NovaBay Pharmaceuticals (NBY) Receives $2.6 Million from Partner Galderma

By September 27, 2012

NovaBay® Pharmaceuticals, Inc. (NYSE MKT: NBY), a biotechnology company focused on addressing the large unmet therapeutic needs of the global anti-infective market with first-in-class compounds such as its proprietary Aganocides®, today announced that it has received $2.6 million from partner Galderma S.A., a global leading pharmaceutical company exclusively focused on dermatology. The payment is associated with the clinical advancement of NovaBay’s “non-antibiotic, anti-infective” Aganocide® compound NVC-422 as a topical formulation moving to replace traditional antibiotics for the impetigo treatment, a highly contagious skin infection caused by common bacteria such as methicillin-resistant Staphylococcus aureus (MRSA).

Under the terms of an exclusive licensing agreement, Galderma is responsible for the ongoing clinical development program for NVC-422 for impetigo, among other indications, and NovaBay will receive escalating double-digit royalties on net sales of products. The agreement is worldwide in scope and covers potentially all major dermatological conditions. NovaBay has retained rights to certain Asian markets, onychomycosis (nail fungus), post surgical use and use in wound care, and orphan drug indications. NovaBay has retained all rights in other Asian markets outside Japan, and has exclusive rights to promote the products developed under the agreement in hospitals and other healthcare institutions in North America.

Galderma and NovaBay recently announced on September 24, 2012 the first patients enrolled in the Phase 2b global trial for impetigo treatment, which according to the Food and Drug Administration (FDA) has all the design elements (controls, sample size, end-points) to be considered a pivotal trial. Full clinical development of NVC-422 for impetigo is expected to be completed globally in 2014.

About NovaBay Pharmaceuticals, Inc.

Going Beyond Antibiotics
NovaBay Pharmaceuticalsis a biotechnology company focused on addressing the large unmet therapeutic needs of the global anti-infective market with its two distinct categories of compounds, Aganocides® and NeutroPhase® Skin & Wound Cleanser. The Company’s four core business units, DermaBay, UroBay, EyeBay and MediBay, are developing treatments that tackle infections in the dermatology, urology, ophthalmology and wound care areas.

Aganocide® Compounds
NovaBay’s first-in-class Aganocide compounds, led by NVC-422, are patented, synthetic Aganocides, proprietary to NovaBay, are non-systemic “non-antibiotics, anti-infective” topical compounds involving 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 reduced likelihood that bacteria or viruses will be able to develop resistance, critical characteristic for advanced anti-infectives in today’s environment. Having demonstrated therapeutic proof-of-concept in three Phase 2 clinical studies, these compounds are suited to treat and prevent a wide range of local, non-systemic infections involving the skin, eye, bladder and may have potential for other opportunities such as sinus, lung and nail infections. NovaBay is currently concentrated on three large therapeutic markets:

Dermatology – Partnered with Galderma, a leading dermatology company, to develop a formulation of NVC-422 for treatment of highly contagious skin infection, impetigo. Current product offerings give rise to resistance. Enrollment in a major global Phase 2b/3 clinical study began on September 24, 2012 with top-line data expected in the first half of 2013.

Ophthalmology – NovaBay is developing an eye drop formulation of NVC-422 for treating viral conjunctivitis, for which there is currently no FDA-approved treatment. Enrollment into a global Phase 2b/3 clinical study has begun with top-line data expected in the first half of 2013.

Urology – NovaBay’s irrigation solution containing NVC-422 is currently in Phase 2 clinical studies, with the goal of reducing the incidence of urinary catheter blockage and encrustation (UCBE). The Company reported positive data from Part A of this study and expects to announce top-line results from Part B later in the first half of 2013.
NeutroPhase Skin and Wound Cleanser is the only patented pure hypochlorous acid (HOCI) cleared by the U.S. Food and Drug Administration (FDA) to target the six-million-patient U.S. market of chronic non-healing wounds, such as pressure, venous stasis and diabetic ulcers. The saline based solution is the only skin and wound cleanser available to include a stabilized, pure form HOCI shown in studies to kill bacteria in solution, including necrotizing fasciitis. For additional information, visit:

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Cautionary Information Regarding Forward Looking Statements
The statements in this press release regarding NovaBay’s expectation regarding its partnership with Galderma and bringing products to market for dermatological indication; NovaBay’s expectation on the potential efficacy of Aganocide compounds for the treatment of impetigo and other indications; any potential plans for future clinical development of NVC-422;the expected timing of enrollment and commencement of clinical trials, expected timing of receipt and announcement of results of clinical studies, and efficacy of NeutroPhase and Aganocides are forward-looking statements subject to risks and uncertainties. Actual results may be different from those that NovaBay expects due to a number of factors, including risk that negative results from the development program could preclude Galderma from providing additional funding to NovaBay, risks and uncertainties in obtaining regulatory approvals for NovaBay’s products, as well as other risks relating to NovaBay, its NeutroPhase and Aganocide compounds detailed in NovaBay’s 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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NovaBay Pharmaceuticals Contacts
Thomas J. Paulson  
Chief Financial Officer
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