Executive Summary / Key Takeaways

• IDEAYA Biosciences is rapidly advancing a diversified precision oncology pipeline, leveraging its expertise in synthetic lethality and antibody-drug conjugates (ADCs) to address high unmet medical needs in cancer.
• The company achieved a significant financial inflection point in Q3 2025, reporting net income of $119.24 million and collaboration revenue of $207.83 million, primarily driven by the transformative Servier licensing agreement for darovasertib.
• Darovasertib, the lead program, has demonstrated compelling clinical efficacy in both metastatic and neoadjuvant uveal melanoma, including a median overall survival of 21.1 months in metastatic disease and significant ocular tumor shrinkage in the neoadjuvant setting, supported by FDA Breakthrough Therapy Designation.
• IDE397, a MAT2A inhibitor, exhibits a differentiated and favorable safety profile compared to prior compounds in its class, enabling continuous dosing and robust pharmacodynamic modulation, which is critical for its potential in MTAP-deleted tumors.
• With approximately $1.14 billion in cash, cash equivalents, and marketable securities as of September 30, 2025, IDEAYA is well-capitalized to fund its planned operations into 2030, supporting multiple preclinical and clinical milestones across its expanding pipeline.

A New Era in Precision Oncology: IDEAYA's Strategic Foundation

IDEAYA Biosciences, incorporated in June 2015, has rapidly established itself as a focused precision medicine oncology company. The company's core mission is to discover, develop, and commercialize transformative therapies for cancer, a goal it pursues by integrating advanced small-molecule drug discovery, structural biology, and bioinformatics with robust internal capabilities in identifying and validating translational biomarkers. This foundational strategy allows IDEAYA to develop tailored, potentially first-in-class targeted therapies aligned to the genetic drivers of disease.

The company's approach is deeply rooted in two cutting-edge technological platforms: synthetic lethality and antibody-drug conjugates (ADCs). Synthetic lethality, a key differentiator, involves targeting two genes or pathways where the individual inhibition of either has little effect, but the simultaneous inhibition of both is lethal to cancer cells. This mechanism underpins several of IDEAYA's pipeline assets, offering a highly selective approach to cancer treatment. The company's proprietary DECIPHER dual CRISPR library and INQUIRE chemical library, coupled with HARMONY machine-learning engines, further enhance its drug discovery platform, providing a technological moat in a competitive landscape.

In the broader oncology market, IDEAYA operates amidst formidable global biopharmaceutical companies such as AstraZeneca , Merck , Bristol-Myers Squibb , and Pfizer . These larger players command extensive resources, diversified portfolios, and established market presence. However, IDEAYA's specialized focus on synthetic lethality and molecular diagnostics provides it with agility and innovation speed in emerging oncology areas, allowing it to target niche patient populations with high unmet medical needs more effectively. This specialized approach enables IDEAYA to potentially achieve faster development cycles for targeted drugs, a critical advantage in segments where larger competitors may have broader but less precise offerings.

Strategic partnerships are central to IDEAYA's competitive positioning, offsetting its smaller operational scale and higher per-program R&D costs compared to industry giants. Collaborations with GSK (GSK), Pfizer, Gilead (GILD), Servier, and Hengrui Pharma provide access to crucial resources, shared development costs, and expanded regulatory and commercial expertise. For instance, the collaboration with Pfizer for darovasertib leverages Pfizer's c-MET inhibitor, crizotinib, and its regulatory experience for potential registrational trials, while the Servier agreement provides ex-U.S. commercialization capabilities. This network of alliances enhances IDEAYA's ability to advance its pipeline efficiently and compete against the broader capabilities of its larger rivals.

Technological Edge: Unlocking New Therapeutic Avenues

IDEAYA's technological differentiation is a cornerstone of its investment thesis, particularly its advancements in synthetic lethality and ADCs. These platforms are designed to exploit specific vulnerabilities in cancer cells, leading to highly targeted and potentially more effective treatments. The company's commitment to these technologies is evident across its clinical and preclinical pipeline.

A prime example is IDE397, a small molecule inhibitor of methionine adenosyltransferase 2a (MAT2A), developed for solid tumors with methylthioadenosine phosphorylase (MTAP) gene deletion. This program exemplifies the synthetic lethality approach. Upon MTAP deletion, the cellular substrate MTA accumulates, partially inhibiting PRMT5. IDE397 then reduces the availability of SAM, which PRMT5 requires, creating a "one-two punch" that selectively disrupts essential pre-mRNA splicing in MTAP-deleted tumors. Preclinically, IDE397 has demonstrated robust tumor growth control and regressions, with complete inhibition of tumor SDMA (a key pharmacodynamic marker) in various MTAP-deleted patient-derived xenograft models. For instance, in an MTAP-deleted lung cancer model, IDE397 achieved 92% tumor growth inhibition and 100% suppression of tumor SDMA. Clinically, IDE397 has shown robust plasma SAM reduction (a mean of 77% in Cohort 5) and exposure-dependent tumor SDMA reduction, with almost complete loss observed in a Cohort 5 lung cancer patient.

Crucially, IDE397's safety profile presents a significant competitive advantage. It has demonstrated a favorable human adverse event (AE) profile, with no serious adverse events reported and the maximum tolerated dose not yet reached. This contrasts sharply with prior drugs targeting PRMT5 and MAT2A, which were often limited by hematologic or liver toxicities. For example, a GSK PRMT5 inhibitor showed 26% serious adverse events and 53% Grade 3/4 AEs at its expansion dose, while another compound, 8270, exhibited 20-67% Grade 3 or higher AEs. IDE397's superior tolerability enables continuous dosing without dose holidays or reductions, which is vital for maintaining sustained target engagement and maximizing therapeutic efficacy. This allows IDEAYA to potentially explore unique combinations and earlier lines of treatment, expanding its market opportunity.

Darovasertib, an oral protein kinase C (PKC) inhibitor, is another key technological asset, particularly in uveal melanoma (UM). In the neoadjuvant setting for primary UM, darovasertib has shown remarkable efficacy, with 83% of patients demonstrating ocular tumor shrinkage, and 54% achieving at least 20% shrinkage. This translated to a 57% eye preservation rate in enucleation-recommended patients, which increased to 95% in those achieving at least 20% ocular tumor shrinkage. Furthermore, 70% of plaque brachytherapy-eligible patients experienced a reduction in predicted radiation dose to the eye. In first-line metastatic UM, the combination of darovasertib and crizotinib achieved a median overall survival of 21.1 months, significantly surpassing the reported historical median OS of approximately 12 months. This combination also delivered a median progression-free survival of 7.0 months, a confirmed overall response rate of 34%, and a disease control rate of 90%.

The company's ADC platform is highlighted by IDE849, a potential first-in-class DLL3 TOP1i ADC. Initial Phase 1 data in small-cell lung cancer (SCLC) demonstrated an 80.0% overall response rate (ORR) and 70.0% confirmed ORR in second-line SCLC patients at the 2.4 mg/kg expansion dose. Notably, patients with baseline brain metastases also showed a 66.7% confirmed ORR across doses equal to or greater than 2.4 mg/kg, indicating potential for addressing a challenging patient population. These quantifiable benefits underscore IDEAYA's ability to develop innovative therapies with meaningful clinical impact.

Financial Momentum and Strategic Outlook

IDEAYA Biosciences has reached a pivotal financial inflection point, transitioning from consistent operating losses to a period of significant revenue generation and net income. For the three months ended September 30, 2025, the company reported collaboration revenue of $207.83 million, a dramatic increase from prior periods, and a net income of $119.24 million. This positive shift was primarily driven by the exclusive License Agreement with Servier in August 2025, which provided an upfront payment of $210 million for ex-U.S. rights to darovasertib, with $207.80 million recognized as revenue in the quarter. For the nine months ended September 30, 2025, collaboration revenue stood at $207.83 million, leading to a net income of $30.42 million, a substantial improvement compared to a net loss of $144.17 million for the same period in 2024.

Despite this positive revenue development, IDEAYA continues to invest heavily in its pipeline. Research and development expenses increased by 48% to $228.11 million for the nine months ended September 30, 2025, compared to $154.49 million in the prior year. This increase reflects substantial investments in advancing lead product candidates, with Darovasertib R&D expenses rising to $74.99 million from $28.11 million, IDE397 to $11.23 million from $9.13 million, and IDE161 to $5.81 million from $4.49 million over the same period. General and administrative expenses also rose by 57% to $44.47 million, driven by personnel, consulting, and legal costs associated with growth.

As of September 30, 2025, IDEAYA's liquidity position is robust, with approximately $1.14 billion in cash, cash equivalents, and marketable securities. Management believes this capital is sufficient to fund planned operations into 2030, supporting the achievement of multiple preclinical and clinical milestones. This strong financial runway is critical for a biotechnology company with an extensive, early-to-mid-stage pipeline, mitigating immediate financing risks. The company's ability to secure significant upfront payments and potential milestones from strategic partners like Servier and Hengrui Pharma (which includes a $75 million upfront fee and up to $1.04 billion in total milestones for IDE849) underscores the perceived value of its assets and its strategic approach to pipeline development.

Looking ahead, IDEAYA has several key catalysts. For darovasertib, the Phase 2/3 OptimUM-2 trial in first-line HLA-A2-negative metastatic UM is on track to report median progression-free survival (PFS) data by year-end 2025 to Q1 2026, with the potential to enable a U.S. accelerated approval filing. The Phase 3 OptimUM-10 trial in neoadjuvant primary UM is enrolling approximately 450 patients. For IDE397, the GSK option package is expected to be delivered by mid-2022, potentially triggering a $50 million option exercise fee and up to $940 million in additional development, regulatory, and sales milestones. The company targets Phase 2 dose selection for IDE397 by year-end 2025, with the next clinical update planned for H1 2026. IDEAYA also plans to expand IDE849 into neuroendocrine tumors and other DLL3-expressing tumors by year-end 2025 and initiate a Phase 1 combination trial of IDE849 and IDE161. Furthermore, IND filings for IDE034 and IDE574 are on track for year-end 2025, and a Phase 1 dose escalation trial for IDE892 is targeted for Q4 2025, with combination trials with IDE397 planned for H1 2026.

Risks and Competitive Dynamics

Despite its promising pipeline and strong financial position, IDEAYA faces inherent risks common to the biotechnology industry. The company operates in a highly competitive environment with rapid technological change, necessitating continuous innovation. Development of new product candidates is costly and time-consuming, with no guarantee of regulatory approval or commercial success. Delays in clinical trials, whether due to regulatory requirements or patient enrollment challenges, could significantly increase expenses and extend timelines. While IDEAYA has a robust cash position, it will require substantial additional capital in the future to fully develop and commercialize its product candidates, and there is no assurance that such financing will be available on favorable terms.

IDEAYA's competitive landscape is defined by its specialized focus. While larger pharmaceutical companies like AstraZeneca (AZN), Merck (MRK), Bristol-Myers Squibb (BMY), and Pfizer (PFE) possess greater financial resources, broader pipelines, and established commercial infrastructures, IDEAYA's strength lies in its targeted approach to synthetic lethality and ADCs. Its ability to identify and exploit specific genetic vulnerabilities in cancer cells provides a differentiated edge. The favorable safety profile of IDE397, for instance, allows for continuous dosing, a critical factor that has limited some competitors in the MAT2A/PRMT5 space. This technological advantage, coupled with strategic partnerships, enables IDEAYA to compete effectively in niche precision oncology markets where unmet needs are high. The company's collaborations also help to de-risk development and share costs, a crucial strategy for a company of its scale.

Conclusion

IDEAYA Biosciences stands at a compelling juncture, having transformed its financial trajectory through strategic partnerships while aggressively advancing a deep and differentiated precision oncology pipeline. The recent Servier agreement for darovasertib, coupled with the promising clinical data across its lead programs, underscores the company's scientific prowess and commercial potential. IDEAYA's technological leadership in synthetic lethality and ADCs, exemplified by the favorable risk-benefit profile of IDE397 and the robust efficacy of darovasertib and IDE849, positions it as a significant innovator in the fight against cancer.

With a substantial cash runway extending into 2030, IDEAYA is well-equipped to execute on its ambitious development plans and navigate the inherent challenges of drug development. The company's strategic collaborations further enhance its capabilities, allowing it to leverage external expertise and resources. As IDEAYA progresses its diverse pipeline through critical clinical and regulatory milestones, its focused approach to delivering highly selective and effective therapies for genetically defined cancers offers a compelling investment thesis for discerning investors.