Israel’s TopGum business completes deal for PLD’s US gummy manufacturing

Israeli-founded TopGum Industries has marked a game-changing acquisition of P&L Developments (PLD) pharma firm’s US gummy manufacturing operations, reports Neill Barston.

The move, which was initially highlighted at the start of the year, offers the company a significant strategic opportunity to expand its overall product reach, as well as extending its global presence. 

As TopGum noted, the US remains its largest target market, with the business devising a specialism as a pioneer in the emerging pharmaceutical gummies market, that has shown consistent levels of growth. 

Notably, TopGum and PLD agreed to launch a strategic commercial partnership under which PLD will commercialize and distribute TopGum-manufactured products to leading U.S. retailers under store-brand labels.

The completion of the transaction reinforces TopGum’s position as a leading innovative company in its field, and marks a significant milestone in its strategy to become a leading global player in healthcare products built on advanced, enjoyable delivery systems.

The acquisition gives TopGum a U.S.-based manufacturing platform purpose-built to FDA pharmaceutical standards, capable of producing both pharmaceutical gummies and dietary supplements. This state-of-the-art facility is among a select few globally to have reached operational manufacturing capability for pharmaceutical gummies.

Strategic Rationale
The combination of TopGum and PLD’s gummy operations addresses two major structural shifts in the U.S. consumer health market: the accelerating migration of both VMS and pharmaceutical products into gummy and other enjoyable dosage forms and the rising retailer and brand demand for U.S.-based supply chains.

TopGum estimates that the pharmaceutical gummy market is expected to follow a similar accelerated growth trajectory to the one experienced by the dietary supplements market over the past 15 years, during which the gummy format became the leading dosage form.

In parallel with the acquisition, TopGum and PLD have entered into a long-term strategic partnership for the commercialization of TopGum’s dietary supplement and pharmaceutical gummy portfolio to leading U.S. retailers under store-brand labels.

 Eyal Shohat, Chief Executive Officer, TopGum, commented: “This is a strategic transaction that gives TopGum a unique foothold in the emerging pharmaceutical gummy market and reinforces its positioning as an innovative, leading company in its field.

“The transaction positions TopGum as a unique player with an advanced global manufacturing platform, built to serve the largest dietary supplement brands in the U.S. with local manufacturing. Partnering with PLD, one of the leading generic pharmaceutical companies in the U.S., gives us access to leading U.S. retail chains and accelerates our growth in this market.

“The fact that a significant portion of the consideration is contingent and share-based reflects PLD’s confidence in TopGum’s strategy, capabilities and long-term growth trajectory. The pharmaceutical gummy category is in its earliest innings, and we believe it will follow the same arc the dietary supplement market followed over the past 15 years, when the gummy format became the dominant one. We view the completion of the transaction as a significant milestone in TopGum’s growth trajectory.”