Benzinga | Dec 21, 2021 04:52PM EST

Gilead, Arcus Biosciences Complete Closing Of Option Exercise For 3 Clinical-Stage Programs And New Research Collaboration

Gilead Sciences, Inc. (NASDAQ:GILD) and Arcus Biosciences, Inc. (NYSE:RCUS) today announced the closing of Gilead's option exercises to three programs in Arcus' clinical-stage portfolio and a new research collaboration between the two companies. On November 17, 2021, Gilead exercised its options to anti-TIGIT molecules domvanalimab and AB308, as well as clinical candidates etrumadenant (dual adenosine A2a/A2b receptor antagonist) and quemliclustat (small molecule CD73 inhibitor).

The closing occurred following the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

Under the terms of the parties' Option, License and Collaboration Agreement, as amended in connection with Gilead's three option exercises (the "2020 Agreement"), the closing of this transaction triggers option payments totaling $725 million from Gilead to Arcus, expected to be paid in early Q1 2022. With closing of the transaction for all three programs, the $100 million option continuation payment previously due in Q3 2022 will not be made by Gilead. In addition, the parties will co-develop and share the global costs related to these clinical programs. If the optioned molecules achieve regulatory approval, Gilead and Arcus will co-commercialize and equally share profits in the U.S. Outside of the U.S., Gilead holds exclusive commercialization rights, subject to any rights of Arcus's existing collaboration partners, and Gilead would pay Arcus tiered royalties on net sales of each optioned product.