NovaBay Announces Successful End-of-Phase 2a FDA Meeting for Dermatology Program

By June 6, 2012

NovaBay Pharmaceuticals, Inc. (NYSE AMEX: NBY) today announced successful completion of an End-of-Phase 2a meeting with the Food and Drug Administration (FDA) regarding the Company’s NVC-422 program for treating impetigo, a highly contagious skin infection affecting millions of children and adults worldwide. During the meeting, the FDA provided guidance related to the proposed study protocol and statistical analysis plan, as well as the overall development plan. This valuable guidance is being incorporated into the Phase 2b protocol and analysis plan thereby enhancing the design of study. Implementation of the phase 2b program with NovaBay’s partner Galderma S.A. is actively progressing following the successful meeting with FDA.

“Impetigo is a major worldwide market, with over thirteen million prescriptions written annually for traditional antibiotics in developed countries alone. We expect our proprietary topical formulation of NVC-422 to advance the treatment of impetigo as it has the potential to clear infections, including those caused by methicillin-resistant Staphylococcus aureus, MRSA, without giving rise to resistance,” said Dr. Ron Najafi, Chairman and Chief Executive Officer of NovaBay. “Our market research has clearly shown that physicians urgently need an improved product to fight infections with the properties of NVC-422.

Behzad Khosrovi, Ph.D., Senior Vice President of Product Development for NovaBay said, “We continue to work closely with Galderma’s clinical, regulatory and manufacturing teams as the leadership of product development has shifted from NovaBay to Galderma and look forward to the initiation of the global Phase 2b study in the third quarter of this year. Over the last 12 months, in support of global product registration, Galderma has established clinical safety for topical NVC-422, including the successful completion of multiple safety studies involving more than 300 healthy volunteers, as well as the feasibility of manufacturing scale-up and long-term shelf-life.”

Impetigo is a highly contagious skin infection that mainly affects infants and children. Usually, red sores appear on the face, especially around a child’s nose and mouth. Although it commonly occurs when bacteria enter the skin through cuts or insect bites, impetigo can also develop in skin that’s perfectly healthy.

About NovaBay Pharmaceuticals, Inc.

Going Beyond Antibiotics
NovaBay Pharmaceuticals is a clinical-stage biotechnology company focused on addressing the large unmet therapeutic needs of the global anti-infective market with its two distinct categories of products.

Aganocide® Compounds
NovaBay’s first-in-class Aganocide compounds, led by NVC-422, are patented, synthetic molecules with a broad spectrum of activity against bacteria, viruses and fungi. Mimicking the mechanism of action that human white blood cells use against infections, Aganocides possess a very low likelihood that bacteria or viruses will be able to develop resistance, which is critical for advanced anti-infectives. Having demonstrated clinical efficacy in Phase 2 proof-of-concept clinical studies, NVC-422 is suited to treat and prevent a wide range of local, non-systemic infections. NovaBay’s clinical development activities are focused on three disease areas:

Dermatology – Partnered with Galderma, a leading dermatology company, to develop a formulation of NVC-422 for treatment of highly contagious skin infection, impetigo, caused primarily by S. aureus and Group A Beta-hemolytic streptococci. A major global Phase 2b clinical study is planned for 2012.

Ophthalmology – NovaBay is developing an eye drop formulation of NVC-422 for treating adenoviral conjunctivitis. Enrollment into a global Phase 2b clinical study has begun with top-line data expected in the first half of 2013.

Urology – NovaBay’s urinary catheter irrigation solution containing NVC-422 is currently enrolling patients in its Phase 2 proof-of-concept clinical studies, with the goal of reducing the incidence of urinary catheter blockage and encrustation (UCBE) and associated urinary tract infections. The Company reported positive data from Part A of this study and expects to announce top-line results from Part B later in 2012.

NovaBay is also developing NeutroPhase, which is an FDA 510(k)-cleared product for advanced wound care. We believe that NeutroPhase is the only patented pure hypochlorous acid solution available and has the potential to be best suited to treat the six-million-patients in the U.S. who suffer from chronic non-healing wounds, such as pressure, venous stasis and diabetic ulcers.

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Forward Looking Statements

This release contains forward-looking statements, which are based upon management’s current expectations, assumptions, estimates, projections and beliefs. Statements regarding NovaBay’s expectations including, but not limited to, (i) any potential plans for future clinical development of its Aganocide compounds and of bringing products to market including the expected timing of the initiation of the Phase 2b impetigo clinical trial and expected timing of the results of the Phase 2, Part B UCBE trial and Phase 2 conjunctivitis trial; (ii) the potential efficacy of Aganocide compounds; (iii) the development and potential benefits of, and the market opportunities for, NovaBay’s product candidates (iv) the potential to deliver the same or better efficacy than antibiotics and to address the growing problem of antibiotic resistance as well as other statements that relate to future events or results, are forward-looking. 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: the risk that negative results from the development programs could preclude Galderma from providing additional funding to NovaBay; inherent risks and uncertainties relating to difficulties or delays in conducting clinical trials; the inherent uncertainty of patent protection for the company’s intellectual property or trade secrets, risks and uncertainties relating to difficulties or delays in discovery, development, testing, production and marketing of the company’s product candidates; unexpected adverse side effects or inadequate therapeutic efficacy of the product candidates; the company’s ability to obtain additional financing as necessary; and the risk of unexpected delays in the regulatory process which may delay the commencement or completion of clinical trials as well other as risks relating to NovaBay and its Aganocide compounds detailed in NovaBay’s Quarterly Report on Form 10-Q, under the caption “Risk Factors” in Item 1A of Part II of that report, which was filed with the Securities and Exchange Commission on May 3, 2012. 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.

NovaBay Pharmaceuticals Contacts
Thomas J. Paulson  
Chief Financial Officer
Contact Thomas Paulson

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