NovaBay Pharmaceuticals And Sonoma Pharmaceuticals Agree To Market Avenova-Branded Products In European Union; Sonoma Will Manufacture Ocudox And Pay NovaBay Royalty Fee Based On Net Product Sales
Portfolio Pulse from Benzinga Newsdesk
NovaBay Pharmaceuticals and Sonoma Pharmaceuticals have reached an agreement to market Avenova-branded products in the European Union. Under the agreement, Sonoma will manufacture the eye product Ocudox and pay NovaBay a royalty fee based on net product sales. The products will be marketed through Sonoma's European distribution network, leveraging NovaBay's Avenova brand and Sonoma's distribution expertise.
January 09, 2024 | 2:18 pm
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POSITIVE IMPACT
NovaBay Pharmaceuticals will receive royalty fees from Sonoma for the net sales of Avenova-branded products in the EU, potentially increasing revenue streams.
The agreement to receive royalties from sales in the EU is likely to be seen as a positive development for NovaBay Pharmaceuticals, as it opens up a new revenue stream without the company having to manage manufacturing and distribution. This could lead to increased investor confidence and a potential short-term uptick in the stock price.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
Sonoma Pharmaceuticals will expand its product line in the EU by manufacturing Ocudox with Avenova branding and will pay royalties to NovaBay, which may affect its profit margins.
While the partnership allows Sonoma to leverage the Avenova brand, which could boost sales, the obligation to pay royalties to NovaBay may impact Sonoma's profit margins. The net effect on the stock price could be neutral in the short term as the market assesses the balance between increased sales potential and the cost of royalties.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70