NovaBay Pharmaceuticals Enters into Agreement to Broaden Intellectual Property Estate and Expand Clinical Opportunities for Its Aganocide Compounds

By April 22, 2009

NovaBay® Pharmaceuticals, Inc. (NYSE Amex: NBY), a mid-stage biopharmaceutical company developing first-in-class, potent, well-tolerated products to treat and prevent a wide range of infections with low chance of developing drug resistance, today announced an exclusive agreement with Professors Markus Nagl M.D. and Waldemar Gottardi, Ph.D. of the Medical University of Innsbruck, Austria. The agreement was entered into to advance the development of NovaBay’s Aganocide® compounds by integrating extensive and on-going clinical work at the university with NovaBay’s development program.

Professors Gottardi and Nagl have conducted extensive clinical research and have patented and published widely for many years on the use of N-chlorotaurine (NCT), a natural antimicrobial produced by the body’s white blood cells. NovaBay’s Aganocide® compounds are synthetic analogs of NCT that maintain or enhance the biological activity of the natural compound while adding pharmaceutically acceptable stability. Professors Gottardi and Nagl have pioneered the exploratory use of NCT compounds in humans in a number of indications that overlap with and even go beyond those for which NovaBay’s Aganocide® compounds are currently being developed.

Under the terms of the agreement, NovaBay® will fund ongoing research in the laboratories of Professors Gottardi and Nagl at the Medical University of Innsbruck and NovaBay® will have access to past and future data generated in human clinical trials by Professors Nagl, Gottardi and their collaborators. These data are expected to support many of the indications being pursued by NovaBay® and its partners. For instance, they have published successful results of a Phase II clinical trial in ear infections (otitis externa) using NCT. NovaBay® expects Alcon, its licensee for the use of Aganocide® compounds in the treatment of eye, ear, and sinus infections, to start human trials in the ear during 2009 with Novabay’s lead Aganocide® compound NVC-422. Professors Nagl and Gottardi have also pursued studies with NCT in additional indications that can provide NovaBay® with guidance in its future clinical programs.

In addition to the research agreement, NovaBay® has obtained an exclusive license to a broad portfolio of intellectual property covering uses of NCT compounds. As a result, NovaBay® has augmented its composition of matter patent for Aganocide® compounds with a license to a series of patents covering key potential uses, including utility of NCT compounds in pulmonary diseases and their potential use in major animal health markets, such as mastititis.

“We are very excited to collaborate with this world-class research team, and pleased to draw on the extensive experience of Professors Gottardi and Nagl in understanding the role of our class of molecules in the prevention and treatment of infectious diseases,” said Dr. Ron Najafi, Chairman and Chief Executive Officer of NovaBay. “We look forward to building on their work to further expand the range of clinical opportunities provided by our Aganocide® compound platform.”

“We expect to substantially broaden NovaBay’s efforts by leveraging the resources and expertise at the Medical University of Innsbruck,” said Dr. Bez Khosrovi, Vice President of Research and Development at NovaBay. “We see this collaboration as adding significant depth to our preclinical and clinical development programs and to the continued exploration of the properties of our Aganocide® compounds. We expect that our joint efforts will provide important information that may further accelerate our efforts to develop this novel class of anti-infectives.”

About Aganocide® Compounds

The Aganocide® compounds are novel, proprietary, synthetic N-chlorinated antimicrobial molecules specifically designed by NovaBay® to mimic the body’s natural defense against infection. The Aganocide® compounds maintain the biological activities while improving the stability of naturally occurring N-chlorinated antimicrobial molecules. These highly differentiated compounds may deliver the same or better efficacy than currently used antibiotics without contributing to the growing rise of bacterial resistance. In preclinical trials, the Aganocide® compounds have shown to be highly effective against bacteria, viruses and fungi. They have also been demonstrated to be effective against bacteria in biofilm, which render most antibiotics ineffective. These compounds have a potentially broad therapeutic index providing a high degree of potency, good tolerability and dosing versatility and flexibility.

About NovaBay® Pharmaceuticals, Inc.

NovaBay® Pharmaceuticals is a mid-stage biopharmaceutical company focused on developing its proprietary and patented Aganocide® compounds, first-in-class, novel, synthetic anti-infective product candidates that are bioequivalent to the active antimicrobial molecules generated within white blood cells to treat and prevent a wide range of infections without causing resistance. NovaBay® has internal development programs aimed at addressing hospital and respiratory infections. The company has a licensing and research collaboration agreement with Alcon, Inc. for use of its Aganocides in the eye, ear and sinus, and in contact lens solutions. NovaBay® has entered into an agreement with Galderma S.A. to develop and commercialize Aganocides in acne, impetigo and other dermatological indications. NovaBay® and Aganocide® are trademarks of NovaBay® Pharmaceuticals, Inc. For more information on NovaBay, visit www. novabaypharma.com.

Cautionary Information Regarding Forward-Looking Statements

The statements in this press release of NovaBay’s expectations regarding the timing of commencement of NVC-422 clinical trials, the benefits to NovaBay® from the agreements with Professors Gottardi and Nagl, and the potential efficacy of NovaBay’s Aganocide® compounds, are forward-looking statements. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others, the risk that results obtained in animal models may not be obtained in humans, and the risk of unexpected delays in the regulatory process may delay the commencement or completion of clinical trials. Other risks relating to NovaBay® and its Aganocide® compounds , including risks that could cause actual results to differ materially from those projected in the forward-looking statements in this press release, are detailed in NovaBay’s Annual Report on Form 10-K, under the caption “Risk Factors” in Item 1A of Part I of that report, which was filed with the Securities and Exchange Commission on March 31, 2009.

For more information

Investors:
NovaBay Pharmaceuticals Contacts
Thomas J. Paulson  
Chief Financial Officer
510-899-8809
Contact Thomas Paulson

 

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