NovaBay Pharmaceuticals Announces Preliminary Sales for the Fourth Quarter of 2016
• Fourth quarter total revenue will exceed $4.0 million
• Gross margin on Avenova product sales expected in the 85% range
• Cash and equivalents at December 31, 2016 expected to be $9.5 million
EMERYVILLE, Calif. (January 9, 2017) – NovaBay® Pharmaceuticals, Inc. (NYSE MKT: NBY), a biopharmaceutical company focusing on commercializing prescription Avenova® lid and lash hygiene for the domestic eye care market, announces that Avenova sales for the fourth quarter of 2016 are expected to exceed $3.8 million, an increase of more than 146% over the prior year and up at least 26% from the third quarter of 2016. Total revenue for the full year of 2016 is expected to top $11.8 million, up more than 171% from 2015.
“I’m pleased to report a strong finish to an exceptional year of growth in Avenova sales,” said Mark M. Sieczkarek, NovaBay’s Chairman, President and CEO. “We continued to execute on our channel strategy with least 77% of Avenova sales for the fourth quarter coming from the higher-margin prescription ophthalmology channel, up from only 30% in the fourth quarter of 2015. As a result of the shift in sales channel mix, we expect gross margin on Avenova product sales for the fourth quarter will exceed 85%.
“We completed 2016 with a strong balance sheet with approximately $9.5 million in cash and equivalents. This represents the highest cash balance we’ve reported in over two years. We are still finalizing the closing process for the quarter and will report at a later date on our objective of achieving positive adjusted cash flow from operations in December,” he added.
“We have a positive outlook in 2017 for continued growth in Avenova prescriptions and sales,” said Sieczkarek. “We anticipate strong gross margin contribution from Avenova product sales as we grow Avenova sales through the prescription ophthalmology channel.”
NovaBay expects to report financial results for the fourth quarter of 2016 and to hold an investment community call in March 2017. NovaBay defines adjusted cash flow from operations as GAAP cash flow from operations less changes in operating assets and liabilities.
About NovaBay Pharmaceuticals, Inc.: Going Beyond Antibiotics®
Avenova is formulated with Neutrox®, which is cleared by the U.S. Food and Drug Administration (FDA) as a 510(k) medical device. Neutrox is NovaBay’s commercial name for its proprietary pure hypochlorous acid. Data from a multicenter clinical study show that Avenova reduced bacterial load, the underlying cause of blepharitis, on ocular skin surface by more than 90%. Laboratory tests show that hypochlorous acid has potent antimicrobial activity in solution yet is non-toxic to mammalian cells and also neutralizes bacterial toxins. Avenova is marketed to optometrists and ophthalmologists throughout the U.S. by NovaBay’s direct salesforce. It is accessible from more than 90% of retail pharmacies in the U.S. through agreements with McKesson Corporation, Cardinal Health and AmeriSource Bergen.
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 our ability to become cash flow positive by the end of 2016, the anticipated market acceptance of our products, future sales of our products, and the Company’s expected future financial results. Forward-looking statements can be identified with words like (and variations of): “estimate,” “believe,” and “expect.” These 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 manufacturing, distributing, and selling the Company’s products, unexpected adverse side effects or inadequate therapeutic efficacy of our product, the uncertainty of patent protection for the Company’s intellectual property, and any potential regulatory violations. Other risks relating to NovaBay’s business, including risks that could cause results to differ materially from those projected in the forward-looking statements in this press release, are detailed in NovaBay’s latest Form 10-K and Form 10-Q filings with the Securities and Exchange Commission, especially under the heading “Risk Factors.” 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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From the Company
Thomas J. Paulson
Chief Financial Officer