Arcus Biosciences, a clinical-stage, global biopharmaceutical company focused on developing differentiated molecules and combination therapies for people with cancer, obtained a $250 million term loan facility from Hercules Capital. The additional capital strengthens Arcus’s balance sheet and increases flexibility to rapidly advance casdatifan, its potential best-in-class HIF-2a inhibitor. Arcus plans to present data from ARC-20, its Phase 1/1b study of casdatifan in clear cell renal cell carcinoma (ccRCC), later this year.
“2024 has been an exciting year for us, with the completion of enrollment of STAR-221, our first Phase 3 study for domvanalimab, our Fc-silent anti-TIGIT antibody, in upper GI cancers and the rapid enrollment of the expansion portion of ARC-20, our Phase 1/1b study of casdatifan, our HIF-2a inhibitor,” said Terry Rosen, Ph.D., chief executive officer of Arcus. “This non-dilutive facility enhances our already strong cash position and enables us to expand and accelerate our development program for casdatifan across multiple settings in ccRCC.”
“Hercules is pleased to enter into this financial partnership with Arcus to help finance the company’s broad pipeline of oncology programs as well as meet its near- and long-term strategic goals,” said Cristy Barnes, managing director at Hercules Capital.
Under the terms of the term loan facility, $50 million was drawn at closing and an additional $100 million is committed and fully available at Arcus’s sole option in minimum increments of $25 million. A second tranche of $100 million will be available to support strategic initiatives, subject to future approval by Hercules. The term loan matures in five years and maturity is extendable to six years upon the initiation of Phase 3 trials for casdatifan and quemliclustat. The facility provides for an interest-only period of four years, which is extendable to five years based on the achievement of certain regulatory milestones. The loan facility is secured by substantially all the company’s assets, excluding those covered by its existing collaboration agreements.
J. Wood Capital Advisors served as sole financial advisor to the company. Latham & Watkins LLP served as legal counsel to the company. Morrison & Foerster LLP served as legal counsel to Hercules Capital.