Day One Announces Sale of Priority Review Voucher for $108 Million

Rhea-AI Summary

Day One Biopharmaceuticals (Nasdaq: DAWN) announced the sale of its Priority Review Voucher (PRV) for $108 million to an undisclosed buyer. The PRV was awarded following the FDA's accelerated approval of OJEMDA™ (tovorafenib). This sale provides non-dilutive capital, strengthening Day One's balance sheet to support the launch of OJEMDA and further clinical development for cancer treatments. Additionally, $8.1 million from the sale will be paid to Viracta Therapeutics to fulfill obligations under a license agreement.

Positive

• Sale of the PRV for $108 million provides significant non-dilutive capital.
• Strengthens Day One's balance sheet.
• Supports the launch of OJEMDA™ (tovorafenib).
• Furthers clinical development opportunities for cancer treatments.

Negative

• A significant portion of the proceeds ($8.1 million) will be paid to Viracta Therapeutics, reducing the net benefit.

Financial Analyst

The sale of the Priority Review Voucher (PRV) for $108 million is a significant event for Day One Biopharmaceuticals. This transaction provides the company with a substantial influx of non-dilutive capital, meaning it raises funds without issuing new shares and thereby avoids diluting existing shareholders' equity. This capital boost strengthens the company's balance sheet, which is important as it continues the launch of OJEMDA™ and invests in further clinical developments.

Balance sheet strength is essential for biopharmaceutical companies, especially those in the commercial stage. It impacts their ability to fund research and development (R&D), manage operational costs and pursue strategic initiatives without needing additional equity financing, which might dilute shareholder value. This move demonstrates effective financial management, enabling Day One to maintain financial stability while progressing its growth plans.

Medical Research Analyst

The sale of the PRV indicates that the FDA's accelerated approval of OJEMDA™ (tovorafenib) is a milestone for Day One Biopharmaceuticals. The PRV program aims to incentivize the development of treatments for rare pediatric diseases and receiving such a voucher is a testament to the innovative nature of OJEMDA™. This voucher's sale not only provides immediate financial benefits but also highlights the potential impact of OJEMDA™ in the market, reinforcing the company's focus on addressing unmet medical needs in oncology.

Investing proceeds from the PRV sale back into clinical development signifies a strategic commitment to advancing their pipeline of therapies for pediatric and adult cancer patients. This reinvestment could accelerate the development of additional therapies, potentially leading to more approvals and commercial opportunities in the future.

Market Research Analyst

The transaction brings attention to the market dynamics of the PRV system, which serves as a valuable asset for companies in the biopharmaceutical space. Selling the PRV for $108 million underscores its high market value, reflecting the ongoing demand for expedited review processes in drug development. For retail investors, understanding the strategic sale of PRVs can be insightful, as it highlights how companies can leverage regulatory incentives to optimize financial resources effectively.

Additionally, the company's obligation to pay $8.1 million to Viracta Therapeutics as part of the license agreement demonstrates the interconnectedness of partnerships and licensing deals in the biotech industry. Such collaborations are common and often necessary for securing the rights to develop and commercialize breakthrough therapies. This aspect underscores the importance of monitoring partnership agreements and their financial implications on the overall business strategy.

BRISBANE, Calif., May 30, 2024 (GLOBE NEWSWIRE) -- Day One Biopharmaceuticals (Nasdaq: DAWN) (“Day One” or the “Company”), a commercial-stage biopharmaceutical company dedicated to developing and commercializing targeted therapies for people of all ages with life-threatening diseases, today announced it sold its Priority Review Voucher (PRV) for $108 million to an undisclosed buyer. The Company was awarded the PRV following the U.S. Food and Drug Administration (FDA) accelerated approval of OJEMDA™ (tovorafenib).

“The sale of the PRV delivers true non-dilutive capital to Day One and further strengthens our balance sheet as we continue executing on the launch of OJEMDA and investing in clinical development opportunities for children and adults living with cancer,” said Charles York II, chief operating and financial officer of Day One.

Under the Rare Pediatric Disease Priority Review Voucher Program, FDA awards PRVs to sponsors of rare pediatric disease product applications that meet certain criteria. The program is intended to encourage development of new drugs and biologics for the prevention and treatment of rare diseases. A PRV can be redeemed to receive priority review of a subsequent marketing application for a different product, sold or transferred.

As part of the transaction, $8.1 million of the total consideration received from the sale of the PRV will be paid to Viracta Therapeutics, Inc. (“Viracta”) to fully satisfy PRV related obligations of the Company’s license agreement with Viracta, dated December 16, 2019, as amended.

About Day One Biopharmaceuticals
Day One Biopharmaceuticals is a commercial-stage biopharmaceutical company that believes when it comes to pediatric cancer, we can do better. The Company was founded to address a critical unmet need: the dire lack of therapeutic development in pediatric cancer. Inspired by “The Day One Talk” that physicians have with patients and their families about an initial cancer diagnosis and treatment plan, Day One aims to re-envision cancer drug development and redefine what’s possible for all people living with cancer—regardless of age—starting from Day One.

Day One partners with leading clinical oncologists, families, and scientists to identify, acquire, and develop important targeted cancer treatments. The Company’s pipeline includes tovorafenib (OJEMDA™) and pimasertib.

Day One is based in Brisbane, California. For more information, please visit www.dayonebio.com or find the Company on LinkedIn or X.

Cautionary Note Regarding Forward-Looking Statements
This press release contains “forward-looking” statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to: Day One’s plans to develop cancer therapies, expectations from current clinical trials, and the ability of tovorafenib to treat pLGG or related indications.

Statements including words such as “believe,” “plan,” “continue,” “expect,” “will,” “develop,” “signal,” “potential,” or “ongoing” and statements in the future tense are forward-looking statements. These forward-looking statements involve risks and uncertainties, as well as assumptions, which, if they do not fully materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements.

Forward-looking statements are subject to risks and uncertainties that may cause Day One’s actual activities or results to differ significantly from those expressed in any forward-looking statement, including risks and uncertainties in this press release and other risks set forth in our filings with the Securities and Exchange Commission, including Day One’s ability to develop, obtain regulatory approval for or commercialize any product candidate, Day One’s ability to protect intellectual property, the potential impact of global business or macroeconomic conditions, including as a result of inflation, rising interest rates, instability in the global banking system, geopolitical conflicts and the sufficiency of Day One’s cash, cash equivalents and investments to fund its operations. These forward-looking statements speak only as of the date hereof and Day One specifically disclaims any obligation to update these forward-looking statements or reasons why actual results might differ, whether as a result of new information, future events or otherwise, except as required by law.

DAY ONE MEDIA
Laura Cooper, Head of Communications
media@dayonebio.com

DAY ONE INVESTORS
LifeSci Advisors, PJ Kelleher
pkelleher@lifesciadvisors.com

FAQ

What did Day One Biopharmaceuticals announce on May 30, 2024?

Day One announced the sale of its Priority Review Voucher for $108 million.

How much did Day One sell its Priority Review Voucher for?

Day One sold its Priority Review Voucher for $108 million.

What is the significance of the Priority Review Voucher sale for DAWN?

The sale provides non-dilutive capital and strengthens Day One's balance sheet.

What is the FDA approval related to the PRV sale?

The PRV was awarded following the FDA's accelerated approval of OJEMDA™ (tovorafenib).

How much of the PRV sale proceeds will be paid to Viracta Therapeutics?

$8.1 million will be paid to Viracta Therapeutics.