Perrigo Co. plc (NYSE: PRGO; TASE) and Ferrara Candy Co. Inc. announced that Perrigo's Nutritionals division has signed a supply agreement with Ferrara to manufacture store brand gummy vitamins and dietary supplements to be sold at leading retailers across the United States. The five-year supply agreement gives Perrigo exclusivity on a full line of store brand gummy vitamin, mineral, and supplement products using Ferrara's gummy technology and manufacturing capabilities. Perrigo's extensive expertise in vitamin and dietary supplement formulation, quality assurance, and safety testing will be combined with Ferrara's manufacturing capabilities and non-stick gummy technology, which excels in gummy taste, texture and packaging. In addition to being suitable for vitamins and dietary supplements, Ferrara's gummy technology has the potential for other over-the-counter (OTC) products as well.
Perrigo's Chairman and CEO Joseph C. Papa stated, "We are excited to announce the addition of a full assortment of children's and adult multivitamins, calcium, fiber, heart health and letter vitamins to our store brand portfolio. This strategic supplier relationship extends our company's reach into a financially attractive and expansive gummy market. We look forward to working with Ferrara and are excited to launch new products into this growing nutritional category."
According to IRI multi-outlet data, sales of vitamin and dietary supplement gummies were $625 million and are forecasted to reach $1 billion by 2017.
"We are pleased to partner with Perrigo as we extend the strength of Ferrara's manufacturing capabilities and technologies into a new, growing market," said Todd Siwak, CEO of Ferrara. "Healthy living has become a bigger focus for more and more Americans, and the application of our gummy technology to vitamins and dietary supplements is another example of Ferrara evolving its offerings to capitalize on this trend. Ferrara has a long history of strong strategic private label and co-manufacturing relationships, and we are confident that our partnership with Perrigo will also be a success."
Ferrara is one of the world's leading gummy manufacturers with significant operational capabilities and procurement scale. Perrigo's line of store brand gummies will be manufactured by Ferrara in its state-of-the art facility in Bellwood, Illinois. The facility meets numerous quality and safety certifications, including SQF. Ferrara's facility is in close proximity to Perrigo's distribution facility in Allegan, Mich., which will create unique supply chain efficiencies.