For most of us, Marshmallow Peeps have been a holiday staple our entire lives. We don't recall an Easter basket without the sugary confection. The history of the marshmallow goes back much farther than that. The marsh-mallow plant emerged as a sweet treat in ancient Egypt when mixed with honey to create one of the earliest candies. In the Nineteenth century doctors used the plant as a medicine for sick children. By mixing juice extracted from marsh-mallow plant roots with egg whites and sugar a foamy substance was created. Once hardened this was used to soothe sore throats. Unfortunately, modern techniques eliminated the need for the original plant roots, also stripping the mallows of any healing properties.
It actually wasn't until 1953 that Just Born purchased the Rodda candy company. Rodda hand crafted marshmallow chicks, which Bob Born quickly fell in love with. It was only a year after taking over the original company that Bob acquired a machine to mass produce his 'Peeps.' The traditional chick was solely created until 1960 when Just Born began introducing other seasonally shaped marshmallow into the Peep family. Today Just Born reigns supreme as the largest marshmallow candy manufacturer in the world!
Information source: http://inventors.about.com/od/foodrelatedinventions/a/marshmallows_2.htm