Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Jul. 29, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | RCUS | |
Entity Registrant Name | Arcus Biosciences, Inc. | |
Entity Central Index Key | 0001724521 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-38419 | |
Entity Tax Identification Number | 47-3898435 | |
Entity Address, Address Line One | 3928 Point Eden Way | |
Entity Address, City or Town | Hayward | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94545 | |
City Area Code | 510 | |
Local Phone Number | 694-6200 | |
Entity Common Stock, Shares Outstanding | 72,159,962 | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, Par Value $0.0001 Per Share | |
Security Exchange Name | NYSE | |
Entity Incorporation, State or Country Code | DE | |
Document Quarterly Report | true | |
Document Transition Report | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 272,629 | $ 147,914 |
Short-term investments | 900,147 | 351,394 |
Receivable from collaboration partners ($35,720 and $744,535 from a related party) | 35,831 | 744,595 |
Accrued interest receivable | 3,196 | 2,227 |
Prepaid expenses and other current assets | 15,672 | 15,620 |
Total current assets | 1,227,475 | 1,261,750 |
Long-term investments | 98,329 | 181,990 |
Property and equipment, net | 33,416 | 32,455 |
Right-of-use assets | 104,025 | 104,968 |
Restricted cash | 3,005 | 3,005 |
Other long-term assets ($1,322 and $0 from a related party) | 10,523 | 7,730 |
Total assets | 1,476,773 | 1,591,898 |
Current liabilities: | ||
Accounts payable | 21,984 | 10,261 |
Accrued research and development | 35,019 | 29,587 |
Other accrued liabilities | 14,438 | 24,181 |
Deferred revenue, current ($89,388 and $96,981 to a related party) | 90,117 | 102,003 |
Other current liabilities | 2,466 | 52 |
Total current liabilities | 164,024 | 166,084 |
Deferred revenue, noncurrent ($428,546 and $462,217 to a related party) | 429,339 | 462,217 |
Operating lease liabilities, noncurrent | 121,343 | 116,887 |
Other long-term liabilities | 14,681 | 5,260 |
Total liabilities | 729,387 | 750,448 |
Commitments (Note 10) | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized as of June 30, 2022 and December 31, 2021; no shares issued and outstanding as of June 30, 2022 and December 31, 2021 | 0 | 0 |
Common stock, $0.0001 par value, 400,000,000 shares authorized as of June 30, 2022 and December 31, 2021; 72,085,473 and 70,781,736 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively. Shares outstanding includes zero and 9,946 shares issued but subject to vesting as of June 30, 2022 and December 31, 2021, respectively. | 7 | 7 |
Additional paid-in capital | 1,164,602 | 1,118,058 |
Accumulated deficit | (409,979) | (275,354) |
Accumulated other comprehensive loss | (7,244) | (1,261) |
Total stockholders’ equity | 747,386 | 841,450 |
Total liabilities and stockholders’ equity | $ 1,476,773 | $ 1,591,898 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Related party, receivable from collaboration partners | $ 35,720 | $ 744,535 |
Related party, other long-term assets | 1,322 | 0 |
Related party, deferred revenue - current | 88,595 | 96,981 |
Related party, deferred revenue - noncurrent | $ 429,339 | $ 462,217 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 72,085,473 | 70,781,736 |
Common stock, shares outstanding | 72,085,473 | 70,781,736 |
Common stock, shares outstanding includes shares issued but subject to vesting | 0 | 9,946 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Total revenues | $ 26,759 | $ 9,461 | $ 44,764 | $ 18,922 |
Operating expenses: | ||||
Research and development (($36,327), ($1,176), ($66,626) and ($6,100) from a related party) | 69,905 | 68,771 | 131,116 | 135,158 |
General and administrative (($99), $0, ($197) and $0 from a related party) | 25,836 | 16,826 | 49,810 | 32,647 |
Total operating expenses | 95,741 | 85,597 | 180,926 | 167,805 |
Loss from operations | (68,982) | (76,136) | (136,162) | (148,883) |
Non-operating income (expense): | ||||
Interest and other income, net | 2,861 | 166 | 3,443 | 320 |
Effective interest on liability for sale of future royalties | (511) | (902) | ||
Total non-operating income, net | 2,350 | 166 | 2,541 | 320 |
Net loss before income taxes | (66,632) | (75,970) | (133,621) | (148,563) |
Income tax expense | 0 | 0 | (1,004) | 0 |
Net loss | (66,632) | (75,970) | (134,625) | (148,563) |
Other comprehensive loss | (2,584) | (44) | (5,983) | (90) |
Comprehensive loss | $ (69,216) | $ (76,014) | $ (140,608) | $ (148,653) |
Net loss per share, basic and diluted | $ (0.93) | $ (1.09) | $ (1.88) | $ (2.17) |
Weighted-average number of shares used to compute basic and diluted net loss per share | 71,814,232 | 69,745,297 | 71,506,216 | 68,421,086 |
License and Development Services Revenue | ||||
Revenues: | ||||
Total revenues | $ 16,693 | $ 24,632 | ||
Other Collaboration Revenue | ||||
Revenues: | ||||
Total revenues | $ 10,066 | $ 9,461 | $ 20,132 | $ 18,922 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
License and Development Services Revenue | ||||
Revenue from related parties | $ 16,693 | $ 0 | $ 24,632 | $ 0 |
Other Collaboration Revenue | ||||
Revenue from related parties | 8,316 | 7,711 | 16,632 | 15,422 |
Research and Development | ||||
Reimbursement from related party for shared costs | (35,808) | (1,176) | (66,107) | (6,100) |
General and Administrative | ||||
Reimbursement from related party for shared costs | $ (99) | $ 0 | $ (197) | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Purchase Agreement Gilead | Common Stock | Common Stock Purchase Agreement Gilead | Additional Paid-In Capital | Additional Paid-In Capital Purchase Agreement Gilead | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance at Dec. 31, 2020 | $ 502,304 | $ 6 | $ 830,438 | $ (328,184) | $ 44 | |||
Balance, shares at Dec. 31, 2020 | 63,691,901 | |||||||
Issuance of common stock | $ 220,296 | $ 1 | $ 220,295 | |||||
Issuance of common stock, shares | 5,650,000 | |||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock | 1,885 | 1,885 | ||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock, shares | 200,828 | |||||||
Vesting of early exercised stock options | 183 | 183 | ||||||
Vesting of early exercised stock options, shares | 54,039 | |||||||
Stock-based compensation | 12,761 | 12,761 | ||||||
Other comprehensive loss | (46) | (46) | ||||||
Net loss | (72,593) | (72,593) | ||||||
Balance at Mar. 31, 2021 | 664,790 | $ 7 | 1,065,562 | (400,777) | (2) | |||
Balance, shares at Mar. 31, 2021 | 69,596,768 | |||||||
Balance at Dec. 31, 2020 | 502,304 | $ 6 | 830,438 | (328,184) | 44 | |||
Balance, shares at Dec. 31, 2020 | 63,691,901 | |||||||
Net loss | (148,563) | |||||||
Balance at Jun. 30, 2021 | 604,555 | $ 7 | 1,081,341 | (476,747) | (46) | |||
Balance, shares at Jun. 30, 2021 | 70,042,790 | |||||||
Balance at Mar. 31, 2021 | 664,790 | $ 7 | 1,065,562 | (400,777) | (2) | |||
Balance, shares at Mar. 31, 2021 | 69,596,768 | |||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock | 843 | 843 | ||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock, shares | 269,369 | |||||||
Vesting of early exercised stock options | 175 | 175 | ||||||
Vesting of early exercised stock options, shares | 36,245 | |||||||
Issuance of common stock under Employee Stock Purchase Plan | 1,394 | 1,394 | ||||||
Issuance of common stock under Employee Stock Purchase Plan, shares | 140,408 | |||||||
Stock-based compensation | 13,367 | 13,367 | ||||||
Other comprehensive loss | (44) | (44) | ||||||
Net loss | (75,970) | (75,970) | ||||||
Balance at Jun. 30, 2021 | 604,555 | $ 7 | 1,081,341 | (476,747) | (46) | |||
Balance, shares at Jun. 30, 2021 | 70,042,790 | |||||||
Balance at Dec. 31, 2021 | $ 841,450 | $ 7 | 1,118,058 | (275,354) | (1,261) | |||
Balance, shares at Dec. 31, 2021 | 70,781,736 | 70,771,790 | ||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock | $ 9,928 | 9,928 | ||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock, shares | 840,577 | |||||||
Vesting of early exercised stock options | 52 | 52 | ||||||
Vesting of early exercised stock options, shares | 9,946 | |||||||
Stock-based compensation | 16,541 | 16,541 | ||||||
Other comprehensive loss | (3,399) | (3,399) | ||||||
Net loss | (67,993) | (67,993) | ||||||
Balance at Mar. 31, 2022 | 796,579 | $ 7 | 1,144,579 | (343,347) | (4,660) | |||
Balance, shares at Mar. 31, 2022 | 71,622,313 | |||||||
Balance at Dec. 31, 2021 | $ 841,450 | $ 7 | 1,118,058 | (275,354) | (1,261) | |||
Balance, shares at Dec. 31, 2021 | 70,781,736 | 70,771,790 | ||||||
Net loss | $ (134,625) | |||||||
Balance at Jun. 30, 2022 | $ 747,386 | $ 7 | 1,164,602 | (409,979) | (7,244) | |||
Balance, shares at Jun. 30, 2022 | 72,085,473 | 72,085,473 | ||||||
Balance at Mar. 31, 2022 | $ 796,579 | $ 7 | 1,144,579 | (343,347) | (4,660) | |||
Balance, shares at Mar. 31, 2022 | 71,622,313 | |||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock | 2,050 | 2,050 | ||||||
Issuance of common stock upon exercise of stock options and vesting of restricted stock, shares | 320,603 | |||||||
Issuance of common stock under Employee Stock Purchase Plan | 2,296 | 2,296 | ||||||
Issuance of common stock under Employee Stock Purchase Plan, shares | 142,557 | |||||||
Stock-based compensation | 15,677 | 15,677 | ||||||
Other comprehensive loss | (2,584) | (2,584) | ||||||
Net loss | (66,632) | (66,632) | ||||||
Balance at Jun. 30, 2022 | $ 747,386 | $ 7 | $ 1,164,602 | $ (409,979) | $ (7,244) | |||
Balance, shares at Jun. 30, 2022 | 72,085,473 | 72,085,473 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2021 USD ($) | |
Purchase Agreement | Gilead | |
Offering costs | $ 55 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flow from operating activities | ||
Net loss | $ (134,625) | $ (148,563) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense | 32,218 | 26,128 |
Depreciation and amortization | 2,962 | 1,620 |
Noncash lease expense | 4,000 | 1,117 |
Amortization of premiums on investments | 2,380 | 1,412 |
Acquired in-process research and development | 2,500 | |
Effective interest on liability for sale of future royalties | 902 | |
Changes in operating assets and liabilities: | ||
Receivable from collaboration partners ($708,296 and ($381) from a related party) | 708,764 | (526) |
Prepaid expenses and other current assets | 4,028 | (9,086) |
Other long-term assets (($1,322) and $0 to a related party) | (1,442) | 471 |
Accounts payable | 12,102 | (3,569) |
Accrued research and development | 8,432 | 10,449 |
Other accrued liabilities | (10,220) | 163 |
Deferred revenue (($41,264) and ($15,422) to a related party) | (44,764) | (18,922) |
Operating lease liabilities | (1,184) | (1,003) |
Other long-term liabilities | 2,645 | (2) |
Net cash provided by (used in) operating activities | 588,698 | (140,311) |
Cash flow from investing activities | ||
Purchases of short-term and long-term investments | (763,131) | (370,690) |
Proceeds from maturities of short-term and long-term investments | 262,824 | 438,733 |
Sales of short-term and long-term investments | 26,852 | 7,500 |
Purchases of property and equipment | (4,302) | (9,714) |
Purchases of in-process research and development | (5,500) | |
Net cash (used in) provided by investing activities | (483,257) | 65,829 |
Cash flow from financing activities | ||
Proceeds from issuance of common stock ($0 and $220,235 from a related party) | 220,235 | |
Proceeds from sale of future royalties | 5,000 | |
Proceeds from issuance of common stock pursuant to equity award plans | 14,274 | 4,122 |
Repurchase of unvested shares of stock | (6) | |
Net cash provided by financing activities | 19,274 | 224,351 |
Net increase in cash and cash equivalents | 124,715 | 149,869 |
Cash, cash equivalents and restricted cash at beginning of period | 150,919 | 173,618 |
Cash, cash equivalents and restricted cash at end of period | 275,634 | 323,487 |
Supplemental disclosure of cash flow information | ||
Income taxes paid | 2,743 | |
Non-cash investing and financing activities: | ||
Unpaid portion of property and equipment purchases included in accounts payable and accrued liabilities | 617 | 6,488 |
Vesting of early exercised stock options and restricted stock | $ 52 | $ 358 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Statement of Cash Flows [Abstract] | ||
Receivable from related party | $ (708,815) | $ (381) |
Other long-term assets to related party | (1,322) | 0 |
Deferred revenue from related party | (41,264) | (15,422) |
Proceeds from issuance of common stock from a related party | $ 0 | $ 220,235 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Note 1. Organization Description of Business Arcus Biosciences, Inc. (the Company) is a clinical-stage biopharmaceutical company focused on creating best-in-class cancer therapies. Using its robust and highly efficient drug discovery capability, the Company has now advanced six investigational products into clinical development, with its most advanced molecule, an anti-TIGIT antibody, now in two Phase 3 registrational studies. The Company’s deep portfolio of novel small molecules and enabling antibodies allows it to create highly differentiated combination therapies, which the Company is developing to treat multiple large tumor types including lung, colorectal, prostate and pancreatic cancers. The Company expects its clinical-stage portfolio to continue to expand and to include molecules targeting both immuno-oncology and cancer cell-intrinsic pathways. The Company’s vision is to create, develop and commercialize highly differentiated combination cancer therapies that have a meaningful impact on patients. The Company currently has six investigational products in clinical development: domvanalimab (previously referred to as AB154), etrumadenant (previously referred to as AB928), quemliclustat (previously referred to as AB680), zimberelimab (previously referred to as AB122), AB308 and AB521. In 2020, the Company entered into an Option, License and Collaboration Agreement (Gilead Collaboration Agreement) with Gilead Sciences, Inc. (Gilead), whereby Gilead obtained an exclusive license to zimberelimab and time-limited exclusive options to all of the Company's then-current and future programs during the 10-year collaboration term. In December 2021, Gilead obtained rights to an additional four of the Company's investigational products: domvanalimab, etrumadenant, quemliclustat and AB308. For each program to which Gilead exercised or exercises its option, the parties will co-develop globally and, provided that the Company has not exercised its opt-out rights, if any, co-commercialize the program in the U.S., and Gilead will have the right to commercialize the program outside of the United States, subject to the rights of our existing partners in certain territories. Liquidity and Capital Resources As of June 30, 2022, the Company had cash and investments of $ 1,271.1 m illion, which are cash, cash equivalents, and investments in marketable securities, which the Company believes will be sufficient to fund its planned operations for a period of at least twelve months following the date of filing of this report. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2. Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and pursuant to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the results of operations and cash flows for the periods presented have been included. Operating results for the six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any future period. The balance sheet as of December 31, 2021 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2022. There have been no significant changes to the Company’s significant accounting policies described in Note 2, Summary of Significant Accounting Policies, in Notes to Consolidated Financial Statements in Item 8 of Part II of the Form 10-K. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Arcus Biosciences, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosures of contingent assets and liabilities. Estimates used include the determination of the standalone selling price of performance obligations and the timing of revenue recognition, the value of stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, uncertain tax positions, and valuation allowance for deferred tax assets. Actual results could differ materially from the Company’s estimates. Cash Equivalents and Investments Cash equivalents include marketable securities having an original maturity of three months or less at the time of purchase. Short-term investments have maturities of greater than three months and up to twelve months at the time of purchase. Long-term investments have maturities greater than 12 months at the time of purchase. Collectively, cash equivalents, short-term and long-term investments are considered available-for-sale and are recorded at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive income (loss). Realized gains and losses are included in interest and other income, net in the condensed consolidated statements of operations and comprehensive income or loss. The basis on which the cost of a security that is sold or an amount that is reclassified out of accumulated other comprehensive income or loss into earnings is determined using the specific identification method. Reconciliation of Cash, Cash Equivalents, and Restricted Cash as Reported in Condensed Consolidated Statements of Cash Flows Restricted cash at June 30, 2022 and 2021 represents cash balances held as security in connection with the Company’s facility lease agreements. The following table provides a reconciliation of cash, cash equivalents, and restricted cash within the condensed consolidated balance sheets to the total shown in the condensed consolidated statements of cash flows (in thousands): June 30, 2022 2021 Cash and cash equivalents $ 272,629 $ 320,482 Restricted cash 3,005 3,005 Cash, cash equivalents and restricted cash $ 275,634 $ 323,487 Concent ration of Credit Risk Cash equivalents, short-term and long-term investments are financial instruments that potentially subject the Company to concentrations of credit risk. The Company invests in money market funds, treasury bills and notes, government bonds, commercial paper, corporate notes, and certificates of deposit. The Company's investment policy limits interest-bearing security investments to certain types of instruments issued by institutions with investment-grade credit ratings, and it places restrictions on maturities and concentration by asset class and issuer. The Company limits its credit risk associated with cash equivalents, short-term and long-term investments by placing them with banks and institutions it believes are credit worthy and in highly rated investments. Leases and Rent Expense The Company recognizes a lease asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation. The Company determines whether an arrangement is or contains a lease at contract inception. Operating leases and related tenant improvement allowances receivable are included in operating lease right-of-use assets, prepaid expenses and other current assets, other current liabilities, and operating lease liabilities, noncurrent in our condensed consolidated balance sheets at June 30, 2022 and December 31, 2021. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses its incremental borrowing rate based on information available at the lease commencement date. The incremental borrowing rate represents the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The Company considers a lease term to be the noncancelable period that it has the right to use the underlying asset, including any periods where it is reasonably assured the Company will exercise the option to extend the contract. Periods covered by an option to extend are included in the lease term if the lessor controls the exercise of that option. The Company elected to not apply the recognition requirements of the leasing standard to short-term leases with terms of 12 months or less which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. For short-term leases, lease payments are recognized as operating expenses on a straight-line basis over the lease term. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3. Fair Value Measurements Financial assets and liabilities are recorded at fair value. The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. During the periods presented, the Company has not changed the manner in which it values assets and liabilities that are measured at fair value. The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the hierarchy as of June 30, 2022 or December 31, 2021. The following tables set forth the Company’s financial instruments (excluding restricted cash) that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): June 30, 2022 Total Level 1 Level 2 Level 3 Money market funds $ 187,998 $ 187,998 $ - $ - U.S. treasury securities 320,202 - 320,202 - Corporate securities and commercial paper 747,351 - 747,351 - Certificates of deposit 12,073 12,073 U.S. government agency obligations 3,481 - 3,481 - Total assets measured at fair value $ 1,271,105 $ 187,998 $ 1,083,107 $ - December 31, 2021 Total Level 1 Level 2 Level 3 Money market funds $ 147,914 $ 147,914 $ - $ - U.S. treasury securities 112,170 - 112,170 - Corporate securities and commercial paper 421,214 - 421,214 - Total assets measured at fair value $ 681,298 $ 147,914 $ 533,384 $ - Classified as (with contractual maturities): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 272,629 $ 147,914 Short-term investments (due within one year) 900,147 351,394 Long-term investments (due between one and three years) 98,329 181,990 Total cash, cash equivalents and investments in marketable securities $ 1,271,105 $ 681,298 All the Company's investments in marketable securities are classified as available-for-sale. At June 30, 2022 and December 31, 2021, the balance in the Company’s accumulated other comprehensive income (loss) related to the Company’s available-for-sale marketable securiti es. There were no realized gains or losses recognized on the sale or maturity of available-for-sale marketable securities as of June 30, 2022 and December 31, 2021, and as a result, the Company did no t reclassify any amounts out of accumulated other comprehensive income for the periods then ended. Th e Company has not recognized any allowances for credit losses given the nature of its receivables and investment portfolio and the immaterial amount of unrealized losses on available for sale securities. No credit related losses have been recognized for any of the periods presented. The fair value and amortized cost of investments in marketable securities by major security type as of June 30, 2022 and December 31, 2021 are presented in the tables that follow (in thousands): Amortized Unrealized Unrealized Fair As of June 30, 2022: Money market funds $ 187,998 $ - $ - $ 187,998 U.S. treasury securities 322,351 1 ( 2,150 ) 320,202 Corporate securities and commercial paper 752,429 8 ( 5,086 ) 747,351 Certificates of deposit 12,071 4 ( 2 ) 12,073 U.S. government agency obligations 3,500 - ( 19 ) 3,481 Total $ 1,278,349 $ 13 $ ( 7,257 ) $ 1,271,105 Amortized Unrealized Unrealized Fair As of December 31, 2021: Money market funds $ 147,914 $ - $ - $ 147,914 U.S. treasury securities 112,473 1 ( 304 ) 112,170 Corporate securities and commercial paper 422,172 3 ( 961 ) 421,214 Total $ 682,559 $ 4 $ ( 1,265 ) $ 681,298 As of June 30, 2022, the fair value of the liability for sale of future royalties recorded on the balance sheet in other long-term liabilities is based on the Company's current estimates of future contingent milestones and royalties expected to be paid to BVF Partners L.P. (BVF) over the term of the parties' funding agreement (the BVF Agreement). These estimates are considered Level 3 fair value inputs. See Note 6 for further discussion of the liability and related estimates. |
Other Accrued Liabilities
Other Accrued Liabilities | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Other Accrued Liabilities | Note 4. Other Accrued Liabilities Other accrued liabilities consisted of the following (in thousands): As of June 30, 2022 As of December 31, 2021 Accrued personnel expenses $ 12,942 $ 16,648 Professional fees 236 4,938 Income taxes payable 18 1,815 Other 1,242 780 Total $ 14,438 $ 24,181 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Leases | Note 5. Leases The Company leases its corporate headquarters, which includes approximately 150,753 square feet of executive offices and research and development and business operations, in an office park in Hayward, California under a non-cancelable operating lease with terms that extend through 2031 . One of the buildings, having approximately 14,460 square feet of leased space, has a lease term that commenced April 2022 with tenant allowances totaling approximately $ 5.8 million. The Company also leases space in Brisbane, California under a non-cancelable lease that extends through 2031 . Both leases are subject to options by the Company to extend the lease terms. The following table summarizes supplemental cash flow disclosures and non-cash financing activities related to our operating leases (in thousands): Six Months Ended June 30, 2022 2021 Cash paid for amounts included in measurement of lease liabilities $ 4,421 $ 2,000 Cash received from tenant improvement allowances $ 8,381 $ - Right-of-use assets obtained in exchange for new operating lease liabilities $ 3,029 $ 24,473 Recognition of tenant improvement allowance receivable included in other current liabilities $ 5,791 $ 10,598 |
Liability for Sale of Future Ro
Liability for Sale of Future Royalties | 6 Months Ended |
Jun. 30, 2022 | |
Research and Development [Abstract] | |
Liability for Sale of Future Royalties | Note 6. Liability for Sale of Future Royalties In October 2021, the Company and BVF entered into the BVF Agreement, under which BVF will fund the discovery and development of compounds for the treatment of inflammatory diseases (the Program) by providing the Company with $ 15 million in three non-refundable payments. Consistent with the terms of the Gilead Collaboration Agreement, Gilead has an option to the Program. The Company received $ 5 million from BVF in the fourth quarter of 2021 and an additional $ 5 million in the first quarter of 2022. The Company expects to receive the third $ 5 million payment in the second half of 2022. In return, the Company is obligated to perform research and development activities in the Program, to make contingent payments upon the achievement of certain clinical and regulatory milestones of up to $ 72.5 million or $ 160.0 million depending on whether the program is solely developed by Arcus or as part of the collaboration with Gilead. The Company also must pay mid- to high-single digit royalties based on net sales of products generated by the Program. The agreement also provides BVF with the option to provide an additional $ 10 million in funding for the Program in exchange for an increase in the royalty rate. The Company accounts for the BVF Agreement as a liability primarily because it has significant continuing involvement in generating the cash flows due to BVF. If the Program achieves certain development and regulatory milestones and commercial sales, the Company will recognize the portion of milestone payments and royalties paid to BVF as a decrease to the accumulated liability with a corresponding reduction in cash. The carrying amount of the liability for sale of future royalties is based on management's estimate of the future contingent milestones and royalties to be paid to BVF over the life of the arrangement as discounted using an imputed rate of interest. The excess of future estimated contingent milestone and royalty payments over the $ 15 million of allocated proceeds is recognized as non-cash interest expense using the effective interest method, which is reported in the condensed consolidated statements of operations as non-operating expense. The balance associated with the liability was $ 11.2 million at June 30, 2022 and is reported on the condensed consolidated balance sheets in other long-term liabilities. The imputed effective rate of interest on the unamortized portion of the liability was approximately 20.6 % as of June 30, 2022. The Company periodically reassesses the amount and timing of expected payments. To the extent such payments are greater or less than the Company's initial estimates or the timing of such payments is materially different than those estimates, the Company will adjust the liability and the effective interest rate using a retrospective method, catch-up method, or prospective method, subject to an accounting policy election applied on a consistent basis. As of June 30, 2022, there have been no changes to the estimated effective interest rate. There are a number of factors that could materially affect the amount and timing of contingent milestone and royalty payments, most of which are not within the Company's control. The liability is recognized using significant unobservable inputs. These inputs are derived using internal management estimates, based in part on external data when available, and reflect management’s judgements and forecasts. The significant unobservable inputs include the forecasted revenues, the probability and timing of clinical and regulatory milestones, the expected term of the royalty stream, and the royalty rate as well as the overall probability of success. These estimates are considered Level 3 fair value inputs. A significant change in unobservable inputs could result in a material increase or decrease to the effective interest rate of the liability. Changes to the liability for sale of future royalties were as follows for the six months ended June 30, 2022 (in thousands): 2022 Beginning balance, January 1 $ 5,260 Cash received from BVF 5,000 Interest accretion 902 Ending balance, June 30 $ 11,162 The Company incurred $ 0.5 million and $ 0.9 million in non-cash interest expense for the three and six months ended June 30, 2022. |
License and Collaboration Agree
License and Collaboration Agreements | 6 Months Ended |
Jun. 30, 2022 | |
License And Collaboration Agreements [Abstract] | |
License and Collaboration Agreements | Note 7. License and Collaboration Agreements The following table summarizes the revenues recognized from the Company’s collaboration agreements with Gilead and Taiho Pharmaceutical Co., Ltd. (Taiho) (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 License and development services revenue $ 16,693 $ - $ 24,632 $ - Other collaboration revenue 10,066 9,461 20,132 18,922 Total collaboration and license revenues $ 26,759 $ 9,461 $ 44,764 $ 18,922 The following table summarizes revenues by collaboration, category of revenue, and the method of recognition (in thousands): Three Months Ended June 30, Six Months Ended June 30, Revenues recognized: Over time Point in time 2022 2021 2022 2021 License and development services for all Gilead programs * $ 16,693 $ - $ 24,632 $ - Gilead access rights related to the * 8,316 7,711 16,632 15,422 Taiho access rights * 1,750 1,750 3,500 3,500 Total collaboration and license revenues $ 26,759 $ 9,461 $ 44,764 $ 18,922 The Company recognized the following revenue as a result of changes in the deferred revenue balance during the period below (in thousands): Three Months Ended June 30, Six Months Ended June 30, Revenue recognized in the period from: 2022 2021 2022 2021 Amounts included in deferred revenue at the beginning of the period $ 26,759 $ 9,461 $ 44,764 $ 18,922 Performance obligations satisfied in a previous period - - - - Gilead Sciences, Inc. Summary In May 2020, the Company entered into the Gilead Collaboration Agreement, Common Stock Purchase Agreement (the Stock Purchase Agreement), and Investor Rights Agreement, (collectively, the Gilead Agreements), each with Gilead. Upon closing in July 2020, Gilead made an upfront payment of $ 175 million pursuant to the Gilead Collaboration Agreement and made an equity investment of approximately $ 200 million in the Company by purchasing 5,963,029 shares of Arcus common stock at a per share price of $ 33.54 pursuant to the Stock Purchase Agreement. In November 2021, the Company and Gilead entered into an amendment to the Gilead Collaboration Agreement (the Amended Gilead Collaboration Agreement), under which Gilead exercised its options to three programs for a total option payment of $ 725 million that was received in January 2022. In connection with Gilead’s exercise of its options to the three programs, the parties agreed to (i) slightly reduce the royalties for these programs, such that Gilead will pay the Company tiered royalties as a percentage of revenues ranging from the mid-teens to the low twenties and (ii) remove the $ 100 million option continuation payment that was otherwise due on the second anniversary of the Gilead Collaboration Agreement. As of June 30, 2022, Gilead had obtained licenses to the following investigational products: zimberelimab (in 2020), domvanalimab, AB308, etrumadenant, and quemliclustat (the latter four in 2021). Pursuant to the terms of the Gilead Collaboration Agreement, as amended, Gilead obtained exclusive licenses to zimberelimab, domvanalimab, AB308, etrumadenant, and quemliclustat, and time-limited exclusive options to all of the Company’s current and future clinical programs during the 10 -year collaboration term and, for those programs that enter clinical development prior to the end of the collaboration term, for up to an additional three years thereafter. Gilead's option rights to future programs are contingent upon Gilead’s payments of up to $ 300 million in option continuation payments, consisting of a $ 100 million payment due at Gilead's option on each of the fourth, sixth, and eighth anniversaries of the agreement. Gilead's option, on a program-by-program basis, will expire after a prescribed period, following the achievement of a clinical development milestone in such program and the Company's delivery to Gilead of the requisite data package. Gilead may exercise its option to any program at any time prior to expiration of the option, and will pay the Company an option fee of $ 150 million per program. Gilead has exercised its option to all of the clinical programs in existence at the date of the 2020 agreement, and the Company may not exercise its opt-out rights for any of these programs. With respect to domvanalimab, the Company is also eligible to receive up to $ 500 million in potential U.S. regulatory approval milestones. Gilead was also granted option rights to two research programs for which the Company will lead discovery and early development activities. With respect to these two research programs, Gilead has the right to exercise its option, on a program-by-program basis, either (i) upon the Company's completion of certain IND-enabling activities for an option payment of $ 60 million or (ii) following the achievement of a clinical development milestone for an option payment of $ 150 million. These research programs were not determined to be performance obligations at contract inception, due to the very early stages of the programs and the amounts of the option payments. The Company’s assessment of the transaction price upon the signing of the Amended Gilead Collaboration Agreement included an analysis of amounts it expected to receive, which at contract inception consisted of the upfront cash payment of $ 725 million committed upon contract closing following expiration of the antitrust waiting period in December 2021, as well as amounts totaling $ 165.1 million deferred from the original Gilead transaction, which excludes the $ 100 million option continuation payment that would otherwise have been due on the second anniversary of the Gilead Collaboration Agreement. The Company considers the entire $ 890.1 million to be the allocable transaction price as of the amendment closing date, due to the Company's history of timely payments from Gilead and receipt of the full $ 725 million in January 2022 per the terms of the amendment. The Company determined that the Amended Gilead Collaboration Agreement represented a contract modification under the application of ASC 606. At the amendment closing date, the Company allocated the transaction price to the new and remaining performance obligations identified as follows: Amount Allocation of transaction price Deferred revenues as of 12/21/2021 $ 165,086 Option payment for Domvanalimab 275,000 Option payment for Etrumadenant 250,000 Option payment for Quemliclustat 200,000 Total transaction price allocated to performance obligations $ 890,086 Allocation to performance obligations Distinct Combined Amount Domvanalimab license * $ 328,838 Etrumadenant license and R&D activities * 218,722 Quemliclustat license and R&D activities * 175,618 Domvanalimab R&D activities * 34,528 Zimberelimab R&D and commercial services * 11,243 Access rights related to the Company's research * 84,076 Material rights to option continuation periods * 37,061 Total $ 890,086 Upon closing of Gilead’s exercise of its option to a program, the two companies will co-develop and equally share global development costs for the joint development program, subject to opt-out rights of the Company applicable to certain programs, and expense caps on the Company’s spending and related subsequent adjustments. For each optioned program, provided the Company has not exercised its opt-out rights (if applicable), the Company has an option to co-promote in the United States with equal sharing of related profits and losses. Gilead has the right to exclusively commercialize any optioned programs outside of the U.S., subject to the rights of the Company’s existing partners to any territories, and Gilead will pay to the Company tiered royalties as a percentage of revenues ranging from (i) the mid-teens to the low twenties for the three 2021 optioned programs, (ii) high single digits to low double digits for research programs if Gilead exercises its option rights at the IND stage, and (iii) the high teens to the low twenties for all other programs. The Company had $ 517.9 million and $ 559.2 million of deferred revenue remaining on its condensed consolidated balance sheets related to this agreement at June 30, 2022 and December 31, 2021, respectively, allocated between current and noncurrent based on the expected timing of future recognition. Stock Purchase Agreement and Investor Rights Agreement Pursuant to the Stock Purchase Agreement, Gilead has the right, at its option, to purchase additional shares from the Company, up to a maximum of 35 % of the Company’s then-outstanding voting common stock, from time to time over five years from closing of the initial transaction, at a purchase price equal to the greater of a 20 % premium to market (based on a trailing five-day average closing price) at the time Gilead exercises such option, and the $ 33.54 initial purchase price. The Investor Rights Agreement also includes a three-year standstill and a two-year lockup and provides Gilead with registration rights commencing at the end of the lockup period, pro rata participation rights in certain future financings and the right to designate two individuals to be appointed to the Company’s Board of Directors. In the year ended December 31, 2020, Gilead made an equity investment of approximately $ 200 million in the Company by purchasing 5,963,029 shares of the Company's common stock at a per share price of $ 33.54 pursuant to the Stock Purchase Agreement. Of the $ 200 million equity investment, approximately $ 90.6 million was determined to be a premium on the purchase of common stock and allocated to the performance obligations created by the Gilead Collaboration Agreement. Gilead made an additional equity investment in the Company of approximately $ 56.7 million, net of offering costs, by purchasing 2,200,000 shares of its common stock at a per share price of $ 27.50 in the May 2020 public offering. In January 2021, the Company and Gilead entered into an Amended and Restated Common Stock Purchase Agreement, which amended and restated in its entirety the Common Stock Purchase Agreement, pursuant to which Gilead purchased from the Company 5,650,000 shares of its common stock at a purchase price of $ 39.00 per share, for a total of $ 220.3 million, net of offering costs. All other terms of the original Common Stock Purchase Agreement, including Gilead's option to purchase additional shares from the Company, up to a maximum ownership of 35 % of its then-outstanding common stock, remain unchanged. Pursuant to the Investor Rights Agreement, the Company appointed Gilead's two designees to the Company’s Board of Directors. Based on the value of the Company’s common stock at the contract closing, the right to purchase additional shares had no value. See Note 12 for further discussion of the agreements with Gilead. The Company evaluated the agreements with Gilead under ASC 808 and ASC 606 and determined that the licenses to zimberelimab and domvanalimab, and access rights related to the Company's research and development pipeline, were within the scope of ASC 606 because Gilead meets the definition of a customer with respect to those performance obligations. Zimberelimab license Effective on the July 2020 closing of the Gilead Collaboration Agreement, Gilead obtained an exclusive license to zimberelimab. The standalone selling price of this license was determined using a discounted cash flow method. The Company recognized the full amount associated with this distinct performance obligation in license revenue on the date the transaction closed. Domvanalimab option and license Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company’s anti-TIGIT monoclonal antibody program, including domvanalimab and AB308, in exchange for an option payment of $ 275 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $ 36.7 million of deferred revenue on its consolidated balance sheets related to this performance obligation. Effective on the December 2021 closing of the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to domvanalimab. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that the program was in later stages of development and it met the criteria for being distinct from the research and development services required under the Gilead Collaboration Agreement (as amended). Specifically, the domvanalimab program was in a Phase 3 clinical trial at the time that Gilead acquired the license and the Company concluded that: (i) the R&D services for such later-stage, Phase 3 intellectual property, primarily involved validating the drug’s efficacy; and (ii) the ongoing R&D services do not significantly modify or customize the drug compound such that the intellectual property is not significantly different at the end of the arrangement as a result of the services. As the license had been made available in the fourth quarter of 2021, the Company recognized the full $ 328.8 million of transaction price allocated to this performance obligation as license revenue in December 2021. Etrumadenant option, license and R&D activities Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company’s adenosine receptor program, etrumadenant, in exchange for an option payment of $ 250 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $ 127.0 million of deferred revenue on its condensed consolidated balance sheets related to this performance obligation. Effective on the December 2021 closing of the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to etrumadenant. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that it was combined with the research and development services required under the agreements due to the early stage of the technology and the highly specialized nature of the Company's know-how. Accordingly, transaction price allocated to this license is recognized as revenue as the related research services are performed. The Company determined that it retains obligations to perform further development services for Gilead related to etrumadenant. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to the combined license and services as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated full-time employee expense for the program. Due to the combined nature of the performance obligation, the Company determined that the revenue from the license would be recognized at the same rate and using the same input-driven methodology as the revenue from the research and development services. The Company determined that its performance of the R&D activities commenced January 1, 2022 and accordingly the Company recognized $ 13.2 million and $ 18.2 million in license and development services revenue associated with these obligations for the three and six months ended June 30, 2022, respectively. At June 30, 2022, the Company had $ 200.5 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition. Quemliclustat option, license and R&D activities Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company's CD73 program, quemliclustat, in exchange for an option payment of $ 200 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had no deferred revenue on its consolidated balance sheets related to this performance obligation. The Company determined that it retains obligations to perform further development services for Gilead related to quemliclustat. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to these services as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated full-time employee expense for the program. Effective on the December 2021 closing of the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to quemliclustat. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that it was combined with the research and development services required under the agreements due to the expertise and the highly specialized nature of the Company's know-how. Accordingly, transaction price allocated to this license is recognized as revenue as the related research services are performed. Due to the combined nature of the performance obligation, the Company determined that the revenue from the license would be recognized at the same rate and using the same input-driven methodology as the revenue from the research and development services. The Company determined that its performance of the R&D activities commenced January 1, 2022 and accordingly the Company recognized $ 1.9 million and $ 3.7 million in license and development services revenue associated with these obligations for the three and six months ended June 30, 2022, respectively. At June 30, 2022, the Company had $ 172.0 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition. R&D activities for domvanalimab The Company determined that it retains separate obligations to perform further development services for Gilead related to domvanalimab. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to these services as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated full-time employee expense for the program. The Company determined that its performance of the R&D activities commenced as of January 1, 2022 and accordingly the Company recognized $ 1.3 million and $ 2.2 million in license and development services revenue associated with these obligations in the three and six months ended June 30, 2022, respectively. At June 30, 2022, the Company had $ 32.3 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition. R&D and commercialization activities for zimberelimab monotherapy The Company determined that it retains an obligation to perform further development and commercialization services for Gilead related to zimberelimab monotherapy. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $ 9.7 million deferred revenue on its consolidated balance sheets, related to the two performance obligations. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to these services as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated full-time employee expense for the program. 0.3 million and $ 0.6 million in license and development services revenue associated with these obligations in the three and six months ended June 30, 2022. At June 30, 2022, the Company had $ 9.5 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition. Access rights related to the Company’s research and development pipeline and material rights to option continuation periods Gilead receives exclusive access to the Company’s current programs as well as the future programs for a period of ten years , contingent upon Gilead’s payment of $ 300 million, consisting of three $ 100 million option continuation payments due at Gilead’s option on each of the fourth, sixth, and eighth anniversaries of the agreement. The standalone selling price of this ongoing research and development pipeline access was determined using an expected cost-plus margin approach. The Company uses a time-elapsed input method to measure progress toward satisfying this obligation, which is the method the Company believes most faithfully depicts the Company’s performance in transferring the promised services during the time period in which Gilead has access to the Company’s research and development pipeline. Accordingly, the revenue allocated to the performance obligation is being recognized using this input method over the minimum four-year period. The Company determined that Gilead is not obligated to pay the remaining $ 300 million due over the remainder of the term. Failure to pay the non-obligatory option continuation payments will result in Gilead’s loss of certain rights to access and obtain licenses to the programs arising from the Company’s research and development pipeline. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $ 91.7 million deferred revenue on its condensed consolidated balance sheets related to this performance obligation. The Company recognized $ 8.3 million and $ 16.6 million in other collaboration revenues associated with these obligations in the three and six months ended June 30, 2022, respectively. The Company recognized $ 7.7 million and $ 15.4 million in other collaboration revenues associated with these obligations in the three months and six months ended June 30, 2021, respectively. At June 30, 2022, the Company had $ 103.6 million of deferred revenue on its consolidated balance sheets related to this performance obligation, classified between current and noncurrent based on the amortization of the revenue. Cost-sharing reimbursements The Company's research and development obligations under the Gilead Collaboration Agreement includes a 50/50 share of the joint development costs associated with optioned programs. Payments received from Gilead for their share of costs incurred will be recognized as a reduction of R&D expense or G&A expense depending on the type of expense reimbursed. Payments made to Gilead for the Company's share of costs incurred will be recognized as an increase to those expenses depending on the type of cost reimbursed. The Company recognized reductions of operating expenses totaling $ 35.9 million and $ 66.3 million, respectively, during the three and six months ended June 30, 2022 as a result of this cost-sharing provision. The Company recog nized reductions of operating expenses totaling $ 1.2 million and $ 6.1 million, respectively, during the three and six months ended June 30, 2021 as a result of this cost-sharing provision. Capitalized costs to obtain contract The Company incurred $ 7.3 million in costs to obtain the contract in 2020, which consisted of consultant and legal fees that were directly connected to the successful completion of the Gilead Agreements. The Company determined that $ 1.9 million of these expenses were related to the Stock Purchase Agreement which were recognized as offering costs. The Company allocated the remaining costs between the various performance obligations, to be recognized when the underlying revenue is recognized. The Company incurred an additional $ 4.5 million in fees to a third party as part of entering into the Amended Gilead Collaboration Agreement in 2021. These fees were combined with the $ 3.8 million of capitalized fees that remained from the original agreement at the date of closing, and the total $ 8.3 million was allocated among the performance obligations identified under the Amended Gilead Collaboration Agreement and deferred or recognized accordingly. The Company recognized $ 0.2 million and $ 0.4 million in expense related to these capitalized costs during the three and six months ended June 30, 2022, respectively. The Company recognized $ 0.1 million and $ 0.2 million in expense related to these capitalized costs during the three months and six months ended June 30, 2021, respectively. As of June 30, 2022, the Company had $ 4.5 million in capitalized costs to obtain the contract, of which $ 0.8 million was recorded in prepaid expenses and other current assets and $ 3.7 million was recorded in other long-term assets. Taiho Pharmaceutical Co., Ltd In September 2017, the Company and Taiho entered into an option and license agreement (the Taiho Agreement) under which Taiho obtained exclusive options to Arcus programs arising over a five-year period ending September 2022 (the Option Period). If Taiho timely exercises its option, Taiho obtains exclusive development and commercialization rights to investigational products from such Arcus Program for Japan and certain other territories in Asia (excluding China) (the Taiho Territory). In consideration for the exclusive options and other rights contained in the Taiho Agreement, Taiho paid non-refundable, non-creditable cash payments to the Company totaling $ 35.0 million. For each option that Taiho elects to exercise, it will be obligated to make an option exercise payment of between $ 3.0 million to $ 15.0 million, depending on the development stage of the applicable Arcus Program for which the option is exercised. Upon exercise Taiho is solely responsible for continued development and commercialization in the Taiho Territory. In addition, the Taiho Agreement provides that the Company is eligible to receive additional clinical and regulatory milestones totaling up to $ 130.0 million per Arcus Program, and it will be eligible to receive contingent payments of up to $ 145.0 million per Arcus Program associated with the achievement of specified levels of Taiho net sales in the Taiho Territory. In addition, the Company will receive royalties ranging from high single-digits to mid-teens on net sales of licensed products in the Taiho Territory. Royalties will be payable on a licensed product-by-licensed product and country-by-country basis during the period of time commencing on the first commercial sale of a licensed product in a country and ending upon the later of: (a) ten (10) years from the date of first commercial sale of such licensed product in such country; and (b) expiration of the last-to-expire valid claim of the Company’s patents covering the manufacture, use or sale or exploitation of such licensed product in such country (the Royalty Term). The Company determined that the identified performance obligations for the Taiho Agreement, which include the combined performance obligation of the research and development services and the obligation to participate on the joint steering committee, are satisfied over time. The Company uses a time-elapsed input method to measure progress toward satisfying its performance obligation, which is the method the Company believes most faithfully depicts the Company’s performance in transferring the promised services during the time period in which Taiho has access to the Company’s research and development activities. Accordingly, the transaction price of $ 35.0 million is being recognized in other collaboration revenues using this input method over the estimated performance period of five years ending September 2022. From the inception of the Taiho Agreement through June 30, 2022, Taiho has exercised its option to the Company's adenosine receptor antagonist program (including etrumadenant), its anti-PD-1 program (including zimberelimab), and its anti-TIGIT program (including domvanalimab and AB308) for option payments totaling $ 26.0 million. The Taiho Agreement will remain in effect until the expiry of all royalty terms for the licensed products. As of June 30, 2022, no clinical or regulatory milestones had been achieved under the Taiho Agreement. As of June 30, 2022, no sales milestone or royalty revenue has been recognized. In November 2021, Taiho exercised its option under the Taiho Agreement to the Company's anti-TIGIT program, including domvanalimab and AB308, in exchange for a $ 15.0 million option exercise fee. In November 2019, Taiho exercised its option to the Company's anti-PD-1 antibody program, including zimberelimab, for a fee of $ 8.0 million. For each of these exercises, the Company identified one performance obligation which was the delivery of the license, which was recognized by the Company as license revenue during the years ended December 31, 2021 and 2019, respectively. Upon the option exercises, Taiho gained sole responsibility for the development and commercialization of the licensed products within the Taiho Territory. As of June 30, 2022 and December 31, 2021, the Company recorded deferred revenue, current of $ 1.5 million and $ 5.0 million, respectively, on its condensed consolidated balance sheet. WuXi Biologics License Agreements The Company entered into a license agreement (the WuXi PD-1 Agreement) with WuXi Biologics in August 2017, as subsequently amended, in which it obtained an exclusive license to develop, use, manufacture, and commercialize products including an anti-PD-1 antibody worldwide except for Greater China. From the inception of the WuXi PD-1 Agreement through June 30, 2022, the Company has made upfront and milestone payments of $ 41.0 million and incurred sub-license fees of $ 11.3 million. These milestone payments and sub-license fees were recorded as research and development expense, as the products had not reached technological feasibility and did not have alternative future use. During the three and six months ended June 30, 2022, the Company incurred no milestone expense under the WuXi PD-1 Agreement. During the three and six months ended June 30, 2021, the Company incurred zero and $ 10.0 million in development milestone expense under the WuXi PD-1 Agreement. The WuXi PD-1 Agreement also provides for clinical and regulatory milestone payments, commercialization milestone payments of up to $ 375.0 million and tiered royalty payments to be made to WuXi Biologics that range from the high single-digits to low teens of net sales by the Company of licensed products. In December 2020, the Company entered into a separate license agreement (the WuXi CD39 Agreement) with WuXi Biologics to develop anti-CD39 antibodies. Under the agreement, the Company was granted exclusive worldwide rights to anti-CD39 antibodies discovered under the collaboration and will be responsible for the further development and commercialization of those antibodies. The WuXi CD39 Agreement provides for clinical and regulatory milestone payments totaling $ 16.5 million, and royalty payments in the low single digits of net sales by the Company of licensed products. From the inception of the WuXi CD39 Agreement through June 30, 2022, the Company has paid a $ 1.5 million development milestone and $ 0.5 million in upfront payments, both of which were recorded in research and development expense, as the products are still in research stage. The Company incurred zero and $ 1.5 million in development milestone expense under the WuXi CD39 Agreement during the three and six months ended June 30, 2022. The Company incurred no development milestone expense under the WuXi CD39 Agreement during the three and six months ended June 30, 2021. Abmuno License Agreement In December 2016, the Company entered into a license agreement (the Abmuno Agreement) with Abmuno Therapeutics LLC (Abmuno) in which it obtained a worldwide exclusive license to develop, use, manufacture, and commercialize products that include an anti-TIGIT antibody, including domvanalimab. From the inception of the Abmuno Agreement through June 30, 2022, the Company has made upfront and milestone payments totaling $ 14.6 million as of June 30, 2022, which were recorded in research and development expense, as the products are still in research stage. The Abmuno Agreement also provides for additional clinical, regulatory and commercialization milestone remaining payments of up to $ 93.0 million as of June 30, 2022. The Company incurred no development milestone expense for the three and six months ended June 30, |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 8. Stock-Based Compensation The Company grants awards under its 2018 Equity Incentive Plan and the 2020 Inducement Plan. Total stock-based compensation expense was recognized in the condensed consolidated statements of operations and comprehensive loss as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 7,717 $ 6,968 $ 16,219 $ 13,138 General and administrative 7,960 6,399 15,999 12,990 Total stock-based compensation $ 15,677 $ 13,367 $ 32,218 $ 26,128 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9. Income Taxes The provision or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into consideration in the relevant period. Each quarter, the Company updates the estimate of the annual effective tax rate, and if the estimated tax rate changes, the Company records a cumulative adjustment to the provision. The Company did no t record a provision for income taxes for the three months ended June 30, 2022 and 2021. The Company’s provision for income taxes was $ 1.0 million and zero for the six months ended June 30, 2022 and 2021 with an effective tax rate of - 0.8 % and 0 %, respectively. The effective tax rate differs from the U.S. statutory tax rate primarily due to the valuation allowances on the Company’s deferred tax assets and state income taxes. The income tax provision includes the effects of the mandatory capitalization and amortization of research and development expenses starting in 2022, as required by the 2017 Tax Cuts and Jobs Act. As of June 30, 2022 and December 31, 2021, the Company has provided a valuation allowance against U.S. federal and state deferred tax assets. Management continues to evaluate the realizability of deferred tax assets and the related valuation allowance. If management's assessment of the deferred tax assets or the corresponding valuation allowance were to change, the Company would record the related adjustment to income during the period in which management makes the determination. The Company recognizes interest and penalties associated with uncertain tax benefits as part of the income tax provision. To date, the Company has not recognized any interest and penalties in its condensed consolidated statements of operations, nor has it accrued for or made payments for interest and penalties. The Company is subject to taxation in the U.S. and various foreign jurisdictions. The tax years subsequent to 2015 remain open and subject to examination by federal, state, and foreign taxing authorities in which the Company is subject to tax. |
Net Loss per Share
Net Loss per Share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Note 10. Net Loss per Share Basic net loss per share is calculated based on the weighted-average number of shares of the Company’s common stock during the period. Diluted net loss per share is calculated based on the weighted-average number of shares of the Company’s common stock and other dilutive securities outstanding during the period. Potentially dilutive securities are excluded from the calculation if their inclusion would have been antidilutive. The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ ( 66,632 ) $ ( 75,970 ) $ ( 134,625 ) $ ( 148,563 ) Denominator: Weighted-average common shares outstanding 71,814,232 71,094,199 71,506,216 69,792,730 Less: weighted-average common shares subject to vesting - ( 1,348,902 ) - ( 1,371,644 ) Weighted-average common shares used to compute basic and diluted 71,814,232 69,745,297 71,506,216 68,421,086 Net loss per share: basic and diluted $ ( 0.93 ) $ ( 1.09 ) $ ( 1.88 ) $ ( 2.17 ) The following outstanding potentially dilutive securities were excluded from the computation of diluted net loss per share because including them would have been antidilutive: As of June 30, 2022 2021 Common stock options issued and outstanding 12,404,112 12,508,782 Restricted stock units issued 1,397,281 1,330,120 Employee Stock Purchase Plan shares 135,040 169,326 Unvested early exercised common stock options - 73,618 Unvested restricted common stock issued as - 1,257,651 Total 13,936,433 15,339,497 The Company also excluded the effect of Gilead’s right to purchase additional shares of the Company’s common stock from its calculation as these rights had no intrinsic value at June 30, 2022. |
Commitments
Commitments | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 11. Commitments Standby Letters of Credit The Company has standby letters of credit up to an aggregate of $ 3.0 million provided as collateral for its leases. The letters of credit are secured by $ 3.0 million in deposits classified as restricted cash on the Company’s condensed consolidated balance sheets. At June 30, 2022 the standby letters of credit were not drawn down. |
Related Parties
Related Parties | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 12. Related parties Relationship and transactions with Gilead As of June 30, 2022, Gilead held approximately 19.2 % o f the Company’s outstanding common stock. These holdings resulted from a combination of Gilead’s participation in the May 2020 public offering as well as purchases of stock under the stock purchase agreement. In the May 2020 public offering, Gilead purchased 2,200,000 shares of common stock for an amount of $ 56.7 million, net of offering costs. Under the stock purchase agreement (as amended and restated), Gilead purchased 5,963,029 and 5,650,000 shares in July 2020 and February 2021, respectively, for a total investment of $ 327.8 million, net of offering costs and amounts allocated to the performance obligations created by the Gilead Collaboration Agreement. Gilead has the right, at its option, to purchase up to a maximum of 35 % of the Company’s then-outstanding voting common stock, from time to time over five years from the closing of the initial transaction. Pursuant to the Investor Rights Agreement, the Company appointed Gilead's two designees to the Company’s Board of Directors. See Note 7 for further discussion of the agreements with Gilead. At June 30, 2022, the Company had a $ 35.7 million cost sharing receivable recorded on the condensed consolidated balance sheets under receivable from collaboration partners, to be invoiced the following quarter. At June 30, 2022, the Company had a $ 1.3 million long-term cost-share receivable recorded in other long-term assets on the balance sheet, to be invoiced upon the achievement of milestones under the AstraZeneca agreement in future years. The Company also had $ 88.6 million in deferred revenue, current and $ 429.3 million in deferred revenue, noncurrent recorded on its condensed consolidated balance sheets at June 30, 2022. For the three and six months ended June 30, 2022 the Company recognized $ 25.0 million and $ 41.3 million, respectively, in revenue under the Gilead Collaboration Agreement. For each of these periods, the Company also recognized net reductions in operating expenses totaling $ 35.9 million and $ 66.3 million, respectively. For the three and six months ended June 30, 2021 the C ompany recognized $ 7.7 million and $ 15.4 million, respectively, in revenue under the Gilead Collaboration Agreement. For each of these periods, the Company also recognized net reductions in operating expenses totaling $ 1.2 million and $ 6.1 million, respectively . The Company received a $ 175 million upfront payment from Gilead upon closing of the Gilead Collaboration Agreement in July 2020. In addition, in July 2020 the Company received $ 200 million from Gilead in connection with the Stock Purchase Agreement, of which approximately $ 109.4 million represented the fair value of stock purchased at the transaction closing date with the remaining premium of $ 90.6 million allocated to the transaction price. In February 2021, the Company received $ 220.4 million from Gilead in connection with the purchase by Gilead of 5,650,000 shares of the Company’s common stock at a per share price of $ 39.00 pursuant to the amended and restated Stock Purchase Agreement. In January 2022, the Company received $ 725 million in option exercise payments from Gilead. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and pursuant to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the results of operations and cash flows for the periods presented have been included. Operating results for the six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any future period. The balance sheet as of December 31, 2021 has been derived from audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2022. There have been no significant changes to the Company’s significant accounting policies described in Note 2, Summary of Significant Accounting Policies, in Notes to Consolidated Financial Statements in Item 8 of Part II of the Form 10-K. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Arcus Biosciences, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosures of contingent assets and liabilities. Estimates used include the determination of the standalone selling price of performance obligations and the timing of revenue recognition, the value of stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, uncertain tax positions, and valuation allowance for deferred tax assets. Actual results could differ materially from the Company’s estimates. |
Cash Equivalents and Investments | Cash Equivalents and Investments Cash equivalents include marketable securities having an original maturity of three months or less at the time of purchase. Short-term investments have maturities of greater than three months and up to twelve months at the time of purchase. Long-term investments have maturities greater than 12 months at the time of purchase. Collectively, cash equivalents, short-term and long-term investments are considered available-for-sale and are recorded at fair value. Unrealized gains and losses are recorded in accumulated other comprehensive income (loss). Realized gains and losses are included in interest and other income, net in the condensed consolidated statements of operations and comprehensive income or loss. The basis on which the cost of a security that is sold or an amount that is reclassified out of accumulated other comprehensive income or loss into earnings is determined using the specific identification method. |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash as Reported in Condensed Consolidated Statements of Cash Flows | Reconciliation of Cash, Cash Equivalents, and Restricted Cash as Reported in Condensed Consolidated Statements of Cash Flows Restricted cash at June 30, 2022 and 2021 represents cash balances held as security in connection with the Company’s facility lease agreements. The following table provides a reconciliation of cash, cash equivalents, and restricted cash within the condensed consolidated balance sheets to the total shown in the condensed consolidated statements of cash flows (in thousands): June 30, 2022 2021 Cash and cash equivalents $ 272,629 $ 320,482 Restricted cash 3,005 3,005 Cash, cash equivalents and restricted cash $ 275,634 $ 323,487 |
Concentration of Credit Risk | Concent ration of Credit Risk Cash equivalents, short-term and long-term investments are financial instruments that potentially subject the Company to concentrations of credit risk. The Company invests in money market funds, treasury bills and notes, government bonds, commercial paper, corporate notes, and certificates of deposit. The Company's investment policy limits interest-bearing security investments to certain types of instruments issued by institutions with investment-grade credit ratings, and it places restrictions on maturities and concentration by asset class and issuer. The Company limits its credit risk associated with cash equivalents, short-term and long-term investments by placing them with banks and institutions it believes are credit worthy and in highly rated investments. |
Leases and Rent Expense | Leases and Rent Expense The Company recognizes a lease asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation. The Company determines whether an arrangement is or contains a lease at contract inception. Operating leases and related tenant improvement allowances receivable are included in operating lease right-of-use assets, prepaid expenses and other current assets, other current liabilities, and operating lease liabilities, noncurrent in our condensed consolidated balance sheets at June 30, 2022 and December 31, 2021. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the net present value of lease payments, the Company uses its incremental borrowing rate based on information available at the lease commencement date. The incremental borrowing rate represents the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The Company considers a lease term to be the noncancelable period that it has the right to use the underlying asset, including any periods where it is reasonably assured the Company will exercise the option to extend the contract. Periods covered by an option to extend are included in the lease term if the lessor controls the exercise of that option. The Company elected to not apply the recognition requirements of the leasing standard to short-term leases with terms of 12 months or less which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. For short-term leases, lease payments are recognized as operating expenses on a straight-line basis over the lease term. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash within the condensed consolidated balance sheets to the total shown in the condensed consolidated statements of cash flows (in thousands): June 30, 2022 2021 Cash and cash equivalents $ 272,629 $ 320,482 Restricted cash 3,005 3,005 Cash, cash equivalents and restricted cash $ 275,634 $ 323,487 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | The following tables set forth the Company’s financial instruments (excluding restricted cash) that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): June 30, 2022 Total Level 1 Level 2 Level 3 Money market funds $ 187,998 $ 187,998 $ - $ - U.S. treasury securities 320,202 - 320,202 - Corporate securities and commercial paper 747,351 - 747,351 - Certificates of deposit 12,073 12,073 U.S. government agency obligations 3,481 - 3,481 - Total assets measured at fair value $ 1,271,105 $ 187,998 $ 1,083,107 $ - December 31, 2021 Total Level 1 Level 2 Level 3 Money market funds $ 147,914 $ 147,914 $ - $ - U.S. treasury securities 112,170 - 112,170 - Corporate securities and commercial paper 421,214 - 421,214 - Total assets measured at fair value $ 681,298 $ 147,914 $ 533,384 $ - |
Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities | Classified as (with contractual maturities): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 272,629 $ 147,914 Short-term investments (due within one year) 900,147 351,394 Long-term investments (due between one and three years) 98,329 181,990 Total cash, cash equivalents and investments in marketable securities $ 1,271,105 $ 681,298 |
Schedule of Fair Value and Amortized Cost of Investments in Marketable Securities by Major Security Type | The fair value and amortized cost of investments in marketable securities by major security type as of June 30, 2022 and December 31, 2021 are presented in the tables that follow (in thousands): Amortized Unrealized Unrealized Fair As of June 30, 2022: Money market funds $ 187,998 $ - $ - $ 187,998 U.S. treasury securities 322,351 1 ( 2,150 ) 320,202 Corporate securities and commercial paper 752,429 8 ( 5,086 ) 747,351 Certificates of deposit 12,071 4 ( 2 ) 12,073 U.S. government agency obligations 3,500 - ( 19 ) 3,481 Total $ 1,278,349 $ 13 $ ( 7,257 ) $ 1,271,105 Amortized Unrealized Unrealized Fair As of December 31, 2021: Money market funds $ 147,914 $ - $ - $ 147,914 U.S. treasury securities 112,473 1 ( 304 ) 112,170 Corporate securities and commercial paper 422,172 3 ( 961 ) 421,214 Total $ 682,559 $ 4 $ ( 1,265 ) $ 681,298 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Summary of Other Accrued Liabilities | Other accrued liabilities consisted of the following (in thousands): As of June 30, 2022 As of December 31, 2021 Accrued personnel expenses $ 12,942 $ 16,648 Professional fees 236 4,938 Income taxes payable 18 1,815 Other 1,242 780 Total $ 14,438 $ 24,181 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Schedule of Supplemental Cashflow Disclosures Related to Operating Leases | The following table summarizes supplemental cash flow disclosures and non-cash financing activities related to our operating leases (in thousands): Six Months Ended June 30, 2022 2021 Cash paid for amounts included in measurement of lease liabilities $ 4,421 $ 2,000 Cash received from tenant improvement allowances $ 8,381 $ - Right-of-use assets obtained in exchange for new operating lease liabilities $ 3,029 $ 24,473 Recognition of tenant improvement allowance receivable included in other current liabilities $ 5,791 $ 10,598 |
Liability for Sale of Future _2
Liability for Sale of Future Royalties (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Liability for Sale of Future Royalties | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Schedule of Changes to Liability | Changes to the liability for sale of future royalties were as follows for the six months ended June 30, 2022 (in thousands): 2022 Beginning balance, January 1 $ 5,260 Cash received from BVF 5,000 Interest accretion 902 Ending balance, June 30 $ 11,162 |
License and Collaboration Agr_2
License and Collaboration Agreements (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Summary of Revenues by Collaboration and by Category of Revenue | The following table summarizes revenues by collaboration, category of revenue, and the method of recognition (in thousands): Three Months Ended June 30, Six Months Ended June 30, Revenues recognized: Over time Point in time 2022 2021 2022 2021 License and development services for all Gilead programs * $ 16,693 $ - $ 24,632 $ - Gilead access rights related to the * 8,316 7,711 16,632 15,422 Taiho access rights * 1,750 1,750 3,500 3,500 Total collaboration and license revenues $ 26,759 $ 9,461 $ 44,764 $ 18,922 |
Summary of Revenue Recognized as a Result of Changes in Deferred Revenue | The Company recognized the following revenue as a result of changes in the deferred revenue balance during the period below (in thousands): Three Months Ended June 30, Six Months Ended June 30, Revenue recognized in the period from: 2022 2021 2022 2021 Amounts included in deferred revenue at the beginning of the period $ 26,759 $ 9,461 $ 44,764 $ 18,922 Performance obligations satisfied in a previous period - - - - |
Schedule of Payments Allocated to Performance Obligations | The Company determined that the Amended Gilead Collaboration Agreement represented a contract modification under the application of ASC 606. At the amendment closing date, the Company allocated the transaction price to the new and remaining performance obligations identified as follows: Amount Allocation of transaction price Deferred revenues as of 12/21/2021 $ 165,086 Option payment for Domvanalimab 275,000 Option payment for Etrumadenant 250,000 Option payment for Quemliclustat 200,000 Total transaction price allocated to performance obligations $ 890,086 Allocation to performance obligations Distinct Combined Amount Domvanalimab license * $ 328,838 Etrumadenant license and R&D activities * 218,722 Quemliclustat license and R&D activities * 175,618 Domvanalimab R&D activities * 34,528 Zimberelimab R&D and commercial services * 11,243 Access rights related to the Company's research * 84,076 Material rights to option continuation periods * 37,061 Total $ 890,086 |
Gilead and Taiho | |
Summary of Revenues | The following table summarizes the revenues recognized from the Company’s collaboration agreements with Gilead and Taiho Pharmaceutical Co., Ltd. (Taiho) (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 License and development services revenue $ 16,693 $ - $ 24,632 $ - Other collaboration revenue 10,066 9,461 20,132 18,922 Total collaboration and license revenues $ 26,759 $ 9,461 $ 44,764 $ 18,922 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock-Based Compensation Expense | Total stock-based compensation expense was recognized in the condensed consolidated statements of operations and comprehensive loss as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Research and development $ 7,717 $ 6,968 $ 16,219 $ 13,138 General and administrative 7,960 6,399 15,999 12,990 Total stock-based compensation $ 15,677 $ 13,367 $ 32,218 $ 26,128 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net loss $ ( 66,632 ) $ ( 75,970 ) $ ( 134,625 ) $ ( 148,563 ) Denominator: Weighted-average common shares outstanding 71,814,232 71,094,199 71,506,216 69,792,730 Less: weighted-average common shares subject to vesting - ( 1,348,902 ) - ( 1,371,644 ) Weighted-average common shares used to compute basic and diluted 71,814,232 69,745,297 71,506,216 68,421,086 Net loss per share: basic and diluted $ ( 0.93 ) $ ( 1.09 ) $ ( 1.88 ) $ ( 2.17 ) |
Summary of Outstanding Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss per Share | The following outstanding potentially dilutive securities were excluded from the computation of diluted net loss per share because including them would have been antidilutive: As of June 30, 2022 2021 Common stock options issued and outstanding 12,404,112 12,508,782 Restricted stock units issued 1,397,281 1,330,120 Employee Stock Purchase Plan shares 135,040 169,326 Unvested early exercised common stock options - 73,618 Unvested restricted common stock issued as - 1,257,651 Total 13,936,433 15,339,497 |
Organization - Additional Infor
Organization - Additional Information (Details) $ in Millions | 1 Months Ended | 6 Months Ended |
Dec. 31, 2021 Product | Jun. 30, 2022 USD ($) Product | |
Organization [Line Items] | ||
Number of investigational product | 6 | |
Cash, Cash Equivalents and Investments in Marketable Securities | ||
Organization [Line Items] | ||
Cash and investments | $ | $ 1,271.1 | |
Gilead Collaboration Agreement | ||
Organization [Line Items] | ||
Number of investigational product | 4 |
Significant Accounting Polici_4
Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 272,629 | $ 147,914 | $ 320,482 | |
Restricted cash | 3,005 | 3,005 | 3,005 | |
Cash, cash equivalents and restricted cash | $ 275,634 | $ 150,919 | $ 323,487 | $ 173,618 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 | Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | ||
Realized gains (loss) on sale or maturity of available-for-sale marketable securities | $ 0 | $ 0 |
Reclassification out of accumulated other comprehensive income | 0 | 0 |
Credit related losses | $ 0 | $ 0 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Details) - Fair Value On Recurring Basis - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | $ 1,271,105 | $ 681,298 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 187,998 | 147,914 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 1,083,107 | 533,384 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 187,998 | 147,914 |
Money Market Funds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 187,998 | 147,914 |
U.S. Treasury Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 320,202 | 112,170 |
U.S. Treasury Securities | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 320,202 | 112,170 |
Corporate Securities and Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 747,351 | 421,214 |
Corporate Securities and Commercial Paper | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 747,351 | $ 421,214 |
Certificates of Deposit | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 12,073 | |
Certificates of Deposit | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 12,073 | |
U.S. Government Agency Obligation | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | 3,481 | |
U.S. Government Agency Obligation | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets measured at fair value | $ 3,481 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value Disclosures [Abstract] | ||
Cash and cash equivalents | $ 272,629 | $ 147,914 |
Short-term investments (due within one year) | 900,147 | 351,394 |
Long-term investments (due between one and three years) | 98,329 | 181,990 |
Total cash, cash equivalents and investments in marketable securities | $ 1,271,105 | $ 681,298 |
Fair Value Measurements - Sch_3
Fair Value Measurements - Schedule of Fair Value and Amortized Cost of Investments in Marketable Securities by Major Security Type (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | $ 1,278,349 | $ 682,559 |
Unrealized Gain | 13 | 4 |
Unrealized Loss | (7,257) | (1,265) |
Fair Value | 1,271,105 | 681,298 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 187,998 | 147,914 |
Fair Value | 187,998 | 147,914 |
U.S. Treasury Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 322,351 | 112,473 |
Unrealized Gain | 1 | 1 |
Unrealized Loss | (2,150) | (304) |
Fair Value | 320,202 | 112,170 |
Corporate Securities and Commercial Paper | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 752,429 | 422,172 |
Unrealized Gain | 8 | 3 |
Unrealized Loss | (5,086) | (961) |
Fair Value | 747,351 | $ 421,214 |
Certificates of Deposit | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 12,071 | |
Unrealized Gain | 4 | |
Unrealized Loss | (2) | |
Fair Value | 12,073 | |
U.S. Government Agency Obligation | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Amortized Cost | 3,500 | |
Unrealized Loss | (19) | |
Fair Value | $ 3,481 |
Other Accrued Liabilities - Sum
Other Accrued Liabilities - Summary of Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Accrued Liabilities, Current [Abstract] | ||
Accrued personnel expenses | $ 12,942 | $ 16,648 |
Professional fees | 236 | 4,938 |
Income taxes payable | 18 | 1,815 |
Other | 1,242 | 780 |
Total | $ 14,438 | $ 24,181 |
Leases - Additional Information
Leases - Additional Information (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2022 USD ($) ft² | |
Lessee, Lease, Description [Line Items] | |
Operating lease, existence of option to extend | true |
Operating lease, option to extend | Both leases are subject to options by the Company to extend the lease terms. |
Buildings | |
Lessee, Lease, Description [Line Items] | |
Square feet of space leased | 14,460 |
Tenant allowances | $ | $ 5.8 |
Hayward, California | Executive Offices Research and Development and Business Operations | |
Lessee, Lease, Description [Line Items] | |
Square feet of space leased | 150,753 |
Operating lease expiration year | 2031 |
Brisbane, California | |
Lessee, Lease, Description [Line Items] | |
Operating lease expiration year | 2031 |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow Disclosures and Non-cash Financing Activities Related to Operating Leases (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Leases [Abstract] | ||
Cash paid for amounts included in measurement of lease liabilities | $ 4,421 | $ 2,000 |
Cash received from tenant improvement allowances | 8,381 | |
Right-of-use assets obtained in exchange for new operating lease liabilities | 3,029 | 24,473 |
Recognition of tenant improvement allowance receivable included in other current liabilities | $ 5,791 | $ 10,598 |
Liability for Sale of Future _3
Liability for Sale of Future Royalties - Additional Information (Details) - BVF Partners L.P. - BVF Agreement - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2021 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Payment to be made for discovery and development of compounds | $ 15,000,000 | ||||
Cash received from counterparty | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | ||
Option to provide additional funding | 10,000,000 | ||||
Liability for milestone payments and royalties | 11,200,000 | $ 11,200,000 | |||
Imputed effective rate of interest on unamortized portion of liability | 20.60% | ||||
Non-cash interest expense | $ 500,000 | $ 900,000 | |||
Minimum | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Payment to be made for discovery and development of compounds | 15,000,000 | ||||
Contingent payments upon achievement of certain clinical and regulatory milestones | 72,500,000 | ||||
Maximum | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Contingent payments upon achievement of certain clinical and regulatory milestones | $ 160,000,000 |
Liability for Sale of Future _4
Liability for Sale of Future Royalties - Schedule of Changes to Liability (Details) - Liability for Sale of Future Royalties - BVF Partners L.P. - BVF Agreement $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Beginning balance, January 1 | $ 5,260 |
Cash received from BVF | 5,000 |
Interest accretion | 902 |
Ending balance, June 30 | $ 11,162 |
License and Collaboration Agr_3
License and Collaboration Agreements - Summary of Revenues (Details) - Gilead and Taiho - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
License and Development Services Revenue | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | $ 16,693 | $ 24,632 | ||
Other Collaboration Revenue | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | 10,066 | $ 9,461 | 20,132 | $ 18,922 |
Collaboration and License | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | $ 26,759 | $ 9,461 | $ 44,764 | $ 18,922 |
License and Collaboration Agr_4
License and Collaboration Agreements - Summary of Revenues by Collaboration and by Category of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | $ 26,759 | $ 9,461 | $ 44,764 | $ 18,922 |
License and Development Services for all Gilead Programs | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | 16,693 | 24,632 | ||
Gilead Access Rights | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | 8,316 | 7,711 | 16,632 | 15,422 |
Taiho Access Rights | ||||
License And Collaboration Agreements [Line Items] | ||||
Total collaboration and license revenues | $ 1,750 | $ 1,750 | $ 3,500 | $ 3,500 |
License and Collaboration Agr_5
License and Collaboration Agreements - Summary of Revenue Recognized as a Result of Changes in Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
License And Collaboration Agreements [Abstract] | ||||
Amounts included in deferred revenue at the beginning of the period | $ 26,759 | $ 9,461 | $ 44,764 | $ 18,922 |
License and Collaboration Agr_6
License and Collaboration Agreements - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 58 Months Ended | 59 Months Ended | ||||||||||||
Jul. 13, 2020 USD ($) Program $ / shares shares | Jan. 31, 2022 USD ($) | Nov. 30, 2021 USD ($) Program | Jan. 31, 2021 USD ($) $ / shares shares | Nov. 30, 2019 USD ($) | Sep. 30, 2017 USD ($) | Aug. 31, 2017 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Mar. 31, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) $ / shares shares | Dec. 31, 2017 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Dec. 30, 2021 USD ($) | |
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Total collaboration and license revenues | $ 26,759,000 | $ 9,461,000 | $ 44,764,000 | $ 18,922,000 | ||||||||||||||
Option continuation payment due upon second anniversary of agreement | $ 100,000,000 | |||||||||||||||||
Deferred revenue recognized | 26,759,000 | 9,461,000 | 44,764,000 | 18,922,000 | ||||||||||||||
Remaining capitalized fees at closing | 3,800,000 | |||||||||||||||||
Fees allocated among performance obligations | 8,300,000 | |||||||||||||||||
Contract with customer liability, noncurrent | 429,339,000 | 429,339,000 | 462,217,000 | $ 429,339,000 | $ 429,339,000 | |||||||||||||
Gilead | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Fee incurred to third party upon receipt of option exercise payments | 4,500,000 | |||||||||||||||||
WuXi Biologics License Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Clinical and regulatory milestones achieved | $ 16,500,000 | |||||||||||||||||
Range of tiered royalty payments on net sales | high single-digits to low teens | |||||||||||||||||
WuXi Biologics License Agreement | Research and Development | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Upfront cash payment | 500,000 | |||||||||||||||||
Sub-license fees incurred | 11,300,000 | |||||||||||||||||
Upfront and milestone payments | 41,000,000 | |||||||||||||||||
Development milestone payments | 1,500,000 | |||||||||||||||||
WuXi Biologics License Agreement | WuXi PD-1 | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Development milestone expense | 0 | 0 | $ 0 | 10,000,000 | ||||||||||||||
WuXi Biologics License Agreement | WuXi CD39 | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Development milestone expense | 0 | 0 | 1,500,000 | 0 | ||||||||||||||
WuXi Biologics License Agreement | Maximum | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Clinical, regulatory and commercialization milestone payments | $ 375,000,000 | |||||||||||||||||
Abmuno License Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Upfront and milestone payments | 14,600,000 | |||||||||||||||||
Clinical, regulatory and commercialization remaining milestone payments | 93,000,000 | |||||||||||||||||
Development milestone expense | 0 | 0 | 0 | 5,000,000 | ||||||||||||||
Gilead Collaboration Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Option payment upon completion of certain IND-enabling activities | $ 60,000,000 | |||||||||||||||||
Option payment upon achievement of certain development milestones | 150,000,000 | |||||||||||||||||
Deferred revenue | 517,900,000 | 517,900,000 | 559,200,000 | 517,900,000 | 517,900,000 | |||||||||||||
Increase (Decrease) in Operating expenses | (35,900,000) | (1,200,000) | (66,300,000) | (6,100,000) | ||||||||||||||
Gilead Collaboration Agreement | Gilead | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Upfront cash payment | $ 175,000,000 | |||||||||||||||||
Collaboration term for current and future clinical programs | 10 years | |||||||||||||||||
Contingent milestone payments receivable | $ 300,000,000 | |||||||||||||||||
Additional collaboration term for programs entering clinical development prior to end of collaboration term | 3 years | |||||||||||||||||
Option continuation payment receivable upon eighth anniversary of agreement | $ 100,000,000 | |||||||||||||||||
Option continuation payment receivable upon fourth anniversary of agreement | 100,000,000 | |||||||||||||||||
Option continuation payment receivable upon sixth anniversary of agreement | 100,000,000 | |||||||||||||||||
Option fee per program for all other programs entering clinical development to exercise option | $ 150,000,000 | |||||||||||||||||
Number of research programs | Program | 2 | |||||||||||||||||
Option payment upon achievement of certain development milestones | $ 250,000,000 | |||||||||||||||||
Total collaboration and license revenues | 13,200,000 | 18,200,000 | ||||||||||||||||
Deferred revenue | 200,500,000 | 200,500,000 | 200,500,000 | 200,500,000 | ||||||||||||||
Deferred revenue related to domvanalimab option | $ 36,700,000 | |||||||||||||||||
Deferred revenue recognized | 328,800,000 | |||||||||||||||||
Deferred revenue related to etrumadenant option | 127,000,000 | |||||||||||||||||
Option payment upon achievement of certain development milestones | $ 275,000,000 | |||||||||||||||||
Current and future programs exclusive access period | 10 years | |||||||||||||||||
Performance obligation period | 4 years | |||||||||||||||||
Contractual obligation remaining amount not obligated to pay | $ 300,000,000 | |||||||||||||||||
Deferred revenue related to research and development pipeline | 103,600,000 | 103,600,000 | 103,600,000 | 103,600,000 | $ 91,700,000 | |||||||||||||
Consultant and legal fees | 7,300,000 | |||||||||||||||||
Capitalized costs | 200,000 | 100,000 | 400,000 | 200,000 | ||||||||||||||
Cost sharing receivable | 4,500,000 | 4,500,000 | 4,500,000 | 4,500,000 | ||||||||||||||
Gilead Collaboration Agreement | Gilead | Prepaid Expenses and Other Current Assets | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Capitalized costs to obtain the contract, current | 800,000 | 800,000 | 800,000 | 800,000 | ||||||||||||||
Gilead Collaboration Agreement | Gilead | Other Noncurrent Assets | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Receivable from collaboration partners- noncurrent | 1,300,000 | 1,300,000 | 1,300,000 | 1,300,000 | ||||||||||||||
Capitalized costs to obtain the contract, noncurrent | 3,700,000 | 3,700,000 | 3,700,000 | 3,700,000 | ||||||||||||||
Gilead Collaboration Agreement | Gilead | Maximum | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Contingent milestone payments receivable | 300,000,000 | |||||||||||||||||
Potential regulatory approval milestones payment receivable related to domvanalimab | 500,000,000 | |||||||||||||||||
Gilead Collaboration Agreement | Taiho Pharmaceutical Co., Ltd | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Option period | 5 years | |||||||||||||||||
Option ending period | 2022-09 | |||||||||||||||||
Non refundable and non creditable cash payments | $ 35,000,000 | |||||||||||||||||
Payment for first option exercise | $ 15,000,000 | |||||||||||||||||
Purchase Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Direct offering cost | 1,900,000 | |||||||||||||||||
Purchase Agreement | Gilead | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Issuance of common stock | $ 200,000,000 | $ 220,296,000 | ||||||||||||||||
Issuance of common stock, shares | shares | 5,963,029 | 5,963,029 | ||||||||||||||||
Shares issued, price per share | $ / shares | $ 33.54 | $ 33.54 | ||||||||||||||||
Percentage of option to purchase maximum shares of common stock | 35% | |||||||||||||||||
Period over common stock to be purchased | 5 years | |||||||||||||||||
Percentage of premium purchase price of common stock | 20% | |||||||||||||||||
Trailing days average closing price | 5 days | |||||||||||||||||
Share Price | $ / shares | $ 33.54 | |||||||||||||||||
Funds received for purchase of common stock | $ 200,000,000 | |||||||||||||||||
Purchase price of common stock allocation to performance obligation | $ 90,600,000 | |||||||||||||||||
Purchase Agreement | Gilead | May 2020 Public Offering | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Shares issued, price per share | $ / shares | $ 27.50 | |||||||||||||||||
Additional equity investment net of offering costs | $ 56,700,000 | |||||||||||||||||
Additional equity investment shares issued | shares | 2,200,000 | |||||||||||||||||
Amended Gilead Collaboration Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Upfront cash payment | 725,000,000 | |||||||||||||||||
Issuance of common stock | $ 220,300,000 | |||||||||||||||||
Issuance of common stock, shares | shares | 5,650,000 | |||||||||||||||||
Shares issued, price per share | $ / shares | $ 39 | |||||||||||||||||
Option payments received | $ 725,000,000 | |||||||||||||||||
Number of exercise option to programs | Program | 3 | |||||||||||||||||
Removal of option continuation payment under agreement | $ 100,000,000 | |||||||||||||||||
Deferred revenue | 165,100,000 | |||||||||||||||||
Initial transaction price | 890,100,000 | |||||||||||||||||
Maximum ownership percentage of outstanding common stock remain unchanged | 35% | |||||||||||||||||
Quemliclustat Option, and R&D Activities Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Option payment upon achievement of certain development milestones | 200,000,000 | |||||||||||||||||
Total collaboration and license revenues | 1,900,000 | 3,700,000 | ||||||||||||||||
Deferred revenue | 172,000,000 | 172,000,000 | 172,000,000 | 172,000,000 | ||||||||||||||
R&D activities for Domvanalimab | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Total collaboration and license revenues | 1,300,000 | 2,200,000 | ||||||||||||||||
Deferred revenue | 32,300,000 | 32,300,000 | 32,300,000 | 32,300,000 | ||||||||||||||
R&D and Commercialization Activities for Zimberelimab Monotherapy | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Deferred revenue related to development and commercialization services | 9,700,000 | 9,700,000 | 9,700,000 | 9,700,000 | ||||||||||||||
Total collaboration and license revenues | 300,000 | 600,000 | ||||||||||||||||
Deferred revenue | 9,500,000 | 9,500,000 | 9,500,000 | 9,500,000 | ||||||||||||||
Access Rights related to Research and Development Pipeline | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Total collaboration and license revenues | 8,300,000 | 7,700,000 | $ 16,600,000 | 15,400,000 | ||||||||||||||
Taiho Agreement | Taiho Pharmaceutical Co., Ltd | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Payment for option exercise | $ 8,000,000 | 26,000,000 | ||||||||||||||||
Range of royalties receivable on net sales | high single-digits to mid-teens | |||||||||||||||||
Royalties payable description | Royalties will be payable on a licensed product-by-licensed product and country-by-country basis during the period of time commencing on the first commercial sale of a licensed product in a country and ending upon the later of: (a) ten (10) years from the date of first commercial sale of such licensed product in such country; and (b) expiration of the last-to-expire valid claim of the Company’s patents covering the manufacture, use or sale or exploitation of such licensed product in such country (the Royalty Term). | |||||||||||||||||
Non-refundable, non-creditable upfront cash payments | $ 35,000,000 | |||||||||||||||||
Estimated performance period | 5 years | |||||||||||||||||
Clinical and regulatory milestones achieved | $ 0 | |||||||||||||||||
Sales milestone or royalty revenue recognized | 0 | |||||||||||||||||
Deferred revenue, current | 1,500,000 | 1,500,000 | $ 5,000,000 | 1,500,000 | 1,500,000 | |||||||||||||
Taiho Agreement | Taiho Pharmaceutical Co., Ltd | Minimum | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Payment for option exercise | $ 3,000,000 | |||||||||||||||||
Taiho Agreement | Taiho Pharmaceutical Co., Ltd | Maximum | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Contingent milestone payments receivable | 145,000,000 | |||||||||||||||||
Payment for option exercise | 15,000,000 | |||||||||||||||||
Additional clinical and regulatory milestone payments receivable | $ 130,000,000 | |||||||||||||||||
AstraZeneca Agreement | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Development cost recorded within research and development expenses | 400,000 | $ 300,000 | 1,600,000 | $ 300,000 | ||||||||||||||
AstraZeneca Agreement | Other Long-term Liabilities | ||||||||||||||||||
License And Collaboration Agreements [Line Items] | ||||||||||||||||||
Contract with customer liability, noncurrent | $ 2,600,000 | $ 2,600,000 | $ 2,600,000 | $ 2,600,000 |
License and Collaboration Agr_7
License and Collaboration Agreements - Schedule of Payments Allocated to Performance Obligations (Details) - USD ($) $ in Thousands | Dec. 12, 2021 | Dec. 21, 2021 |
Allocation of transaction price | ||
Deferred revenues as of 12/21/2021 | $ 165,086 | |
Option payment for Domvanalimab | $ 275,000 | |
Option payment for Etrumadenant | 250,000 | |
Option payment for Quemliclustat | 200,000 | |
Total transaction price allocated to performance obligations | 890,086 | |
Allocation to performance obligations | ||
Domvanalimab license | 328,838 | |
Etrumadenant license and R&D activities | 218,722 | |
Quemliclustat license and R&D activities | 175,618 | |
Domvanalimab R&D activities | 34,528 | |
Zimberelimab R&D and commercial services | 11,243 | |
Access rights related to the Company's research and development pipeline | 84,076 | |
Material rights to option continuation periods | 37,061 | |
Total | $ 890,086 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 15,677 | $ 13,367 | $ 32,218 | $ 26,128 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 7,717 | 6,968 | 16,219 | 13,138 |
General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 7,960 | $ 6,399 | $ 15,999 | $ 12,990 |
Income Taxes - Additional Infor
Income Taxes - Additional Information - (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 0 | $ 0 | $ 1,004 | $ 0 |
Effective tax rate | (0.80%) | 0% |
Net Loss per Share - Computatio
Net Loss per Share - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator: | ||||||
Net loss | $ (66,632) | $ (67,993) | $ (75,970) | $ (72,593) | $ (134,625) | $ (148,563) |
Denominator: | ||||||
Weighted-average common shares outstanding | 71,814,232 | 71,094,199 | 71,506,216 | 69,792,730 | ||
Less: weighted-average common shares subject to vesting | (1,348,902) | (1,371,644) | ||||
Weighted-average common shares used to compute basic and diluted net loss per share | 71,814,232 | 69,745,297 | 71,506,216 | 68,421,086 | ||
Net loss per share: basic and diluted | $ (0.93) | $ (1.09) | $ (1.88) | $ (2.17) |
Net Loss per Share - Summary of
Net Loss per Share - Summary of Outstanding Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss per Share (Details) - shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 13,936,433 | 15,339,497 |
Common Stock Options Issued and Outstanding | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 12,404,112 | 12,508,782 |
Restricted Stock Units Issued | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 1,397,281 | 1,330,120 |
Employee Stock Purchase Plan Shares | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 135,040 | 169,326 |
Unvested Early Exercised Common Stock Options | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 73,618 | |
Unvested Restricted Common Stock Issued as Part of Collaboration Agreement | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted net loss per share | 1,257,651 |
Commitments - Additional Inform
Commitments - Additional Information (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 |
Commitments [Line Items] | |||
Restricted cash | $ 3,005 | $ 3,005 | $ 3,005 |
Standby Letters of Credit | |||
Commitments [Line Items] | |||
Long-term line of credit | 3,000 | ||
Restricted cash | $ 3,000 |
Related Parties - Additional In
Related Parties - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Jul. 13, 2020 | Jan. 31, 2022 | Feb. 28, 2021 | May 31, 2020 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||||||||
Receivable from collaboration partners, current | $ 35,831 | $ 35,831 | $ 744,595 | ||||||
Related party, deferred revenue - current | 88,595 | 88,595 | 96,981 | ||||||
Related party, deferred revenue - noncurrent | $ 429,339 | $ 429,339 | $ 462,217 | ||||||
Gilead | |||||||||
Related Party Transaction [Line Items] | |||||||||
Percentage of outstanding common stock held | 19.20% | 19.20% | |||||||
Number of shares issued | 2,200,000 | ||||||||
Value of common stock issued | $ 56,700 | ||||||||
Option payments received | $ 725,000 | ||||||||
Gilead | Operating Expenses | |||||||||
Related Party Transaction [Line Items] | |||||||||
Reimbursed under cost-sharing provisions of arrangement | $ 35,900 | $ 1,200 | $ 66,300 | $ 6,100 | |||||
Gilead | Cost Sharing Receivable | |||||||||
Related Party Transaction [Line Items] | |||||||||
Receivable from collaboration partners, current | 35,700 | 35,700 | |||||||
Related party, deferred revenue - current | 88,600 | 88,600 | |||||||
Related party, deferred revenue - noncurrent | 429,300 | 429,300 | |||||||
Gilead | Cost Sharing Receivable | Other Noncurrent Assets | |||||||||
Related Party Transaction [Line Items] | |||||||||
Receivable from collaboration partners, noncurrent | $ 1,300 | $ 1,300 | |||||||
Gilead | Maximum | |||||||||
Related Party Transaction [Line Items] | |||||||||
Right to purchase additional outstanding voting common stock percentage | 35% | 35% | |||||||
Gilead | Gilead Collaboration Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Revenue recognized | $ 25,000 | $ 7,700 | $ 41,300 | $ 15,400 | |||||
Upfront cash payment | 175,000 | ||||||||
Gilead | Stock Purchase Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Issuance of common stock, shares | 5,963,029 | 5,650,000 | |||||||
Issuance of common stock | $ 220,400 | 327,800 | |||||||
Funds received for purchase of common stock | 200,000 | ||||||||
Fair value of stock purchased | 109,400 | ||||||||
Premium on stock purchased | $ 90,600 | ||||||||
Shares issued, price per share | $ 39 |