. Further, he announced that Deerland Enzymes recently began packing and shipping all of its customers’ bulk products with the advanced DehydroDryDrum (D3) System. This packaging system includes a laminate-lined drum with an improved lid style to provide a better seal. This system provides a superior vapor barrier for shipping bulk blends and capsules, in comparison to standard fiber drums.

As a further safety measure, Deerland Enzymes utilizes inventory software that provides instant traceability of all products and raw materials. All raw materials that are received into inventory are bar-coded, allowing each ingredient to be tracked at any time, both during and after production of the finished good, and after shipping.

Market Trends

In the 1990s, herbs such as ginkgo, kava and horny goat weed were the rage, so these and other botanical supplements were being produced in higher numbers at contract/custom manufacturing facilities. Now, it’s other ingredients, but also, other technologies.

For example, Ravech noted that Deerland Enzymes’ customers are increasingly interested in delivery forms and packaging options that will increase stability or shelf life; any technology that may work to limit the product’s exposure to moisture, heat or oxygen is of particular interest. Product-wise, digestive support is “growing at a higher rate than the supplement industry as a whole,” he observes. Products containing probiotics continue to gain popularity. Since different strains offer specific benefits, he said that Deerland’s customers are increasingly seeking a multi-strain formulation of both non-spore and spore forming probiotics. “Based on this demand, more science is emerging to support the benefits of spore-forming probiotic strains, such as Bacillus subtilis. Deerland Enzymes has genome sequenced and clinically tested DE111, a highly effective strain of Bacillus subtilis, a very stable probiotic spore that supports digestive health and works as a complement to many of the non-spore strains that are also available,” he explained.

Pharma Tech Industries is seeing more requests for line extension opportunities into innovative dosage forms, said Noland. “Brand marketers see this as a low cost/low risk way of extending their brand into a new package form that creates more differentiation to the consumer. Unit-dose package formats, in particular, seem to be more highly demanded as consumers tend to want more portability and ease of use,” he reported.

In liquid supplements, Laoudis observed that Nutritional Engineering Inc. is seeing steady demand for targeted health conditions encompassing memory and cognitive support, joint care support and anti-aging products. “We have also started a brand new cosmetic product line and are in the process of developing pet products,” she revealed.

The natural health product field has indeed flowed from human health needs to cosmetics that are not only cleaner but also provide nutraceutical values, and of course, companion animals (pets). This spread creates even more of a need for contract/custom manufacturers to specialize and/or keep abreast of providing solid, effective and regulated services. Laoudis summarized, “Industries are always advancing forward and are in need of finding the right company to provide them the services that can take on any project from start to finish.” NIE

For More Information:
Deerland Enzymes, (800) 697-8179
Nutritional Engineering, (760) 599-5200
Pharma Tech Industries, (706) 246-3555