SecProbe.io

December 14, 2010

Ramin Najafi
Chief Executive Officer and President
NovaBay Pharmaceuticals, Inc.
5980 Horton Street, Suite 550
Emeryville, CA 94608

Re: NovaBay Pharmaceuticals, Inc.  Form 10-K for the Fiscal Year Ended December 31, 2009
Filed March 30, 2010 File No. 001-33678
 Dear Mr. Najafi:
 We have reviewed your filing and have the following comments.  In our comments, we
ask you to provide us with information so  we may better underst and your disclosure.

Please respond to this letter within te n business days by providing the requested
information or by advising us when you will provide the requested response.  If you do not believe a comment applies to your facts and circumstances, please tell us why in your response.
Please furnish us a letter on EDGAR under the fo rm type label CORRESP that keys your
responses to our comments.
 After reviewing the information you provide in response to these comments, we may
have additional comments.
Our Target Indications and Product Candidates, page 4

1. We note that you have a collaboration a nd license agreement with Alcon and a
collaboration agreement with Galderma.  W ith respect to your agreement with Alcon,
please provide draft disclosure for future fili ngs describing the range of royalty rates that
may be payable to you and the term of the ag reement.  With respec t to your agreement
with Galderma, please provide dr aft disclosure for future fi lings describing the range of
royalty rates that may be payable to you, aggregate milestones  payable under the
agreement, and the term and termin ation provisions of the agreement.

Intellectual Property, page 7

2. We note that you have one issued foreign pa tent in China, Hong Kong, Israel, India,
Mexico and South Korea.  Please provide proposed disclosure for future filings
describing the subject matter of this patent and the expiration da te of the patent.

Ramin Najafi
NovaBay Pharmaceuticals, Inc.
December 14, 2010
Page 2

Item 7.  Management’s Discussion and Analysis
Results of Operations
Comparison of Years Ended December 31, 2009, 2008 and 2007
Research and Development, page 33

3. You disclose your target indications and product candidates beginning on page four.
Additionally, you disclose on page 33 that you expect to incur increasing research and development expenses in 2010 and in subseque nt years, and you expect expenses during
2010 will be related to your common cold, dermatology, and catheter associated urinary
tract infections programs.  Please provide us proposed disclosure for future filings that
includes the following information relate d to each of your ma jor research and
development projects:

• The costs incurred during each period pr esented and to date on the project;
• The nature, timing and estimated costs of the efforts necessary to complete the
project; and
• The anticipated completion dates.

Notes to Consolidated Financial Statements

Note 9. Stockholders’ Equity
Stock Warrants
Investor Warrants, page 58

4. In your August 2009 public unit offering, you issued warrants to investors to purchase an
aggregate of 1,225,000 shares of common stock at  an exercise price of $2.75 per share.
Please tell us why you did not cl assify your warrants issued in this public unit offering as
liabilities, and provide us proposed disclo sure for future filings to address your
accounting treatment of these warrants.  Sp ecifically, tell us how you considered ASC
815-40-25-11 through 25-16.

We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are
in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.

 In responding to our comments, please provi de a written statement from the company
acknowledging that:

• the company is responsible for the adequacy  and accuracy of the disclosure in the
filing;
• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and

Ramin Najafi
NovaBay Pharmaceuticals, Inc.
December 14, 2010 Page 3

• the company may not assert staff comments as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United
States.

You may contact Staci Shannon, Staff Account ant, at (202) 551-3374 or Joel Parker,
Branch Chief, at (202) 551-3651 if you have a ny questions regarding the processing of your
response, as well as any questions regarding co mments on the financial statements and related
matters.  You may contact Johnny Gharib, Sta ff Attorney, at (202) 551-3170, or Sebastian
Gomez Abero, Staff Attorney, at (202) 551-3578 w ith questions on other comments.  In this
regard, do not hesitate to contact me at  (202) 551-3679 with any other questions.

Sincerely,

Jim B. Rosenberg Senior Assistant Chief Accountant