NovaBay Pharmaceuticals, Inc. Reports Third Quarter 2014 Financial Results And A Clinical/Business Update
Q3 Commercial Highlights:
- Initiation of the marketing campaign and commercialization effort for NovaBay's new product, i-Lid™ Cleanser, with medical sales representatives deployed in 10 major metropolitan areas across the United States.
- Creation of an Optometry Advisory Board and expansion of Ophthalmology Advisory Board to help oversee the development and marketing of NovaBay's i-Lid Cleanser .
- Clearance of NovaBay's NeutroPhase® Skin and Wound Cleanser by China's Food and Drug Administration with upcoming product launch in mainland China by partner, China Pioneer Pharma.
EMERYVILLE, Calif., Nov. 12, 2014 (GLOBE NEWSWIRE) -- NovaBay Pharmaceuticals, Inc. (NYSE MKT:NBY), a biopharmaceutical company focusing on the development and commercialization of its non-antibiotic anti-infective products, today reported third quarter 2014 financial results and provided an update on its clinical and commercialization progress.
"Our newly launched sales and marketing campaign for i-Lid Cleanser initially targets major urban areas where large numbers of individuals suffer from dry-eye and blepharitis. These markets include New York City, Los Angeles, Boston, Atlanta, San Francisco and other high value markets around the United Sates," commented Ron Najafi, Ph.D., Chairman and CEO of NovaBay Pharmaceuticals.
"Once eye care professionals prescribe i-Lid Cleanser and see positive results, we believe they will realize that it offers a marked improvement in the standard of care for patients with common conditions like dry eye syndrome associated with blepharitis and meibomitis," added Dr. Najafi.
Third Quarter 2014 Results
Net loss for the quarter ended September 30, 2014 was $4.2 million, compared to a net loss of $3.8 million for the same period last year. The higher net loss was mainly due to the fact that we recorded collaboration revenue from Galderma in 2013 and did not in 2014.
Cash, cash equivalents, and short-term investments decreased by approximately $4.0 million to $9.1 million on September 30, 2014, compared with $13.1 million on December 31, 2013. The decrease in cash balance was primarily attributable to our spending in multiple clinical trials, partially offset by $6.0 million in net cash proceeds from a March 2014 equity financing.
NovaBay's license, collaboration, distribution and product revenue for the quarter ended September 30, 2014 was $0.2 million, compared to $1.1 million for the same period last year. The decrease in license, collaboration, distribution and product revenue was related to the full amortization of the upfront payments from Galderma in 2013 and the end of the FTE funding from the same contract.
Research and development expenses for the three months ended September 30, 2014, were $2.3 million, compared to $2.5 million for the same period last year. The changes over the period relate to the decrease in clinical activities as NovaBay completed its adenoviral conjunctivitis trial in March 2014 and its urology (UCBE) trial in the second half of 2013.
Sales, general and administrative expenses for the three months ended September 30, 2014 were $1.9 million, compared to $1.5 million for the same period last year. The increase was due to $0.5 million related to sales and marketing activities for i-Lid Cleanser in the three months ended September 30, 2014. The increase was partially offset by lower travel and entertainment expenses in 2014.
Q3 and Recent Business and Clinical Updates
- October: Announced that NovaBay's i-Lid Cleanser with Neutrox was added to the Vision Source Independent Optometry Network, the largest independent optometry network in the country.
- September: Announced that China's Food and Drug Administration had cleared NovaBay's NeutroPhase Skin and Wound Cleanser for sale throughout mainland China. We will be shipping NeutroPhase to China to support launch of the product by China Pioneer Pharma, which placed its first order in October, in preparation of launch of NeutroPhase Skin and Wound Cleanser in China.
- September: Announced creation of an Optometry Advisory Board to help oversee the development and marketing of NovaBay's i-Lid Cleanser and other eye lid hygiene products. The five members of the new board are nationally known eye care professionals.
- September: Featured i-Lid Cleanser with Neutrox™ for the first time at the International Vision Expo & Conference, one of the most important contact lens and eye product conferences, covering everything from the latest medical information to trends in eyewear fashion.
- August: Initiated a marketing campaign and commercialization effort for the company's new product, i-Lid Cleanser, led by Glenn Moro, NovaBay's new Vice President of Sales and Marketing. NovaBay's i-Lid Cleanser sales force has been deployed in 10 major metropolitan areas across the United States.
- August: Announced that NovaBay's NVC-422 ophthalmic formulation did not meet the primary or secondary endpoints in its Phase 2 BAYnovation clinical study in patients with adenoviral conjunctivitis. NovaBay does not intend to initiate any new studies of NVC-422 for this indication.
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 regulatory approvals for our products, the anticipated market acceptance of our products, and the company's expected future financial results. 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 development, clinical trial, 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. Other risks relating to NovaBay and Aganocide compounds, 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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| For Investment Inquiries: |
| Thomas J. Paulson |
| Chief Financial Officer |
| 510-899-8809 |
| Contact Tom |
| For NovaBay i-Lid Cleanser purchasing information, please contact: |
| Toll-Free: 1-800-890-0329 |
| Contact i-Lid Cleanser |
| www.ilidcleanser.com |
| NOVABAY PHARMACEUTICALS, INC. | ||
| CONSOLIDATED BALANCE SHEETS | ||
| September 30, | December 31, | |
| 2014 | 2013 | |
| (in thousands, except per share data) | (unaudited) | |
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $ 7,884 | $ 10,500 |
| Short-term investments | 1,251 | 2,553 |
| Accounts receivable | 364 | 784 |
| Inventory | 405 | 231 |
| Prepaid expenses and other current assets | 514 | 723 |
| Total current assets | 10,418 | 14,791 |
| Property and equipment, net | 478 | 718 |
| Other assets | 147 | 141 |
| TOTAL ASSETS | $ 11,043 | $ 15,650 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Liabilities: | ||
| Current liabilities: | ||
| Accounts payable | $ 918 | $ 1,674 |
| Accrued liabilities | 1,176 | 1,616 |
| Deferred revenue | 259 | 337 |
| Total current liabilities | 2,353 | 3,627 |
| Deferred revenues - non-current | 2,212 | 1,534 |
| Deferred rent | 164 | 136 |
| Warrant liability | 624 | 1,837 |
| Total liabilities | 5,353 | 7,134 |
| Stockholders' equity: | ||
| Preferred stock, $0.01 par value; 5,000 shares authorized; none outstanding at September 30, 2014 and December 31, 2013 | — | — |
| Common stock, $0.01 par value; 120,000 shares authorized at September 30, 2014 and 65,000 shares authorized at December 31, 2013; 51,143 and 44,624 issued and outstanding at September 30, 2014 and December 31, 2013, respectively | 511 | 446 |
| Additional paid-in capital | 72,267 | 64,438 |
| Accumulated other comprehensive loss | (9) | (15) |
| Accumulated deficit during development stage | (67,079) | (56,353) |
| Total stockholders' equity | 5,690 | 8,516 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 11,043 | $ 15,650 |
| NOVABAY PHARMACEUTICALS, INC. | |||||
| CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||
| (unaudited) | |||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||
| (in thousands, except per share data) | 2014 | 2013 | 2014 | 2013 | Cumulative Period from July 1, 2002 (inception) to September 30, 2014 |
| Sales: | |||||
| Product revenue | $ 90 | $ (1) | $ 299 | $ 78 | $ 536 |
| Cost of goods sold | 42 | 43 | 189 | 82 | 359 |
| Gross profit | 48 | (44) | 110 | (4) | 177 |
| Other revenue: | |||||
| License, collaboration and distribution revenue | 23 | 1,035 | 99 | 2,739 | 60,598 |
| Other revenues | 39 | 65 | 165 | 150 | 478 |
| Total other revenue | 62 | 1,100 | 264 | 2,889 | 61,076 |
| Operating expenses: | |||||
| Research and development | 2,312 | 2,513 | 7,078 | 8,424 | 79,685 |
| Sales, general and administrative | 1,911 | 1,525 | 5,273 | 5,081 | 51,240 |
| Total operating expenses | 4,223 | 4,038 | 12,351 | 13,505 | 130,925 |
| Operating loss | (4,113) | (2,982) | (11,977) | (10,620) | (69,672) |
| Non-cash gain (loss) on changes in fair value of warrants | (104) | (866) | 1,213 | (1,282) | 1,365 |
| Other income (expense), net | (2) | 3 | 48 | 8 | 1,315 |
| Loss before provision for income taxes | (4,219) | (3,845) | (10,716) | (11,894) | (66,992) |
| Provision for income taxes | — | (3) | (10) | (11) | (87) |
| Net loss | (4,219) | (3,848) | (10,726) | (11,905) | (67,079) |
| Change in unrealized gains (losses) on available-for-sale securities | 3 | 6 | 6 | (13) | (11) |
| Comprehensive loss | $ (4,216) | $ (3,842) | $ (10,720) | $ (11,918) | $ (67,090) |
| Net loss per share: | |||||
| Basic and diluted | $ (0.08) | $ (0.10) | $ (0.22) | $ (0.32) | |
| Shares used in per share calculations: | |||||
| Basic and diluted | 50,821 | 37,467 | 48,995 | 37,166 | |
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