EXHIBIT 10.18
CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.
 
AMENDMENT N°1
 
TO THE COLLABORATION AND LICENSE AGREEMENT
 
THIS AMENDMENT N°1 (the “Amendment”) is entered into as of this 1st day of
December, 2009 (“Effective Date”), by and between NovaBay Pharmaceuticals, Inc.,
a California corporation, having its principal place of business at 5980 Horton
Street, Suite 550, Emeryville, California 94608 (“Novabay”), and Galderma S.A. a
Swiss corporation, having its principal place of business at World Trade Center
– 2 avenue Gratte-Paille – CP 552 CH-1000 Lausanne, Switzerland (“Galderma”),
 
WHEREAS, Galderma and Novabay have entered into a COLLABORATION AND LICENSE
AGREEMENT, effective as of March 20, 2009 (the “Agreement”) under which they
have agreed to collaborate to develop and obtain regulatory approval for, and
commercialize, pharmaceutical products incorporating Collaboration Compounds in
the Field; and
 
WHEREAS, upon signature of the Agreement, the Parties had anticipated that the
Acne Plan would focus on the feasibility of a solution formulation (hereinafter
the “Solution”); and
 
WHEREAS, after signature of the Agreement, the Parties have agreed to also
determine the feasibility of a gel formulation (hereinafter the “Gel”) in
addition to the Solution; and
 
WHEREAS, in order to select the best formulation between the Solution and the
Gel, both in terms of action on P. Acnes and in terms of local safety and
tolerability, a two weeks tolerance study (hereinafter the “Two Weeks Tolerance
Study” as defined in the Early Clinical Evaluation plan for Acne - April 29,
2009) will be performed, with results anticipated on January 10, 2010 at the
latest; and
 
WHEREAS, the Parties agree to add a new milestone payment upon the completion of
the Two Weeks Tolerance Study to Galderma’s satisfaction and to modify the
amounts and timing for the payment of the Continuation Fee; and
 
NOW THEREFORE, in consideration of these premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by each Party, the Parties agree as follows:
 
1.
Unless otherwise stated, all terms appearing herein with a capital letter shall
have the meaning set forth in the Agreement.

 
***Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.
 
 

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CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.
 
2.
The Parties agree to modify Section 1.3 as follow:

 
1.3           “Acne-Plan” shall mean the then current comprehensive plan
(including timelines) for the following: (i) during the Initial Period,
(A) appropriate study(ies) to determinate the feasibility of one or more
formulations for an Acne Product (the “Formulation Feasibility Studies”) and
(B) the Development of such an Acne Product for the Galderma Territory, through
the completion of (a) the Two Weeks Tolerance Study with respect thereto, and
(b) the first Phase II Clinical Trial with respect thereto (the “Acne POC”), and
(ii) during the Continuation Period, further Development of Acne Products in the
Field for the Galderma Territory through the Marketing Approval therefore.
 
3.
The Parties agree to complete Section 8.1.3 with the following clause:

 
“Formulation Feasibility” shall mean that preliminary non-clinical studies have
shown that it should be feasible to produce a stable formulation of a
Collaboration Compound that should also be able to meet minimum requirements for
patient acceptability.  It does not imply that a final commercial formulation
has been developed.  Formulation Feasibility shall be determined independently
from the Completion of Preliminary Proof of Concept Study and any results
thereof.
 
4.
The Parties agree to add the following Section 8.1.4:

 
8.1.4           Completion of Two Week Tolerance Study.  Upon the completion of
the Two Weeks Tolerance Study to Galderma’s satisfaction and no later than
January 10, 2010, [***].
 
5.
The Parties agree to modify Section 8.2.1 as follow:

 
8.2.1           Continuation Fee.  A non-refundable, non-creditable
“Continuation Fee” in the applicable amount set forth in the table below based
on the timing of such payment:

Timing Amount of Continuation Fee
If paid on or before October 1, 2010
$[***]
If paid after October 1, 2010 but on or before December 31, 2010
$[***]
If paid after December 31, 2010 but on or before March 31, 2011
$[***]
If paid after March 31, 2011
$[***]

 
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***Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.
 
 

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CONFIDENTIAL TREATMENT REQUESTED BY NOVABAY PHARMACEUTICALS, INC.
 
Provided that Galderma has given Novabay three and a half (3 and 1/2) months
prior notice regarding study supplies, shipping date, requirements, quantities
and approving specifications, it is hereby agreed that if Novabay fails to ship
the non- clinical and/or the clinical study supplies in accordance with the
agreed time schedule and Galderma’s shipping instructions, the above payment
date shall be modified accordingly.  In particular, the Parties agree that late
shipment of study supplies, even if the delay does not exceed a few days, may
result in study cancellation or study postponement for several months, due to
but not limited to, Galderma’s and/or CRO’s resources allocated to other
projects, non-availability or agreement cancellation by study sites, clinical or
organizational constraints linked to seasonality.  In such case, the timing for
the Continuation fee shall be moved forward for a period equivalent to such
postponement.
 
6.
All other terms of the Agreement shall remain in full force and effect.

 
IN WITNESS WHEREOF, the Parties have caused this AMENDMENT N°1 TO THE
COLLABORATION AND LICENSE AGREEMENT to be duly executed, effective as of the
Effective Date, by their respective duly authorized officers.
 

GALDERMA    NOVABAY           By: /s/ Humberto C Antunes   By: /s/ Ramin Najafi
Name: Humberto C Antunes   Name: Ramin "Ron" Najafi, Ph.D. Title: CEO   Title:
CEO & Chairman

 
 
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***Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been filed separately with the Commission.