Day One Biopharmaceuticals pany(US:DAWN)2025-08-05 20:06PART I. FINANCIAL INFORMATION Item 1. Interim Condensed Financial Statements (Unaudited) Presents unaudited financial statements showing a Q2 2025 net loss of $30.3 million and significant OJEMDA revenue growth Condensed Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $494,428 | $562,330 | | Total Assets | $519,037 | $582,788 | | Total Current Liabilities | $51,221 | $73,451 | | Total Liabilities | $58,203 | $80,037 | | Total Stockholders' Equity | $460,834 | $502,751 | Condensed Statement of Operations Summary (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $33,562 | $8,192 | $64,065 | $8,192 | | Total revenues | $33,908 | $8,192 | $64,669 | $8,192 | | Loss from operations | $(34,974) | $(114,807) | $(76,041) | $(181,574) | | Gain from sale of PRV | — | $108,000 | — | $108,000 | | Net loss | $(30,322) | $(4,407) | $(66,318) | $(66,819) | | Net loss per share | $(0.29) | $(0.05) | $(0.64) | $(0.77) | Condensed Statement of Cash Flows Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(83,803) | $(98,858) | | Net cash (used in) provided by investing activities | $(6,291) | $106,345 | | Cash provided by financing activities | $748 | $1,345 | | Net (decrease) increase in cash | $(89,346) | $8,832 | | Cash and cash equivalents, end of period | $35,622 | $239,616 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the commercial launch of OJEMDA™, clinical pipeline progress, and financial results Overview The company is a commercial-stage entity focused on its newly FDA-approved product, OJEMDA™, for pediatric glioma - The FDA granted accelerated approval for OJEMDA™ (tovorafenib) on April 23, 2024, for patients with relapsed or refractory pLGG, and the company has commenced its commercial launch in the U.S130 - The pivotal Phase 3 trial, FIREFLY-2, is evaluating tovorafenib as a front-line therapy in pLGG, with enrollment expected to be completed in the first half of 2026134 - In June 2024, the company licensed DAY301, a novel Antibody Drug Conjugate (ADC) targeting PTK7, and a Phase 1a/b clinical trial is ongoing142 - An agreement with Ipsen grants exclusive rights to commercialize tovorafenib outside the United States in exchange for an upfront payment, milestones, and royalties135136137 Results of Operations Total revenues increased to $33.9 million in Q2 2025, driven by OJEMDA sales, while R&D expenses decreased Comparison of Three Months Ended June 30, 2025 and 2024 (in thousands) | Account | 2025 | 2024 | $ Change | | :--- | :--- | :--- | :--- | | Product revenue, net | $33,562 | $8,192 | $25,370 | | Total revenues | $33,908 | $8,192 | $25,716 | | Research and development | $36,149 | $92,106 | $(55,957) | | Selling, general and administrative | $28,968 | $30,186 | $(1,218) | | Net loss | $(30,322) | $(4,407) | $(25,915) | Comparison of Six Months Ended June 30, 2025 and 2024 (in thousands) | Account | 2025 | 2024 | $ Change | | :--- | :--- | :--- | :--- | | Product revenue, net | $64,065 | $8,192 | $55,873 | | Total revenues | $64,669 | $8,192 | $56,477 | | Research and development | $75,768 | $132,316 | $(56,548) | | Selling, general and administrative | $58,293 | $56,743 | $1,550 | | Net Loss | $(66,318) | $(66,819) | $501 | - The decrease in R&D expenses for Q2 2025 was primarily due to a $55.0 million upfront payment related to the MabCare License Agreement in Q2 2024, which was not repeated190 Liquidity and Capital Resources The company holds $453.1 million in cash and equivalents, sufficient to fund operations for at least twelve months - As of June 30, 2025, the company had $453.1 million in cash, cash equivalents, and short-term investments206 - Management believes current cash reserves are sufficient to fund capital requirements for at least twelve months from the filing date of this report206217 Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(83,803) | $(98,858) | | Net cash (used in) provided by investing activities | $(6,291) | $106,345 | | Cash provided by financing activities | $748 | $1,345 | Item 3. Quantitative and Qualitative Disclosures About Market Risk The company reports no material changes to its market risks from the prior year's annual report - There were no material changes to the company's market risks from those described in the 2024 Form 10-K228 Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of the end of the quarter - Based on an evaluation as of June 30, 2025, the Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective229 - There were no changes in internal control over financial reporting during the three months ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls230 PART II. OTHER INFORMATION Item 1. Legal Proceedings The company is not currently party to any material legal proceedings - The company is not presently a party to any legal proceedings that would have a material adverse effect on its business232 Item 1A. Risk Factors The company faces significant risks related to its commercial operations, financial position, and regulatory environment Risks Related to Our Financial Position Financial risks include a limited operating history, a history of net losses, and reliance on a single product - As a commercial-stage company with a limited operating history and only one approved product, it is difficult for investors to evaluate the company's likelihood of success235 - The company has incurred significant net losses since inception, with an accumulated deficit of $620.4 million as of June 30, 2025, and expects to incur continued losses238 - The company may require additional capital to finance its operations and may be forced to delay, reduce, or eliminate its R&D programs if unable to raise it250 Risks Related to Development and Commercialization of OJEMDA and our Product Candidates The company's development and commercialization efforts face significant risks from clinical trials and competition - Clinical trials are expensive, time-consuming, and involve uncertain outcomes, with failure possible at any stage257258 - The company faces substantial competition from major pharmaceutical companies with greater financial resources and established products287290 - The commercial success of OJEMDA depends on achieving market acceptance among physicians and securing adequate reimbursement from third-party payors, which is uncertain313315 Risks Related to Government Regulation The company operates in a highly regulated industry, facing extensive oversight and risks from healthcare reform - The development and commercialization of pharmaceutical products are subject to extensive, lengthy, and uncertain regulation by the FDA and other global authorities325 - OJEMDA's accelerated approval is subject to post-marketing requirements, and failure to confirm clinical benefit could lead to the FDA withdrawing approval341368 - The company is subject to healthcare fraud and abuse laws, such as the federal Anti-Kickback Statute, which could expose it to significant penalties378 - Recent legislation, such as the Inflation Reduction Act (IRA), could increase costs and put downward pressure on drug prices, affecting profitability380384 Risks Related to Our Reliance on Third Parties The business model relies heavily on third-party CROs, CMOs, and licensing partners like Ipsen - The company relies on third-party CROs to conduct clinical trials and is responsible for ensuring their compliance with GCP requirements412413 - The company depends on third-party manufacturers, including some in China, exposing it to production difficulties, quality control issues, and geopolitical risks418419 - The license agreement with Ipsen is crucial for the ex-U.S. commercialization of tovorafenib, and non-performance by Ipsen could harm the business432435 Risks Related to Our Intellectual Property Success depends on obtaining, maintaining, and enforcing intellectual property protection for its products - The company's commercial success depends on its ability to obtain and maintain patent protection, but the patent position of biopharmaceutical companies is highly uncertain490491492 - The company may face claims that it infringes on third-party patents, which could lead to costly litigation or prevent commercialization of its products507 - The company relies on license agreements with third parties like Viracta, Takeda, and MabCare, and a termination could result in the loss of rights to its products516518519 Risks Related to Our Common Stock The company's common stock faces risks including high price volatility and significant stockholder control - The market price of the company's common stock is likely to be highly volatile and subject to wide fluctuations574 - The company does not intend to pay dividends, so any return on investment will depend on the appreciation of the stock's value579 - As of June 30, 2025, executive officers, directors, and 5% stockholders beneficially owned 45.0% of the voting stock, giving them significant influence586 - Anti-takeover provisions in the company's charter documents and Delaware law could prevent or delay an acquisition587 Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities The company reports no unregistered sales, use of proceeds, or repurchases of its equity securities - There were no unregistered sales of equity securities, use of proceeds, or issuer purchases of equity securities during the period604605606 Item 3. Defaults Upon Senior Securities The company reports that there have been no defaults upon its senior securities - None607 Item 4. Mine Safety Disclosures This item is not applicable to the company's operations - Not applicable608 Item 5. Other Information No directors or Section 16 officers adopted or terminated a Rule 10b5-1 trading plan during the quarter - During the three months ended June 30, 2025, none of the Company's Section 16 officers or directors adopted or terminated any Rule 10b5-1 trading plan609 Item 6. Exhibits This section provides an index of the exhibits filed with the Form 10-Q - The report includes certifications from the Principal Executive Officer and Principal Financial Officer pursuant to the Sarbanes-Oxley Act of 2002611 - Inline XBRL Instance Document and Taxonomy Extension Schema are filed with the report611