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Bionovo Announces Third Quarter 2009 Highlights and Financial Results

EMERYVILLE, Calif., Nov. 5 /PRNewswire-FirstCall/ -- Bionovo, Inc. (Nasdaq: BNVI), a drug discovery and development company focused on the unmet needs in women's health and oncology, today announced third quarter highlights and financial results for the three months ended September 30, 2009.

Subsequent to the end of the quarter, in October 2009, Bionovo successfully completed a public offering and issued approximately 31 million shares of common stock together with approximately 29 million warrants. The net proceeds to the Company were approximately $17.7 million. The Company intends to use these proceeds to conduct a Phase 3 trial of Menerba, its lead product candidate for the treatment of menopausal vasomotor symptoms.

"The third quarter was an extremely productive quarter for Bionovo," stated Isaac Cohen, Bionovo's Chairman and Chief Executive Officer. "Not only did we publish and present a considerable amount of scientific data and make significant progress in the Menerba manufacturing and quality control process, but we also completed an important financing that sets the stage for the next chapter in the history of Bionovo. This financing provides us with the necessary funds to conclude our preparation for the FDA submission and conduct the first of two pivotal clinical trials for Menerba. This is an exciting time at Bionovo, and we eagerly anticipate the accomplishment of important milestones in the upcoming quarters."

Third Quarter 2009 Company Highlights

  • During the third quarter of 2009, Bionovo completed the raw material characterization, analytical method development and pilot manufacturing process development that constitutes a large part of the Chemistry, Manufacturing and Control (CMC) specifications necessary to satisfy the FDA's requests for clarification of the Company's manufacturing and analytical strategy for guaranteeing the consistency of its drug products. The Company is currently concluding work on the analytical method application and the commercial scale manufacturing batches.
  • Bionovo presented the positive results of its Phase 2 clinical trial of Menerba to the international women's health community at the 8th Annual European Society for Gynecology (EGS) in Rome, Italy. The overall reaction of the European scientific, clinical, and pharmaceutical community was extremely positive and demonstrated an international interest in finding a safer alternative to hormone therapy for the treatment of menopausal vasomotor symptoms.
  • The Company presented the results of a study on the effects of two plant-derived, tissue-selective estrogen receptor alpha (ERa) modulators (TSERaM) on menopausal obesity at the 20th Annual Meeting of the North American Menopause Society. In this study, plant-derived TSERaMs, like estrogens, were shown to reduce body fat in mice, but while estrogens also caused cell proliferation in the mammary gland and uterus, the plant-derived TSERaMs did not elicit these potentially cancer-causing side effects. These results suggest that the development of botanically-derived, tissue-selective ERa modulators could result in a safer alternative for the treatment of menopausal weight gain, a condition that can lead to the development of metabolic syndrome, a combination of risk factors for cardiovascular disease and diabetes.
  • Bionovo published a paper describing the molecular mechanisms underlying the selective cytotoxic activity of its preclinical drug candidate BN108 and its active compound, timosaponin AIII (TAIII), in the peer-reviewed, open-access journal, Public Library of Science One. BN108 and TAIII kill tumor cells by eliciting two responses: first, they inhibit mTORC1, an oncogenic pathway that is abnormally activated in many tumors, and second, they induce a profound stress in the endoplasmic reticulum (ER) of tumor cells. This dual effect of the drug activates cell suicide, or apoptosis, in tumor cells, but because these drugs do not inhibit mTORC1 and induce little ER stress in normal cells, normal cells are left unharmed.
  • Bionovo published the results of its study on the inhibitory effect of tamoxifen on estrogen receptor beta (ERb) gene regulation in the peer-reviewed journal, Molecular and Cellular Endocrinology. The results of this study demonstrate that tamoxifen inhibits the beneficial effects of ERb in the prevention of breast cancer cell proliferation. This suggests that there is a biological rationale for the development of ERb drugs for the treatment of breast cancer.
  • The Company announced the addition of Dr. Debu Tripathy, a leading researcher and clinician in the area of breast cancer, to its Medical Advisory Board. Dr. Tripathy is a Professor of Medicine at the Keck School of Medicine at the University of Southern California (USC) and Co-Leader of the Women's Cancer Program at USC Norris Comprehensive Cancer Center.

Third Quarter Results

Total operating expenses for the three months ended September 30, 2009 were $3.9 million compared to $5.2 million for the same period in 2008 and $4.1 million for the second quarter of 2009. The decrease in year-over-year spending was primarily a result of a decrease in clinical activity and reduced employee headcount. Operating expenses in the third quarter of 2009 were primarily related to the Menerba manufacturing process development and commercial quality assurance procedures. Company management expects operating expenses to remain consistent through the fourth quarter at a burn rate of between $1 million and $1.5 million per month.

The Company reported a net loss for the three months ended September 30, 2009 of $3.7 million, or $0.05 per share, compared with a net loss of $5.1 million, or $0.07 per share, for the same period in 2008.

The Company commenced the quarter with $5.4 million in cash, cash equivalents and short-term investments. As of September 30, 2009, the Company had cash, cash equivalents and short-term investments of $2.3 million. In October 2009, the Company successfully completed a registered public offering of approximately 31 million shares of common stock together with approximately 29 million warrants, resulting in net proceeds to the Company of approximately $17.7 million. As of the close of the financing on October 7, 2009, the Company's cash and cash equivalents balance stood at $19.9 million.

Conference Call

The Company will conduct a conference call and webcast to review the financial results for the third quarter of fiscal year 2009 and the Company's plans for the remainder of the year at 4:45 p.m. ET on Thursday, November 5, 2009.

Interested parties can access the call by dialing (800) 860-2442 or (412) 858-4600, or can listen via a live Internet webcast, which can be found at A replay of the call will be available via webcast at for 30 days or by playback at (877) 344-7529 or (412) 317-0088, conference code 434779, through November 9, 2009.

About Bionovo, Inc.

Bionovo, Inc. is a pharmaceutical company focused on the discovery and development of safe and effective treatments for women's health and cancer, markets with significant unmet needs and billions in potential annual revenue. The company applies its expertise in the biology of menopause and cancer to design new drugs derived from botanical sources which have novel mechanisms of action. Based on the results of early and mid-stage clinical trials, Bionovo believes they have discovered new classes of drug candidates within their rich pipeline with the potential to be leaders in their markets. Bionovo is headquartered in Emeryville, California and is traded on the NASDAQ Capital Market under the symbol, "BNVI". For more information about Bionovo and its programs, visit:

Forward Looking Statements

This release contains certain forward-looking statements relating to the business of Bionovo, Inc. that can be identified by the use of forward-looking terminology such as "believes," "expects," or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties, including uncertainties relating to product development, efficacy and safety, regulatory actions or delays, the ability to obtain or maintain patent or other proprietary intellectual property protection, market acceptance, physician acceptance, third party reimbursement, future capital requirements, competition in general and other factors that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the Securities and Exchange Commission, which are available at Bionovo, Inc. is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

                                   Bionovo, Inc.
                          (A Development Stage Company)
                      Consolidated Statements of Operations

                (Unaudited, in thousands, except per share amounts)

                                                                   February 1,
                                                                     (Date of
                                   Three months        Nine months       to
                                      ended               ended      September
                                   September 30,      September 30,       30,
                                   ------------       ------------   ---------
                                  2009     2008      2009      2008      2009
                                  ----     ----      ----      ----      ----
    Revenues                      $155       $-      $162        $-    $1,054
                                  ----       --      ----        --    ------

    Operating expenses:
      Research and development   2,938    3,942     9,493     8,881    36,701
      General and administrative   926    1,222     3,110     4,853    16,660
      Merger cost                    -        -         -         -     1,964
                                   ---      ---       ---       ---     -----
    Total operating expenses     3,864    5,164    12,603    13,734    55,325
                                 -----    -----    ------    ------    ------

    Loss from operations        (3,709)  (5,164)  (12,441)  (13,734)  (54,271)

      Change in fair value of
       warrant liability             -        -         -         -       831
      Interest income                5      143        75       639     2,066
      Interest expense             (22)     (36)      (77)      (98)     (443)
      Other expense                  -       (1)      (86)      (21)     (162)
                                   ---       --       ---       ---      ----
    Net loss                   $(3,726) $(5,058) $(12,529) $(13,214) $(51,979)
                               =======  =======  ========  ========  ========
      Basic and diluted net loss
       per common share         $(0.05)  $(0.07)   $(0.16)   $(0.17)   $(1.14)
                                ======   ======    ======    ======    ======

      Shares used in computing
       basic and diluted
       net loss per share       76,436   76,363    76,388    76,350    45,444
                                ======   ======    ======    ======    ======

                                    Bionovo, Inc.
                            (A Development Stage Company)
                             Consolidated Balance Sheets
                        (in thousands, except share amounts)

                                                  September 30,   December 31,
                                                          2009           2008
                                                          ----           ----
    Current assets:
      Cash and cash equivalents                          $2,252        $3,270
      Short-term investments                                 -         10,292
      Receivables                                            56           126
      Prepaid expenses and other current assets             651           805
                                                            ---           ---
        Total current assets                              2,959        14,493
    Property and equipment, net                           6,141         6,938
    Other assets and patent pending, net                  1,349         1,073
                                                          -----         -----
        Total assets                                    $10,449       $22,504
                                                        =======       =======


    Current liabilities:
      Accounts payable                                     $406          $521
      Accrued clinical and costs of other studies            67            73
      Accrued compensation and benefits                     406           456
      Current portion of lease obligations                  544           682
      Current portion of notes payable                       57             -
      Other current liabilities                             772           595
                                                            ---           ---
        Total current liabilities                         2,252         2,327
      Non-current portion of lease obligations              180           545
      Non-current portion of notes payable                  136             -
                                                            ---           ---
        Total liabilities                                 2,568         2,872
                                                          -----         -----

    Commitments and contingencies

    Shareholders' equity:
      Preferred stock, $0.0001 par value; 10,000,000
       shares authorized; none issued and outstanding         -             -
      Common stock $0.0001 par value, 190,000,000
       shares authorized, 76,585,550 and 76,363,101
       shares outstanding at September 30, 2009 and
       December 31, 2008, respectively                        8             8
      Additional paid-in capital                         59,852        59,050
      Accumulated other comprehensive gain                    -            24
      Accumulated deficit                               (51,979)      (39,450)
                                                        -------       -------
        Total shareholders' equity                        7,881        19,632
                                                          -----        ------
          Total liabilities and shareholders' equity    $10,449       $22,504
                                                        =======       =======

SOURCE Bionovo, Inc.

SOURCE Bionovo, Inc.
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