Gilead in talks about buying stake in TIGIT biotech Arcus: report

Shares in Arcus jumped 50% on the report of Gilead's interest (Gilead China)

Gilead Sciences is talking to Arcus Biosciences about buying a “significant stake” in the immuno-oncology drug developer, Bloomberg reports. The deal could see Gilead join companies including Merck and Roche in the race to bring an anti-TIGIT antibody to market.

Arcus has moved its anti-TIGIT candidate, AB154, into a phase 2 trial in patients with non-small cell lung cancer. In the trial, Arcus hopes to show AB154 improves the efficacy of anti-PD-1 checkpoint inhibitors—in that case, the biotech’s own zimberelimab. The potential for the targeting of TIGIT, another immune checkpoint, to enhance the efficacy of drugs such as Keytruda has attracted the interest of a who’s who of leading cancer companies.

Gilead is reportedly considering becoming the latest company to place a bet on TIGIT. Exactly what form the agreement with Arcus will take, and even whether it will even happen, remains unclear, with Bloomberg reporting that Gilead is in talks about taking a “significant stake” and development partnerships. 

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Arcus had a market cap of $716 million before reports of Gilead’s interest drove shares up as much as 54%. The figures mean any deal with Arcus is likely to represent a relatively small bet for Gilead, which struck a $4.9 billion deal to buy Forty Seven last month and paid $11 billion to acquire Kite in 2017. 

If Gilead strikes a deal for AB154, it will go up against Merck and Roche. Merck began testing its drug, MK-7684, in humans late in 2016 and is now gearing up to initiate a clutch of substudies to assess it in combination with Keytruda in melanoma patients. Roche has a still broader roster, with eight trials of anti-TIGIT prospect tiragolumab either enrolling patients or due to start doing so. The roster of trials features two phase 3 lung cancer studies. 

Companies that want to buy their way into the TIGIT field have a few options, including Arcus. Other companies with anti-TIGIT drugs in their pipelines include iTeos Therapeutics and Mereo BioPharma. Shares in Mereo rose 25% in early trading in London following the report of Gilead’s interest in Arcus. And iTeos is a privately held company that raised $125 million at the start of the month. 

The companies and their investors are betting TIGIT is the long-sought target that will take the efficacy of PD-1/PD-L1 checkpoint inhibitors to the next level. However, earlier efforts to enhance the efficacy of checkpoint inhibitors have stuttered or flamed out completely, most dramatically when the failure of Incyte’s epacadostat took down the I-O field. 

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