Day One Biopharmaceuticals, Inc. (Nasdaq: DAWN), a biopharmaceutical company focused on developing and commercializing targeted therapies for patients of all ages with life-threatening diseases, has announced the signing of a definitive merger agreement to acquire Mersana Therapeutics.
The acquisition strengthens Day One’s oncology portfolio by adding Emi-Le, a potential first-in-class monotherapy being developed to treat adenoid cystic carcinoma (ACC) — an aggressive and rare cancer, most commonly originating in the salivary gland, with limited treatment options. Early data from an ongoing Phase 1 study of Emi-Le have shown encouraging anti-tumor activity, suggesting potential for an accelerated path to regulatory approval.
Emi-Le is an antibody-drug conjugate (ADC) that targets B7-H4, a protein highly expressed in ACC and other cancers in both adults and children. As a targeted investigational therapy showing monotherapy activity in a disease without approved treatments or a clear standard of care, Emi-Le represents a significant innovation with the potential for rapid development and commercialization.
“This acquisition will add a potential game-changing medicine to the Day One portfolio,” said Jeremy Bender, Ph.D., CEO of Day One Biopharmaceuticals. “If approved, Emi-Le will enhance our ability to make a meaningful difference for patients while driving continued growth and value creation for our company.”
Terms of the Agreement
Under the terms of the definitive merger agreement:
- Day One will launch a tender offer to acquire all outstanding shares of Mersana common stock at $25 per share in cash, plus one non-tradable contingent value right (CVR) per share.
- Each CVR could provide potential milestone payments of up to $30.25 per share in cash, depending on clinical, regulatory, and sales achievements.
- This brings the total potential consideration to $55.25 per share, valuing the deal at up to $285 million, including an initial $129 million equity value at closing.
Milestone Payments Include:
Clinical Milestones:
- $1.25 per share for a development milestone linked to an existing partnership.
- $1.00 per share for FDA Breakthrough Therapy Designation for ACC.
- $4.00 per share for first dosing in a registrational trial for Emi-Le.
Regulatory and Sales Milestones:
- $9.00 per share upon FDA approval of Emi-Le.
- $2.00 per share for first commercial sale in major EMA markets.
- $1.00 per share for first commercial sale in Japan.
- $2.00, $4.00, and $6.00 per share respectively for reaching annual net sales milestones of $100M (by 2032), $200M (by 2035), and $300M (by 2037).
Day One plans to fund the acquisition using existing cash reserves, with its current financial strength expected to support the full development of Emi-Le through potential approval without the need for additional financing.
The transaction is anticipated to close by the end of January 2026, pending regulatory approvals and other customary closing conditions.
Summary
Day One Biopharmaceuticals, Inc. (Nasdaq: DAWN) has announced a definitive merger agreement to acquire Mersana Therapeutics in a deal valued at up to $285 million, marking a major expansion of its oncology portfolio.
Key Highlights
- Strategic Acquisition:
Day One aims to strengthen its cancer treatment pipeline with the addition of Emi-Le, a potential first-in-class antibody-drug conjugate (ADC). - Targeted Therapy Focus:
Emi-Le is designed to treat adenoid cystic carcinoma (ACC) — a rare, aggressive cancer often arising in the salivary gland and lacking effective treatment options. - Innovative Mechanism:
The therapy targets B7-H4, a protein highly expressed in several adult and pediatric cancers, showing early signs of anti-tumor activity in ongoing Phase 1 trials. - Deal Structure:
Mersana shareholders will receive:- $25 per share in cash at closing.
- Non-tradable contingent value rights (CVRs) worth up to $30.25 per share, tied to future clinical, regulatory, and sales milestones.
- Total Valuation:
The deal represents a total potential value of $285 million, with an initial equity value of $129 million at closing. - Financing:
The acquisition will be fully funded from Day One’s existing cash reserves, requiring no additional financing. - Expected Closing:
The transaction is anticipated to close by January 2026, pending regulatory approvals and customary closing conditions. - Leadership Statement:
Day One CEO Jeremy Bender, Ph.D., called the acquisition “a game-changing opportunity” to expand treatment options for patients with rare and life-threatening cancers while creating long-term value.
About Day One Biopharmaceuticals, Inc.
Day One Biopharmaceuticals is a commercial-stage biotech company dedicated to improving outcomes in pediatric cancer care. Founded to address the significant lack of treatments for childhood cancers, the company draws inspiration from “The Day One Talk” – the conversation physicians have with families upon a child’s cancer diagnosis and treatment planning.
With a mission to transform how cancer drugs are developed, Day One strives to expand therapeutic possibilities for patients of all ages from the very start of their journey.
Collaborating closely with oncologists, researchers, and families, the company focuses on discovering, acquiring, and advancing innovative targeted cancer therapies. Its current development pipeline includes tovorafenib (OJEMDA™) and DAY301.
About Mersana Therapeutics
Mersana Therapeutics is a clinical-stage biopharmaceutical company dedicated to developing innovative antibody-drug conjugates (ADCs) to meet the urgent need for new cancer treatments. Leveraging its proprietary Dolasynthen (cytotoxic) and Immunosynthen (immunostimulatory) ADC platforms, the company has built a robust pipeline of internally developed and partnered candidates targeting various cancers. Its lead programs include Emi-Le (emiltatug ledadotin; XMT-1660), a Dolasynthen-based ADC aimed at B7-H4, and XMT-2056, an Immunosynthen ADC directed at a unique HER2 epitope, both designed to deliver targeted and potent therapeutic effects.
