Stock Alert for Bionovo Inc. ($BNVI)(D*)

Bionovo Inc. (NASDAQ: $BNVI)(D*)

* Financial status indicator is deficient: Issuer failed to meet NASDAQ continued listing requirements.

Bionovo Inc. (BNVI) is a clinical stage drug discovery and development company focusing on women’s health and cancer. The Company designs drugs derived from botanical sources, which have mechanisms of action. The Company’s drug candidate, Menerba, represents a class of receptor sub-type selective estrogen receptor modulator (SERM) for the treatment of vasomotor symptoms of menopause, or hot flashes. The Company has designed Menerba to selectively modulate estrogen receptor beta (ERβ). In preclinical studies, Menerba inhibited tumor growth, as well as bone resorption known to cause osteoporosis, which is developed during menopause. The Company was developing BZL101, an oral anti-cancer agent for advanced breast cancer during the year ended December 31, 2008. BZL101 is designed to take advantage of the metabolism of cancer cells. BZL101 inhibits glycolysis, a metabolic pathway on which cancer cells rely.

The Company was founded in 2002 and is based in Emeryville, California.

Share Statistics (21-April-10)			FY 2007	FY 2008	% Chg	Q4 2008	Q4 2009	% Chg
Symbol	BNVI	Revenue, $Mn	0.58M	0.23M	60.0%	0.23M	0.13M	43.5%
Current price	$0.56	Gross marg.	100.0%	100.0%	0.0%	100.0%	100.0%	0.0%
52wk Range:	$1.15-0.34	Oper. margin	-2343%	-7416%	216.5%	-1543%	-3183%	106.3%
Avg Vol (3m):	843,013	Net margin	-2216%	-7488%	237.9%	-1517%	-2953%	98.1%
Market Cap.	60.21M
Dil. Shares Outst.	107.5M	EPS, $	-0.20	-0.22	10.0%	-0.05	-0.04	20.0%

Source: Reuters.com, SEC Filings.

Financial Summary

For the year ended December 31, 2009, total revenues were $0.3 million compared with $0.2 million for the same period in 2008. Revenues in 2009 consisted of a National Institute of Health (NIH) grant drawdown combined with approximately $55,000 in limited research services revenue, whereas revenues in 2008 included only the NIH grant.

For the year ended December 31, 2009, total operating expenses were $16.6 million compared with $17.5 million for the same period in 2008. The decrease in 2009 operating expenses is primarily due to decreases in clinical trial expenses partially offset by increases in expenses to support BNVI’s Menerba manufacturing process development.

The net loss for the year ended December 31, 2009, was $16.4 million, or $0.20 per share, compared with a net loss of $16.7 million, or $0.22 per share, for the same period in 2008. The year-over-year decrease in net loss was driven primarily by the decreased activity related to BNVI’s  clinical trials.

As of December 31, 2009, cash, cash equivalents and short-term investments totaled approximately $15.9 million compared to $13.6 million at December 31, 2008. The increase is due to the public offering completed in October of 2009 resulting in net proceeds of $17.4 million, partially offset by cash used in operating activities. The net cash used in operating activities for 2009 was $13.3 million, compared with $15.3 million in 2008.

Financial Strength (20-Apr-2010)	Company	Industry	Sector	S&P 500
Quick Ratio (MRQ)	8.13	5.87	2.63	0.81
Current Ratio (MRQ)	8.13	6.34	3.13	0.96
Long-Term Debt to Equity (MRQ)	0.99	22.37	25.70	155.11
Total Debt to Equity (MRQ)	3.43	26.34	33.01	220.99

Source: Reuters.com, SEC Filings.

Analyst Consensus

Buy

Outperform

Hold

Underperform

Sell

No Opinion

This is the consensus forecast amongst two polled investment analysts. Against the Bionovo Inc company.

Analyst Detail	Buy	Outperform	Hold	Underperform	Sell	No Opinion
Latest	1	0	1	0	0	0
4 weeks ago	1	0	1	0	0	0
2 months ago	1	0	1	0	0	0
3 months ago	1	0	1	0	0	0
Last year	0	0	1	0	0	0

The two analysts offering 12-month price targets for BNVI have a median target of 1.50, with a high estimate of 2.00 and a low estimate of 1.00. The median estimate represents a 240.91% increase from the last price of 0.44.

Source: www.ft.com

Consensus Estimates Analysis

	# of Estimates	Mean	High	Low	1 Year Ago
SALES (in millions)
Quarter Ending Jun-10	1	0.00	0.00	0.00	–
Quarter Ending Sep-10	1	0.00	0.00	0.00	–
Year Ending Dec-10	2	0.51	1.00	0.01	0.01
Year Ending Dec-11	2	1.01	2.00	0.01	–
EARNINGS (per share)
Quarter Ending Jun-10	1	-0.04	-0.04	-0.04	–
Quarter Ending Sep-10	1	-0.05	-0.05	-0.05	–
Year Ending Dec-10	2	-0.16	-0.15	-0.17	-0.20
Year Ending Dec-11	1	-0.16	-0.16	-0.16	–

Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=BNVI.W

Investment Highlights

BNVI recently announced that the U.S. Patent and Trademark Office (USPTO) has issued a patent covering a method of using BNVI’s proprietary drug candidate Bezielle(R) (BZL101) for the treatment of metastatic breast cancer. The patent issued today is BNVI’s second issued patent, with more than 70 other patent applications currently pending.

BNVI’s U.S. Patent No. 7,700,136 covers a method of treating breast cancer using an extract of Scutellaria Barbata. This patent also covers the use of BNVI’s proprietary Bezielle(R) formulation as a monotherapy for the treatment of breast cancer. The patent is expected to provide coverage through at least November 13, 2026.

The Company’s first issued patent was U.S. Patent No. 7,482,029, issued on January 27, 2009. The patent covers treatment of hot flashes with MF101, which has been demonstrated in clinical trials to safely provide menopausal women with relief from hot flashes. MF101 is the development name for BNVI’s proprietary drug, Menerba(R), an oral formulation for the treatment of hot flashes. The patent is expected to provide coverage through at least August 31, 2026.

Bezielle (BZL101)

Bezielle(R) is an oral drug designed for the treatment of advanced breast cancer with a novel mechanism of action. Bezielle targets diseased cells while leaving normal cells healthy and intact. Normal cells depend primarily on the citric acid cycle (>85%) and very little on glycolysis (<7%) for energy production. Cancer cells depend largely on glycolysis (>85%) for energy production. Bezielle stops the production cycle of energy in cancer cells by inhibiting glycolysis. This leads to DNA damage and cell death in cancer cells while normal cells remain largely unharmed.

There are currently no effective therapeutic cures for advanced breast cancer and treatment is primarily aimed at palliation of symptoms as well as improving overall survival. More than 200,000 women in the United States are diagnosed with breast cancer each year and breast cancer is the second leading cause of cancer death in women. Although survival after breast cancer treatment is improving, there are still more than 40,000 deaths per year due to the disease in the Unites States alone.

Source: http://www.bionovo.com/

Technical Analysis

Source: http://stockcharts.com

BNVI is trading above its upper Bollinger Band. Relative to recent price action, the stock is currently overextended and due for either a pause or retracement.

BNVI’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below 0, which suggests that the underlying moving averages are bearish.

Comparative Analysis

Company Name	Ticker	Price per	Mrkt. Cap.	P/E		P/S
April-21-2010	symbol	Share, $	$ Mn	2009	2010	2009	2010
Cyclacel Pharmaceuticals Inc.	CYCC	2.45	86.75M	n/a	n/a	107.28	n/a
Palatin Technologies Inc.	PTN	0.29	28.72M	6.60	n/a	2.56	n/a
GTx Inc.	GTXI	3.26	118.73M	n/a	n/a	8.06	n/a
Drug Manufacturers Median			78.06M	n/a	n/a	39.30	n/a
Bionovo Inc.	BNVI	0.56	60.21M	n/a	n/a	157.25	n/a

Source: Thomson Financial

Insider Trading Activity

NET SHARES PURCHASE ACTIVITY Inside Purchases – Last 6 Months
	Shares	Transaction
Purchases	27,000	2
Sales	n/a	0
Net Shares Purchased (Sold)	27,000	2
Total Insider Shares Held	19.99M	n/a
% Net Shares Purchased (Sold)	0.1%	n/a

Net Institutional Purchases – Prior Qtr to Latest Qtr
	Shares
Net Shares Purchased (Sold)	976,719
% Change in Institutional Shares Held	17.4%

Source: Yahoo Finance

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