NovaBay Pharma (NBY) Reports In-Line Q3 EPS; Announces Corp. Restructuring, Names New CEO

NovaBay Pharma (NYSE: NBY) reported Q3 EPS of ($0.07), in-line with the analyst estimate of ($0.07). Revenue for the quarter came in at $1.2 million versus the consensus estimate of $1.06 million.

NovaBay also announced a corporate restructuring to focus on the commercialization of its prescription Avenova® Lid and Lash Cleanser. NovaBay is also taking steps to reduce operating expenses with the goal of achieving positive cash flow from operations by the end of 2016. NovaBay Chairman Mark M. Sieczkarek has assumed the position of interim President and Chief Executive Officer, effective immediately, replacing former President and CEO, NovaBay founder Ron Najafi, Ph.D.

“We have an exciting opportunity for continued rapid commercial progress and sales growth with Avenova, and we are taking steps to focus our efforts on further establishing our presence in the largely untapped U.S. market that we estimate at 41 million patients. We are significantly reducing expenses associated with research and development and clinical programs in order to direct all resources to our commercial priorities,” said Mr. Sieczkarek. “As interim CEO, I look forward to leveraging my experience with successful medical product launches, including several ophthalmic products, to help NovaBay reach and sustain profitability.”

“On behalf of my colleagues at NovaBay and my fellow directors, I want to thank Ron Najafi for his many years of service and dedication to our company. It was his vision that led to the development of Neutrox™ and ultimately, the commercialization of Avenova®. He has been instrumental in building NovaBay, and we greatly appreciate his pledge of ongoing support to facilitate a smooth transition. The entire NovaBay team wishes him the best in his future endeavors,” he added.

Mr. Sieczkarek previously was CEO of Solta Medical, Inc. (acquired by Valeant Pharmaceuticals) and of Conceptus, Inc. (acquired by Bayer HealthCare), where he led the launch of the medical device Essure®. Prior to that, he was Senior Vice President and President of The Americas and Europe for the leading ophthalmic company Bausch & Lomb (acquired by Valeant Pharmaceuticals), where he was responsible for overseeing multinational commercial launches of several leading products. He has served as a member of the NovaBay Board of Directors since January 2014, was named Chairman in April 2015, and has been instrumental in the development of the go-to-market strategy for Avenova.

Avenova is the only commercial lid and lash hygiene product formulated with Neutrox, NovaBay’s proprietary, pure hypochlorous acid compound, which has the natural antimicrobic ability to manage chronic eye conditions such as blepharitis, meibomian gland dysfunction and associated dry eye. These chronic conditions cause itching, irritation and inflammation, among other symptoms, and affect approximately 30 million Americans. Avenova is also finding use in the pre-surgical setting for Lasik and cataract operations, for retinal injections and in managing contact lens intolerance, increasing the estimated total market to 41 million patients.

“We are only beginning to address the market for chronic eye conditions that are best managed with ongoing treatment regimens as well as for the expanded uses. Avenova has a distinct advantage in an established market, as it contains no soap or bleach impurities. Given the choice, we believe that doctors and their patients will choose Avenova,” said Mr. Sieczkarek. “We are delighted with the rapid growth Avenova has achieved to date, with quarterly sales increasing 10-fold to more than $1 million over the course of one year. The metrics that support continued growth are also gaining momentum, with an increasing number of eye care specialists prescribing our product and more patients refilling their prescriptions.”

For earnings history and earnings-related data on NovaBay Pharma (NBY) click here.

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