NovaBay Announces New Business Strategy Focusing on Products for Eye Care

Revenue Growth – NovaBay is expanding its sales and marketing team for Avenova™ daily-use prescription eye care product with more than 50 U.S. direct medical sales representatives expected to be in place in 2015.

Innovation – NovaBay will continue to develop innovative products for the eye care market and plans to add new products currently in development in the next 12 to 18 months.

Strategic Alternatives – While NovaBay remains committed to the partnerships it currently has in wound care with China’s Pioneer Pharma, Korea’s Shin-Poong Pharma and the Middle East’s Biopharm Group to market NeutroPhase; in animal care with Virbac; and in dermatology with Galderma, NovaBay intends to seek additional sources of revenue and reduce expenses by licensing or selling select assets in urology, dermatology, wound care and plastic surgery.

“Following a comprehensive review of our assets, competitive positions, markets and market dynamics we have determined that focusing on eye care affords NovaBay the best opportunity for near-term revenue growth and, ultimately, profitability and positive operating cash flow,” said Ron Najafi, Ph.D., Chairman and CEO of NovaBay. “In addition, we are committed to monetizing other assets. Expenses to support programs outside of eye care have been significantly reduced, unless these programs are funded through collaborations or partnerships.”

Revenue Growth

The eye care market that NovaBay is currently reaching through its direct medical sales representatives is very large. An estimated 30 million Americans suffer from eyelid conditions such as blepharitis, meibomian gland dysfunction (MGD) or dry eye syndrome, collectively representing an estimated $500 million annual market in the U.S. alone. NovaBay recently announced the rebranding of what was previously known as i-Lid Cleanser to Avenova, in order to more clearly differentiate this prescription product from over-the-counter (OTC) detergent-based lid wipes. NovaBay’s FDA-cleared* prescription product, Avenova, offers clear advantages as a part of the regimen for managing these disorders compared with alternative regimens that include antibiotics, steroids and detergent-based OTC cleansers.

Starting in September 2014, with 10 direct medical sales representatives led by eye care industry marketing leader Glenn Moro, NovaBay has proven the market potential for Avenova. “Based on the metrics and current performance, we will be expanding the sales force to 35 representatives by February and to approximately 50 representatives by July. These sales representatives will be calling on ophthalmologists and optometrists across the United States. NovaBay’s distribution agreements with McKesson Corporation and Vision Source have made this game-changing product available in 90 percent of the nation’s 67,000 pharmacies and in optometrists’ and ophthalmologists’ offices all across the country,” Glenn Moro commented.

With the active support of the key opinion leaders who have joined NovaBay’s Ophthalmic and Optometry Advisory Boards, NovaBay expects to continue its active educational and marketing programs throughout 2015. The company plans to have a very active presence at major eye care conferences in the coming months, including the American Academy of Ophthalmology, the American Optometric Association, the American Society of Cataract and Refractive Surgery Conferences and the South Eastern Congress of Optometry, as well as numerous Vision Expo meetings held around the U.S.

At meetings, in professional publications and in surveys, nationally prominent ophthalmologists and optometrists like Christine W. Sindt, O.D., Clinical Associate Professor of Ophthalmology and Visual Sciences at the University of Iowa’s Carver College of Medicine, and Art Epstein, O.D., Director of Clinical Research at Phoenix Eye Care, are reporting on the improvements in eye care from the use of Avenova. Patients also say that Avenova has brought long-sought relief after years of suffering.


NovaBay will continue to innovate in eye care by creating or acquiring new products to be sold by its expanding field force of Medical representatives.

The company is developing new formulations of its Neutrox™ and Aganocide® product categories that will strengthen its position as an eye care innovator. NovaBay intends to create strong proprietary and clinical positions with novel formulations of Neutrox for the management of blepharitis and dry eye disease. An Aganocide-based topical product may complement the action of Neutrox-based solutions. The company also is developing a ground-breaking product that could revolutionize the care of contact lenses. NovaBay expects to introduce this product in the coming months.

NovaBay is actively evaluating a number of existing products to be synergistic with and complement Avenova. All products under consideration are intended to leverage the company’s proprietary field force of Medical Representatives and bolster productivity.

Strategic Alternatives for Other Assets

NovaBay intends to consider strategic alternatives for its assets and technology for programs not related to eye care. The company plans to retain and support its partnerships to market NeutroPhase with China Pioneer Pharma, Shin-Poong Pharma and the Biopharm Group. The potential markets are significant, with an estimated 24 million people suffering from diabetic ulcers and other chronic wounds in China alone, and millions more in Middle Eastern countries.

NovaBay also sees significant value in the proven ability of its Auriclosene (NVC-422) product to reduce the encrustation and blockage of in-dwelling urinary catheters. The company is now working with investment bankers to monetize that value by identifying the right partner. It is also working to sell or out-license its efforts in dermatology and other areas.

“We are excited about our new business strategy, which leverages our heritage while focusing operations on our largest market segment,” added Dr. Najafi. “While we look to the future with great optimism, we also are grateful for the hard work and dedication over the years by employees who are affected by a streamlining of our organization and extend best wishes to them in their future professional endeavors.”

About Avenova

Avenova is the only eye care product to contain Neutrox, NovaBay’s pure hypochlorous acid (HOCl), which is a naturally occurring substance produced by white blood cells to fight microbial invaders. Laboratory tests show it has potent antimicrobial activity and yet is non-toxic to mammalian cells. Neutrox neutralizes bacterial toxins in vitro. Avenova is uniquely suited for daily use by the millions of Americans who suffer from chronic eye conditions like blepharitis and dry eye. It is the only such product designed for continuous daily eyelid hygiene.

Avenova was cleared by the U.S. Food and Drug Administration as a prescription medical device through the 510(k) process. It is distributed nationwide by McKesson Corporation and has been added to the Vision Source Independent Optometry Network. Vision Source is the largest independent optometry network in the country, representing 2,800 independent optometrist offices.

Conference Call

NovaBay management will host an investment community conference call on Wednesday, January 21, 2015 at 12:00 p.m. Eastern time to discuss this announcement and answer questions. Shareholders and other interested parties may participate in the conference call by dialing 866-880-4999 from within the U.S. or 702-495-1913 from outside the U.S. and entering the conference identification number 62204781. The live call also will be available at

A replay of the call will be available beginning two hours after its completion through 11:59 p.m. Eastern time February 4, 2015 by dialing  855-859-2056 from within the U.S. or 404-537-3406 from outside the U.S. and entering the conference identification number 62204781. The call will also be archived for 90 days at

*Avenova Skin and Wound Cleanser is intended for use under the supervision of healthcare professionals for cleansing and removal of foreign material, including microorganisms and debris from wounds, and for moistening absorbent wound dressings and cleaning minor cuts, minor burns, superficial abrasions and minor irritations of the skin. It is also intended for moistening and debriding acute and chronic dermal lesions, such as Stage I to IV pressure ulcers, stasis ulcers, leg ulcers, diabetic foot ulcers, post surgical wounds, first and second degree burns, grafted and donor sites.

About NovaBay Pharmaceuticals, Inc.: Going Beyond Antibiotics®

NovaBay Pharmaceuticals is a biopharmaceutical company focusing on the development and commercialization of its non-antibiotic anti-infective products to address the unmet therapeutic needs of the global, topical anti-infective market with its two distinct product categories: FDA-cleared NEUTROX™ Family of Products: AVENOVA™ for the eye care market, NEUTROPHASE® for wound care and CELLERX™ for the dermatology market; and its AGANOCIDE® compounds, led by AURICLOSENE™.

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Forward-looking Statements

This release contains forward-looking statements and opinions regarding the commercial potential of Avenova, which are based upon management’s current expectations, assumptions, estimates, projections and beliefs. The words “will,” “estimated,” “potential” and “expectation” are intended to identify the forward-looking statements. 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 the actual deployment of the sales force, the ability to monetize existing assets, and the ability to secure satisfactory partnerships. Other risks relating to NovaBay and its products, 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-Qs as filed 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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