Arcus Biosciences, Inc. (RCUS) Bundle
A Brief History of Arcus Biosciences, Inc.
Arcus Biosciences, Inc. is a biopharmaceutical company focused on developing innovative therapies for cancer treatment, particularly through immune-oncology approaches. Founded in 2015, the company has collaborated with various partners to advance its clinical pipeline.
Key Collaborations and Developments
Arcus has established significant collaborations, most notably with Gilead Sciences. In January 2024, the company entered into a Third Gilead Collaboration Agreement Amendment, which included a $100 million option continuation payment and a premium of $87 million allocated to performance obligations. This agreement has been critical in shaping Arcus's financial landscape.
Financial Performance
As of September 30, 2024, Arcus reported total revenues of $48 million for the third quarter, a substantial increase from $32 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenues reached $232 million, compared to $86 million for the same period in the previous year.
| Period | Total Revenues (in millions) | Net Loss (in millions) |
|---|---|---|
| Q3 2024 | 48 | (92) |
| Q3 2023 | 32 | (71) |
| 9M 2024 | 232 | (189) |
| 9M 2023 | 86 | (226) |
Stockholder Equity and Financing
As of September 30, 2024, Arcus had a total stockholders' equity of $565 million, increasing from $462 million at the end of 2023. The company has utilized various financing mechanisms, including equity sales and collaboration agreements, to bolster its capital.
| Date | Transaction Type | Amount (in millions) |
|---|---|---|
| January 2024 | Gilead Stock Purchase Agreement | 320 |
| August 2023 | Equity Distribution Agreement | 5 |
Research and Development Expenses
For the nine months ended September 30, 2024, Arcus reported R&D expenses totaling $347 million, reflecting increased costs associated with late-stage development programs and higher personnel costs. This marks a significant rise from $247 million for the same period in 2023.
| Period | R&D Expenses (in millions) |
|---|---|
| 9M 2024 | 347 |
| 9M 2023 | 247 |
Clinical Trials and Pipeline
The company has made strides in clinical development, with multiple investigational products advancing through various phases of trials. Notably, collaborations with Taiho Pharmaceutical have led to milestone payments of $26 million related to successful clinical milestones.
Outlook
Looking ahead, Arcus anticipates continued investment in its R&D initiatives, with projections of operational funding sufficient to sustain its activities into mid-2027 based on current cash and investments.
A Who Owns Arcus Biosciences, Inc. (RCUS)
Major Shareholders
As of October 30, 2024, Arcus Biosciences, Inc. (RCUS) had 91,511,609 shares of common stock outstanding.
The following table summarizes the major shareholders of Arcus Biosciences, Inc. as of 2024:
| Shareholder | Number of Shares Owned (millions) | Percentage Ownership (%) |
|---|---|---|
| Gilead Sciences, Inc. | 15.2 | 16.6 |
| Taiho Pharmaceutical Co., Ltd. | 7.5 | 8.2 |
| Vanguard Group | 6.9 | 7.5 |
| BlackRock, Inc. | 5.8 | 6.3 |
| Other Institutional Investors | 30.0 | 32.8 |
| Retail Investors | 25.2 | 27.6 |
Institutional Ownership
As of September 30, 2024, institutional investors held approximately 75% of the total shares outstanding. Notable institutional shareholders include:
- Vanguard Group: 7.5%
- BlackRock, Inc.: 6.3%
- State Street Corporation: 4.2%
- Invesco Ltd.: 3.8%
Recent Stock Issuance
In January 2024, Arcus Biosciences issued 15.2 million shares of common stock to Gilead Sciences, Inc. as part of a collaboration agreement. This issuance significantly impacted the ownership structure of the company.
Stock Performance
As of October 30, 2024, the stock price for Arcus Biosciences, Inc. was approximately $17.50 per share. The market capitalization of the company was around $1.60 billion based on the total shares outstanding.
Financial Overview
For the nine months ended September 30, 2024, Arcus Biosciences reported total revenues of $232 million, with a net loss of $189 million during the same period. The company continues to rely on collaborations for revenue generation, especially from Gilead and Taiho.
Collaboration Agreements
Arcus Biosciences has significant collaboration agreements with Gilead Sciences, which include milestone payments and revenue sharing from joint research projects. As of September 30, 2024, there were $39 million in deferred revenues related to these collaboration agreements.
Conclusion on Ownership Dynamics
The ownership structure of Arcus Biosciences, Inc. reflects a strong presence of institutional investors and strategic partnerships, particularly with Gilead and Taiho. This dynamic is critical for the company's ongoing financial health and operational strategy.
Arcus Biosciences, Inc. (RCUS) Mission Statement
Company Overview
Arcus Biosciences, Inc. is a clinical-stage biopharmaceutical company focused on developing innovative therapies for cancer treatment. The company aims to create best-in-class therapies through its robust drug discovery capabilities and a deep portfolio of investigational products.
Mission Statement
As of 2024, Arcus Biosciences articulates its mission as striving to develop novel therapies that have a meaningful impact on patients suffering from cancer. The company emphasizes a commitment to advancing its investigational products through rigorous clinical trials and collaborations with strategic partners.
Key Financial Metrics
| Financial Metric | As of September 30, 2024 | As of December 31, 2023 |
|---|---|---|
| Cash and Cash Equivalents | $201 million | $127 million |
| Marketable Securities | $888 million | $632 million |
| Total Assets | $1.252 billion | $1.095 billion |
| Total Liabilities | $687 million | $633 million |
| Stockholders' Equity | $565 million | $462 million |
Revenue Streams
In 2024, Arcus Biosciences reported diversified revenue streams primarily from collaboration agreements. Here is a breakdown of the revenue recognized:
| Revenue Source | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| License and Development Services Revenue | $41 million | $22 million | $204 million | $58 million |
| Other Collaboration Revenue | $7 million | $10 million | $28 million | $28 million |
| Total Revenues | $48 million | $32 million | $232 million | $86 million |
Key Collaborations
- Gilead Collaboration: Revenue from Gilead accounted for 63% of total revenues in Q3 2024.
- Taiho Collaboration: In July 2024, Taiho exercised its option for quemliclustat, contributing $15 million in license revenue.
Research and Development Expenses
Arcus Biosciences has significantly increased its investment in research and development to support its expanding pipeline.
| R&D Expense Category | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Late-stage Development Programs | $69 million | $32 million | $196 million | $110 million |
| Early-stage Development Programs | $34 million | $30 million | $92 million | $101 million |
| Total R&D Expenses | $123 million | $82 million | $347 million | $247 million |
Net Loss
For the nine months ended September 30, 2024, Arcus Biosciences reported a net loss of $189 million, compared to a net loss of $226 million for the same period in 2023.
Future Outlook
As of September 30, 2024, Arcus holds a strong cash position with $1.1 billion in cash, cash equivalents, and marketable securities, projected to fund operations into mid-2027.
How Arcus Biosciences, Inc. (RCUS) Works
Business Overview
Arcus Biosciences, Inc. (RCUS) operates as a clinical-stage biopharmaceutical company focused on developing innovative therapies for cancer treatment, particularly in the field of immuno-oncology. The company has established strategic collaborations, primarily with Gilead Sciences and Taiho Pharmaceutical, to advance its clinical programs.
Financial Performance
As of September 30, 2024, Arcus reported a net loss of $189 million for the nine months ended September 30, 2024, compared to a net loss of $226 million for the same period in 2023. The total revenues increased significantly to $232 million for the nine months ended September 30, 2024, from $86 million in the same period of the prior year.
| Financial Metric | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Net Loss | $189 million | $226 million |
| Total Revenues | $232 million | $86 million |
| Loss Per Share (Basic and Diluted) | $2.11 | $3.07 |
| Shares Used to Compute Loss Per Share | 89.6 million | 73.6 million |
Revenue Sources
Arcus’s revenue primarily stems from collaboration agreements. The company recognized substantial revenue from its collaborations with Gilead and Taiho, particularly from license and development services.
| Collaboration Partner | Revenue Recognized (2024, 9 months) | Revenue Recognized (2023, 9 months) |
|---|---|---|
| Gilead | $207 million | $82 million |
| Taiho | $25 million | $4 million |
Research and Development Expenses
R&D expenses for the nine months ended September 30, 2024, totaled $347 million, up from $247 million in the prior year. This increase reflects the company's commitment to advancing its clinical pipeline including multiple Phase 3 trials.
Clinical Pipeline
Arcus is advancing several investigational products in various stages of clinical trials. Key programs include domvanalimab, quemliclustat, and zimberelimab, with several collaborations targeting different cancer types.
| Product | Stage | Indication |
|---|---|---|
| Domvanalimab | Phase 3 | Non-small cell lung cancer |
| Quemliclustat | Phase 3 | Pancreatic cancer |
| Zimberelimab | Phase 2 | Multiple indications |
Collaboration Agreements
Arcus has formed significant collaborations with major pharmaceutical companies. The agreement with Gilead includes milestones and option payments that can total up to $522 million for various performance obligations.
| Collaboration Agreement | Transaction Amount |
|---|---|
| Gilead Collaboration | $522 million |
| Taiho Collaboration | $15 million (option payment) |
Cash Flow and Liquidity
As of September 30, 2024, Arcus reported cash and cash equivalents of $201 million. The company has managed to secure additional financing, including a $250 million term loan facility from Hercules Capital.
| Cash Flow Activity | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Net Cash Used in Operating Activities | ($70 million) | ($218 million) |
| Net Cash Provided by Financing Activities | $279 million | $30 million |
Stockholder Equity
As of September 30, 2024, Arcus’s total stockholders' equity was $565 million, reflecting an increase from $462 million at the end of 2023.
| Equity Component | 2024 (September 30) | 2023 (December 31) |
|---|---|---|
| Total Stockholders' Equity | $565 million | $462 million |
| Accumulated Deficit | ($1,038 million) | ($849 million) |
How Arcus Biosciences, Inc. (RCUS) Makes Money
Revenue Streams
Arcus Biosciences generates revenue primarily through collaborative agreements with pharmaceutical companies, focused on licensing and development services. The major collaborators include Gilead Sciences and Taiho Pharmaceutical.
Collaboration Agreements
As of 2024, the key agreements are:
- Gilead Collaboration Agreement
- Taiho Collaboration Agreement
Gilead Collaboration Agreement
Under the Gilead collaboration, Arcus earns revenue from:
- License and development services
- Access rights for R&D pipeline
For the nine months ended September 30, 2024, revenue from Gilead was as follows:
| Type of Revenue | Amount (in millions) |
|---|---|
| License and R&D Services Revenue | $185 |
| Access Rights Revenue | $22 |
| Total Revenue from Gilead | $207 |
Gilead accounted for 89% of total revenues for the nine months ended September 30, 2024.
Taiho Collaboration Agreement
Arcus received a $15 million option payment in July 2024 for quemliclustat, recognized as revenue in the third quarter of 2024. Additionally:
| Type of Revenue | Amount (in millions) |
|---|---|
| License Revenue | $15 |
| R&D Services Revenue | $10 |
| Total Revenue from Taiho | $25 |
Research and Development Services
R&D services are a significant part of revenue generation. Arcus partners with Gilead and Taiho for clinical trials and other development efforts, leading to milestone payments. For the nine months ended September 30, 2024:
| Collaboration Partner | Revenue Recognized (in millions) |
|---|---|
| Gilead | $185 |
| Taiho | $10 |
Deferred Revenue
As of September 30, 2024, Arcus had $394 million in deferred revenue, reflecting anticipated future revenue from collaborations.
Operating Expenses and Losses
For the nine months ended September 30, 2024, total operating expenses were $459 million, leading to a net loss of $189 million. Key components of operating expenses included:
| Expense Type | Amount (in millions) |
|---|---|
| Research and Development | $347 |
| General and Administrative | $92 |
| Impairment of Long-lived Assets | $20 |
Non-Operating Income
Arcus reported non-operating income of $38 million for the nine months ended September 30, 2024, primarily from interest on investments.
Future Funding Needs
Arcus anticipates needing substantial additional funding to support ongoing operations and development efforts. The company has raised capital through equity sales and secured a $250 million term loan facility in August 2024.
Conclusion
Arcus Biosciences, through strategic collaborations, milestone payments, and licensing agreements, has established a multifaceted revenue model. However, the company continues to face significant operating losses as it invests heavily in R&D efforts aimed at developing its investigational products.
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Resources:
- Arcus Biosciences, Inc. (RCUS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Arcus Biosciences, Inc. (RCUS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Arcus Biosciences, Inc. (RCUS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.