Infant formula maker Bubs makes inroads into US market

Australian infant formula manufacturer Bubs has begun a major US clinical trial as part of an approval process for the US market.

The nationwide Growth Monitoring Study (GMS) clinical trial is part of the regulatory process for approvals by the US Food and Drug Administration (FDA), which would allow its organic infant formulas a permanent market position in the country, which is the second largest infant formula market in the world.

All product for the US market will be manufactured at Bubs’ Deloraine facility in Melbourne, which is currently the only US FDA approved infant manufacturing plant in Australia.

Bubs first began exporting its infant formula into the US in 2022 in response to a national formula shortage, as part of the US government’s Operational Fly Formula, providing over 1.25 million tins of formula to the country, however, with the new trial Bubs is now taking steps to move its sales in the country from a temporary ‘enforcement discretion’ into a approved one.

Speaking during an investor call, Bubs CEO Reg Weine said, “If not for the US enforcement discretion at the height of the infant formula crisis, the process to enter the US market would not be possible.”

He added that even with this positive position it has not been an easy process.

“Even now Bubs must complete the regulatory pathway and achieve key milestones over a three and a half year journey, that includes factory audits, nutritional studies and clinical trials. Bubs will have spent more than $10 million by the time the USA FDA rules on our submission in 2025 for permanent access to the US infant formula market.”

However, this has not dissuaded the company from pursuing the North American market, which is estimated to be worth about US$8 billion.

Weine said the company has made the most of the opportunity that Fly Formula provided, stating “Our USA business grew 200% year on year in FY23 and now represents 40% of our group sales…last year we sold 400,000 tins of Bubs infant formula [in the US].”

It is a major step for the company, which has grown from a small business started in a Sydney kitchen in 2006 to become a leading exporter of organic formula, toddler milks, baby foods and snacks to 10 export markets, including China, Southeast Asia, the Middle East and the US.

This latest trial follows a Protein Efficiency Ration (PER) study completed in June, which was a key milestone in US regulatory approvals, and opened the door to the clinical trials.

“Bubs answered the call when we were needed by American families, and in so doing established a trusted relationship with many US healthcare professionals, parents and caregivers,” Bubs COO Richard Paine added.

“We are excited to build upon that relationship by providing the FDA with the data necessary for Bubs to take up its permanent place in the American market.”

Its work in supporting the infant formula shortfall in the US won Bubs the Australian Exporter of the Year award at the Australian Export Awards in 2022.

The study is being conducted by Validcare.