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Tuesday, March 13, 2012

A Box Labeled Success

At some point the notion developed among the Cargo Cult members that cargoes were being sent for them by their long dead ancestors but those cargoes were being intercepted by the Europeans. This idea was confirmed in the strongest possible way for one islander during World War II. His name was Bateri and he had learned to read and write some. One day he went into the office of military post and saw stacked up boxes labeled Batteries. Obviously those boxes were his!

The investors at BioNovo saw the box labeled "Success", they foolishly thought it was theirs. Instead it is another happy biotech ending. Not for the investor but for the people who spent their money.
March 12, 2012 Bionovo, Inc. today announced that it will need to obtain substantial additional funding to achieve its objectives of internally developing drugs. The Company reduced its workforce by over 90%. The remaining management of the Company will receive reduced cash compensation until either adequate financing can be obtained or the Company is sold. The Company can not make any assurances about either of these events. As previously announced, management and the board of directors are continuing to explore strategic options for the Company. Management is currently reviewing the status of the ongoing clinical trial for Menerba.

The Company does not currently have adequate internal liquidity to meet its cash needs. If sufficient additional funds are not received in the near term, the Company may not be able to execute its business plan and may need to further curtail or cease operations.

That is a shame.
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.

We could have used the safe and effective treatments to keep our mothers and grandmothers alive and the investors could have used some of the billions in potential annual revenue. So who are the ten percenters left at BioNovo? I think I know who one of them might be.
Bionovo, Inc., a pharmaceutical company focused on the discovery and development of safe and effective treatments for women's health and cancer, announced today that its President and Chief Medical Officer will be awarded as one of California's 14th Assembly District Women of the Year at an awards ceremony taking place on March 8, 2012. Dr. Tagliaferri is being honored for her notable accomplishments in empowering women within the biotechnology and medical fields as well as serving as a role model and leader to women within the district.

The newly unemployed women can thank her for the empowerment. Maybe she failed to deliver safe and effective treatments worth billions of dollars, but she is a success. BioNovo is not. But then the award did not go to BioNovo.
It is such an honor to be recognized by Assemblymember Skinner as well as those who have nominated me for this award," said Dr. Tagliaferri. "My close colleagues and I have devoted our careers and research efforts to discovering safe and effective drugs derived from botanical sources for the treatment of breast cancer and menopause. At Bionovo, we are aiming to provide the 40 million women transitioning through menopause with a safer alternative to hormone therapy with the advancement of Menerba, our late stage development drug for the treatment of menopausal symptoms.
Surely she knew at the time she made this statement that the Company did not currently have adequate internal liquidity to meet its cash needs. And that if sufficient additional funds are not received in the near term, the Company may not be able to execute its business plan and may need to further curtail or cease operations. There was a box in her office labeled, "Success". The investors and employees walking out the door needn't think that box is theirs anymore.

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