When a product is manufactured by one company but sold and distributed under the brand name of another company, it is known as a private label product. Private labels are a response to the challenges faced by manufacturers such as lack of resources, monetary deficit or heavy workload. Alternatively, they are also useful when a company wants to manufacturers according to custom requirements without investing into in-house resources. In life sciences industry, these companies are called “private label distributors (PLDs)”.

If a company is distributing a product under its private label, they are not required to register under the concerned health authority. But they have other responsibilities to fulfil, in case of drug products:

  • PLDs are required to obtain the National Drug Code (NDC) for the drug to be distributed.
  • They are required to obtain labeler codes for their products. If any changes are made to the code, PLDs need to update the information immediately.
  • PLD labeler codes must be used by manufacturers for listing the products.

Advantages of using private labels

  1. Ease of control – Since the manufacturing process is outsourced to a third party, it offers an end-to-end control to the private labeler over the entire process. It also provides control over the cost involved in the process.
  1. High customer loyalty – Successful private labels serve as a booster for greater customer loyalty and help increase the brand value as well.
  1. Competitive edge – Private labelers are well equipped with the competitive scenario of the market which provides them an edge over other distributors.
  1. Profitability – With all the factors of production under control, the PLDs can control the level of profits managed by distributor.

Although private labels help in increasing the brand name of the product, if not done right, may lead to losses. To know more about private labels and how they can help your business, reach out to us at sales@freyrsolutions.com