Natural Alternatives Buys Real Health Labs 40198

Natural Alternatives Buys Real Health Labs

SAN MARCOS, Calif.NaturalAlternatives International Inc. (NASDAQ:NAII) announced the purchase of SanDiego-based Real Health Laboratories Inc., which formulates and manufacturescustomized nutritional supplements for major retailers, including Walgreens,CVS, Rite Aid, Sav-On, Longs and Eckerd. Real Health also markets itsnutritional products directly to consumers through catalogues, utilizingin-house graphic design, creative, fulfillment and call center operations. RealHealth, which has sold branded supplements and other lifestyle products since1994, posted revenues of $11.6 million for its last fiscal year ended Oct. 31,2005.

This acquisition marks a significant advance in ourstrategy of marketing our own branded products and expanding distributionchannels, said Randell Weaver, president of NAII.We believe thisacquisition will provide meaningful strategic, operational and financialbenefits to both companies, including the integration of certain NAII outsourcedactivities into RHLs existing operation.We anticipate integration of theseactivities to generate cost savings.

John Dullea will continue as president of Real Health,according to Mark LeDoux, chief executive officer (CEO) of NAII. Dullea has morethan 30 years of consumer products marketing and retail distribution expertiseboth domestically and internationally, including stints at Johnson & Johnsonand Andrew Jergens Co.

I share NAIIs vision of building a leading portfolio ofbranded supplement products across multiple channels, Dullea said. Thecombination of our capabilities should provide considerable opportunity forfuture growth.