Arcus Biosciences Prices $250 Million Stock Sale At $17.50 A Share, 8.4% Below Wednesday's Close
The cancer drug developer is selling 14,285,715 new shares, 10.1% of the count outstanding after the deal, with proceeds aimed at its kidney-cancer drug.
Arcus Biosciences, a late clinical-stage drug developer focused on cancer and immune diseases, priced a $250.0 million stock offering on Wednesday: 14,285,715 shares at $17.50 each, 8.4% below the $19.10 last reported sale price on October 21. The company is the seller, and it said most of the money will go toward its kidney-cancer drug casdatifan.
Size, price and share count
After underwriting discounts, Arcus gets $235.0 million before expenses. It estimates net proceeds of about $234.5 million, or about $269.7 million if the underwriters buy their full extra allotment.
The new shares are 10.1% of the 141,304,346 shares the prospectus says will be outstanding after the offering. If the underwriters use their 30-day option on 2,142,857 more shares, the count rises to 143,447,203.
New buyers face immediate dilution of $12.56 per share in net tangible book value, based on an as-adjusted $4.94 per share, the prospectus says. The figure is $12.39 if the option is exercised in full.
Jefferies, Leerink Partners, TD Cowen, Evercore ISI and Mizuho are the underwriters. Delivery is expected on or about October 23.
Money for casdatifan
Arcus said it intends to use the proceeds "to fund ongoing research and development activities, including the expansion and acceleration of our clinical development program for casdatifan, and for other general corporate purposes."
The company has no approved products. Its most advanced cancer drugs are in Phase 3 studies, including casdatifan for clear cell renal cell carcinoma, a kidney cancer. Gilead holds licenses and options on several of its programs, and Taiho holds rights in Japan and certain other Asian countries.
The prospectus estimates preliminary cash, cash equivalents and marketable securities of about $694.0 million as of September 30, 2026. Its accounting firm has not audited or reviewed that figure.
Priced after the trial data
Arcus presented new casdatifan data on October 20, and Seeking Alpha reported the shares closed at $19.10 on Wednesday, down $4.65 on the day.
In the prospectus, the company said casdatifan combined with the anti-PD-1 drug zimberelimab produced a confirmed objective response rate of 50% in 30 first-line patients. With the cabozantinib combination in second-line patients, median progression-free survival was 14.5 months.
The stock closed at $19.36 on Thursday, giving the company a market value of $2.4 billion.
The underwriters' option runs 30 days from the October 21 prospectus supplement, and the offering is expected to settle on or about October 23.
Sources
- Form 424B5 — Arcus Biosciences, Inc. (RCUS) — SEC EDGAR
- Arcus Biosciences Announces Pricing of $250 Million Public Offering of Common Stock — Yahoo Finance
- Arcus Biosciences Commences Public Offering o... — benzinga.com
- Arcus Biosciences slides 20% on stock offering, kidney-cancer data (RCUS:NYSE) | Seeking Alpha — seekingalpha.com
- Arcus Biosciences Announces Pricing of $250 Million Public Offering of Common Stock – Company Announcement - FT.com — Financial Times
- Arcus Biosciences Announces Commencement of Public Offering of Common Stock — businesswire.com
