The move comes as the company sees continued success in its baby probiotic products and will launch oil drops for colic babies at the beginning of next year.
Peter Rothschild, CEO, BioGaia, told FoodProductionDaily, it will start construction on the factory in September and it will become operational in two years’ time.
“This is an extension of our existing plant built in 2012 to develop and manufacture packaging for probiotics,” he said.
“We needed to plan ahead a little bit because businesss has taken off and we are looking to increase output in the next two years.
“We are working on a number of development projects for ourselves and our customers so we need to know that we can manufacture them as well. R&D is important for us and we manufacturer our own packaging machinery from scratch. ”
BioGaia previously owned 50% of TwoPac which was formed in 2002 and produces drops and straws with probiotics. The remainder was held by its management team but, in June last year, the firm signed an agreement to acquire the remaining share.
The decision behind the move was to gain full control over part of the company’s product manufacturing and to partner with TwoPac in the development of products that can be manufactured at a reasonable cost.
Rothschild added the factory was built after Nestlé asked for the drops they buy from BioGaia be made by TwoPac.
He said the conditions for the factory had to be changed to meet Nestlé’s requirements, which delayed the project, but at the beginning of 2013 the facility was inaugurated.
“TwoPac has been a central part of operations because it can make its own customised machinery, which is reliable and faster and it can have a mechanic in place as soon as a problem arises in production,” he said.
According to BioGaia, up to 26% of all infants in the West suffer from infant colic, which is defined as recurrent crying, mainly in the evening, for at least three hours a day, at least three days a week and for at least three weeks in an otherwise healthy infant.
However, a report in the British Medical Journal suggests probiotics cannot be routinely recommended for all infants with colic.
It found L reuteri treatment "did not reduce crying or fussing in infants with colic, nor was it effective in improving infant sleep, maternal mental health, family or infant functioning, or quality of life" and say "probiotics therefore cannot be routinely recommended for all infants with colic."
Rothschild confirmed it will be launching oil drops for colic babies, and it has signed an agreement with a UK company, which he would not name, to bring it to market at the beginning of 2015.
“The factory expansion is a big investment for us. We need to make sure it is profitable and get the machines and products ready for production," he said.
“We are currently waiting for building permits to start construction for five lines. The challenge for us is there are lots of regulatory issues coming up all the time. It’s nothing we can’t handle but a lot of work and planning to meet these requirements.
“Requirements are increasing by the day because authorities are more concerned about the well-being of individuals. They want to make sure consumers have the right information and are not given anything that is harmful. We have to follow suit and do what’s necessary so our facilities have to be of a high quality to meet requirements.”