Beauty Store Business magazine - January, 2020

Derma E Acquired by Topix Pharmaceuticals

Topix Pharmaceuticals, an independent leader in skin care with a portfolio of clinically proven products and brands sold across multiple channels, has acquired eco-ethical natural skincare brand Derma E. The acquisition will allow additional resources to support Derma E’s category-leading growth while expanding Topix’s family of brands.

Founded in 1984, Derma E was among the first to create natural, vegan and cruelty-free skincare products sold in natural retailers. Its affordable skincare formulas were made without parabens, sodium lauryl sulfates, petrolatum, mineral oil, artificial colors, gluten, soy or GMOs—long before consumers demanded it. In recent years, the brand has successfully established itself in the beauty space as a category leader with a global presence.

Positioned for marked growth, Topix is backed by New Mountain Capital, an investment firm that currently manages more than $20 billion in assets. New Mountain Capital invested in Topix in July 2016 to provide equity capital for Topix to execute a growth strategy, including both organic and acquisition-led growth.

“We are thrilled to welcome Derma E into the Topix family,” said Andre Moura, managing director at New Mountain Capital and chairman of the Topix board of directors. “Topix is a leader in the dermatologist market with differentiated innovation and FDA-certified manufacturing capabilities. We look forward to supporting Derma E and its customers with these resources and believe the partnership will create multiple new avenues of long-term growth for both Derma E and the broader Topix business.”

Burt Shaffer, founder and chief executive officer of Topix added, “Derma E is an important first step in expanding Topix into adjacent, high-growth categories with a highly complementary brand that resonates deeply with consumers and shares Topix’s commitment to innovation."

Derma E co-founders David Stearn and Linda Miles are equally enthusiastic about the acquisition. “Topix is an ideal partner to help Derma E not only accelerate its growth plans but also ensure that the integrity of the brand and its mission remain,” said Derma E CEO, Stearn. “Topix is highly regarded amongst dermatologists as a leader in innovative and clinically validated skincare products and we believe several new opportunities can be opened for Derma E as a result of this transaction.”

Miles, president of Derma E, added, “David and I have been on a journey to create affordable and high-quality products from clean ingredients since 1984. We have seen tremendous growth – from offering just a single product to offering over 80 products, spanning facial, body and hair care. We are proud of the success that we have achieved and we look forward to the next chapter of growth for Derma E with Topix.”

Derma E will continue to operate at its Simi Vally, California, location. While David Stearn will be retiring; Linda Miles will continue to work with Topix in a consulting capacity during the transition.