Creations Garden received an FDA warning letter in 2012 over significant GMP violations. The company’s problems worsened with the accusation that company founder Dino Gugliamelli had hired a hit man to kill his wife, something Gugliamelli denies. He recently pleaded not guilty to charges of attempted murder and solicitation to commit murder. Creations Garden declared Chapter 11 bankruptcy in late 2013.
“We are delighted to come in and keep those people working and grow our business by turning a bad situation into a good one. We see it as a win-win,” Israel told NutraIngredients-USA.
Little overlap
Creations Garden is currently GMP compliant, according to a Robinson Pharma statement. The company manufactures dietary supplements and cosmetics and in particular has a robust infrastructure for the production of liquid and powder products, Israel said.
Robinson Pharma’s strength, on the other hand, lies in the production of softgels and well as capabilities in tablets, hard shell capsules, and packaging. The combination of the two will open up a new world for Robinson Pharma and its customers, Israel said.
“This will give us significantly larger capabilities,” he said. “There is only a little overlap between the two companies. It’s going to allow us to go back to existing customers and offer them something new. And it will allow us to seek out business that we had to turn down before.”
Demand for more transparency
The deal reflects a growing demand for Robinson Pharma’s services, Israel said. When the current regime of more stringent GMP enforcement was gathering momentum, some industry observers thought the costs of compliance could drive some smaller companies making their own products out of the manufacturing game altogether and into the arms of contract manufacturers. Israel said he has not observred that shift, but what he has seen is clients switching among contract manufacturers toward bigger operations that can more easily fulfil their compliance needs.
“What I’m really seeing is people switching from less capable contract manufacturers to more capable ones. I am seeing a demand for more transparency that puts greater demands on our regulatory department,” Israel said.