NovaBay Pharmaceuticals has acquired specialty skin care brand, DERMAdoctor, in a deal that has the potential to double its topline revenue in 2022. The biopharmaceutical company has purchased all of the brand’s inventory, products and intellectual property for $15.0 million. The deal includes $12.0 million in cash at closing and up to an additional $3 million in earnout payments contingent upon the DERMAdoctor business achieving predetermined financial targets for the 2022 and the 2023 fiscal years.

Promising clinical skin therapy with measurable results, DERMAdoctor was founded in 1998 and currently sells more than 30 products DTC and across major retailers including Macy’s, QVC, Costco and more. The brand also maintains a large network of international distributors and retailers.

DERMAdoctor’s co-founders, Dr. Audrey Kunin and Dr. Jeff Kunin, will remain with the company. Dr. Audrey will serve as NovaBay’s Chief Product Officer for all new product development and join the NovaBay board of directors. Dr. Jeff will continue to hold his position as DERMAdoctor’s President. The brand’s entire 13-member team will remain, and the business will continue to operate from its current headquarters in Riverside, Missouri.

“Having evaluated various strategic opportunities to expand NovaBay’s commercial presence in the beauty industry with complementary product offerings, DERMAdoctor stood out as the ideal fit commercially, while also supporting the goals of reaching profitability and enhancing stockholder value,” said Justin Hall, CEO, NovaBay.

He added, “We plan to employ our commercial organization’s expertise and industry relationships in combination with those of DERMAdoctor in order to broaden the distribution and future growth of our combined products to an expanded and more diverse customer base.”

NovaBay’s U.S. beauty market offerings currently includes Avenova, an antimicrobial lid and lash spray, CelleRx Clinical Reset, a product designed to remove bacteria buildup on facial skin, and NeutroPhase Skin and Wound Cleanser for wound heal.

The transaction is expected to close in the fourth quarter of 2021, subject to customary closing conditions.