Conference call begins today at 4:30 p.m.
Eastern time
NovaBay® Pharmaceuticals, Inc. (NYSE American: NBY), a
biopharmaceutical company focusing on commercializing prescription
Avenova® for the domestic eye care market, reports financial
results for the three and nine months ended September 30, 2018 and
provides a business update.
Net sales for the third quarter of 2018 were $3.1 million,
compared with $4.1 million for the third quarter of 2017 and $2.8
million for the second quarter of 2018.
“We achieved quarterly revenue growth on a sequential basis, as
anticipated, driven primarily by deploying sales representatives to
territories we’ve identified as having favorable health plan
coverage, as well as by initial contributions from sales
representatives we hired mid-year,” said Jack McGovern, NovaBay
Interim CEO and CFO. “We also saw a modest improvement in net
product revenue per unit compared with the second quarter as more
patients satisfied their 2018 health plan deductibles.
“We are executing on a strategy to support improved per-unit
revenue by engaging specialty pharmacy providers as new channel
partners,” he added. These channels will allow us to significantly
improve the overall patient experience. We have contracted with two
such providers to date, with more expected by year end.
“We expect net sales for the fourth quarter of 2018 to be higher
than the third quarter and anticipate returning to double-digit
year-over-year growth in 2019. Our optimism is based on improving
productivity from our sales representatives, a more focused
marketing message to our providers and on expectations for higher
per-unit revenue through our new channel partners,” concluded
McGovern.
Third Quarter Financial Results
Net sales for the third quarter of 2018 were $3.1 million,
compared with $4.1 million for the third quarter of 2017, with the
decrease primarily due to a lower selling price of Avenova. Gross
margin on net product revenue was 89% for the third quarter of
2018, compared with 87% for the prior-year period, with the
improvement due to product mix.
Sales and marketing expenses for the third quarter of 2018 were
$3.2 million, compared with $3.3 million for the third quarter of
2017, with the decrease primarily due to a reduction in the number
of sales representatives, partially offset by an increase in
sampling. General and administrative expenses for the third quarter
of 2018 were $1.3 million, compared with $2.3 million for the
prior-year period, with the decrease primarily due to lower
stock-based compensation expense and lower professional services
and consulting fees. Research and development expenses for the
third quarter of 2018 were $45,000, compared with $132,000 for the
third quarter of 2017.
The operating loss for the third quarter of 2018 was $1.8
million, a 17% improvement from an operating loss of $2.2 million
for the third quarter of 2017.
Non-cash gain on the change of fair value of warrant liability
for the third quarter of 2018 was $267,000, compared with a
non-cash loss of $281,000 for the third quarter of 2017.
The net loss for the third quarter of 2018 was $1.5 million, or
$0.09 per share, compared with a net loss for the third quarter of
2017 of $2.4 million, or $0.16 per share.
Nine Month Financial Results
Net sales for the nine months ended September 30, 2018 were $8.9
million, compared with $11.9 million for the nine months ended
September 30, 2017. Gross margin on net product revenue was 88% for
the first nine months of 2018, up from 85% for the first nine
months of 2017.
The operating loss for the first nine months of 2018 was $6.3
million, a 19% improvement from an operating loss of $7.7 million
for the comparable period in 2017. For the nine months ended
September 30, 2018, sales and marketing expenses decreased 8% to
$9.6 million, general and administrative expenses decreased 39% to
$4.3 million, and research and development expenses decreased 42%
to $152,000, all compared with the nine months ended September 30,
2017.
Non-cash gain on the change of fair market of warrant liability
for the first nine months of 2018 was $1.0 million, compared with a
non-cash loss of $501,000 for the first nine months of 2017.
The net loss for the nine months ended September 30, 2018 was
$5.3 million, or $0.31 per share, compared with a net loss for the
nine months ended September 30, 2017 of $8.2 million, or $0.54 per
share.
NovaBay reported cash and cash equivalents of $5.2 million as of
September 30, 2018, compared with $3.2 million as of December 31,
2017. In February 2018, the company raised net proceeds of $5.6
million through a private placement of common stock.
Conference Call
NovaBay management will host an investment community conference
call today beginning at 4:30 p.m. Eastern time (1:30 p.m. Pacific
time) to discuss the Company’s financial and operational results
and to answer questions. Shareholders and other interested parties
may participate in the conference call by dialing 800-608-8202 from
within the U.S. or 702-495-1913 from outside the U.S., with the
conference identification number 5709629.
A live webcast of the call will be available at
http://novabay.com/investors/events and will be archived for 90
days. A replay of the call will be available beginning two hours
after call completion through 11:59 p.m. Eastern time November 15
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
5709629.
About Avenova®
Avenova is an eye care product formulated with our proprietary,
stable and pure form of hypochlorous acid. It has proven in
laboratory testing to have broad antimicrobial properties as a
preservative in solution as it removes foreign material including
microorganisms and debris from the skin on the eyelids and lashes
without burning or stinging. 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 AmerisourceBergen.
About NovaBay Pharmaceuticals, Inc.: Going Beyond
Antibiotics®
NovaBay Pharmaceuticals, Inc. is a biopharmaceutical company
focusing on commercializing and developing 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: the NEUTROX® family of products and the
AGANOCIDE® compounds. The Neutrox family of products includes
AVENOVA® for the eye care market, NEUTROPHASE® for wound care
market, and CELLERX® for the aesthetic dermatology market. The
Aganocide compounds, still under development, have target
applications in the dermatology and urology markets.
Forward-Looking Statements
This release contains forward-looking statements that are based
upon management's current expectations, assumptions, estimates,
projections and beliefs. These statements include, but are not
limited to, statements regarding our business strategies and future
focus, our estimated future revenue, and generally the Company’s
expected future financial results. Forward-looking statements can
be identified with words like (and variations of): “expect,” and
“anticipate.” 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 sales rep productivity, product
distribution, obtaining adequate insurance reimbursement for the
Company’s products, and any potential regulatory
problems. 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-Q/K 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,
INC.CONSOLIDATED BALANCE SHEETS(Unaudited)(in
thousands, except par value amounts)
September 30 December
31, 2018 2017
ASSETS Current assets: Cash and cash equivalents $ 5,207 $
3,199 Accounts receivable, net of allowance for doubtful accounts
($9 and $13 at September 30, 2018 and December 31, 2017,
respectively) 2,612 3,629 Inventory, net of allowance for excess
and obsolete inventory and lower of cost or estimated net
realizable value adjustments of $124 and $140 at September 30, 2018
and December 31, 2017, respectively) 390 504 Prepaid expenses and
other current assets 1,319 1,663 Total
current assets 9,528 8,995 Property and equipment, net 271 471
Other assets 566 613 TOTAL ASSETS $
10,365 $ 10,079
LIABILITIES AND
STOCKHOLDERS' EQUITY Liabilities: Current liabilities: Accounts
payable $ 564 $ 466 Accrued liabilities 2,751 1,672 Deferred
revenue 62 2,841 Total current
liabilities 3,377 4,979 Deferred revenues - non-current - 534
Deferred rent 213 286 Warrant liability 518 1,489 Other liabilities
198 197 Total liabilities 4,306
7,485 Stockholders' equity : Preferred
stock: 5,000 shares authorized; none outstanding at September 30,
2018 and December 31, 2017 — — Common stock, $0.01 par value;
50,000 and 240,000, shares authorized at September 30, 2018 and
December 31, 2017, respectively; 17,089 and 15,385 shares issued
and outstanding at September 30, 2018 and December 31, 2017,
respectively 171 154 Additional paid-in capital 119,601 113,514
Accumulated deficit (113,713 ) (111,074 ) Total
stockholders' equity 6,059 2,594 TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY $ 10,365 $ 10,079
NOVABAY PHARMACEUTICALS,
INC.CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (LOSS)(Unaudited)(in thousands except per
share data)
Three Months Ended
Nine Months Ended September 30, September 30,
2018 2017
2018
2017 Sales:
Product revenue, net $ 3,142 $ 4,080 $ 8,870 $ 11,868 Other revenue
- 11 13 46 Total sales, net 3,142 4,091
8,883 11,914 Product cost of goods sold 332 521
1,062 1,807 Gross profit 2,810 3,570
7,821 10,107 Research and development
45 132 152 264 Sales and marketing 3,230 3,296 9,603 10,412 General
and administrative 1,344 2,311 4,326 7,134
Total operating expenses 4,619 5,739 14,081
17,810 Operating loss (1,809 ) (2,169 ) (6,260 )
(7,703 ) Non cash gain (loss) on changes in fair value of
warrant liability 267 (281 ) 971 (501 ) Other income, net 4
3 13 9 Loss before provision for income
taxes (1,538 ) (2,447 ) (5,276 ) (8,195 ) Provision for income tax
- - (1 ) (1 ) Net loss and comprehensive loss $
(1,538 ) $ (2,447 ) $ (5,277 ) $ (8,196 ) Net loss per share
attributable to common stockholders, basic $ (0.09 ) $ (0.16 ) $
(0.31 ) $ (0.54 ) Net loss per share attributable to common
stockholders, diluted $ (0.11 ) $ (0.16 ) (0.37 ) (0.54 )
Weighted-average shares of common stock outstanding used in
computing net loss per share of common stock Basic 17,089 15,324
16,864 15,306 Diluted 17,148 15,324 17,056 15,306
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181114005819/en/
NovaBay ContactsFor NovaBay
Avenova+ purchasing information:Please call us toll free:
1-800-890-0329 or email sales@avenova.comwww.Avenova.com
From the CompanyJack
McGovernChief Financial
Officer510-899-8800jmcgovern@novabay.com
Investor ContactLHA Investor
RelationsJody Cain310-691-7100Jcain@lhai.com
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