Arcus Biosciences(RCUS) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company reported cash of $1 billion at the end of Q1 2025, an increase from$992 million at the end of 2024, bolstered by a $150 million equity financing completed in February 2025 [34][36] - GAAP revenue for Q1 2025 was$8 million, down from $36 million in Q4 2024, primarily driven by collaboration with Gilead [35] - The company expects to recognize GAAP revenue of$75 million to $90 million for the full year 2025 [35] Business Line Data and Key Metrics Changes - The late-stage portfolio is focused on the casdadefan program, which is the top priority, with ongoing data generation expected to reinforce its advantages over competitors [4][5] - The Fc silent anti-TIGIT antibody, domvanilumab, is advancing towards its first Phase III study readout, expected in 2026 [14] - The PRISM-one trial of QEMLi, a small molecule CD73 inhibitor, is enrolling rapidly and is anticipated to be fully enrolled by the end of 2025 [16] Market Data and Key Metrics Changes - The addressable patient population for the IO naive setting is approximately 13,000 in the U.S. and 20,000 in other major markets, with a combined market opportunity estimated at$5 billion [30][31] - TKI-based regimens dominate the clear cell RCC market, holding approximately 65% share in the first line and 75% in the second line settings [31] Company Strategy and Development Direction - The company aims to develop casdadefan in TKI-free regimens, targeting earlier lines of RCC treatment to improve patient quality of life [11][12] - Collaborations with AstraZeneca are focused on combining casdadefan with their anti-PD-1/CTLA-4 bispecific antibody for first-line RCC, marking a strategic move towards TKI-free options [12][96] - The company is prioritizing late-stage programs while maintaining a sustainable pipeline with minimal investment in early-stage programs [43] Management's Comments on Operating Environment and Future Outlook - Management remains focused on execution amidst a tumultuous macro environment, ensuring resource deployment reflects ongoing assessments of priorities [4][5] - The company anticipates a steady flow of data for casdadefan over the next couple of years, reinforcing its competitive position [5][10] - Management expressed confidence in the ability to fund operations through pivotal readouts, with a strong balance sheet supporting ongoing development [34][36] Other Important Information - The company is exploring additional cohorts in the ARC20 study to evaluate casdadefan in various settings, including TKI-free regimens [13][19] - The competitive landscape for anti-TIGIT antibodies has shifted, with the company and AstraZeneca's candidates dominating the Phase III landscape [15] Q&A Session Summary Question: Can you elaborate on pipeline reprioritization and the adenosine inhibitor program? - Management confirmed that while there is a path forward for the adenosine modulator, current plans do not include moving forward with it at this time, focusing instead on late-stage programs like casdadefan [39][41] Question: What should be expected in the ASCO presentation versus the abstract? - Management indicated that the ASCO presentation will feature more recent data, including safety and efficacy for a population of about 40 patients, with compelling results anticipated [44][46] Question: What is the plan for the Peak One study and its primary endpoint? - Management stated that it is too early to provide specific timelines for the Peak One study's PFS primary endpoint, but they expect rapid enrollment and are focused on collecting OS data as a key secondary endpoint [66][68] Question: Will the company consider commercialization partnerships post-Peak One? - Management expressed intent to commercialize casdadefan independently, with potential consideration for a partner in Europe, emphasizing confidence in their capabilities [108]