NovaBay Pharmaceutical’s Investigational New Drug Application (IND) for the Prevention of Catheter Associated Urinary Tract Infections Cleared by FDA

By January 22, 2008

NovaBay Pharmaceuticals, Inc. (AMEX & TSX: NBY, http://www.novabaypharma.com a biopharmaceutical company developing products for the treatment or prevention of a wide range of bacterial and viral infections, today announced that it has received clearance from the U.S. Food and Drug Administration to begin human clinical trials of its lead Aganocide® compound, NVC-422, for the prevention of catheter-associated urinary tract infections (CAUTI).

According to the Center for Disease Control, CAUTI is the major source of hospital acquired (nosocomial) infections, accounting for more than 40% of all hospital infections. These 800,000 infections result in prolonged hospitalization, urosepsis, septicemia and, in a small proportion of cases, death. The cost of treating a case of CAUTI has been reported to vary from $2,000 to $30,000 depending upon severity.

“There is an urgent need for new approaches to the prevention of urinary tract infections that result from the use of catheters,” said Bernard Churchill, M.D., Professor of Urology at UCLA and an advisor to NovaBay Pharmaceuticals. “The current level of these infections in US hospitals is unacceptable, especially since bacterial resistance is continually reducing the available antibiotic treatment options for many patients.”

“We are very pleased to have received rapid clearance of this important Investigational New Drug Application, as this enables us to stay on track with our clinical development programs and targeted milestones,” said Dr. Ron Najafi, Chairman and CEO of NovaBay Pharmaceuticals. “Our current plans are to move NVC-422 into clinical trials for additional indications during 2008 through both our internal programs and those of our partner, Alcon.”

About Catheter-Associated Urinary Tract Infections (CAUTI)

Catheters are an important aid to the management of patients in hospitals and long-term care facilities, but they bring with them a substantial risk of infection. Bacteria rapidly form biofilm on the catheter, serving as a reservoir of infection. Antibiotics are largely ineffective against bacteria once they have established a biofilm. The bladder is usually a sterile environment, but once bacteria are established there they can cause serious infections of the upper urinary tract and kidneys, leading in severe cases to life-threatening bloodstream infections. Attempts to eliminate infections through the use of drug- or silver-coated catheters have generally provided a few extra days of protection before the risk of infection returns.

About NVC-422

NVC-422 is a novel topical non-antibiotic anti-infective compound that, in-vitro, has been shown to destroy pathogens extremely rapidly. In-vitro, NVC-422 is highly active against gram-positive and gram-negative bacteria, fungi and viruses, including drug-resistant strains such as methicillin-resistant staphylococcus aureus (MRSA, including USA100 and USA300 strains), mupirocin-resistant and vancomycin-resistant Staphylococcus aureus. NVC-422 has been shown to be effective in-vitro against the causative agents of urinary tract infections, including multidrug-resistant Escherichia coli and Pseudomas aeruginosa. In addition to its potential use to prevent CAUTI, NovaBay is in clinical development of NVC-422, under the trademark AgaNase, to reduce the risk of surgical site infections and to reduce the risk of MRSA infections in hospital environments. Alcon, Inc. is in advanced pre-clinical development of formulations of NVC-422 for use against ophthalmic and ear infections. NVC-422 is not an antibiotic and the company believes it is unlikely to contribute to antibiotic resistance.

About NovaBay

NovaBay Pharmaceuticals, Inc. is a biopharmaceutical company focused on developing innovative product candidates for 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, based upon small molecules 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 different needs in the prevention and treatment of bacterial, fungal and viral infections, including MRSA. NovaBay has entered into a licensing and research collaboration agreement with an affiliate of Alcon, Inc. for use of the Aganocide® compounds in eye, ear and sinus infections and in contact lens solutions. NovaBay has also entered into a license agreement with an affiliate of Kinetic Concepts, Inc. for the use of NovaBay’s NeutroPhase product in wound care applications.

NovaBay(TM), AgaNase(TM), Aganocide® and NeutroPhase(TM) are trademarks of NovaBay Pharmaceuticals, Inc. All other trademarks and trade names are the property of their respective owners.
For more information visit the company’s website at http://www.novabaypharma.com

Forward-Looking Statements

This release contains forward-looking statements, which are based upon management’s current expectations, assumptions, estimates, projections and beliefs. These statements include, but are not limited to, statements regarding the development and potential benefits of, and the market opportunities for, NovaBay’s product candidates. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or achievements to be materially different and adverse
from those expressed in or implied by the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, risks and uncertainties relating to difficulties or delays in discovery, development, testing, regulatory approval, production and marketing of the company’s product candidates, unexpected adverse side effects or inadequate therapeutic efficacy of the product candidates, the uncertainty of patent protection for the company’s intellectual property or trade secrets, the company’s ability to obtain additional financing as necessary and
unanticipated research and development and other costs. The forward-looking statements in this release speak only as of this date, and NovaBay disclaims any intent or obligation to revise or update publicly any forward-looking statement except as required by law.

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