Group 1 - Arcus Biosciences has a well-known biotech entrepreneur, Terry Rosen, as its CEO, which adds credibility to the company [1] - The company has established major collaborations and possesses a significant amount of cash, indicating strong financial backing [1] - There is a lack of substantial data to support the company's valuation and growth potential, raising concerns among investors [1]

COMBINING TO CURE ® Arcus is at the forefront of designing combination therapies, with best-in-class potential, in the relentless pursuit of cures for cancer. CORPORATE PRESENTATION Nov. 6, 2024 Forward-looking Statements/Safe Harbor 2 Forward Looking Statements Safe Harbor: This presentation contains forward-looking statements about Arcus Biosciences, Inc. ("we," "Arcus" or the "Company") made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements reg ...

Financial Data and Key Metrics Changes - The company reported GAAP revenue of $48 million for Q3 2024, an increase from $39 million in Q2 2024, primarily driven by collaborations with Gilead and Taiho [35] - Cash position improved to $1.1 billion at the end of Q3 2024, up from $1 billion at the end of Q2 2024, bolstered by a $100 million collaboration continuation payment from Gilead [34] - R&D expenses for Q3 2024 were $123 million, compared to $115 million in Q2 2024, with expectations of modest increases in Q4 2024 [36] Business Line Data and Key Metrics Changes - The company is focused on launching the late-stage development program for its HIF-2 alpha inhibitor, Casdatifan, with promising initial data from the ARC-20 study [6][12] - The ARC-20 study showed a 34% overall response rate (ORR) and a 25% confirmed ORR for the 100 mg cohort, indicating strong efficacy compared to belzutifan [8][11] - Domvanalimab, the company's anti-TIGIT antibody, demonstrated a median progression-free survival (PFS) of 11.5 months in the ARC-10 study, exceeding benchmarks for anti-PD-1 monotherapy [15][31] Market Data and Key Metrics Changes - The company is targeting a $2 billion plus market opportunity in the G7 countries for the PEAK-1 study, which will enroll approximately 700 patients [24][25] - The potential market for Casdatifan in the IO naive setting is estimated to exceed $3 billion across the G7 countries [26] - The STAR-221 study in first-line gastric cancer has the potential to be first to market with an anti-TIGIT antibody, representing a $3 billion plus opportunity [20] Company Strategy and Development Direction - The company aims to differentiate Casdatifan from belzutifan by demonstrating superior efficacy and safety profiles, particularly in heavily pre-treated patient populations [6][10] - The strategic focus includes advancing multiple Phase 3 trials for Domvanalimab and expanding the development program for Casdatifan into other RCC subpopulations [21][27] - The company is also exploring collaborations to enhance its clinical development plans, particularly with AstraZeneca for combination therapies [25][70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of responses observed in the ARC-20 study, anticipating further improvements in ORR and PFS as more data becomes available [9][12] - The company is well-funded with a cash runway into mid-2027, allowing for continued investment in clinical trials and development programs [22][37] - Management highlighted the importance of the upcoming data presentations and the initiation of Phase 3 studies as key milestones for the company [39] Other Important Information - The company plans to present additional data from the ARC-20 study throughout 2025, including more mature ORR and median PFS [12] - The safety data from the combination cohorts have been consistent with the profiles of the individual drugs, indicating a favorable safety profile for Casdatifan [12][32] - The company has received inbound interest from other potential partners, indicating strong market interest in its programs [63] Q&A Session Summary Question: Interest in Casdatifan and Gilead's opt-in potential - Management confirmed alignment with Gilead on the data needed for the qualifying data package, with a decision expected late this year or early next year [42] Question: Preclinical work with Volru and Casdatifan - No preclinical work was done; the collaboration was based on well-defined profiles of the two molecules [43] Question: Development plans for Etrumadenant - Management is excited about the data set and is working through next steps with Gilead [44] Question: Next steps in IO naive renal cell cancer setting - Management agreed with AstraZeneca to not comment further until the study is listed on clinicaltrials.gov [46] Question: Strategy for managing treatment exposure in trials - Management emphasized starting with a full dose of Cabo and leveraging existing safety data to manage toxicities effectively [72]

Core Insights - Arcus Biosciences reported a quarterly loss of $1 per share, which was better than the Zacks Consensus Estimate of a loss of $1.07, representing an earnings surprise of 6.54% [1] - The company generated revenues of $48 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 43.97%, compared to $32 million in the same quarter last year [2] - Arcus Biosciences shares have declined approximately 20% year-to-date, contrasting with the S&P 500's gain of 21.2% [3] Financial Performance - Over the last four quarters, Arcus Biosciences has surpassed consensus EPS estimates three times [2] - The current consensus EPS estimate for the upcoming quarter is -$1.10, with expected revenues of $33.36 million, and for the current fiscal year, the estimate is -$3.25 on revenues of $250.7 million [7] Industry Context - The Medical - Biomedical and Genetics industry, to which Arcus Biosciences belongs, is currently ranked in the top 38% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment and stock performance [5] Future Outlook - The sustainability of Arcus Biosciences' stock price movement will largely depend on management's commentary during the earnings call and the subsequent revisions of earnings estimates [3][4] - The estimate revisions trend for Arcus Biosciences is currently mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6]

Clinical Development - The company is focused on developing best-in-class therapies, with its most advanced molecule, an anti-TIGIT antibody, currently in multiple Phase 3 registrational studies targeting lung and gastrointestinal cancers[86]. - The company has a clinical pipeline that includes investigational products targeting unique mechanisms such as TIGIT, PD-1, and CD73, with significant collaborations with Gilead and Taiho[87]. - In October 2024, the company reported a 34% objective response rate for casdatifan in a Phase 1/1b study for metastatic clear cell renal carcinoma, with a disease control rate of 81%[91]. - The company announced a 36% reduction in risk of death for the combination of domvanalimab and zimberelimab in a study for PD-L1 high non-small cell lung cancer[92]. - The company initiated the Phase 3 PRISM-1 trial for quemliclustat in pancreatic cancer, which is expected to advance its clinical development[93]. - The company entered into a clinical collaboration with AstraZeneca to evaluate casdatifan in combination with volrustomig for clear cell renal carcinoma[90]. - Taiho exercised its option for quemliclustat, leading to operationalization of the Phase 3 PRISM-1 study in Japan and potential milestone payments for the company[90]. Financial Performance - Total revenues for the three months ended September 30, 2024, increased by 50% to $48 million, driven by a $15 million license revenue from Taiho[100]. - License and development services revenue rose by 86% to $41 million for the three months ended September 30, 2024, and by 252% to $204 million for the nine months ended September 30, 2024[100][101]. - Non-operating income increased by 18% to $13 million for the three months ended September 30, 2024, attributed to higher investment yields[100][105]. - The company recognized a cumulative catch-up to revenue of $107 million due to the updated transaction price and measure of progress for partially satisfied performance obligations related to the Third Gilead Collaboration Agreement Amendment[115]. - A hypothetical 10% change in the updated standalone selling prices related to the Third Gilead Collaboration Agreement Amendment could have altered the cumulative catch-up to revenue recognized during the current year by as much as $3 million[115]. Expenses and Cash Flow - The company has not generated any revenue from product sales and does not expect to do so in the foreseeable future, relying instead on collaboration and license arrangements[94]. - Research and development expenses are expected to increase significantly as the company advances joint development programs with Gilead and expands its clinical-stage portfolio[98]. - General and administrative expenses are anticipated to rise due to staff expansion and increased infrastructure needs to support growing R&D activities[99]. - Research and development expenses increased by 50% to $123 million for the three months ended September 30, 2024, primarily due to higher costs for late-stage program activities[104][105]. - Total operating expenses for the three months ended September 30, 2024, increased by 37% to $153 million, with a notable rise in R&D costs[100]. - Net cash used in operating activities was $70 million for the nine months ended September 30, 2024, a significant improvement from $218 million in the prior year[110]. - The company received $320 million from Gilead in January 2024, which contributed to increased liquidity and investment capacity[107]. - The impairment charge for long-lived assets was $20 million for the nine months ended September 30, 2024, due to the evaluation of office space expected to be subleased[105]. - The company has sufficient cash and marketable securities to fund operations into mid-2027[106]. Shareholder Information - Gilead held approximately 32.9% of the company's outstanding common stock as of September 30, 2024, following recent stock purchases[107]. Market Risks - The company’s market risks, including potential losses from changes in interest rates and foreign currency exchange rates, have not changed materially from those discussed in the Annual Report on Form 10-K filed on February 21, 2024[117].

Financial Performance - Arcus reported revenues of $48 million for Q3 2024, up from $32 million in Q3 2023, driven by $41 million in license and development services revenue[12]. - Arcus Biosciences reported total revenues of $48 million for the three months ended September 30, 2024, compared to $32 million for the same period in 2023, representing a 50% increase[23]. - License and development services revenue was $41 million for the three months ended September 30, 2024, up from $22 million in the same period last year, indicating an 86% growth[23]. - The net loss for the three months ended September 30, 2024, was $92 million, compared to a net loss of $71 million for the same period in 2023[23]. Cash and Assets - The company has $1.1 billion in cash, cash equivalents, and marketable securities as of September 30, 2024, sufficient to fund operations into mid-2027[11]. - Arcus expects its cash, cash equivalents, and marketable securities of $1.091 billion as of September 30, 2024, to fund operations into mid-2027[21]. - Total assets increased to $1.252 billion as of September 30, 2024, compared to $1.095 billion at the end of 2023[24]. - Total stockholders' equity rose to $565 million as of September 30, 2024, up from $462 million at the end of 2023[24]. - The company recognized a $100 million option continuation payment from Gilead in July 2024, contributing to the increase in cash reserves[12]. Research and Development - Research and Development expenses rose to $123 million in Q3 2024, compared to $82 million in Q3 2023, primarily due to higher clinical trial costs[12]. - Research and development expenses increased to $123 million for the three months ended September 30, 2024, compared to $82 million for the same period in 2023, reflecting a 50% rise[23]. - Arcus is advancing its Phase 3 study for casdatifan (PEAK-1) in post-immuno-oncology patients, expected to initiate in the first half of 2025[5]. - Arcus announced a clinical collaboration with AstraZeneca to evaluate casdatifan in combination with volrustomig in IO-naive patients with ccRCC[3]. - Arcus plans to present updated data from multiple expansion cohorts of ARC-20 in the first quarter of 2025[6]. Clinical Outcomes - The objective response rate for casdatifan in the 100mg daily cohort of the ARC-20 study was 34%, with a low primary progression rate of 19%[4]. - Domvanalimab plus zimberelimab reduced the risk of death by 36% in first-line metastatic non-small cell lung cancer compared to zimberelimab alone[7]. - The median overall survival for domvanalimab plus zimberelimab has not been reached, while zimberelimab alone reached a median overall survival of 2 years[7]. Collaborations - Arcus is co-developing four investigational products with Gilead, including zimberelimab and domvanalimab, as part of a collaboration established in May 2020[18]. - The collaboration with Gilead was expanded in November 2021 and May 2023 to include additional oncology and inflammatory disease targets[18]. - Arcus has not received approval from any regulatory authority for its investigational products, and their safety and efficacy have not been established[20].

Arcus Biosciences, Inc. (NYSE: RCUS ) develops immunotherapies for lung, gastrointestinal (GI), kidney, pancreatic, and colorectal cancers. The company discovers and designs small molecules and antibodies optimized for combination therapies. Then, it aims for accelerated development through a deep understanding of cancer mechanisms and strategic collaborations with My name is Myriam Hernandez Alvarez. I received the Electronics and Telecommunication Engineering degree from the Escuela Politecnica Nacional, ...

Matteo Colombo/DigitalVision via Getty Images Topline Summary and Update Arcus Biosciences, Inc. (NYSE:RCUS) is a cancer-focused biotech I've covered a few times with relative optimism, and as an investment thesis, it has yet to pay off. However, with an important trial update at this year's ASCO Annual Meeting and a number of important upcoming catalysts, I'm inclined to remain upbeat about the company's outlook, despite the more recent setbacks faced by the TIGIT story. Let's take another look. Pipeline U ...

Arcus Biosciences, Inc. (NYSE:RCUS) Q2 2024 Earnings Conference Call August 8, 2024 5:00 PM ET Company Participants Pia Eaves – Vice President-Investor Relations and Strategy Terry Rosen – Chief Executive Officer Jennifer Jarrett – Chief Operating Officer Bob Goeltz – Chief Financial Officer Dimitry Nuyten – Chief Medical Officer Conference Call Participants Yigal Nochomovitz – Citi Jonathan Miller – Evercore Daina Graybosch – Leerink Partners Asthika Goonewardene – Truist Securities Operator Good afternoon ...

COMBINING TO CURE ® Arcus is at the forefront of designing combination therapies, with best-in-class potential, in the relentless pursuit of cures for cancer. CORPORATE PRESENTATION August 8, 2024 Forward-looking Statements/Safe Harbor This presentation contains forward-looking statements about Arcus Biosciences, Inc. ("we," "Arcus" or the "Company") made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements regarding events or results to occur in the ...