Vitamins & Supplements Market Update – October 2026

Differentiated Manufacturing Expertise Drives Value Creation Across the Vitamins & Supplements Market

The Vitamins & Supplements market has attracted significant investor interest as demand has accelerated for personalized nutrition, functional wellness, healthy aging, and alternative delivery formats. Brands have reacted to this consumer shift by tailoring products toward distinct health objectives and consumption preferences. This proliferation of offerings has placed increased technical pressure on the concentrated group of production partners responsible for translating product concepts into compliant and commercially viable finished goods. Of note, Capstone recently advised Desert Stream, a sector-based contract development manufacturing organization (CDMO), on its sale to an undisclosed strategic buyer (more below). The CDMO market has become a focal point for strategic and financial buyers, as businesses with differentiated formulation capabilities, diverse delivery format expertise, and scalable manufacturing infrastructure have played an increasingly vital role in supporting established brands and emerging entrants. Following The Riverside Company’s February 2026 platform acquisition of Western Botanicals, a full-service nutraceutical CDMO, Capstone interviewed Harrison Petts, Principal, to learn more about the current investment theses attracting sponsors to the Vitamins & Supplements CDMO sector (see interview below).

The M&A window is open for CDMO owners across VMS, personal care, and beauty, as private equity investors seek attractive platforms and add-on acquisitions to expand production capabilities, extend geographic reach, and accelerate growth.

Lisa TolliverManaging Director, Capstone Partners

Health & Wellness Demand and Format Innovation Elevate the Role of Manufacturing Across the Vitamins & Supplements Market

The normalization of self-care practices and greater intentionality paid toward health and wellness has injected new demand into the Vitamins & Supplements sector centered around innovative formats and preventative solutions. Vitamins and supplements have become routine components of daily wellness regimes, shifting the category from occasional use to a cornerstone of broader functional nutrition habits. Notably, 78% of adults in the U.S. reported daily consumption of at least one supplement, according to a July 2026 survey from Pew Research Center.¹ This widespread usage has reinforced the category’s entrenched position within consumer spending, with vitamins and supplements increasingly viewed as non-discretionary purchases. Capstone’s Supplements Public Company Index has averaged a 6.4% last 12-month (LTM) revenue growth rate as of September 3, 2026, underscoring durable consumer appetite for supplements as a core component of health and wellness priorities.

The expansion of consumer preferences from generic solutions towards alternative delivery formats and personalized nutrition products has reoriented the sector’s value chain, positioning specialized contract manufacturers as key partners in product innovation. Production has evolved from a back-end operation into a critical revenue-generating lever. Brands seeking to keep pace with rapidly evolving demand trends have embraced specialized manufacturers to accelerate product launches, reduce lead times, and access advanced dosages across formats such as gummies, stick packs, sachets, and delayed-release capsules. Palatability and convenience have emerged as key drivers of innovation and differentiation, particularly as brands seek to address “pill fatigue” among consumers managing complex daily supplement regimens. Of note, ~40% of adults in the U.S. have reported difficulty swallowing medications in pill form, according to a February 2025 article from Harvard Medical School.² Addressing this challenge, gummies accounted for ~25% of new supplement launches in 2025.³ The growing prevalence of alternative vitamin and supplement formats has highlighted the extent to which consumer purchasing decisions are increasingly influenced by product experience and ease of consumption rather than efficacy alone. Companies able to support these evolving demands as sought-after merger and acquisition (M&A) targets.

Robust Strategic and Financial Appetite Drives Strong Sector Dealmaking

Vitamins & Supplements M&A activity has strengthened through year-to-date (YTD) 2026, supported by durable consumer demand for health and wellness products and increased private equity (PE) appetite. Sector transaction volume has risen 24.5% year-over-year (YOY) to 61 announced or completed deals. Accelerated transaction activity has reflected growing buyer conviction in the sector’s fragmented nature, providing ample opportunities for investors to enter adjacent categories and build more comprehensive consumer health offerings.

Strategic acquirers have remained active participants, leveraging acquisitions to capitalize on the sector’s robust demand tailwinds and steady pipeline of high-quality, transaction-ready companies. Private strategic acquisitions have risen to 23 deals (+21.1% YOY) in YTD 2026, accounting for 59% of the strategic cohort. These buyers have pursued contract manufacturers that can expand capacity, add technical expertise, provide access to valuable end markets, and deliver integral product categories. Pursuit of scale has been accompanied by targeted demand for branded assets aligned with trending segments including Personalized Nutrition, Longevity, Gut Health, and Ingredient Transparency. Public acquirers have displayed comparative discipline, moderating M&A activity to 16 transactions to date (-15.8% YOY). Enhanced public company selectivity has been driven by greater emphasis on transactions that offer clear operational fit and identifiable value creation opportunities.

Mounting confidence in the sector’s favorable growth profile and competitive landscape has driven increased engagement from new and existing investors across the Vitamins & Supplements market. Sponsor-led dealmaking has doubled during YTD 2026, rising to 22 transactions from the 11 deals recorded in the prior year period. This increase has driven the cohort’s share of total sector volume to 36.1%, up from 22.4% in YTD 2025. Much of this growth has been due to platform formations, which rose from two to 10 transactions YOY. This outsized uptick in platform deals signals strong investor conviction in establishing footholds within the Vitamins & Supplements sector. Notably, Frontenac acquired NutriScience Innovations (NSI), a manufacturer and distributor of ingredients for dietary and nutraceutical supplements (August 2026, undisclosed). NSI’s innovative ingredient development, coupled with its exposure to unique wellness trends, enhanced its attractiveness to investors seeking distinctive production that aligns with the evolution of consumer health and wellness. Add-on acquisition activity has increased 33.3% YOY to 12 deals to date. Financial sponsors will likely drive a greater share of sector M&A moving forward as robust new platform creation and add-on activity persists.

Sector valuations have normalized as buyers have targeted quality assets with immediate value accretion. Pricing multiples have averaged 11.4x EV/EBITDA from 2023 through YTD 2026, marking a 0.8x decline from 12.2x in 2019-2022. Kirin Holdings Company’s (TSE:2503) announced acquisition of Jamieson Wellness (TSX:JWEL) in August 2026 ($1.8 billion, 2.8x EV/Revenue, 16.4x EV/EBITDA) highlights the elevated pricing observed by premium assets across the market. Sector participants that are able to stay at the forefront of long-term consumer preference shifts are likely to continue to garner robust valuations.

Contract Manufacturing M&A Centers on End-to-End Platform Expansion

The Contract Manufacturing market has emerged as an active area for consolidation as buyers seek to build more comprehensive manufacturing platforms capable of supporting increasingly complex customer requirements. Contract manufacturer roll-ups have been a key driver of total sector M&A growth in 2026, increasing from seven transactions (14.3% of sector volume) to 19 transactions (31.1%) YOY. Scaling initiatives within the segment have underpinned the acceleration across the Vitamins & Supplements M&A market to date, especially as wellness brands and ingredient producers seek to bolster offerings and solidify their positions along the value chain. Public strategics and sponsors executing buy-and-build initiatives have targeted unique production operations that deliver differentiated offering contributions and enable vertical integration within the Vitamins & Supplements landscape. The sector’s fragmented profile has been conducive to this consolidation, reinforcing the expectation for M&A to remain a key strategic priority for operators. A few notable Contract Manufacturing segment deals are highlighted below.

• Capstone Partners Advises Desert Stream on its Sale to an Undisclosed Strategic Buyer (July 2026, Confidential) – Capstone advised Desert Stream Inc., a Utah-based nutritional supplement manufacturer, on its sale to an undisclosed buyer in July 2026. Terms of the deal are confidential. Desert Stream’s broad range of manufacturing applications spanning custom formulation, encapsulation, large-scale mixing, flexible packaging, and high-speed bottling and production lines enables it to support diverse supplement formats and customer requirements. This transaction highlights the growing demand for outsourced manufacturing platforms, as buyers continue to value scaled contract manufacturers that provide end-to-end formulation, production, and packaging while enabling brands to efficiently launch products and respond to evolving consumer preferences. For more information about this transaction, please contact Lisa Tolliver.

“Selling the company we spent more than 25 years building was deeply personal. Capstone understood that from day one. They positioned Desert Stream the right way, found us a partner who valued what we’d created, and led us through a smooth process to a great result. A true partnership from start to finish,” mentioned Stony Brooks, Co-Founder of Desert Stream.

• Western Botanicals Acquires SJS Herbal Corporation (August 2026, Undisclosed) – In August 2026, The Riverside Company-backed Western Botanicals (dba WB Blends) acquired SJS Herbal Corporation (dba Yellow Emperor) for an undisclosed sum, expanding its position within the Nutritional Supplements market. SJS Herbal engages in custom liquid supplement contract manufacturing, specializing in herbal and dietary formulations. WB Blends provides preparation, manufacturing, and packaging services across capsule, powder, and liquid supplement formats for health and wellness brands. This transaction broadens WB Blends’ manufacturing capabilities, product expertise, and customer reach, strengthening its ability to serve an increasingly diverse base of supplement brands amid rising consumer demand for preventative health and wellness products. The transaction reflects continued consolidation across the Vitamins & Supplements sector, where scaled manufacturers are pursuing add-on acquisitions to expand capacity, diversify product offerings, and build more comprehensive CDMO platforms.

“This collaboration is about creating more opportunities for our combined customer base. By bringing together the strengths of both organizations, we’re expanding our capabilities while maintaining the quality, service, and relationships our customers rely on every day,” stated Scott Matukas, COO of WB Blends, in a press release.⁴

• Applied Nutrition (LSE:APN) Acquires Majority of Nutrablend Group’s Assets (June 2026, $16.1 Million) – K.-based sports nutrition and wellness company Applied Nutrition acquired the majority of Nutrablend Group’s assets for an enterprise value of $16.1 million (June 2026). The transaction included Nutrablend’s manufacturing and warehousing facility in Buffalo, New York, production equipment, inventory, and its Basic Supplements and GR8 Lifestyle brands. The deal will significantly expand Applied Nutrition’s North American manufacturing footprint, providing an expected annual production capacity of ~$300 million while also enhancing supply chain resilience, reducing logistics costs, and improving time to market for new product development, according to a press release.⁵

“The acquisition of a U.S. manufacturing site significantly strengthens our ability to support ongoing growth in the region and provides us with the ability to expand our North American offering, harnessing Nutrablend’s experienced management team. Importantly, it allows us to launch new products at the same pace as we do in the U.K., improving our responsiveness to consumer and market demand and reinforcing a clear competitive advantage for Applied,” said CEO of Applied Nutrition, Thomas Ryder, in the press release.

Harrison Petts, Principal
In September, Capstone spoke with Harrison Petts, Principal at The Riverside Company, to discuss the Vitamins & Supplements landscape and Riverside’s investment in Western Botanicals. Mr. Petts is responsible for evaluating and executing investment opportunities and working closely with portfolio company management teams to drive growth and value creation. He focuses on investments across Riverside’s Essential Products & Services vertical, with a particular emphasis on the Health, Wellness, and Specialty Ingredients markets. Mr. Petts also supports Riverside’s buy-and-build strategy through add-on acquisitions and operational initiatives.

The Riverside Company is a global PE firm focused on investing in middle market businesses with attractive growth characteristics across diverse markets. Within its Essential Products & Services specialization, the firm targets sectors including Food & Beverage, Functional Ingredients, Lifestyle, Health & Wellness, Personal Care, and Pet Care. Riverside employs a thematic investment strategy and seeks to partner with management teams to accelerate growth through operational improvements, organic expansion, and strategic acquisitions. The firm invests across a broad range of transaction sizes, with dedicated strategies targeting businesses ranging from micro-capitalization opportunities to larger middle market platforms. To learn more about The Riverside Company, its investment approach, and portfolio companies, visit riversidecompany.com

What initially attracted Riverside to Western Botanicals, and what characteristics differentiated it from other nutraceutical manufacturing opportunities?

At Riverside, we deploy a thematic investing approach. We’ve done a lot over the years in specialty ingredients and anything related to health, longevity, and wellness. A few years ago, we initiated a proactive thesis in the VMS space in particular. We looked up and down the value chain from ingredient manufacturers to distributors to CDMOs to brands. We identified the CDMO segment of the market as an attractive investment opportunity. The VMS CDMO market is a large, fragmented market and there are strong trends supporting VMS broadly. We felt like the CDMO part of the market can benefit from the macro trends without being tied to the success or failure of a specific brand or ingredient.

We started looking for a VMS CDMO platform and found Don [Shaver, CEO], Scott [Matukas, COO], and the Western Botanicals [WB] team. They were looking for a capital partner to continue their growth trajectory. WB is an extremely growth-oriented organization  across all facets. We were looking for a business that had a great team and had invested in the people, processes, systems, and capacity to keep scaling and be a true one-stop shop for the VMS brands that are servicing consumers on a daily basis.

The Supplements sector has seen significant interest in contract manufacturers (vs brands). Why do you believe investors are gravitating toward CDMO assets today?

Investing in a VMS CDMO is just a different investment approach compared to investing in the VMS brands themselves. There are great investors that focus more on the branded side, and there has been a lot of activity in that space as well (i.e. Thorne, Nestle’s VMS portfolio, and Vitabiotics, among many others). It’s great to be able to participate in a large, growing, fragmented market and to do that in a diversified fashion where you’re serving a number of different customers, brands, ingredients, and product formats – the CDMOs can benefit from that diversification. That’s not to say that brands can’t, but I think from the investor standpoint, being able to achieve diversification while still benefitting from macro tailwinds creates a lot of opportunity to acquire and grow a platform in the VMS space.

When evaluating manufacturing assets, what capabilities are currently commanding the greatest strategic value? What characteristics cause you to pass on potential CDMO acquisitions?

At the end of the day, you need to be a platform that is a true partner and solutions-provider to your customers, not just an outsourced manufacturer. We believe you achieve this with an excellent team, a focus on innovation and new product development, and relentless focus on quality and manufacturing excellence. It’s paramount to have the right team across sales and marketing, R&D, regulatory, quality, , supply chain, manufacturing, and logistics. It’s a complex business and you need to have the right people that are true subject matter experts in those functional areas. We also look for a business that has some sort of differentiated capabilities on the new product development and innovation side. You want to be a thought partner with your customers, helping them bring new ideas and new products to the market. Aside from helping customers develop exciting products, you have to deliver operational excellence. VMS CDMOs operate in a complex environment – you need expertise in regulatory, quality, and supply chain in order to bring products to market. Additionally, you need to be able to deliver products across an array of product formats (i.e. capsules, powders, liquids, gummies, soft chews, etc.) and packaging formats (i.e. bottles, canisters, bags, stick packs, etc.) – you have to do this consistently, reliably, and on-time. To have a platform that has multiple product formats gives you the ability to be a one-stop shop for your customers. We feel like we have found that with Western, and we have the base to be able to continue adding more capabilities to be that much more value-add to the brands that we’re partnering with.

Which product categories or consumer trends are creating the greatest opportunities for manufacturers today?

More consumers are buying from digitally native brands that grew up in a slightly different environment of reaching their customers – many of these digitally native brands don’t have a history or legacy of manufacturing expertise. The digitally native brands need help with everything from product development, regulatory compliance, manufacturing, and logistics. This dynamic is driving strong growth at the CDMO level, which is a long-term tailwind that we identified. For VMS more broadly, demographic tailwinds are positive across every age category and every socioeconomic class. The aging population is driving growth because people are taking supplements to age more healthily and stay active for longer. The Millennial generation is focused on longevity and proactive health and wellness, where they’re taking more responsibility for their own health and longevity – supplements and vitamins are a great way to do that. For every demographic, there are tailwinds creating growth in supplements more broadly.

What type of add-on acquisitions are you targeting for Western Botanicals, and what capabilities, regions, etc. are most attractive as you seek to expand the platform? What made the recent Yellow Emperor add-on attractive for Western Botanicals?

What makes a platform special is being a true value-added partner and solutions provider to our VMS brand customers. Anything that we can do to continue to add to our solution set and to make ourselves a more thoughtful partner to our customers is what we want to do. One way that manifests is in new product development because it allows us to service our customers better and help them grow their businesses.

When we partnered with Western, they were very strong in powders, liquids, and capsules. However, a smaller portion of our business at acquisition was in the liquid space. Yellow Emperor is known in the market as being a very strong developer and manufacturer of liquid supplements, which gives us more capabilities, talent, innovation, and formula expertise on the liquid side. When we look at our combined platform now of Western and Yellow Emperor, we can service existing and new customers better across product formats in addition to extra capabilities on the liquid side.

Where do you see the Vitamins & Supplements Manufacturing landscape evolving over the next three to five years?

We are still in the early innings of the market’s demographic tailwinds, which is going to present more opportunities to create newer, better and more innovative products. Consumer education of the benefits of supplements is only heading in one direction, which is exciting for the entire VMS space, but also for the CDMOs themselves. Innovation in this market can come from ingredients, product formats, packaging formats, and delivery technologies. Delivery systems like liposomal technologies or innovative capsule formats (i.e. capsule-in-capsule or beadlets) make ingredients more bioavailable. These types of innovations give brands the ability to differentiate themselves and ultimately be that much more efficacious to consumers. At the end of the day, we want to make products that are going to help consumers live happier, healthier, and longer lives. There will be a lot of innovation in the market that will enable our customers to deliver those products to consumers.

The prioritization of preventative health, personalized nutrition, and innovative delivery formats is expected to bolster growth across the Vitamins & Supplements market through the remainder of 2026. Diverse formulation expertise, multi-format manufacturing, and comprehensive product development have become critical differentiators, positioning scaled contract manufacturers with strong customer relationships, regulatory knowledge, and specialized production capabilities as attractive M&A targets. Sector dealmaking is expected to remain robust, supported by strategic acquisitions, sponsor platform formations, and add-on transactions aimed at broadening product offerings across the vitamins and supplements value chain.

To discuss the growing role of contract manufacturers, provide an update on your business, or learn about Capstone’s wide range of advisory services and Vitamins & Supplements market knowledge, please contact us.

Matt Milone, Analyst, was the lead Market Intelligence contributor to this article.

Endnotes

1. Pew Research Center, “About 8 in 10 Americans Take Supplements, and Many See Them as Important To Their Health,” org/short-reads/2026/09/10/about-8-in-10-americans-take-supplements-and-many-see-them-as-important-to-their-health/, accessed September 23, 2026.

2. Harvard Medical School, “When pills pose problems,” harvard.edu/healthy-aging-and-longevity/when-pills-pose-problems, accessed September 23, 2026.

3. Mintel, “US Vitamins, Minerals and Supplements Market Report 2025,” mintel.com/report/us-vitamins-minerals-supplements-market-report, accessed September 23, 2026.

4. WB Blends, “WB Blends Partners with Yellow Emperor, Expanding Liquid Manufacturing Capabilities,” com/wb-blends-acquires-yellow-emperor-expanding-liquid-manufacturing-capabilities/, accessed September 23, 2026.

5. Applied Nutrition, “Trading Update, Acquisition of US Manufacturing Facility & New North American Collaboration,” com/us-manufacturing-acquisition-trading-update/, accessed September 23, 2026.