Outsourcing manufacturing operations to a qualified specialist that has the knowledge to navigate FDA’s Good Manufacturing Practices (GMPs), and other important regulations, along with the appropriate equipment, facilities, and staff, can prove to be an invaluable partnership.
Contract manufacturers (CMs) have the processes in place to support regulatory requirements for quality and product safety, according to Jennifer Cusick, director of sales operations, Trividia Manufacturing Solutions, Inc. (owned by Trividia Health in Fort Lauderdale, FL). “A CM will carry a variety of third-party audit certifications, providing an independent assessment of the quality systems.”
She suggested companies work with experienced CMs, as they have often built long-term relationships with vendors for both raw materials and equipment. “These relationships provide the opportunity for superb customer service when faced with a sourcing challenge.”
Ultimately, CMs mitigate the inherent risks of manufacturing for the brand marketer, said Justin Bath, president of Biovation Labs, Salt Lake City, UT. “Dietary supplements are very complex. There is a lot that goes into a supplement—from procuring the raw materials to ensuring that the finished product is safe and fit for human consumption.”
Companies that typically partner with a contract manufacturer are looking to market a product without having to worry about the risks and expenses that come along with manufacturing, he added. “They want a partner who can help fulfill the product promises they are making to the consumer.”
A qualified CM will ensure that raw materials are sourced from a safe and reliable vendor. “They have the network, they have the relationships, and they have the know-how to source ingredients safely from around the world,” said Mr. Bath.
Culture and customer service are also important, Ms. Cusick said, as well as third-party certifications. When qualifying a CM, she suggested companies first identify their needs and create a checklist to compare each CM. “The list might include quality of customer service, style of communication, timeliness of response, competency of customer service representatives or technical staff. Do they have an open-door policy and engage all staff in facility assessments?”
Other factors include capability—dosage forms (e.g., liquid, tablet, capsule); packaging (e.g., bottle, jar, tube, carton, and secondary packaging requirements)—as well as capacity, and certifications.
However, nothing can replace experience, said Mr. Bath. “A qualified CM will know what ingredients are problematic. They stay informed on FDA warnings for ingredients. They can provide counsel to a brand marketer regarding a formulation that has risky ingredients, helping save time, money, and potential problems down the road. When companies are working with CMs, they are often spending large sums of money in both product research and product manufacturing. The desire to get the product to market quickly can add risk. Working with a qualified outsourcing partner that knows the ropes and the best path to a successful outcome can add trust and peace of mind in an otherwise stressful and unknown situation.”
Increasingly, brands are looking for CMs to be more platform-driven. “They want a partner who can do everything they need regarding the lifecycle of the product. They want a partner that can formulate it, ensure that all the testing is in place, scale the manufacturing, and then handle the shipping and fulfillment—often direct to the consumer. Each step of a platform can reduce costs for brands. Smart, qualified contract manufacturers will have a platform for their customers to come in, get established, and grow on.”
A Challenging Environment
In terms of challenges facing companies today, Ms. Cusick said testing costs remain a major sticking point. “We sometimes feel there is a lot of redundancy in the system and regulatory requirements. The raw material manufacturer tests the material, the CM tests it for identity and purity, the CM tests again against the certificate of anaylsis, and the finished good is tested. Now the testing methods need to be validated, even for industry accepted test methods. The testing validation costs can be prohibitive for new brands.”
Mr. Bath noted three main challenges in today’s market. First, there are increased pressures from external parties. “Regulations from bodies such as the FDA will become stricter and so will the regulatory scrutiny. Not only will the regulators be taking a closer look—which is not a bad thing—but individual consumers will be increasingly able to provide pressure on brands and their partners through channels such as social media.”
Pricing pressures are also continuing to grow, he said. “Cost structures are quickly changing and will continue to become more complex. This is a reflection of both increased wages and increased regulatory scrutiny. Manufacturing automation and scale can help offset those costs.”
Additionally, supply chain integration remains a challenge. “Ingredients come from all over the world. Commodities are fluctuating in terms of supply and cost. Climate change, crop quality, and price are ongoing issues and major challenges.”
At a time when consumers and business partners are looking for transparency, Ms. Cusick said Trividia tailors communication to each client. “Some customers are very knowledgeable and savvy and want to be engaged at the highest technical level,” she noted. “We embrace these customers and enjoy the technical discourse to the ultimate conclusion. Some customers support the theory of ‘operational silence.’ They want the product delivered on a timeline, and they do not want to engage in any of the typical production challenges a CM may face.”
In an effort to increase transparency, brands can adapt the way they label products, Mr. Bath said. “Consumers appreciate it when a brand is very direct and clear with the ingredients they use. In other words, brands should stop using the term ‘proprietary blends’ on their labeling,” he suggested. “If the brand is proud of the quality of their ingredients, and the quality of their product, they should communicate that to the consumer.”
At the end of the day, the old adage of “you get what you pay for,” couldn’t be truer in contract manufacturing, according to Mr. Bath.
“Product marketers often want to find the cheapest manufacturer, but what they need to understand is that if they sell it, they are wholly and completely responsible for the safety of the product,” he cautioned.
“What companies really want when they take a deep, hard look at their business model, is finding the right value-mix in their product manufacturing so they can truthfully, and safely, go to market with a product they feel good about, and would take themselves. Regulatory bodies are increasing the scrutiny on dietary supplements worldwide and if the company is only concerned with finding the lowest price, they are shooting themselves in the foot.”
In today’s marketplace, consumers are looking to get more from nutritional supplements. They want products that help improve their quality of life and help them age well.
“People are living longer and they want to live better,” said Mr. Bath. “Previous generations retired and faded away. Baby boomers are not going into retirement to retire. They are retiring into life—not out of it. They are looking for dietary supplements to help them with that goal—to live more and move forward with a better lifestyle and a better life.”