Arcus Biosciences (RCUS) 10-Q 6 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 01, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2
Trading Symbol	RCUS
Entity Registrant Name	Arcus Biosciences, Inc.
Entity Central Index Key	1,724,521
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		44,456,659

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	[1]
Current assets:
Cash and cash equivalents	$ 169,998	$ 98,426
Short-term investments	95,700	77,277
Prepaid expenses and other current assets	1,550	1,141
Amounts owed by a related party	193	25
Total current assets	267,441	176,869
Long-term investments	11,792
Property, plant and equipment-net	12,513	11,230
Equity investment in related party	1,711	682
Restricted cash	203	203
Other long-term assets	205	1,502
Total assets	293,865	190,486
Current liabilities
Accounts payable	5,388	3,820
Accrued liabilities	4,342	3,137
Deferred revenue, current	5,000	5,000
Other current liabilities	1,650	769
Total current liabilities	16,380	12,726
Deferred revenue, noncurrent	16,087	18,587
Deferred rent	4,516	4,740
Other long-term liabilities	2,308	565
Total liabilities	39,291	36,618
Convertible preferred stock, $0.0001 par value, no shares and 120,958,867 shares authorized as of June 30, 2018 and December 31, 2017, respectively; no shares and 30,459,574 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively; aggregate liquidation preference of 226,725, as of December 31, 2017	0	226,196
Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value, 10,000,000 shares and no shares authorized as of June 30, 2018 and December 31, 2017, respectively; no shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively	0
Common stock; $0.0001 par value; 400,000,000 and 153,993,227 shares authorized as of June 30, 2018 and December 31, 2017, respectively; 44,456,659 and 4,090,898 shares issued and outstanding as of June 30, 2018 and December 31, 2017 respectively	4
Additional paid-in capital	354,375	948
Accumulated deficit	(99,722)	(73,234)
Accumulated other comprehensive loss	(83)	(42)
Total stockholders’ equity (deficit)	254,574	(72,328)
Total liabilities, convertible preferred stock and stockholders’ equity (deficit)	$ 293,865	$ 190,486
[1]	The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Statement Of Financial Position [Abstract]
Convertible preferred stock, par value	$ 0.0001	$ 0.0001
Convertible preferred stock, shares authorized	0	120,958,867
Convertible preferred stock, shares issued	0	30,459,574
Convertible preferred stock, shares outstanding	0	30,459,574
Convertible preferred stock, aggregate liquidation preference		$ 226,725
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	0
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	153,993,227
Common stock, shares issued	44,456,659	4,090,898
Common stock, shares outstanding	44,456,659	4,090,898

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Collaboration and license revenue	$ 1,250		$ 2,500
Type of Revenue [Extensible List]	us-gaap:LicenseAndServiceMember	us-gaap:LicenseAndServiceMember	us-gaap:LicenseAndServiceMember	us-gaap:LicenseAndServiceMember
Operation expenses:
Research and development	$ 13,699	$ 7,834	$ 25,352	$ 13,637
General and administrative	3,450	1,830	6,379	3,327
Total operating expenses	17,149	9,664	31,731	16,964
Loss from operations	(15,899)	(9,664)	(29,231)	(16,964)
Interest and other income, net	2,366	114	2,743	214
Net loss	(13,533)	(9,550)	(26,488)	(16,750)
Other comprehensive income (loss)	14	11	(41)	3
Comprehensive loss	$ (13,519)	$ (9,539)	$ (26,529)	$ (16,747)
Net loss per share, basic and diluted	$ (0.32)	$ (5.64)	$ (1.01)	$ (10.66)
Weighted-average number of shares used to compute basic and diluted net loss per share	42,533,641	1,693,150	26,236,007	1,571,905

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018		Jun. 30, 2017
Cash flow from operating activities
Net loss	$ (26,488)		$ (16,750)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	1,772		203
Depreciation and amortization	1,743		1,114
Share of loss from equity method investee	377		141
Gain on deemed sale from equity method investee	(1,229)
Other non-operating income	(177)		(53)
Changes in operating assets and liabilities
Amounts owed by a related party	(168)		384
Prepaid expenses and other current assets	(409)		(366)
Accounts payable	1,347		(1,610)
Accrued liabilities	1,812		821
Other current liabilities	20		20
Deferred revenue	(2,500)
Deferred rent	(224)		(316)
Net cash used in operating activities	(24,124)		(16,412)
Cash flow from investing activities
Purchases of short-term and long-term investments	(90,671)		(31,440)
Proceeds from maturities of short-term investments	60,415		16,085
Purchases of property and equipment	(2,358)		(4,381)
Net cash used in investing activities	(32,614)		(19,736)
Cash flow from financing activities
Proceeds from initial public offering, net of issuance costs	125,114
Proceeds from issuance of common stock upon exercise of stock options, net of repurchases	3,331		608
Payment of preferred stock issuance costs	(135)
Net cash provided by financing activities	128,310		608
Net decrease in cash and cash equivalents	71,572		(35,540)
Cash and cash equivalents at beginning of period	98,426	[1]	65,160
Cash and cash equivalents at end of period	169,998		29,620
Non-cash investing and financing activities:
Unpaid portion of property and equipment purchases included in accounts payable and accrued liabilities	1,007		495
Vesting of early exercised stock options and restricted stock	$ 647		$ 86
[1]	The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

Organization

Organization	6 Months Ended
	Jun. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Organization	Note 1. Description of Business Arcus Biosciences, Inc. (Company or the Company) is a clinical-stage biopharmaceutical company focused on creating innovative cancer immunotherapies by leveraging underexploited biological opportunities. Specifically, the Company targets well-characterized biological pathways with significant scientific data supporting their importance in regulating the immune response against cancer and for which either there are no molecules in development or those that exist have suboptimal profiles. To exploit these pathways, the Company has built a robust and highly efficient discovery capability to create and optimize highly differentiated small-molecule immuno-oncology product candidates. Since its inception in 2015, the Company has built a broad portfolio of small molecule and antibody product candidates that it plans to develop together as intra-portfolio combinations. Initial Public Offering On March 21, 2018, the Company completed its initial public offering (IPO) pursuant to which the Company issued 9,200,000 shares of common stock, including the exercise of the underwriters’ overallotment option to purchase 1,200,000 shares of common stock, at an offering price at $15.00 per share. The Company received aggregate net proceeds of approximately $124.7 million after deducting underwriting discounts and other offering related costs. In addition, in connection with the completion of the Company’s IPO, all outstanding shares of convertible preferred stock were converted into 30,459,574 shares of common stock and the Company amended and restated its certificate of incorporation and bylaws, which, among other things, changed the authorized capital stock to 400,000,000 shares of common stock and 10,000,000 shares of preferred stock, each with a par value of $0.0001 per share. Liquidity and Capital Resources As of June 30, 2018, the Company had cash and investments of $277.5 million, of which $265.7 million are cash, cash equivalents, and short-term investments which the Company believes will be sufficient to fund its planned operations for a period of at least twelve months following the filing date of this report.

Significant Accounting Policies

Significant Accounting Policies	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Significant Accounting Policies	Note 2. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (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 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 three and six month periods ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018 or for any future period. The balance sheet as of December 31, 2017 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 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, 2017 included in our Prospectus. There have been no material changes to the Company’s significant accounting policies during the six months ended June 30, 2018 as compared to the significant accounting policies described in the Company’s audited financial statements for the year ended December 31, 2017 included in the prospectus dated March 14, 2018 filed with the SEC pursuant to Rule 424(b)(4) under the Securities Act of 1993, as amended. From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB), or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s condensed consolidated financial statements upon adoption. Under the Jumpstart Our Business Startups Act of 2012, as amended (the JOBS Act), the Company meets the definition of an emerging growth company and has elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act. The Company will remain an emerging growth company until the earliest of (1) the last day of its first fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million of the prior June 30th and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. Principles of Consolidation During 2017, the Company established a wholly-owned subsidiary in Australia. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiary. All intercompany accounts, transactions and balances have been eliminated. Reverse Stock Split On March 9, 2018, the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96 The par values and the authorized shares of the common and preferred stock were not adjusted as a result of the Reverse Split. All references to shares of common stock outstanding, average number of shares outstanding and per share amounts in these condensed consolidated financial statements and notes to the condensed consolidated financial statements have been adjusted within the condensed consolidated financial statements, on a retroactive basis, to reflect the Reverse Split 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 disclosure of contingent assets and liabilities. Estimates were used to determine the fair value of common stock prior to the IPO and are used to determine stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, and uncertain tax positions. Actual results could differ materially from the Company’s estimates. Cash Equivalents, Short-Term and Long-Term 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 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 loss. Realized gains and losses are included in interest and other income, net in the condensed consolidated statements of operations and comprehensive loss. Restricted Cash Restricted cash at June 30, 2018 and December 31, 2017, comprises cash balances primarily held as security in connection with the Company’s facility lease agreement and is included in long-term assets in the condensed consolidated balance sheets. Concentration 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 and corporate notes. 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 highly credit worthy and in highly rated investments. Deferred Offering Costs Deferred offering costs, consisting of legal, accounting, filing and other fees directly related to the Company’s IPO, are capitalized. The deferred offering costs, which totaled $3.6 million, were reclassified to additional paid-in capital upon the effectiveness of the IPO in March 2018. Revenue Recognition The Company generates revenue from its option and license agreement for the development and commercialization of its product candidates. Option and license agreements may include non-refundable upfront research and development fees, option fees to obtain development and commercialization licenses for the Company’s products, milestone payments based on achievement of defined development, regulatory and sales targets, and royalties on sales of commercialized products. To date, the Company has not recognized revenue from sales of its product candidates. The Company recognizes revenue when all four of the following criteria have been met: (i) collectability is reasonably assured; (ii) delivery has occurred or services have been rendered; (iii) persuasive evidence of an arrangement exists; and (iv) the fee is fixed or determinable. Revenue under option and license arrangements is recognized based on evaluation of the performance obligations of the contract. Collectability is assessed based on evaluation of payment criteria as stated in the contract as well as the creditworthiness of the customer. Determination of whether delivery has occurred, or services rendered are based on management’s evaluation of the performance obligations as stated in the contract and progress made against those obligations. Evidence of arrangement is deemed to exist upon execution of the contract. Fees are considered fixed and determinable when the amount payable to the Company is no longer subject to any acceptance, refund rights or other contingencies that would alter the fixed nature of the fees charged for the deliverables. Option and license agreements may contain multiple elements as evaluated under Accounting Standards Codification (ASC) 605-25, Revenue Recognition- Multiple-Element Arrangements, A delivered item or items that do not qualify as a separate unit of accounting within the arrangement are combined with the other applicable undelivered items within the arrangement. The allocation of arrangement consideration and the recognition of revenue is then determined for those combined deliverables as a single unit of accounting. For a combined unit of accounting, non-refundable upfront fees are recognized as performance obligations related to the final deliverable are completed. In the case of research and development services, performance would generally be expected to be ratable over the estimated performance period unless the Company determines there is a discernible pattern of performance other than straight-line, in which case the Company uses a proportionate performance method to recognize the revenue over the estimated performance period. Amounts received in advance of performance are recorded as deferred revenue. If any of the initial deliverables are determined to have standalone value separate from the research and development services, then the allocated consideration is recorded as revenue when those items are delivered. Option and license agreements may also contain milestone payments that become due upon the achievement of certain milestones. The Company applies ASC 605-28, Revenue Recognition—Milestone Method. Research and Development Expenses Research and development costs are expensed as incurred. Research and development expenses consist primarily of personnel costs for the Company’s research and product development employees. Also included are non-personnel costs such as professional fees payable to third parties for preclinical and clinical studies and research services, laboratory supplies and equipment maintenance, product licenses, and other consulting costs. The Company estimates preclinical and clinical study and research expenses based on the services performed, pursuant to contracts with research institutions that conduct and manage preclinical and clinical studies and research services on its behalf. The Company estimates these expenses based on discussions with internal management personnel and external service providers as to the progress or stage of completion of services and the contracted fees to be paid for such services. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments associated with licensing agreements to acquire exclusive licenses to develop, use, manufacture and commercialize products that have not reached technological feasibility and do not have alternate commercial use are expensed as incurred. Payments made to third parties under these arrangements in advance of the performance of the related services by the third parties are recorded as prepaid expenses until the services are rendered. Recently Issued Accounting Standards or Updates Not Yet Effective In January 2016, the FASB issued ASU No. 2016-01 (Subtopic 825-10), Financial Instruments (ASU 2016-01) In November 2016, the FASB issued ASU No. 2016-18 (Topic 230), Restricted Cash, Statement of Cash Flows (ASU 2016-18) In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date The core principle of ASU 2014-09 is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing U.S. generally accepted accounting pronouncements. The Company is still in the process of evaluating the effect that this guidance will have on revenue recognition for our option and license agreement with Taiho Pharmaceutical Co., Ltd. (Taiho), specifically as it pertains to the non-refundable, non-creditable cash payments to the Company totaling $35.0 million and the future contingent payments the Company may become entitled to. The Company expects its evaluation to be completed during 2018. In February 2016, the FASB issued ASU No. 2016-02 (Topic 842), Leases (ASU 2016-02). In June 2018, the FASB issued ASU No. 2018-07 (Topic 718), Compensation – Stock Compensation (ASU 2018-07).

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jun. 30, 2018
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 as follows: Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2—Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. 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, 2018 and December 31, 2017. The following tables set forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Fair Value Measurements at June 30, 2018 Total Level 1 Level 2 Level 3 Assets Money market funds $ 104,286 $ 104,286 $ — $ — Overnight repurchase agreements 40,000 — 40,000 — U.S. government agency obligations 46,755 — 46,755 — Corporate securities and commercial paper 86,449 — 86,449 — $ 277,490 $ 104,286 $ 173,204 $ — Fair Value Measurements at December 31, 2017 Total Level 1 Level 2 Level 3 Assets Money market funds $ 66,478 $ 66,478 $ — $ — U.S. government agency obligations 57,153 — 57,153 — Corporate securities and commercial paper 52,072 — 52,072 — $ 175,703 $ 66,478 $ 109,225 $ — Classified as (with contractual maturities): June 30, 2018 December 31, 2017 Cash and Cash equivalents (due within 90 days) $ 169,998 $ 98,426 Short-term investments (due within one year) 95,700 77,277 Long-term investments (due between one and two years) 11,792 — $ 277,490 $ 175,703 The investments are classified as available-for-sale marketable securities. At June 30, 2018 and December 31, 2017, the balance in the Company’s accumulated other comprehensive loss comprised activity related to the Company’s available-for-sale marketable securities. There were no realized gains or losses recognized on the sale or maturity of available-for-sale marketable securities as of June 30, 2018 and December 31, 2017, and as a result, the Company did not reclassify any amounts out of accumulated other comprehensive loss for the periods then ended. The Company has a limited number of available-for-sale marketable securities in loss positions as of June 30, 2018, which the Company does not intend to sell and has concluded it will not be required to sell before recovery of the amortized cost for the investment at maturity (in thousands). Fair Value Measurements at June 30, 2018 Amortized Cost Unrealized Gain Unrealized Loss Fair Value Money market funds $ 104,286 $ — $ — $ 104,286 Overnight repurchase agreements 40,000 — 40,000 U.S. government agency obligations 46,779 (24 ) 46,755 Corporate securities and commercial paper 86,509 — (60 ) 86,449 $ 277,574 $ — $ (84 ) $ 277,490 Fair Value Measurements at December 31, 2017 Amortized Cost Unrealized Gain Unrealized Loss Fair Value Money market funds $ 66,478 $ — $ — $ 66,478 U.S. government agency obligations 57,183 — (30 ) 57,153 Corporate securities and commercial paper 52,084 — (12 ) 52,072 $ 175,745 $ — $ (42 ) $ 175,703

Equity Investment

Equity Investment	6 Months Ended
	Jun. 30, 2018
Inventory Disclosure [Abstract]
Equity Investment	Note 4: Equity Investment In September 2016, the Company purchased approximately 3.6 million shares of common stock of PACT Pharma, Inc. (PACT Pharma), a privately funded, early-stage biopharmaceutical company focused on adoptive cell therapy. The Company determined the fair value of such investment to be insignificant to the Company’s 2016 financial statements given the start-up nature of operations of PACT Pharma, and it was recorded at a nominal amount. In December 2016, the Company and PACT Pharma entered into a Master Services Agreement (the PACT Agreement) under which the Company provided PACT Pharma with general administrative support, including finance, human resources, legal, and other operational support. The Company also received certain warrants to purchase PACT Pharma common stock exercisable upon PACT Pharma’s achievement of certain valuation thresholds pursuant to the PACT Agreement. Also, in December 2016, the Company purchased 1.0 million shares of Series A preferred stock of PACT Pharma for $1.0 million. The Company determined PACT Pharma to be a variable interest entity, and that the Company has a variable interest in PACT. However, because the Company is not the primary beneficiary of PACT Pharma, it is not consolidating the results of operations of PACT Pharma in its condensed consolidated financial statements. The Company’s investment in PACT Pharma is accounted for as an equity method investment, and as a result the Company records its share of PACT Pharma’s operating results in interest and other income, net, in its condensed consolidated statement of operations and comprehensive loss. For the three and six month periods ended June 30, 2018, the Company recorded $0.2 million and $0.4 million, respectively, and for the three and six month periods ended June 30, 2017, the Company recorded $70,000 and $0.1 million, respectively relating to its share of PACT Pharma’s operating losses. As of June 30, 2018 and December 31, 2017, the Company had a $0.2 million and $25,000 receivable from PACT Pharma, respectively, for expenses the Company paid for on its behalf. In May 2018, PACT Pharma closed its Series B convertible preferred stock financing. The Company did not participate in this financing and therefore its equity ownership percentage in PACT Pharma decreased. As a result of the dilution in its equity ownership percentage and an increase in PACT Pharma’s estimated fair value per share, the Company recorded a gain of $1.2 million in interest and other income, net, for the three-month period ended June 30, 2018 and an increase in the fair value of the investment balance in the condensed consolidated balance sheet as of June 30, 2018 by the same amount. The PACT Agreement also expired in accordance with its terms at the closing of PACT Pharma’s Series B convertible preferred stock financing. The Company monitors the investment for events or circumstances indicative of potential other-than-temporary impairment and makes appropriate reductions in carrying values if it is determined that an impairment charge is required. As of June 30, 2018 and 2017, no impairment charge was recorded. As of and for the six-month period ended June 30, 2018 and for the year ended December 31, 2017, the Company also determined the fair value of the warrants to be insignificant to the condensed consolidated financial statements.

License and Collaboration Agree

License and Collaboration Agreements	6 Months Ended
	Jun. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
License and Collaboration Agreements	Note 5. License and Collaboration Agreements Taiho Pharmaceutical Co., Ltd In September 2017, the Company and Taiho entered into an option and license agreement (the Taiho Agreement) to collaborate on the potential development and commercialization of certain product candidates from the Company’s portfolio in Japan and certain other territories in Asia (excluding China) (the Taiho Territory). The Taiho Agreement provides Taiho with exclusive options, over a five-year period (the Option Period), to obtain an exclusive development and commercialization license to clinical stage product candidates from the Company’s programs (each, an Arcus Program). In consideration for the exclusive options and other rights contained in the Taiho Agreement, Taiho will make non-refundable, non-creditable cash payments to the Company totaling $35.0 million, of which the Company received $25.0 million during 2017. An additional $5.0 million is payable by Taiho and expected to be received in both October 2018 and 2019. In the event that the Company has not initiated IND enabling studies for at least five Arcus Programs prior to the expiration of the Option Period, Taiho may elect to extend the Option Period, up to a maximum of seven years for the Option Period, subject to an extension fee. If Taiho elects to exercise an option they will be obligated to make an exercise option payment for each option exercise of between $3.0 million to $15.0 million, dependent on the development stage of the applicable Arcus Program for which the option is exercised. 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 Taiho Agreement contains multiple elements, and the deliverables under the Taiho Agreement consist of (1) the research and development services, in which the Company will use commercially reasonable efforts to initiate IND enabling studies for at least five Arcus Programs, as well as further develop such Arcus Programs during the term of the Agreement, and (2) the obligation to participate on the joint steering committee. These deliverables are non-contingent in nature. The Company determined that the obligation to participate in the joint steering committee does not have stand-alone value to Taiho because the committee’s primary purpose is to monitor and govern the research and development activities and, hence, it is inseparable from the research and development services. The Company also concluded that, at the inception of the agreement, Taiho’s exclusive options are contingent deliverables as the exclusive options have significant uncertainty and are outside of the control of the Company, since Taiho has sole discretion to determine whether or not to exercise such options. Further, the Company concluded that the exclusive options do not contain a significant and incremental discount. As of June 30, 2018, Taiho had not exercised any exclusive option. In July 2018, Taiho exercised its first option and is obligated to make an exercise payment of $3.0 million. The Company determined that the level of effort required for it to meet its obligations under the Taiho Agreement is not expected to vary significantly over the Company’s performance period. Accordingly, the Company combined these deliverables into a single unit of accounting and allocated the entire arrangement consideration to that combined unit of accounting. As a result, the $25.0 million non-refundable, non-creditable cash payments received by the Company are being recognized ratably over the estimated performance period of five years, and the remaining $10.0 million of non-refundable, non-creditable cash payments will be recognized ratably over the estimated remaining performance period as they become due and payable by Taiho. During the three and six month periods ended June 30, 2018, the Company recognized $1.3 million and $2.5 million, respectively, of revenue under the Taiho Agreement. As of June 30, 2018, the Company recorded deferred revenue, current and deferred revenue, noncurrent of $5.0 million and $16.1 million, respectively, in its condensed consolidated balance sheet. As of December 31, 2017, the Company recorded as deferred revenue, current and deferred revenue, noncurrent of $5.0 million and $18.6 million, respectively, in its consolidated balance sheet. The Company determined that the clinical and regulatory milestone payments under the Taiho Agreement do not constitute substantive milestones and, therefore, will not be accounted for under the milestone method of revenue recognition. The events leading to these payments do not meet the definition of a substantive milestone because the achievement of these events depends primarily on Taiho’s performance. Accordingly, any revenue from these payments would be recognized over the remaining period of the performance obligations, if any, relating to this arrangement. If there are no remaining performance obligations under the arrangement at the time the milestone payment is triggered, then such milestone payment will be recognized as revenue in full upon the triggering event being achieved. The Company considers the contingent payments due from Taiho upon the achievement of specified sales volumes to be similar to royalty payments. The Company will recognize royalty payments as revenue in the period when such royalty payments are earned, i.e. in the period when sales of the licensed products in Taiho Territory occur. The Taiho Agreement shall remain in effect until (a) expiration of the last exercise period if Taiho has not exercised any of its exclusive options prior to such expiration or (b) if Taiho has exercised any of its exclusive options prior to the expiration of the applicable exercise period, expiry of all Royalty Terms for the licensed products, in each case subject to certain exceptions. WuXi Biologics License Agreement In August 2017, the Company entered into a license agreement (the WuXi Agreement) with WuXi Biologics (Cayman) Inc. (WuXi Biologics) in which it obtained an exclusive license to develop, use, manufacture, and commercialize products including an anti-PD-1 antibody in North America, Europe, Japan and certain other territories. The Company paid upfront and milestone payments of $18.5 million during the second half of 2017 which were recorded within research and development expenses, as the products have not reached technological feasibility and do not have alternate commercial use. No milestone payments were made during the three and six month periods ended June 30, 2018. The WuXi 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. 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. The Company made milestone payments of zero and $0.8 million for the three and six month periods ended June 30, 2018, respectively, and upfront and milestone payments of zero and $3.8 million for the three and six month periods ended June 30, 2017, respectively, which were recorded within research and development expenses, as the products have not reached technological feasibility and do not have alternate commercial use and are expensed as incurred. In addition, a $2.0 million milestone was reached and recorded within research and development expenses in June 2018 and paid in July 2018. The Abmuno Agreement also provides for additional clinical, regulatory and commercialization milestone payments up to $101.0 million which reflects the payment of $2.0 million in milestone payment made in July 2018.

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Jun. 30, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock-Based Compensation	Note 6: Stock-Based Compensation In March 2018, the Company adopted the 2018 Equity Incentive Plan (2018 Plan). The 2018 Plan replaced the 2015 Plan and 3,570,000 shares were reserved under the 2018 Plan, along with any shares remaining available for issuance under our 2015 Plan or outstanding awards under our 2015 Plan that subsequently expire, lapse unexercised or are forfeited to or repurchased by the Company. Total stock-based compensation expense was recognized in our condensed consolidated statements of operations and comprehensive loss as follows (in thousands): Three months ended June, Six months ended June 30, 2018 2017 2018 2017 Research and development 701 $ 67 1,041 $ 108 General and administrative 415 64 731 95 Total stock-based compensation $ 1,116 $ 131 $ 1,772 $ 203 The Company granted 210,808 and 1,396,989 stock options for the three and six month periods ended June 30, 2018, respectively, and 190,145 and 866,582 for the three and six month periods ended June 30, 2017, respectively. These options had a weighted average grant-date fair value of $11.23 and $7.29 per share for the three and six month periods ended June 30, 2018, respectively, and $1.76 and $1.75 for the three and six month periods ended June 30, 2017, respectively. As a result of stock issuances under the Company’s stock plans, the Company issued 5,171 and 713,931 shares of our common stock for the three and six month periods ended June 30, 2018, respectively, and 240,407 and 519,059 for the three and six month periods ended June 30, 2017, respectively. As a result of early exercises under the 2015 Plan, approximately 1,181,717 and 812,769 shares had not vested and were subject to repurchase as of June 30, 2018 and December 31, 2017, respectively. The Company treats cash received from the exercise of unvested options as a refundable deposit and classifies such amounts as a liability in its condensed consolidated balance sheets. As of June 30, 2018 and December 31, 2017, the Company included cash received from the early exercise of unvested options of $3.5 million and $0.9 million, in its other current and long-term liabilities, respectively based on the timing of their expected vesting. Amounts included in liabilities are transferred into common stock and additional paid-in capital as the shares vest, which is generally over a period of 48 months.

Condensed Consolidated Balanc12

Condensed Consolidated Balance Sheet Components	6 Months Ended
	Jun. 30, 2018
Balance Sheet Related Disclosures [Abstract]
Condensed Consolidated Balance Sheet Components	Note 7. Condensed Consolidated Balance Sheet Components Property and Equipment Property and equipment, net consisted of the following (in thousands): As of June 30, 2018 As of December 31, 2017 Scientific equipment $ 6,197 $ 5,053 Furniture and equipment 730 625 Capitalized software 146 131 Leasehold improvements 10,824 9,280 Construction in progress 338 119 Total 18,235 15,208 Less: Accumulated depreciation and amortization (5,722 ) (3,978 ) Property and equipment, net $ 12,513 $ 11,230 Depreciation and amortization expense was $0.9 million and $1.7 million for the three and six month periods ended June 30, 2018, respectively, and $0.6 million and $1.1 million for the three and six month periods ended June 30, 2017, respectively. Accrued Liabilities Accrued liabilities consisted of the following (in thousands): As of June 30, 2018 As of December 31, 2017 Accrued personnel expenses $ 1,902 $ 1,026 Accrued research and development expenses 2,082 1,193 Professional fees 100 706 Other 258 212 Total $ 4,342 $ 3,137

Net Loss per Share

Net Loss per Share	6 Months Ended
	Jun. 30, 2018
Earnings Per Share [Abstract]
Net Loss per Share	Note 8. Net Loss per Share Effective as of the completion of the IPO, all of the Company’s preferred stock was converted to common stock. For purposes of calculating net loss per share for the three and six month periods ended June 30, 2018, the preferred stock converted to common stock was included in the net loss per common share calculation on a post-conversion basis based on the conversion date. 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, 2018 2017 2018 2017 Numerator: Net loss $ (13,533 ) $ (9,550 ) $ (26,488 ) $ (16,750 ) Denominator: Weighted-average common shares outstanding 44,450,312 3,900,271 28,248,337 3,725,487 Less: weighted-average common shares subject to repurchase (1,916,671 ) (2,207,121 ) (2,012,330 ) (2,153,582 ) Weighted-average common shares used to compute basic and diluted net loss per share 42,533,641 1,693,150 26,236,007 1,571,905 Net loss per share: basic and diluted $ (0.32 ) $ (5.64 ) $ (1.01 ) $ (10.66 ) The following outstanding potentially dilutive securities were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: Six Months Ended June 30, 2018 2017 Convertible preferred stock — 21,307,645 Common stock options issued and outstanding 1,221,862 471,891 Unvested restricted common stock 636,574 1,331,018 Unvested early exercised common stock options 1,181,717 867,958 Total 3,040,153 23,978,512

Subsequent Event

Subsequent Event	6 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
Subsequent Event	Note 9. Subsequent Event In July 2018, Taiho exercised its option under the Option and License Agreement entered into in September 2017 to obtain an exclusive development and commercialization license to the Company’s adenosine receptor antagonist program, which includes AB928 and back-up compounds, in Japan and certain other territories in Asia (excluding China). Taiho is obligated to make the $3.0 million option exercise payment in August 2018.

Significant Accounting Polici15

Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (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 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 three and six month periods ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018 or for any future period. The balance sheet as of December 31, 2017 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 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, 2017 included in our Prospectus. There have been no material changes to the Company’s significant accounting policies during the six months ended June 30, 2018 as compared to the significant accounting policies described in the Company’s audited financial statements for the year ended December 31, 2017 included in the prospectus dated March 14, 2018 filed with the SEC pursuant to Rule 424(b)(4) under the Securities Act of 1993, as amended. From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB), or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s condensed consolidated financial statements upon adoption. Under the Jumpstart Our Business Startups Act of 2012, as amended (the JOBS Act), the Company meets the definition of an emerging growth company and has elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act. The Company will remain an emerging growth company until the earliest of (1) the last day of its first fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million of the prior June 30th and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
Principles of Consolidation	Principles of Consolidation During 2017, the Company established a wholly-owned subsidiary in Australia. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiary. All intercompany accounts, transactions and balances have been eliminated.
Reverse Stock Split	Reverse Stock Split On March 9, 2018, the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96 The par values and the authorized shares of the common and preferred stock were not adjusted as a result of the Reverse Split. All references to shares of common stock outstanding, average number of shares outstanding and per share amounts in these condensed consolidated financial statements and notes to the condensed consolidated financial statements have been adjusted within the condensed consolidated financial statements, on a retroactive basis, to reflect the Reverse Split
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 disclosure of contingent assets and liabilities. Estimates were used to determine the fair value of common stock prior to the IPO and are used to determine stock-based awards and other issuances, accruals for research and development costs, useful lives of long-lived assets, and uncertain tax positions. Actual results could differ materially from the Company’s estimates.
Cash Equivalents, Short-Term and Long-Term Investments	Cash Equivalents, Short-Term and Long-Term 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 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 loss. Realized gains and losses are included in interest and other income, net in the condensed consolidated statements of operations and comprehensive loss.
Restricted Cash	Restricted Cash Restricted cash at June 30, 2018 and December 31, 2017, comprises cash balances primarily held as security in connection with the Company’s facility lease agreement and is included in long-term assets in the condensed consolidated balance sheets.
Concentration of Credit Risk	Concentration 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 and corporate notes. 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 highly credit worthy and in highly rated investments.
Deferred Offering Costs	Deferred Offering Costs Deferred offering costs, consisting of legal, accounting, filing and other fees directly related to the Company’s IPO, are capitalized. The deferred offering costs, which totaled $3.6 million, were reclassified to additional paid-in capital upon the effectiveness of the IPO in March 2018.
Revenue Recognition	Revenue Recognition The Company generates revenue from its option and license agreement for the development and commercialization of its product candidates. Option and license agreements may include non-refundable upfront research and development fees, option fees to obtain development and commercialization licenses for the Company’s products, milestone payments based on achievement of defined development, regulatory and sales targets, and royalties on sales of commercialized products. To date, the Company has not recognized revenue from sales of its product candidates. The Company recognizes revenue when all four of the following criteria have been met: (i) collectability is reasonably assured; (ii) delivery has occurred or services have been rendered; (iii) persuasive evidence of an arrangement exists; and (iv) the fee is fixed or determinable. Revenue under option and license arrangements is recognized based on evaluation of the performance obligations of the contract. Collectability is assessed based on evaluation of payment criteria as stated in the contract as well as the creditworthiness of the customer. Determination of whether delivery has occurred, or services rendered are based on management’s evaluation of the performance obligations as stated in the contract and progress made against those obligations. Evidence of arrangement is deemed to exist upon execution of the contract. Fees are considered fixed and determinable when the amount payable to the Company is no longer subject to any acceptance, refund rights or other contingencies that would alter the fixed nature of the fees charged for the deliverables. Option and license agreements may contain multiple elements as evaluated under Accounting Standards Codification (ASC) 605-25, Revenue Recognition- Multiple-Element Arrangements, A delivered item or items that do not qualify as a separate unit of accounting within the arrangement are combined with the other applicable undelivered items within the arrangement. The allocation of arrangement consideration and the recognition of revenue is then determined for those combined deliverables as a single unit of accounting. For a combined unit of accounting, non-refundable upfront fees are recognized as performance obligations related to the final deliverable are completed. In the case of research and development services, performance would generally be expected to be ratable over the estimated performance period unless the Company determines there is a discernible pattern of performance other than straight-line, in which case the Company uses a proportionate performance method to recognize the revenue over the estimated performance period. Amounts received in advance of performance are recorded as deferred revenue. If any of the initial deliverables are determined to have standalone value separate from the research and development services, then the allocated consideration is recorded as revenue when those items are delivered. Option and license agreements may also contain milestone payments that become due upon the achievement of certain milestones. The Company applies ASC 605-28, Revenue Recognition—Milestone Method.
Research and Development Expenses	Research and Development Expenses Research and development costs are expensed as incurred. Research and development expenses consist primarily of personnel costs for the Company’s research and product development employees. Also included are non-personnel costs such as professional fees payable to third parties for preclinical and clinical studies and research services, laboratory supplies and equipment maintenance, product licenses, and other consulting costs. The Company estimates preclinical and clinical study and research expenses based on the services performed, pursuant to contracts with research institutions that conduct and manage preclinical and clinical studies and research services on its behalf. The Company estimates these expenses based on discussions with internal management personnel and external service providers as to the progress or stage of completion of services and the contracted fees to be paid for such services. If the actual timing of the performance of services or the level of effort varies from the original estimates, the Company will adjust the accrual accordingly. Payments associated with licensing agreements to acquire exclusive licenses to develop, use, manufacture and commercialize products that have not reached technological feasibility and do not have alternate commercial use are expensed as incurred. Payments made to third parties under these arrangements in advance of the performance of the related services by the third parties are recorded as prepaid expenses until the services are rendered.
Recently Issued Accounting Standards or Updates Not Yet Effective	Recently Issued Accounting Standards or Updates Not Yet Effective In January 2016, the FASB issued ASU No. 2016-01 (Subtopic 825-10), Financial Instruments (ASU 2016-01) In November 2016, the FASB issued ASU No. 2016-18 (Topic 230), Restricted Cash, Statement of Cash Flows (ASU 2016-18) In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date The core principle of ASU 2014-09 is that an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing U.S. generally accepted accounting pronouncements. The Company is still in the process of evaluating the effect that this guidance will have on revenue recognition for our option and license agreement with Taiho Pharmaceutical Co., Ltd. (Taiho), specifically as it pertains to the non-refundable, non-creditable cash payments to the Company totaling $35.0 million and the future contingent payments the Company may become entitled to. The Company expects its evaluation to be completed during 2018. In February 2016, the FASB issued ASU No. 2016-02 (Topic 842), Leases (ASU 2016-02). In June 2018, the FASB issued ASU No. 2018-07 (Topic 718), Compensation – Stock Compensation (ASU 2018-07).

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Schedule of Fair Value, Assets Measured on Recurring Basis	The following tables set forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Fair Value Measurements at June 30, 2018 Total Level 1 Level 2 Level 3 Assets Money market funds $ 104,286 $ 104,286 $ — $ — Overnight repurchase agreements 40,000 — 40,000 — U.S. government agency obligations 46,755 — 46,755 — Corporate securities and commercial paper 86,449 — 86,449 — $ 277,490 $ 104,286 $ 173,204 $ — Fair Value Measurements at December 31, 2017 Total Level 1 Level 2 Level 3 Assets Money market funds $ 66,478 $ 66,478 $ — $ — U.S. government agency obligations 57,153 — 57,153 — Corporate securities and commercial paper 52,072 — 52,072 — $ 175,703 $ 66,478 $ 109,225 $ —
Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities	Classified as (with contractual maturities): June 30, 2018 December 31, 2017 Cash and Cash equivalents (due within 90 days) $ 169,998 $ 98,426 Short-term investments (due within one year) 95,700 77,277 Long-term investments (due between one and two years) 11,792 — $ 277,490 $ 175,703
Schedule of Available for Sale Securities at Fair Value Measurements	Fair Value Measurements at June 30, 2018 Amortized Cost Unrealized Gain Unrealized Loss Fair Value Money market funds $ 104,286 $ — $ — $ 104,286 Overnight repurchase agreements 40,000 — 40,000 U.S. government agency obligations 46,779 (24 ) 46,755 Corporate securities and commercial paper 86,509 — (60 ) 86,449 $ 277,574 $ — $ (84 ) $ 277,490 Fair Value Measurements at December 31, 2017 Amortized Cost Unrealized Gain Unrealized Loss Fair Value Money market funds $ 66,478 $ — $ — $ 66,478 U.S. government agency obligations 57,183 — (30 ) 57,153 Corporate securities and commercial paper 52,084 — (12 ) 52,072 $ 175,745 $ — $ (42 ) $ 175,703

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Jun. 30, 2018
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Summary of Stock-Based Compensation Expense	Total stock-based compensation expense was recognized in our condensed consolidated statements of operations and comprehensive loss as follows (in thousands): Three months ended June, Six months ended June 30, 2018 2017 2018 2017 Research and development 701 $ 67 1,041 $ 108 General and administrative 415 64 731 95 Total stock-based compensation $ 1,116 $ 131 $ 1,772 $ 203

Condensed Consolidated Balanc18

Condensed Consolidated Balance Sheet Components (Tables)	6 Months Ended
	Jun. 30, 2018
Balance Sheet Related Disclosures [Abstract]
Summary of Property and Equipment, Net	Property and equipment, net consisted of the following (in thousands): As of June 30, 2018 As of December 31, 2017 Scientific equipment $ 6,197 $ 5,053 Furniture and equipment 730 625 Capitalized software 146 131 Leasehold improvements 10,824 9,280 Construction in progress 338 119 Total 18,235 15,208 Less: Accumulated depreciation and amortization (5,722 ) (3,978 ) Property and equipment, net $ 12,513 $ 11,230
Summary of Accrued Liabilities	Accrued liabilities consisted of the following (in thousands): As of June 30, 2018 As of December 31, 2017 Accrued personnel expenses $ 1,902 $ 1,026 Accrued research and development expenses 2,082 1,193 Professional fees 100 706 Other 258 212 Total $ 4,342 $ 3,137

Net Loss per Share (Tables)

Net Loss per Share (Tables)	6 Months Ended
	Jun. 30, 2018
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, 2018 2017 2018 2017 Numerator: Net loss $ (13,533 ) $ (9,550 ) $ (26,488 ) $ (16,750 ) Denominator: Weighted-average common shares outstanding 44,450,312 3,900,271 28,248,337 3,725,487 Less: weighted-average common shares subject to repurchase (1,916,671 ) (2,207,121 ) (2,012,330 ) (2,153,582 ) Weighted-average common shares used to compute basic and diluted net loss per share 42,533,641 1,693,150 26,236,007 1,571,905 Net loss per share: basic and diluted $ (0.32 ) $ (5.64 ) $ (1.01 ) $ (10.66 )
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 for the periods presented because including them would have been antidilutive: Six Months Ended June 30, 2018 2017 Convertible preferred stock — 21,307,645 Common stock options issued and outstanding 1,221,862 471,891 Unvested restricted common stock 636,574 1,331,018 Unvested early exercised common stock options 1,181,717 867,958 Total 3,040,153 23,978,512

Organization - Additional Infor

Organization - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions	Mar. 21, 2018	Jun. 30, 2018	Dec. 31, 2017
Class Of Stock [Line Items]
Common stock, shares authorized	400,000,000	400,000,000	153,993,227
Preferred stock, shares authorized	10,000,000	10,000,000	0
Common stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Preferred stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Cash and investments		$ 277.5
Cash, Cash Equivalents and Short-term Investments
Class Of Stock [Line Items]
Cash and investments		$ 265.7
IPO
Class Of Stock [Line Items]
Common stock issued	9,200,000
Common stock offering price	$ 15
Net proceeds from issuance of common stock excluding underwriting costs and other offering related costs	$ 124.7
IPO | Common Stock
Class Of Stock [Line Items]
Convertible preferred stock converted into common stock	30,459,574
Overallotment
Class Of Stock [Line Items]
Common stock issued	1,200,000

Significant Accounting Polici21

Significant Accounting Policies - Additional Information (Detail) $ in Millions	Mar. 09, 2018	Sep. 30, 2017USD ($)	Jun. 30, 2018USD ($)	Mar. 31, 2018USD ($)	Dec. 31, 2017USD ($)	Jun. 29, 2017USD ($)
Significant Accounting Policies [Line Items]
Description to be remained in emerging growth company			The Company will remain an emerging growth company until the earliest of (1) the last day of its first fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million of the prior June 30th and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
Minimum annual gross revenue in order to remain classified as emerging growth company			$ 1,070
Maximum market value of common stock held by non-affiliates to be remained in emerging growth company						$ 700
Additional non-convertible debt securities to be remained in emerging growth company			$ 1,000
Reverse stock split			the Company effected a reverse split of all shares of its common and preferred stock at a ratio of 1-for-3.96
Reverse stock split ratio	0.2525
Deferred offering costs				$ 3.6	$ 1.3
Taiho Pharmaceutical Co Ltd | Taiho Agreement
Significant Accounting Policies [Line Items]
Non-refundable, non-creditable cash payments		$ 35	$ 35

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Fair Value Disclosures [Abstract]
Fair value assets transferred from level 1 to level 2	$ 0	$ 0
Fair value assets transferred from level 2 to level 1	0	0
Fair value liabilities transferred from level 1 to level 2	0	0
Fair value liabilities transferred from level 2 to level 1	0	0
Fair value assets transferred into level 3	0	0
Fair value assets transferred out of level 3	0	0
Fair value liabilities transferred into level 3	0	0
Fair value liabilities transferred out of level 3	0	0
Realized gains (loss) on sale or maturity of available-for-sale marketable securities	0	0
Reclassification out of accumulated other comprehensive loss	$ 0	$ 0

Fair Value Measurements - Sched

Fair Value Measurements - Schedule of Fair Value, Assets Measured on Recurring Basis (Details) - Fair Value On Recurring Basis - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	$ 277,490	$ 175,703
Overnight Repurchase Agreements
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	40,000
Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	104,286	66,478
U.S. Government Agency Obligations
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	46,755	57,153
Corporate Securities and Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	86,449	52,072
Level 1
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	104,286	66,478
Level 1 | Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	104,286	66,478
Level 2
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	173,204	109,225
Level 2 | Overnight Repurchase Agreements
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	40,000
Level 2 | U.S. Government Agency Obligations
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	46,755	57,153
Level 2 | Corporate Securities and Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets, fair value	$ 86,449	$ 52,072

Fair Value Measurements - Sch24

Fair Value Measurements - Schedule of Investments Classified as Available for Sale Securities with Contractual Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value Disclosures [Abstract]
Cash and Cash equivalents (due within 90 days)	$ 169,998	$ 98,426
Short-term investments (due within one year)	95,700	77,277	[1]
Long-term investments (due between one and two years)	11,792
Total cash and investments in marketable securities	$ 277,490	$ 175,703
[1]	The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

Fair Value Measurements - Sch25

Fair Value Measurements - Schedule of Available for Sale Securities at Fair Value Measurements (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	$ 277,574	$ 175,745
Unrealized Loss	(84)	(42)
Fair Value	277,490	175,703
Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	104,286	66,478
Fair Value	104,286	66,478
Overnight Repurchase Agreements
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	40,000
Fair Value	40,000
U.S. government agency obligations
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	46,779	57,183
Unrealized Loss	(24)	(30)
Fair Value	46,755	57,153
Corporate Securities and Commercial Paper
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Amortized Cost	86,509	52,084
Unrealized Loss	(60)	(12)
Fair Value	$ 86,449	$ 52,072

Equity Investment - Additional

Equity Investment - Additional Information (Detail) - USD ($) shares in Millions	1 Months Ended		3 Months Ended		6 Months Ended
	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Schedule of Equity Method Investments [Line Items]
Loss from equity method investments					$ 377,000	$ 141,000
PACT Pharma
Schedule of Equity Method Investments [Line Items]
Loss from equity method investments			$ 200,000	$ 70,000	$ 400,000	100,000
Equity method investment agreement termination date					May 31, 2018
Gain in interest and other income			1,200,000
Equity method investments impairment					$ 0	$ 0
PACT Pharma | Variable interest entity
Schedule of Equity Method Investments [Line Items]
Receivable from PACT Pharma			$ 200,000		$ 200,000		$ 25,000
PACT Pharma | Series A Preferred Stock
Schedule of Equity Method Investments [Line Items]
Purchase of common stock, shares	1
Purchase of common stock, value	$ 1,000,000
PACT Pharma | Common Stock
Schedule of Equity Method Investments [Line Items]
Purchase of common stock, shares		3.6

License and Collaboration Agr27

License and Collaboration Agreements - Additional Information (Details)

1 Months Ended

3 Months Ended

6 Months Ended

12 Months Ended

Oct. 31, 2019USD ($)

Oct. 31, 2018USD ($)

Aug. 31, 2018USD ($)

Jul. 31, 2018USD ($)

Sep. 30, 2017USD ($)Program

Aug. 31, 2017USD ($)

Dec. 31, 2016USD ($)

Jun. 30, 2018USD ($)

Jun. 30, 2017USD ($)

Jun. 30, 2018USD ($)

Dec. 31, 2017USD ($)

Jun. 30, 2017USD ($)

Dec. 31, 2017USD ($)

License And Collaboration Agreements [Line Items]

Deferred revenue, current

$ 5,000,000

$ 5,000,000

$ 5,000,000

[1]

$ 5,000,000

[1]

Deferred revenue, noncurrent

16,087,000

16,087,000

18,587,000

[1]

18,587,000

[1]

Subsequent Event

License And Collaboration Agreements [Line Items]

Upfront and milestone payments

$ 2,000,000

Subsequent Event | Research and Development Expenses

License And Collaboration Agreements [Line Items]

Upfront and milestone payments

2,000,000

Taiho Pharmaceutical Co Ltd | Taiho Agreement

License And Collaboration Agreements [Line Items]

Option period

5 years

Non-refundable, non-creditable cash payments

$ 35,000,000

$ 35,000,000

Payment received for license agreement

25,000,000

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 and non creditable cash payments received

$ 25,000,000

Estimated performance period

5 years

Remaining non refundable and non creditable cash payments receivable

10,000,000

$ 10,000,000

Revenue recognized

1,300,000

2,500,000

Deferred revenue, current

5,000,000

5,000,000

5,000,000

5,000,000

Deferred revenue, noncurrent

16,100,000

16,100,000

18,600,000

$ 18,600,000

Taiho Pharmaceutical Co Ltd | Taiho Agreement | Subsequent Event

License And Collaboration Agreements [Line Items]

Payment for option exercise

$ 3,000,000

Payment for first option exercise

$ 3,000,000

Taiho Pharmaceutical Co Ltd | Taiho Agreement | Scenario Forecast

License And Collaboration Agreements [Line Items]

Additional payment to be received for license agreement

$ 5,000,000

$ 5,000,000

Taiho Pharmaceutical Co Ltd | Taiho Agreement | Minimum

License And Collaboration Agreements [Line Items]

Number of programs, IND enabling studies not initiated | Program

5

Payment for option exercise

$ 3,000,000

Taiho Pharmaceutical Co Ltd | Taiho Agreement | Maximum

License And Collaboration Agreements [Line Items]

Extended option agreement period

7 years

Payment for option exercise

$ 15,000,000

Additional clinical and regulatory milestone payments receivable

130,000,000

Contingent payments receivable

$ 145,000,000

WuXi Biologics License Agreement

License And Collaboration Agreements [Line Items]

Upfront and milestone payments

$ 18,500,000

Milestone payments

0

$ 0

Range of tiered royalty payments on net sales

high single-digits to low teens

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

$ 0

$ 0

$ 800,000

$ 3,800,000

Abmuno License Agreement | Maximum

License And Collaboration Agreements [Line Items]

Clinical, regulatory and commercialization milestone payments

$ 101,000,000

[1]

The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Mar. 31, 2018	Dec. 31, 2017
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock options, grants in period, shares	210,808	190,145	1,396,989	866,582
Stock options, grants in period, weighted average grant date fair value per share	$ 11.23	$ 1.76	$ 7.29	$ 1.75
Common stock issued under equity compensation plans	5,171	240,407	713,931	519,059
2018 Equity Incentive Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of shares issued or transferred					3,570,000
2015 Stock Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Shares not vested and subject to repurchase	1,181,717		1,181,717			812,769
Cash received from early exercise of unvested options	$ 3.5		$ 3.5			$ 0.9
Award vesting period			48 months

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, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 1,116	$ 131	$ 1,772	$ 203
Research and Development
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation	701	67	1,041	108
General and Administrative
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 415	$ 64	$ 731	$ 95

Condensed Consolidated Balanc30

Condensed Consolidated Balance Sheet Components - Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Property Plant And Equipment [Line Items]
Total	$ 18,235	$ 15,208
Less: Accumulated depreciation and amortization	(5,722)	(3,978)
Property and equipment, net	12,513	11,230	[1]
Scientific Equipment
Property Plant And Equipment [Line Items]
Total	6,197	5,053
Furniture and Equipment
Property Plant And Equipment [Line Items]
Total	730	625
Capitalized Software
Property Plant And Equipment [Line Items]
Total	146	131
Leasehold Improvements
Property Plant And Equipment [Line Items]
Total	10,824	9,280
Construction in Progress
Property Plant And Equipment [Line Items]
Total	$ 338	$ 119
[1]	The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

Condensed Consolidated Balanc31

Condensed Consolidated Balance Sheet Components - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Property Plant And Equipment [Abstract]
Depreciation and amortization expenses	$ 0.9	$ 0.6	$ 1.7	$ 1.1

Condensed Consolidated Balanc32

Condensed Consolidated Balance Sheet Components - Summary of Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Accrued Liabilities Current [Abstract]
Accrued personnel expenses	$ 1,902	$ 1,026
Accrued research and development expenses	2,082	1,193
Professional fees	100	706
Other	258	212
Total	$ 4,342	$ 3,137	[1]
[1]	The Condensed Consolidated Balance Sheet as of December 31, 2017 has been derived from the audited financial statements as of that date.

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, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Numerator:
Net loss	$ (13,533)	$ (9,550)	$ (26,488)	$ (16,750)
Denominator:
Weighted-average common shares outstanding	44,450,312	3,900,271	28,248,337	3,725,487
Less: weighted-average common shares subject to repurchase	(1,916,671)	(2,207,121)	(2,012,330)	(2,153,582)
Weighted-average common shares used to compute basic and diluted net loss per share	42,533,641	1,693,150	26,236,007	1,571,905
Net loss per share: basic and diluted	$ (0.32)	$ (5.64)	$ (1.01)	$ (10.66)

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, 2018	Jun. 30, 2017
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	3,040,153	23,978,512
Convertible Preferred Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share		21,307,645
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	1,221,862	471,891
Unvested Restricted Common Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	636,574	1,331,018
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	1,181,717	867,958

Subsequent Event - Additional I

Subsequent Event - Additional Information (Detail) $ in Millions	1 Months Ended
	Aug. 31, 2018USD ($)
Taiho Pharmaceutical Co Ltd | Option and License Agreement | Subsequent Event
Subsequent Event [Line Items]
Payment for option exercise	$ 3