Aussie contract manufacturer woos global market with TGA-licensed gummy facility

Star Combo received licensing from Australia’s Therapeutic Goods Administration (TGA) for its gummy production line earlier this year.

Only gelatin gummies are allowed to be produced at the facility, and so far, the company has come up with 10 different gummy formulations spanning across DHA omega-3, immunity, and sleep support.

Production has also begun, with the facility running at a maximum capacity of three million pieces per day.

Prior to this, the company, which has been in the industry for 15 years, specialises in soft gel capsules and produces roughly five million capsules daily. Its other portfolios include tablets, hard capsules, and powder.

CEO Su Zhang believes that being able to manufacture nutraceutical gummies is a step into the global market.

This is because the production processes of nutraceutical gummies are complex and challenging to being with, and its appeal of being Australian-made and TGA-licensed is set to draw interest globally. 

“Since we have received the license to make gummy supplements, we’ve now engaged in dialogue with multinational players. I think that really takes us from a domestic Australia vitamins and supplements product manufacturer into the global stage, that’s where we are taking the business to the next level in terms of global recognition,” ​she told NutraIngredients-Asia. ​

She is unable to reveal names of the brands that the company is already producing gummies for or are in talks with due to non-disclosure agreement, but said that there has been conversations with major multinational companies and global conglomerates.

“To your question that they could manufacture gummies elsewhere, in fact, I’ve asked them: ‘if you're able to make them overseas, and maybe at an even more competitive pricing, why would you come across to an Australian manufacturer?’ ​

“It was actually them convincing me about why they want to come and work with us. I guess this has to do with the quality and the value of a product once it’s got the Australian-made status. There’s inherent trust in the quality of that product, and that’s a selling point.”​

The gummy supplement industry is projected to grow from US$6.004 billion in 2024 to US$10.2bn by 2030.

This is equivalent to a compound annual growth rate (CAGR) of 9.17 per cent, the firm said in its ASX announcement dated May 28, citing statistics from Market Research Future.

“We are still innovating, we are keeping up with the demand and responding to market sentiments,” ​she said, on reasons for manufacturing gummy supplements.

In FY23, Star Combo’s revenue was up 28 per cent yoy to AUD$20.8m.

For its FY24, which ends in Jun 2024, the company said its unaudited revenue as of end April 2024 was already 19 per cent ahead of the same time last year, and gummies would help open new revenue streams.

At the moment, TGA has allowed gummy production for a few firms in Australia, including a small-scale facility for R&D and another facility for producing its own branded products.

Zhang believes that Star Combo is considered the first contract manufacturer to receive TGA licensing for large-scale production of gummies in Australia.

Giving local brand owners an option for quality, logistical issues ​

Local brand owners can now also have the option of shifting their overseas production local, which Zhang believes would be more favourable, as it could get around challenges such as customs clearance, supply chain lag time, and quality control.

Delayed logistics, for instance, could in turn impact the amount of time a product could be sold on the shelves before expiring.

“We’ve also heard components in relation to the incapability to be able to accommodate their request, as well as customs clearance. ​

“So it’s not just one particular aspect that drives them away from that overseas manufacturer…It could be the lack of responsiveness, the ability to call your entire supply chain, your quality aspects of the product profile. They are all factors that come into play.”​