NovaBay Pharmaceuticals announces Retirement of Senior Executive

By January 8, 2009

NovaBay® Pharmaceuticals, Inc. (AMEX: NBY, www.novabaypharma.com), announced today the retirement of Jack O’Reilly, its Senior Vice-President of Corporate and Business Development, effective December 31, 2008. Mr. O’Reilly has also resigned as a member of the Board of Directors. Mr. O’Reilly’s decision to retire was the result of hearing loss that has been increasingly preventing him from playing a full role within the company.

“I am very pleased to announce that Mr. O’Reilly has agreed to act as an advisor to NovaBay, to continue to lead on-going partnership negotiations and to work with the company on new partnerships, especially in Europe, where Mr. O’Reilly expects to spend part of his retirement”, said Dr. Ron Najafi, Chairman and CEO. “We are grateful to Jack who has played key roles in the development of NovaBay, including the completion of NovaBay’s IPO in October 2007. His experience of working in the pharmaceutical industry since 1975 has proved invaluable in guiding our negotiations with key partners.”

Mr O’Reilly said “I have spent seven very fulfilling years as part of the management and as a member of the Board of Directors of NovaBay. I am happy that most of my former roles have been filled by the appointment of highly qualified professionals during the last year – Mr. Thomas Paulson as Chief Financial Officer and Dr. Larry Rozsnyai as Director of Intellectual Property. I am very pleased to accept Dr. Najafi’s request to act as an advisor to the company and look forward to continued, if somewhat reduced, interactions with my many friends in the company, on the Board and in the pharmaceutical industry.

About NovaBay® Pharmaceuticals, Inc.

NovaBay® Pharmaceuticals, Inc. is a biopharmaceutical company focused on developing innovative non-antibiotic, antimicrobial product candidates targeting the treatment or prevention of a wide range of infections in hospital and non-hospital environments. NovaBay® has discovered and is developing a class of non-antibiotic anti-infective compounds, which it has named Aganocide® compounds, which are based upon small molecules that are generated by white blood cells that defend the body against invading pathogens. NovaBay® believes that Aganocide® compounds could form a platform on which to create a variety of products to address differing needs in the treatment and prevention of bacterial and viral infections, including resistant bacteria such as MRSA. NovaBay® has entered into a licensing and research collaboration agreement with an affiliate of Alcon, Inc. for use of the Aganocide® compounds in the eye, ear and sinus, and in contact lens solutions. NovaBay® and Aganocide® are registered trademarks of NovaBay® Pharmaceuticals, Inc. All other trademarks and trade names are the property of their respective owners.

Forward-Looking Statements

Any statements in this press release about future expectations, plans, and prospects for NovaBay, often identified by words such as “estimates,” “believes,” “anticipates,” “plans,” “expects,” “may,” “will,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements. In addition, the forward-looking statements included in this press release represent our views as of this date. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so unless required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to this date.

Contact:

Investors:
NovaBay Pharmaceuticals Contacts
Theresa Granados
510-899-8870
Head of Investor Relations
tgranados@novabaypharma.com

or:

The Investor Relations Group

Investor Relations: Adam Holdsworth / James Carbonara

Media Relations: Janet Vasquez / Laura Colontrelle 212-825-3210

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