September 20, 2017
By Mark Terry, BioSpace.com Breaking News Staff
Hayward, Calif. – Arcus Biosciences announced it has inked an option and license deal with Taiho Pharmaceutical Co. to develop and commercialize product candidates in Arcus’s portfolio in Japan and specific Asian territories excluding China.
During the first three years of the agreement, Arcus will receive $35 million in payments. Taiho will have an option to in-license the development and commercialize rights in the region over a five-year period. Arcus will receive an option payment and can receive up to $275 million in commercial milestone payments per molecule for any product candidate whose license Taiho exercises. In addition, Arcus is eligible for high single digit to mid-double digit royalties on net sales of each product.
“We founded Arcus in 2015 to create a broad portfolio of novel molecules that target the most prevalent mechanisms of tumor-induced immuno-suppression,” said Terry Rosen, Arcus’s chief executive officer, in a statement. “Our relationship with Taiho began with the inaugural investment of Taiho Ventures in Arcus in 2016, and since that time, we have come to recognize an alignment in vision with Taiho. We are thrilled to collaborate with Taiho on the advancement of our rapidly growing pipeline for the benefit of patients in Japan and other important territories in Asia. Given its significant expertise in the oncology area, we are confident that Taiho will maximize the value of our programs in these regions. We look forward to advancing at least four immuno-oncology product candidates into clinical development by the end of 2018.”
Arcus was founded in 2015 by Terry Rosen and Juan Jaen. The company focuses on cancer immunotherapies that target the adenosine pathway, which is linked to driving immuno-suppression in the tumor micro-environment. Before starting Arcus, they founded Flexus Biosciences, which sold its preclinical-stage IDO inhibitor to Bristol-Myers Squibb in February 2015 for $800 million upfront and $450 million in milestones. Rosen is Arcus’s chief executive officer and Jaen is its president. They are also working at Pact Pharma, which is also backed by Taiho Ventures.
Arcus employs about 70 people. So far, it has raised $120 million in funding from investors that include The Column Group, Foresite Capital, GV (previously Google Ventures), Invus, Novartis , Celgene , Taiho Ventures, Stanford University, and DROIA.
Specific programs were not identified, but Arcus has numerous immuno-oncology targets, including CD73, CD39 and the A2A and A2B receptors, which are all involved in the ATP-adenosine pathway. Arcus has two candidates headed for the clinic, a small-molecule dual A2A and A2B receptor antagonist called AB928 and AB154, a monoclonal antibody that inhibits TIGIT, an immune checkpoint.
This deal comes only a month after Arcus signed a deal with China’s Gloria Pharma and WuXi Biologics. In that deal, worth $816 million, involved $18.5 million upfront to license an anti-PD-1 antibody.
Earlier this year, Arcus moved into a Hayward, Calif. facility that had formerly been occupied by Novo Nordisk and was moving into an adjacent building formerly used by Mallinckrodt PLC.
“We really do plan to build here for the long term,” Rosen told the San Francisco Business Times. Then, perhaps joking, perhaps not, he gestured to the rest of HCP Inc.’s Brittania Point Eden business park and said, “We have our eyes on this whole place.”
Its facilities will be 42,000 square feet.
