##### Table of Contents



United States
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2009
 or
 o
    
    Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to
 Commission File No. 001-11182
 BIO-IMAGING TECHNOLOGIES, INC.
  Delaware
    
    11-2872047(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer Identification No.)826 Newtown-Yardley Road, Newtown, Pennsylvania
    
    18940-1721(Address of Principal Executive Offices)
    
    (Zip Code)
 
   þ o
  o o
  Large accelerated filer o
Accelerated filer o
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company þ  o þ
  Class
    
    Number of SharesCommon Stock, $0.00025 par value
    
    14,357,253




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##### 



BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 TABLE OF CONTENTS
 PagePART I.
    
    FINANCIAL INFORMATION.Item 1.
    
    Financial Statements
    
    
    1CONSOLIDATED BALANCE SHEETS (unaudited)
as of March 31, 2009 and December 31, 2008
    
    
    2CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
For the Three Months Ended March 31, 2009 and 2008
    
    
    3CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
For the Three Months Ended March 31, 2009 and 2008
    
    
    4NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
    
    
    6Item 2.
    
    Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    17Overview
    
    
    17Forward Looking Statements
    
    
    18Recent Accounting Pronouncements
    
    
    19Results of Operations
    
    
    21Business Segments
    
    
    24Liquidity and Capital Resources
    
    
    24Changes to Critical Accounting Policies and Estimates
    
    
    25Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    26Item 4T.
    
    Controls and Procedures
    
    
    26PART II.
    
    OTHER INFORMATION.Item 1.
    
    Legal Proceedings
    
    
    27Item 1A.
    
    Risk Factors
    
    
    27Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    35Item 3.
    
    Defaults Upon Senior Securities
    
    
    35Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    35Item 5.
    
    Other Information
    
    
    35Item 6.
    
    Exhibits
    
    
    35SIGNATURES
    
    
    36Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
  -i-




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PART I. FINANCIAL INFORMATION .
 
 Item 1. Financial Statements.
    -1-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
 March 31,
    
    
    December 31,(in thousands)
    
    2009
    
    
    2008ASSETSCurrent assets:Cash and cash equivalents
    
    $
    14,883
    
    
    $
    14,265Accounts receivable, net
    
    
    9,712
    
    
    
    11,982Prepaid expenses and other current assets
    
    
    2,035
    
    
    
    2,315Assets held for sale
    
    
    
    
    
    
    500Deferred income taxes
    
    
    2,831
    
    
    
    3,084Total current assets
    
    
    29,461
    
    
    
    32,146Property and equipment, net
    
    
    7,130
    
    
    
    7,022Intangibles, net
    
    
    1,939
    
    
    
    2,058Goodwill
    
    
    27,391
    
    
    
    27,391Other assets
    
    
    497
    
    
    
    591Total assets
    
    $
    66,418
    
    
    $
    69,208LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    3,603
    
    
    $
    3,832Accrued expenses and other current liabilities
    
    
    3,624
    
    
    
    5,236Deferred revenue
    
    
    13,387
    
    
    
    15,106Current maturities of capital lease obligations
    
    
    35
    
    
    
    54Total current liabilities
    
    
    20,649
    
    
    
    24,228Long-term capital lease obligations
    
    
    64
    
    
    
    65Deferred income tax
    
    
    888
    
    
    
    927Other liabilities
    
    
    585
    
    
    
    576Total liabilities
    
    
    22,186
    
    
    
    25,796Stockholders equity:Preferred stock $0.00025 par value;
authorized 3,000,000 shares, 0 issued and
outstanding at March 31, 2009 and at December
31, 2008
    
    
    
    
    
    
    Common stock  $0.00025 par value; authorized
18,000,000 shares, issued and outstanding
14,356,253 shares at March 31, 2009 and
14,341,403 shares at December 31, 2008
    
    
    4
    
    
    
    4Additional paid-in capital
    
    
    42,474
    
    
    
    42,270Retained earnings
    
    
    1,866
    
    
    
    1,080Accumulated other comprehensive (income) loss
    
    
    (112
    )
    
    
    58Total stockholders equity
    
    
    44,232
    
    
    
    43,412Total liabilities and stockholders equity
    
    $
    66,418
    
    
    $
    69,208
  -2-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME
 For the Three Months EndedMarch 31,(in thousands, except per share data)
    
    2009
    
    
    2008Service revenues
    
    $
    14,475
    
    
    $
    11,023Reimbursement revenues
    
    
    2,595
    
    
    
    3,077Total revenues
    
    
    17,070
    
    
    
    14,100Cost and expenses:Cost of service revenues
    
    
    9,061
    
    
    
    6,343Cost of reimbursement revenues
    
    
    2,595
    
    
    
    3,077Sales and marketing expenses
    
    
    2,156
    
    
    
    1,468General and administrative expenses
    
    
    1,917
    
    
    
    1,539Amortization of intangible assets related to acquisitions
    
    
    119
    
    
    
    24Total cost and expenses
    
    
    15,848
    
    
    
    12,451Income from continuing operations before interest and taxes
    
    
    1,222
    
    
    
    1,649Interest income
    
    
    22
    
    
    
    153Interest expense
    
    
    (2
    )
    
    
    Income tax provision
    
    
    (456
    )
    
    
    (666
    )Income from continuing operation, net of taxes
    
    
    786
    
    
    
    1,136Loss from discontinued operations, net of taxes
    
    
    
    
    
    
    312Net income
    
    $
    786
    
    
    $
    824Basic earnings per share:Income from continuing operations
    

    $
    0.05
    
    
    $
    0.09Loss from discontinued operations
    
    $
    
    
    
    $
    (0.03
    )Net income
    
    $
    0.05
    
    
    $
    0.06Diluted earnings per share:Income from continuing operations
    

    $
    0.05
    
    
    $
    0.09Loss from discontinued operations
    
    $
    
    
    
    $
    (0.03
    )Net income
    
    $
    0.05
    
    
    $
    0.06Weighted average shares used to calculate earnings per
share:Basic
    
    $
    14,341
    
    
    $
    12,021Diluted
    
    $
    15,085
    
    
    $
    12,964
  -3-




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BIO-IMAGING
TECHNOLOGIES, INC. AND SUBSIDIARIES
 CONSOLIDATED
STATEMENTS OF CASH FLOWS
 For the Three Months EndedMarch 31,(in thousands)
    
    2009
    
    
    2008Cash flows from operating activities:Net income
    
    $
    786
    
    
    $
    824Adjustments to reconcile net income to net cash provided by operating
activities, net of acquisition:Depreciation and amortization
    
    
    486
    
    
    
    843Provision for deferred income taxes
    
    
    854
    
    
    
    242Bad debt recovery
    
    
    (11
    )
    
    
    (17
    )Stock based compensation expense
    
    
    204
    
    
    
    145Loss from discontinued operations
    
    
    
    
    
    
    312Changes in operating assets and liabilities, net of acquisitions:(Decrease) increase in accounts receivable
    
    
    2,268
    
    
    
    (795
    )Decrease (increase) in prepaid expenses and other current assets
    
    
    268
    
    
    
    (129
    )Decrease in other assets
    
    
    90
    
    
    
    15(Decrease) increase in accounts payable
    
    
    (365
    )
    
    
    526Decrease in accrued expenses and other current liabilities
    
    
    (2,287
    )
    
    
    (308
    )(Decrease) increase in deferred revenue
    
    
    (1,723
    )
    
    
    1,065Decrease in other liabilities
    
    
    (1
    )
    
    
    (9
    )Decrease in net assets held for sale
    
    
    
    
    
    
    120Cash provided by activities from continuing operations
    
    
    569
    
    
    
    2,834Cash used by discontinued operations
    
    
    
    
    
    
    (433
    )Net cash provided by operating activities
    
    
    569
    
    
    
    2,401Cash flows from investing activities:Purchases of property and equipment
    
    
    (397
    )
    
    
    (969
    )Net cash received for sale of assets of discontinued operations
    
    
    500Net cash paid for acquisition
    
    
    
    
    
    
    (8,257
    )Net cash provided by (used in) investing activities from continuing operations
    
    
    103
    
    
    
    (9,226
    )Purchase of plant, property and equipment for discontinued operations
    
    
    
    
    
    
    (236
    )Net cash provided by (used in) investing activities
    
    
    103
    
    
    
    (9,462
    )Cash flows from financing activities:Payments under equipment lease obligations
    
    
    (19
    )
    
    
    (56
    )Excess tax benefit related to stock options
    
    
    
    
    
    
    63Proceeds from exercise of stock options
    
    
    
    
    
    
    39Net cash (used in) provided by financing activities from continuing operations
    
    
    (19
    )
    
    
    46Effect of exchange rate changes on cash
    
    
    (35
    )
    
    
    209Net increase (decrease) in cash and cash equivalents
    
    
    618
    
    
    
    (6,806
    )Cash and cash equivalents at beginning of period
    
    
    14,265
    
    
    
    17,915Cash and cash equivalents at end of period
    
    $
    14,883
    
    
    $
    11,109Supplemental disclosure of cash flow information:Cash paid during the period for interest
    
    $
    2
    
    
    $
    1Cash paid during the period for income taxes
    
    $
    158
    
    
    $
    1,034
  -4-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the Three Months EndedMarch 31,2009
    
    2008Supplemental cash flow
disclosure(in thousands)Schedule of non cash investing
and financing activities:Increase in property, plant and
equipment acquisitions in
accounts payable
    
    $
    127
    
    
    $
    64
 For the Three Months EndedMarch 31,2009
    
    2008Acquired business(in thousands)Accounts receivable
    
    $
    
    
    
    $
    4,926Property and equipment
    
    
    
    
    
    
    701Other assets
    
    
    
    
    
    
    295Intangible assets and goodwill
    
    
    
    
    
    
    23,975Current liabilities assumed
    
    
    
    
    
    
    (1,062
    )Other liabilities assumed
    
    
    
    
    
    
    (4,474
    )Common stock issued
    
    
    
    
    
    
    (16,104
    )Cash paid for acquired
business, net of cash acquired
for the three months ended
March 31, 2008 of $418
    
    $
    
    
    
    $
    8,257
 For the Three Months EndedMarch 31,2009
    
    2008Statement of comprehensive income(in thousands)Net income
    
    $
    786
    
    
    $
    824Equity adjustment from foreign currency translation
    
    
    (170
    )
    
    
    102Total comprehensive income
    
    $
    616
    
    
    $
    926
  -5-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Note 1  Interim Financial Statements
 Basis of Presentation.
      -6-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Functional Currency.
  Note 2  Stockholders Equity Rollforward
  Accumu-latedRetained
    
    
    OtherAdditional
    
    
    Earnings
    
    
    Compre-Common Stock
    
    
    Paid-in
    
    
    (Accumulated
    
    
    hensive
    
    
    Stockholders(in thousands)
    
    Shares
    
    
    Amount
    
    
    Capital
    
    
    Deficit)
    
    
    Income
    
    
    EquityBalance at December 31,
2008
    
    
    14,341
    
    
    $
    4
    
    
    $
    42,270
    
    
    $
    1,080
    
    
    $
    58
    
    
    $
    43,412Restricted shares issued
    
    
    15
    
    
    
    
    
    
    
    (31
    )
    
    
    
    
    
    
    
    
    
    
    (31
    )Stock based compensation
    
    
    
    
    
    
    
    
    
    
    235
    
    
    
    
    
    
    
    
    
    
    
    235Equity adjustment from
foreign currency
translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (170
    )
    
    
    (170
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    786
    
    
    
    
    
    
    
    786Balance at March 31,
2009
    
    
    14,356
    
    
    $
    4
    
    
    $
    42,474
    
    
    $
    1,866
    
    
    $
    (112
    )
    
    $
    44,232
 Note 3  Earnings Per Share
  -7-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Three Months EndedMarch 31,(in thousands except share data)
    
    2009
    
    
    2008Net income  basic and diluted
    
    $
    786
    
    
    $
    824Denominator  basic:Weighted average number
of common shares
    
    
    14,341
    
    
    
    12,021Basic income per common share
    
    $
    0.05
    
    
    $
    0.06Denominator  diluted:Weighted average number
of common shares
    
    
    14,341
    
    
    
    12,021Common share equivalents
of outstanding stock options
    
    
    434
    
    
    
    815Common share equivalents of
unrecognized compensation expense
    
    
    310
    
    
    
    128Weighted average number of
dilutive common equivalent shares
    
    
    15,085
    
    
    
    12,964Diluted income per
common share
    
    $
    0.05
    
    
    $
    0.06
  Note 4  Commitments and Contingencies
  -8-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Note 5  Accounts Receivable and Allowance for Doubtful Accounts
  (in thousands)
    
    March 31, 2009
    
    
    December 31, 2008Billed trade accounts receivable
    
    $
    7,870
    
    
    $
    10,091Unbilled trade accounts receivable
    
    
    1,827
    
    
    
    1,863Other
    
    
    15
    
    
    
    28Total Receivables
    
    $
    9,712
    
    
    $
    11,982Allowance Rollforward (in thousands):Balance at January 1, 2009
    
    $
    11Additions
    
    
    Write offs (Recoveries)
    
    
    (11
    )Balance at March 31, 2009
    
    $
    
 Note 6  Income Taxes
   -9-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
       Note 7  Acquisition
   -10-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (in thousands)Net Working Capital
    
    $
    701Fixed Assets
    
    
    721Other Assets
    
    
    46Other Liabilities
    
    
    (175
    )Deferred Tax Liability
    
    
    (854
    )Software
    
    
    552Trademark
    
    
    48Customer Backlog
    
    
    730Customer Relationships
    
    
    665Non-Compete Agreements
    
    
    138Goodwill, including Workforce
    
    
    21,366Total Purchase Price
    
    $
    23,938
  Pro Forma Results.
 -11-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Three MonthsEndedMarch 31,(in thousands, except per share data)
    
    2008Total revenue
    
    $
    18,549Income from continuing operations before interest and taxes
    
    
    1,056Income from continuing operations, net of taxes
    
    
    517Basic earnings per share:Income from continuing operations
    
    $
    0.04Diluted earnings per share:Income from continuing operations
    
    $
    0.04
 Note 8  Discontinued Operations and Assets Held for Sale
  -12-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
   Three Months EndedMarch 31,(in thousands, except per share data)
    
    2009
    
    
    2008Service revenues
    
    $
    
    
    
    $
    138Costs and expenses
    
    
    
    
    
    
    633Loss from impairment
    
    
    
    
    
    
    Pretax loss
    
    
    
    
    
    
    495Benefit from income taxes
    
    
    
    
    
    
    183Net loss from discontinued operations
    
    
    
    
    
    
    312
  Current Assets
    
    
    27Fixed Assets
    
    
    1,257Net Assets and Liabilities
    
    $
    1,284
  -13-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Note 9  Intangible Assets
  March 31,
    
    
    Estimated(in thousands)
    
    2009
    
    
    Useful LifeAmortized intangible assets:Technology
    
    $
    843
    
    
    5 yearsTrademarks
    
    
    48
    
    
    5 yearsCustomer backlog
    
    
    1,613
    
    
    
    3 to 7 yearsNon-competition agreement
    
    
    349
    
    
    
    2 to 3 years2,853Accumulated amortization
    
    
    (914
    )$
    1,939Unamortized intangible assets:Goodwill
    
    $
    27,391
  Fiscal years ending2009
    
    $
    3372010
    
    
    4232011
    
    
    3792012
    
    
    3242013
    
    
    227Thereafter
    
    
    249$
    1,939
 Note 10  Subsequent Event
  -14-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     -15-




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BIO-IMAGING TECHNOLOGIES, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
   -16-




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
 
 Overview
        17




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Forward Looking Statements
  18




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Recent Accounting Pronouncements
      19




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20




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Results of Operations
 Three Months Ended March 31, 2009 and 2008
 ThreeThree Months
    
    
    
    
    
    MonthsEnded
    
    
    
    
    
    EndedMarch 31,
    
    % of Total
    
    March 31,
    
    % of Total(in thousands)
    
    2009
    
    Revenue
    
    2008
    
    Revenue
    
    $ Change
    
    % ChangeService revenues
    
    $
    14,475
    
    
    
    84.8
    %
    
    $
    11,023
    
    
    
    78.2
    %
    
    $
    3,452
    
    
    
    31.3
    %Reimbursement
revenues
    
    
    2,595
    
    
    
    15.2
    %
    
    
    3,077
    
    
    
    21.8
    %
    
    
    (482
    )
    
    
    (15.7
    )%Total revenues
    
    
    17,070
    
    
    
    100.0
    %
    
    
    14,100
    
    
    
    100.0
    %
    
    
    2,970
    
    
    
    21.1
    %Cost and expenses:Cost of service revenue
    
    
    9,061
    
    
    
    53.1
    %
    
    
    6,343
    
    
    
    45.0
    %
    
    
    2,718
    
    
    
    42.9
    %Cost of reimbursement
revenue
    
    
    2,595
    
    
    
    15.2
    %
    
    
    3,077
    
    
    
    21.8
    %
    
    
    (482
    )
    
    
    (15.7
    )%Sales and marketing
expenses
    
    
    2,156
    
    
    
    12.6
    %
    
    
    1,468
    
    
    
    10.4
    %
    
    
    688
    
    
    
    46.9
    %General and administrative
expenses
    
    
    1,917
    
    
    
    11.2
    %
    
    
    1,539
    
    
    
    10.9
    %
    
    
    378
    
    
    
    24.6
    %Amortization of intangible
assets related to
acquisitions
    
    
    119
    
    
    
    0.7
    %
    
    
    24
    
    
    
    0.2
    %
    
    
    95
    
    
    
    395.8
    %Total cost and expenses
    
    
    15,848
    
    
    
    92.8
    %
    
    
    12,451
    
    
    
    88.3
    %
    
    
    3,397
    
    
    
    27.3
    %Income from continuing
operations before
interest and taxes
    
    
    1,222
    
    
    
    7.2
    %
    
    
    1,649
    
    
    
    11.7
    %
    
    
    (427
    )
    
    
    (25.9
    )%Interest income
    
    
    22
    
    
    
    0.1
    %
    
    
    153
    
    
    
    1.1
    %
    
    
    (131
    )
    
    
    (85.6
    )%Interest expense
    
    
    (2
    )
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    (2
    )
    
    
    0.0
    %Income tax provision
    
    
    (456
    )
    
    
    (2.7
    )%
    
    
    (666
    )
    
    
    (4.7
    )%
    
    
    210
    
    
    
    (31.5
    )%Income from continuing
operations, net of taxes
    
    
    786
    
    
    
    4.6
    %
    
    
    1,136
    
    
    
    8.1
    %
    
    
    (350
    )
    
    
    (30.8
    )%Loss from discontinued
operations, net of taxes
    
    
    
    
    
    
    0.0
    %
    
    
    (312
    )
    
    
    (2.2
    )%
    
    
    312
    
    
    
    100.0
    %Net income
    
    $
    786
    
    
    
    4.6
    %
    
    $
    824
    
    
    
    5.8
    %
    
    $
    (38
    )
    
    
    (4.6
    )%
    21




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23




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Business Segments and Geographic Information
    
 Liquidity and Capital Resources
  Statement of Cash Flow for the three months ended March 31, 2009 compared to March 31, 2008
 Three Months
    
    Three MonthsEnded
    
    Ended(in thousands)
    
    March 31, 2009
    
    March 31, 2008Net cash provided by activities from continuing operations
    
    $
    569
    
    
    $
    2,834Net cash used in investing activities from continuing operations
    
    $
    103
    
    
    $
    (9,226
    )Net cash provided by financing activities from continuing
operations
    
    $
    (19
    )
    
    $
    46
     24




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Payments Due By Period(in thousands)
    
    
    
    
    
    Less than
    
    
    
    
    
    
    
    
    
    
    More thanContractual obligations
    
    Total
    
    
    1 year
    
    
    1-3 years
    
    
    3-5 years
    
    
    5 yearsCapital lease obligations
    
    $
    100,000
    
    
    $
    76,000
    
    
    $
    24,000
    
    
    $
    
    
    
    $
    Facility rent operating
leases
    
    $
    16,363,000
    
    
    $
    2,407,000
    
    
    $
    3,651,000
    
    
    $
    3,450,000
    
    
    $
    6,855,000Employment agreements
    
    $
    1,434,000
    
    
    $
    725,000
    
    
    $
    709,000
    
    
    $
    
    
    
    $
    Total contractual cash
obligations
    
    $
    17,897,000
    
    
    $
    3,208,000
    
    
    $
    4,384,000
    
    
    $
    3,450,000
    
    
    $
    6,855,000
    
    
    our ability to gain new client contracts;
    
    project cancellations;
    
    the variability of the timing of payments on existing client contracts; and
    
    other changes in our operating assets and liabilities.
   
 Changes to Critical Accounting Policies and Estimates
  25




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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
 Interest Rate Risk
  Foreign Currency Risk
    
 Item 4T. Controls and Procedures.
 Evaluation of Disclosure Controls and Procedures.
 Changes in internal control over financial reporting
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PART II. OTHER INFORMATION .
 
 Item 1. Legal Proceedings.
  
 Item 1A. Risk Factors.
  Risks Related to Our Company and Business
 We may incur financial losses because contracts may be delayed or terminated or reduced in scope
for reasons beyond our control.
  
    
    unexpected or undesired clinical results;
    
    the clients decision to terminate the development of a particular product or to end a
particular study;
    
    insufficient patient enrollment in a study;
    
    insufficient investigator recruitment;
    
    failure to perform our obligations under the contract; or
    
    the failure of products to satisfy safety requirements.
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The current economic downturn may adversely impact our ability to raise capital.
  We depend on a small number of industries and clients for all of our business, and the loss of one
such significant client could cause revenues to drop quickly and unexpectedly.
  
    
    our clients businesses experience financial problems or are affected by a general
economic downturn;
    
    consolidation in the pharmaceutical, biotechnology or medical device industries leads to
a smaller client base for us; or
    
    clients reduce their research and development expenditures.
  Our contracted/committed backlog may not be indicative of future results.
  
    
    the variable size and duration of the projects (some are performed over several years);
    
    the loss or delay of projects;
    
    the change in the scope of work during the course of a project; and
    
    the cancellation of such contracts by our clients.
  We recently acquired Phoenix Data Systems, Inc. and may engage in future acquisitions, which may
be expensive and time consuming, and from which we may not realize anticipated benefits.
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Loss of key personnel, or failure to attract and retain additional personnel, may cause the success
and growth of our business to suffer.
  Our revenues, earnings and operating costs are exposed to exchange rate fluctuations.
  Our investments may be exposed to credit risk.
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We may be required to record additional significant charges to earnings if our goodwill becomes
impaired.
  Risks Related to Our Industry
 Our failure to compete effectively in our industry could cause our revenues to decline.
  
    
    consultative and clinical trials design capabilities;
    
    reputation for on-time quality performance;
    
    expertise and experience in specific therapeutic areas;
    
    the scope of service offerings;
    
    strength in various geographic markets;
    
    the price of services;
    
    ability to acquire, process, analyze and report data in a time-saving and accurate
manner;
    
    ability to manage large-scale clinical trials both domestically and internationally;
    
    our size; and
    
    the service and product offerings of our competitors.
   Changes in outsourcing trends in the pharmaceutical and biotechnology industries could adversely
affect our operating results and growth rate.
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Consolidation among our customers could cause us to lose customers, decrease the market for our
products and result in a reduction of our revenues.
  The current economic downturn coupled with the current regulatory environment could have a negative
impact on the pharmaceutical, biotechnology and medical device industries.
  Failure to comply with existing regulations could result in increased costs to complete clinical
trials.
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Changes in governmental regulation could decrease the need for the services we provide, which would
negatively affect our future business opportunities.
     If governmental agencies do not accept the data and analyses generated by our services, the need
for our services would be eliminated or substantially reduced.
  We may be exposed to liability claims as a result of our involvement in clinical trials.
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Risks Related to Our Common Stock
 Your percentage ownership and voting power and the price of our common stock may decrease as a
result of events that increase the number of our outstanding shares.
  Common stock outstanding
    
    
    14,356Common stock issuable upon:Exercise of options which are outstanding
    
    
    2,014Exercise of options which have not been granted
    
    
    703Restricted stock units outstanding
    
    
    113Total common stock outstanding assuming exercise or conversion of
all of the above
    
    
    17,186
  Shares of our common stock eligible for public sale may have a negative impact on its market price.
   There are a limited number of stockholders who have significant control over our common stock,
allowing them to have significant influence over the outcome of all matters submitted to our
stockholders for approval, which may conflict with our interests and the interests of our other
stockholders.
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Because we do not intend to pay dividends, stockholders will benefit from an investment in our
common stock only if it appreciates in value.
  Trading in our common stock may be volatile, which may result in substantial declines in its market
price.
  
    
    operating results;
    
    analysts reports;
    
    market conditions in the industry;
    
    changes in governmental regulations; and
    
    changes in general conditions in the economy or the financial markets.
   Certain provisions of our charter and Delaware law could make a takeover difficult and may prevent
or frustrate attempts by our stockholders to replace or remove our management team.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  
 Item 3. Defaults Upon Senior Securities.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  
 Item 5. Other Information.
  
 Item 6. Exhibits.
 31.1
    
    Certification of principal executive officer
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed
herewith).31.2
    
    Certification of principal financial and
accounting officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (filed herewith).32.1
    
    Certification of principal executive officer
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, 18 U.S.C. 1350 (furnished herewith).32.2
    
    Certification of principal financial and
accounting officer pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. 1350 (furnished herewith).
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BIO-IMAGING TECHNOLOGIES, INC.DATE:   May 8, 2009
    By:
    /s/ Mark L. WeinsteinMark L. Weinstein, President and
Chief Executive Officer (Principal Executive Officer)DATE:   May 8, 2009
    By:
    /s/ Ted I. KaminerTed I. Kaminer, Executive Vice President of Finance
and Administration and Chief Financial Officer
(Principal Financial and Accounting Officer) -36-