Two days after showing strong pediatric cancer data, Day One taps $150M in public capital
Public biotechs can still raise money, but it comes with a big caveat: The clinical data must impress.
It appears the market reacted so with Day One Biopharmaceuticals, as the biotech plans to secure $150 million this week in a public offering. The four-year-old company is following a trend of biotechs going straight to the market hours or days after releasing results that outperform expectations and pad the case for a drug’s potential regulatory path.
The figure was originally $125 million, but the biotech seems to have garnered enough interest from investors over the course of Tuesday on the back of a Sunday night release of clinical data showing a former Takeda drug worked well in treating kids with a certain form of brain cancer.
The South San Francisco biotech had already seen its shares $DAWN more than double since Friday’s closing price, going from $6.62 before the weekend to $16 apiece before Wednesday’s opening bell. The company went public 54 weeks ago at an initial price of $16, though that figure surged on day one.
Day One’s drug, known as tovorafenib and in-licensed from Takeda, had an effect on many patients in a mid-stage study, the biotech said Sunday. An overall response rate of 64% was recorded among the first 22 evaluable patients who have a brain tumor known as recurrent or progressive low-grade glioma (pLGG).
The results come from FIREFLY-1, which includes a registration cohort among three arms. That cohort has enrolled all patients and will read out in 2023. A filing is expected in the first half of next year, Cowen analysts noted. The analysts predicted $675 million in peak sales in the R/R setting.
A Phase III study will begin in frontline pLGG, Day One decided based on the new data.
Other biotechs have gone down this path in recent months. Despite massive headwinds and a shuttered entry onto Wall Street for nearly every ambitious biotech, some listed companies have been able to pull in new funds after releasing data that excite investors and throw some weight behind their theses.
Three companies got the ball rolling in late March, over the span of 24 hours. Ascendis Pharma, argenx and Apellis Pharmaceuticals reeled in a total of $1.5 billion in new monies after late-stage and long-term data on various drugs.
More biotechs have followed suit since April showers began. Another drug out of Takeda spurned a similar follow-on offering for Phathom Pharmaceuticals, which looked to the market for another $260 million after securing FDA approval to treat adults infected by H. pylori bacteria. Rezolute nabbed $130 million after a Phase II data drop in May, and Tarsus sought about $75 million the same week after a Phase III win for an eye drop.