TopGum Industries signed a binding letter of intent to acquire U.S.-based operations manufacturing pharmaceutical products and dietary supplements in gummy dosage form, marking TopGum’s entry into pharmaceutical manufacturing.

The acquired manufacturing operations mark the first in the world to achieve operational manufacturing capabilities for pharmaceutical-grade gummies containing active pharmaceutical ingredients.¹

Through the transaction, TopGum will establish a U.S. manufacturing footprint while simultaneously expanding beyond dietary supplements and moving into pharmaceutical applications.¹

Hagai Stadler, chairperson of TopGum, said the acquisition represents a new phase for the company, saying, "This transaction represents a strategic leap forward and a new chapter in the company's life. Establishing a manufacturing foothold in the United States generates unparalleled value and positions TopGum at the forefront of the global industry. I thank the company's management and Board of Directors for this significant milestone.”

Who is selling the manufacturing operations?

According to TopGum, the seller is a U.S. company involved in generic pharmaceuticals, contract development, and manufacturing services, with established commercial relationships across major U.S. retail chains.¹

The acquisition is expected to include a dedicated manufacturing facility with active production lines, a laboratory trials line, and infrastructure to support future capacity expansion. The site currently complies with FDA requirements and following a certification process of several months, is expected to meet Therapeutic Goods Administration standards, enabling potential expansion into the Australian market and other regions.¹

What are the financial implications of the acquisition?

Per the terms of the letter of intent, consideration is valued at a total of $12 million in a cash payment at closing, with the issuance of TopGum shares valued at $13 million, based on a share price of NIS 13 per share.¹

The transaction also includes contingent future considerations of up to $12 million, payable in shares and tied to the achievement of defined sales milestones.¹

What is included in the acquisition?

The acquired manufacturing operations will also include several pharmaceutical gummy products that are expected to begin launching in 2026, with the associated development backlog estimated at approximately $60 million over the next two to three years.¹

According to TopGum, the seller has also entered into a development agreement with another large pharmaceutical company, creating a gummy formulation of an existing drug to target a market estimated to be around $1.5 billion annually, with the program being fully funded by the pharmaceutical partner and expected to launch in the second half of 2027.¹

Along with TopGum’s acquisition of manufacturing operations, both parties have also agreed to establish a long-term strategic collaboration, focusing on the commercialization of TopGum’s dietary supplement and pharmaceutical gummy portfolio.¹ As part of the partnership arrangement, TopGum has committed to the appointment of one board director, who will be nominated by the seller.

“This transaction facilitates our entry into the pharmaceutical domain with established manufacturing capabilities and a developed pipeline,” said Eyal Shohat, chief executive officer of TopGum. “The collaboration provides a foundation for continued expansion in both pharmaceutical and dietary supplement markets.”

Sources

1. TopGum Signs Binding LOI to Acquire U.S. Operations and Expand into the Pharmaceutical Domain TopGum Industries January 21, 2026 https://www.prnewswire.com/news-releases/topgum-signs-binding-loi-to-acquire-us-operations-and-expand-into-the-pharmaceutical-domain-302666723.html