Just weeks after her 30th birthday, Mary Tagliaferri was diagnosed with breast cancer.

"Doctors were unclear about how much hormone therapy I should take. Some recommended radiation and surgery," Ms. Tagliaferri remembers. "Very little was known about what to do with women who were young and hadn't had children."

Ms. Tagliaferri decided to combine oriental and traditional medicine. The result was a successful treatment—and a technology platform that grew into Emeryville, California-based Bionovo, a pharma she co-founded with traditional Chinese medicine practitioner Isaac Cohen in 2002.

Ms. Tagliaferri has been cancer-free for 11 years now, and has since watched two lead drugs go into clinical trials—one for breast cancer, and one for menopause, but both based on extracts from Chinese herbs.

In 2005, Bionovo went public by merging with a listed shell company. Between that and private placements, it raised an initial $10 million—this on top of $8 million the founders received in grants from the National Institutes of Health, the Department of Defense Breast Cancer Research Program, and the State of California.

Additional private placements were raised in 2007, bringing in $15.7 million from institutional investors like Salt Lake City-based Cambria Capital and New York City-based brokerage Blaylock & Company. Even better, JP Morgan's Health Science Fund ended up taking a stake. "We liked the fact that all the drugs are derived from plants, and that Bionovo is making more natural drugs," says Joel Vanderhoof, vice president of sales at Cambria Capital.

Investors say botanical pharmas are poised to make a splash. "The cost to develop the drug is much lower," says Roger Wyse, a managing director at San Francisco-based venture firm Burrill & Company. "There is a presumed safety because people have been eating [medicinal herbs] for many years."

Not that it wasn't a bumpy ride for Bionovo in the early days. Despite receiving grant support, Ms. Tagliaferri and Mr. Cohen still had to sell their homes to finance the company. Then Ms. Tagliaferri's first son was born, adding more pressure. "It was a little nerve-racking to pay out of pocket for healthcare and to go from owning my own house to renting," she says.

Earlier, while studying in the medical school at the University of California, San Francisco, Ms. Tagliaferri discovered that 24 of 25 department chairs were men. "It's a myth that there are a lot of women in biotechnology," she says. "There may be female doctors in the clinic, and women at lower-level research positions in labs, but I'm constantly shocked by how few women have penetrated executive, investment, and leadership communities in the biotech world."

She says she has seen how hard it is for women and minorities to raise money and learn the tricks of the trade. Yet Ms. Tagliaferri remains optimistic for the future of women in technology fields. "While it's sad to walk into a room and see the lack of diversity, women are making headway," she says. "There are plenty of competent women that could do my job—they just need to be encouraged."

—Amy Coombs