French pharmaceutical company Servier has agreed to a multibillion-dollar acquisition that, if completed, would flesh out its arsenal of cancer medicines.
The deal, announced Friday, has Servier paying in cash $21.50 for each share of Day One Biopharmaceuticals. That’s a 68% premium to Day One’s previous closing share price and represents a total equity value of around $2.5 billion. The companies expect to close sometime between April and the end of June.
Day One was founded in 2018 by Samuel Blackman, a physician-scientist and industry veteran, and Julie Grant, a general partner at the venture capital firm Canaan Partners. Its name stems from “the day one talk” — when physicians communicate an initial cancer diagnosis and treatment plan to patients and their families. While Day One has said it intends to help patients of all ages, the priority so far has been creating first- or best-of-their-kind therapies for childhood cancers.
Day One had amassed $192 million in equity before going public in mid-2021 and raising another $160 million. It arrived on the market just as a biotechnology bubble created by the coronavirus pandemic was starting to burst. The following few years saw a historic downturn in the biotech stock market, which forced many companies to cull research, cut staff and narrow the scope of their missions. Prior to Friday’s announcement, Day One’s shares were still down 20% from where they were initially priced.
In a statement, Day One’s CEO Jeremy Bender said the sale “represents a unique opportunity to extend the reach” of his company’s science. Bender highlighted how Servier is the “ideal home for our portfolio” given its track record in rare cancers and work advancing targeted therapies. Servier already sells a handful of cancer drugs, including Tibsovo, Voranigo and Onivyde.
In its fiscal year that stretches from 2024 to 2025, Servier recorded revenue of 6.9 billion euros or roughly $7.9 billion. Its oncology business had grown 55% from the year prior, to account for about a third of the total. The company said one of its goals is for that oncology segment to reach 4 billion euros by 2030.
By buying Day One, Servier gets a couple experimental drugs in human testing as well as Ojemda, an approved medicine for certain hard-to-treat brain tumors that affect children. Ojemda is also currently being evaluated in a late-stage study of children with those tumors, who have genetic alterations that impair “Rafs” — a category of enzymes that can cause uncontrolled cell growth and multiplication.
Last year, Day One recorded $155 million in net product revenue and a net loss from operations of about $128 million. Its proposed sale comes just several months after it agreed to buy struggling cancer drugmaker Mersana Therapeutics in a heavily backloaded deal.
