Bay Area Startup Arcus Biosciences Emerges With $120 Million

Bay Area Startup Arcus Biosciences Emerges With $120 Million August 29, 2016
By Alex Keown, BioSpace.com Breaking News Staff

HAYWARD, Calif. – New immuno-oncology startup Arcus Biosciences has scored an impressive $120 million funding in two financing rounds all while in stealth mode.

Bay Area Arcus was founded in May 2015 and is helmed by Terry Rosen, the co-founder and CEO of oncology therapy company Flexus Biosciences—a company that was snapped up by Bristol-Myers Squibb for $1.25 billion. The company also is led by its president, Juan Jaen, who served as head of research and development at Flexus. FierceBiotech reported that Arcus will use its funding to push two of its immuno-oncology treatments into early clinical testing over the next year. The company, which has remained in stealth mode, is initially developing drug therapies for small molecules along the ATP-adenosine pathway; CD73, CD39 and the A2A receptor, FierceBiotech reported. Its lead candidate is expected to be from the CD73 program, with the A2A program slated to be the second candidate in the clinic.

With the explosion of checkpoint inhibitors being used to address various cancers, Arcus said a large number of cancer patients do not benefit from those treatments. According to its website, Arcus said it has initiated “several drug discovery programs aimed at restoring the vigor and functionality of tumor-infiltrating T and NK cells.”

“We have also initiated drug discovery efforts with the objective of stimulating the maturation and activation of tumor antigen-presenting dendritic cells (DC),” the company said on its website.

Although Immuno-oncology is one of the hottest areas of research right now, Rosen told FierceBiotech he believes companies blazing trails in the field, which would include Juno , Kite Pharma and more, will see a lot of “disappointing data” in the next year or two due to poorly planned combination trials. In fact, last month Juno halted a mid-stage trial of its candidate JCARO15, a CAR-T therapy for patients with relapsed or refractory B cell acute lymphoblastic leukemia due to three deaths. Two of the deaths correlated with a change in the trial protocols, when, in addition to receiving JCAR015, patients received a chemotherapy drug, fludarabine. The trial was later restarted, but with modifications.

Rosen told FierceBiotech that he is building Arcus as a long-term company and not something that will generate interest only to be snapped up by a larger company.

“This is the last field in which I will probably ever work,” he said, according to FierceBiotech.

The company anticipates the approach of immuno-oncology will shift from a focus on the origin or a tumor to activity in a particular tumor, Jaen told FierceBiotech.

Investors supporting the company include Novartis , Celgene , The Column Group and Foresite Capital, according to the company’s website.

Since its founding, Arcus has been on a bit of a hiring spree. The company initially planned to have 38 employees on staff by year’s end, but that has since been scaled up to about 60 employees, FierceBiotech reported.

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