MediciNova Reports Fourth Quarter and Full Year 2009 Results

MediciNova Reports Fourth Quarter and Full Year 2009 Results

SAN DIEGO, Calif. March 24, 2010 MediciNova, Inc., a biopharmaceutical company that is publicly traded on the Nasdaq Global Market

(Trading Symbol: MNOV) and the Hercules Market of the Osaka Securities Exchange (Code Number: 4875), today announced financial results for the fourth quarter and full year ended December 31, 2009.

A detailed discussion of financial results and product development programs can be found in MediciNova s Annual Report on Form 10-K for the year ended

December 31, 2009, which was filed with the Securities and Exchange Commission on March 24, 2010 and is available through investors.medicinova.com/sec.cfm.

For the quarter ended December 31, 2009, MediciNova reported a net

loss of $5.9 million, or $0.49 per share, compared to a net loss of $1.4 million, or $0.12 per share, for the same period last year. There were no revenues for the quarters ended December 31, 2009 and 2008. Research and development expenses

were $2.6 million for the quarter ended December 31, 2009, compared to $2.0 million for the quarter ended December 31, 2008. The increase in research and development expenses was primarily due to the commencement of MN 221-CL-010, the

Phase Ib clinical trial for MN-221 designed to determine the safety and efficacy of MN-221 at three different dose levels in patients with moderate to severe, but stable chronic obstructive pulmonary disease ( COPD ). General and

administrative expenses were $3.4 million for the quarter ended December 31, 2009, compared to $1.8 million for the quarter ended December 31, 2008. The increase in general and administrative expenses was primarily due to transaction costs

related to the acquisition of Avigen, Inc. (or Avigen ), which was completed on December 18, 2009.

December 31, 2009, MediciNova reported a net loss of $20.4 million, or $1.68 per share, as compared to a net loss of $21.9 million, or $1.82 per share, for the year ended December 31, 2008. There were no revenues for the years ended

December 31, 2009 and 2008. Research and development expenses were $10.9 million for the year ended December 31, 2009, as compared to $13.8 million for the year ended December 31, 2008. The decrease in research and development

expenses primarily related to the completion of the Phase II clinical trial for MN-166 for the treatment of multiple sclerosis and the completion of clinical trials for our non-prioritized development assets, offset by an increase in expenses

related to the conduct of clinical trials for MN-221 for acute exacerbations of asthma and COPD. General and administrative expenses were $10.4 million for the year ended December 31, 2009, as compared to $8.8 million for the year ended

December 31, 2008. The increase in general and administrative expenses was primarily due to transaction costs related to the acquisition of Avigen.

At December 31, 2009, we had $28.4 million in cash, cash equivalents, investment securities-current and an ARS Put, net of ARS loan, as compared to $49.1 million of cash, cash equivalents, investment

securities and a long-term asset consisting of the ARS Put as of December 31, 2008, which decrease of $20.7 million was primarily a result of our $3.0 million payment to acquire Avigen and our operating loss of $20.4 million, offset by noncash

expenses. Restricted cash and letter of credit of $30.5 million will be included in our capital resources upon conversion of the associated convertible notes into our common stock.

At December 31, 2009, $24.6 million of our ARS consisted primarily of government-guaranteed student

loan securities and $1.8 million of our ARS consisted of private placement securities. None of the underlying collateral for our ARS consisted of subprime mortgages or collateralized debt obligations. At December 31, 2009, $24.3 million of ARS

subject to the UBS settlement (described below) have been classified as current assets given the estimated time frame in which we can readily convert these securities into cash. The remaining $2.1 million of ARS have been classified as long-term

assets given the estimated time frame in which we can readily convert these securities into cash.

In August 2008, UBS and its affiliates

( UBS ), the brokerage firm through which we purchased the majority of our ARS investments, entered into a settlement with the SEC, the New York Attorney General and other state agencies. Under the settlement, UBS issued to us the Auction

Rate Security Rights, which would allow us to sell to UBS our ARS held in accounts with UBS ( ARS Rights Offer ). Pursuant to the ARS Rights Offer, we received the right to sell to UBS the ARS held in accounts with UBS at par value at any

time during the period beginning June 30, 2010 and ending July 2, 2012 ( ARS Put ). As part of the settlement, UBS also offered to us a no net cost loan program ( ARS Loan ), whereby we would be able to borrow up to 75%

of the market value, as determined by UBS at its sole discretion, of our ARS that have been pledged as collateral at an interest cost that would not exceed the interest being paid on the underlying ARS investments. Under the ARS Loan program, UBS

may demand full or partial payment of the ARS Loan, at its sole option and without cause, at any time. In November 2008, we accepted the ARS Rights Offer. In January 2009, we were approved for the ARS Loan in the amount of $15.9 million and drew

down the entire preapproved amount. In addition, in February 2009, we borrowed an additional $2.2 million under the ARS Loan, bringing the total amount outstanding under the ARS Loan to $18.1 million, following UBS decision to increase our

availability under the ARS Loan. All cash received under the ARS Loan was invested in money market accounts. Our ARS Loan balance at December 31, 2009 was $17.6 million, with an effective average interest rate of 1.29 percent charged, or

approximately $235,000 of interest charged, on the no net cost loan.

As described in MediciNova s Japanese report referred to as the

Kessan Tanshin, which was filed with the Osaka Securities Exchange, MediciNova s cash burn for the fiscal year ended December 31, 2010 is anticipated to be less than $16.0 million, with the full year net loss forecast

anticipated to be approximately $17.7 million.

Recent Highlights in 2010

During 2009 we made significant progress as a company. The clinical development of MN-221 has been

very promising and significant. We have shown improved efficacy, a reduction in hospitalizations, without an increase in safety risk in our MN-221-CL-006 trial for acute exacerbations of asthma. We are also very pleased to have recently announced

positive data from our MN-221-CL-010 trial in COPD patients, which could greatly expand this drug s potential market opportunity, said Yuichi Iwaki, M.D., Ph.D., President and Chief Executive Officer of MediciNova, Inc. The

acquisition of Avigen was another important milestone, which has allowed the combination of the ibudilast program of the two companies. We were pleased to announce that Kirk Johnson, Ph.D., of Avigen has decided to continue his work on the ibudilast

program (MN-166) by joining MediciNova as our Chief Scientific Officer,

MediciNova, Inc. is a publicly-traded biopharmaceutical company focused on acquiring and developing novel, small-molecule therapeutics for the treatment of

diseases with unmet need with a specific focus on the U.S. market. Through strategic alliances primarily with Japanese pharmaceutical companies, MediciNova holds rights to a diversified portfolio of clinical and preclinical product candidates, each

of which MediciNova believes has a well-characterized and differentiated therapeutic profile, attractive commercial potential and patent assets having claims of commercially adequate scope. MediciNova s pipeline includes six clinical-stage

compounds for the treatment of acute exacerbations of asthma, chronic obstructive pulmonary disease exacerbations, multiple sclerosis and other neurologic conditions, asthma, interstitial cystitis, solid tumor cancers, Generalized Anxiety Disorder,

preterm labor and urinary incontinence and two preclinical-stage compounds for the treatment of thrombotic disorders. MediciNova s current strategy is to focus its resources on its two prioritized product candidates, MN-221 for the treatment of

acute exacerbations of asthma and chronic obstructive pulmonary disease exacerbations and MN-166 for the treatment of multiple sclerosis and other neurologic conditions, and either pursue development independently in the United States, in the case

of MN-221, or establish a strategic collaboration to support further development, in the case of MN-166. MediciNova will seek to monetize its other product candidates. For more information on MediciNova, Inc., please visit www.medicinova.com.

Statements in this press release that are not historical in nature constitute forward-looking statements within the meaning of the safe

harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements regarding MediciNova s clinical trials supporting safety and efficacy of product candidates and

the potential novelty of such product candidates as treatments for disease, plans and objectives for present and future clinical trials and product development, strategies, future performance, expectations, assumptions, financial condition,

liquidity and capital resources. These forward-looking statements may be preceded by, followed by or otherwise include the words believes, expects, anticipates, intends, estimates,

projects, can, could, may, will, would, or similar expressions. These forward-looking statements involve a number of risks and uncertainties that may cause actual results or

events to differ materially from those expressed or implied by such forward-looking statements. Factors that may cause actual results or events to differ materially from those expressed or implied by these forward-looking statements, include, but

are not limited to, the risks and uncertainties inherent in clinical trials and product development and commercialization, such as the uncertainty in results of clinical trials for product candidates, the uncertainty of whether the results of

clinical trials will be predictive of

results in later stages of product development, the risk of delays or failure to obtain or maintain regulatory approval, the risk of failure of the third parties upon whom MediciNova relies to

conduct its clinical trials and manufacture its product candidates to perform as expected, the risk of increased cost and delays due to delays in the commencement, enrollment, completion or analysis of clinical trials or significant issues regarding

the adequacy of clinical trial designs or the execution of clinical trials and the timing, cost and design of future clinical trials and research activities, the timing of expected filings with the FDA, MediciNova s failure to execute strategic

plans or strategies successfully, MediciNova s collaborations with third parties, MediciNova s ability to realize the anticipated strategic and financial benefits from its acquisition of Avigen, Inc., to integrate the two ibudilast

development programs and to pursue discussions with potential partners to secure a strategic collaboration to advance the clinical development of the combined development program, the availability of funds to complete product development plans and

MediciNova s ability to raise sufficient capital when needed, intellectual property or contract rights, and the other risks and uncertainties described in MediciNova s filings with the Securities and Exchange Commission, including its

annual report on Form 10-K for the year ended December 31, 2008 and its subsequent periodic reports on Forms 10-Q and 8-K. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date hereof.

MediciNova disclaims any intent or obligation to revise or update these forward-looking statements.

CONTACT: MediciNova, Inc.

Shintaro Asako, Chief

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