It’s a new $DAWN for Day One as startup pivots to an IPO for more funding to back its work in pediatric cancer
Pediatric cancer biotech Day One Pharmaceuticals is headed for Nasdaq, in a move that comes less than three months after their work on a brain cancer treatment led to a nine-figure crossover round backed by some blue-chip investors.
The South San Francisco-based company is penciling in $100 million as their initial IPO target, though the ultimate raise will likely be higher. Tuesday’s filing comes after RA Capital led a $130 million B round for the company in February, following what CEO Jeremy Bender said at the time was “rapid” progress of their lead program.
When Day One prices in a few weeks, it will trade under the ticker $DAWN.
As the pharma industry continues developing and pushing forward cancer treatments, Day One execs argue that the mainstream players left pediatric cancer behind. Adult patients make up a significantly bigger portion of the market, the company said, and there have been lags in understanding pediatric biology properly.
Day One’s mission, then, is to try to fill that gap by developing targeted therapies aimed specifically at children. Their proposed treatments are entirely new efforts rather than reformulating adult treatments that come with heavy side effects, like radiation therapy and chemo.
Their lead program is a former Takeda program called DAY101, an oral pan-RAF inhibitor that can cross the blood-brain barrier and block mutations in gliomas. As such, Day One is aiming for an indication to treat pediatric low-grade gliomas, the most common form of brain tumors in children. The current standard of care is platinum-based chemo, with no clear favorite beyond that, Bender told Endpoints News in February.
The biotech recently launched a Phase II study for the experimental drug, with the goal of reading out top-line results in the first half of 2022. Day One plans to ultimately enroll 60 patients in the single-arm, open-label study and hopes it can form the basis of an approval package.
Within its S-1, Day One plans to funnel its cash not only toward this Phase II trial, but also launch a new Phase III study for the frontline treatment of pediatric low grade gliomas next year. Its goals also include a Phase II trial for RAF-altered solid tumors in patients older than 12, as well as a Phase Ib/II study combining DAY101 with Merck KgGA’s MEK inhibitor pimasertib to treat adult MAPK-altered solid tumors.
The S-1 also provided some details regarding that deal with Takeda and the company’s equity. Day One only paid $1 million for the DAY101 candidate and at the time of the agreement, December 2019, offered a Takeda subsidiary about a 12% stake in the company. The subsidiary, Millennium Pharmaceuticals, will continue to own that stake when Day One goes public.
Bender for his part, owns a 3% stake, while CMO and founder Sam Blackman has a 4.6% stake. The biggest stakeholder is Canaan Partners at 21.9%, followed up by the Atlas Venture Fund at 16.9%.
Day One also noted that Derek DiRocco, the RA Capital partner who joined the board with February’s raise, will be leaving the company after a very short stint once the biotech begins trading publicly.
Biotech IPOs continue to boom as 2021 marches forward, with more than 50 companies having either filed or priced their IPOs so far this year. For the year, the combined biotech raise is approaching $6.5 billion, and is expected to reach nearly $7 billion later this week when four more companies make their Nasdaq debuts.