The following table summarizes the revenues recognized from the Company’s collaboration agreements with Gilead and Taiho Pharmaceutical Co., Ltd. (Taiho) (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
License and development services revenue	$	23,742	$	-	$	48,374	$	-
Other collaboration revenue		9,839		9,461		29,971		28,383
Total collaboration and license revenues	$	33,581	$	9,461	$	78,345	$	28,383

The following table summarizes revenues by collaboration, category of revenue, and the method of recognition (in thousands):


			Three Months Ended September 30,				Nine Months Ended September 30,
Revenues recognized:	Over time	Point in time	2022		2021		2022		2021
License and development services for all Gilead programs	*		$	23,742	$	-	$	48,374	$	-
Gilead access rights related to the Company's research and development pipeline	*			8,317		7,711		24,949		23,133
Taiho access rights	*			1,522		1,750		5,022		5,250
Total collaboration and license revenues			$	33,581	$	9,461	$	78,345	$	28,383

The Company recognized the following revenue as a result of changes in the deferred revenue balance during the periods indicated below (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Amounts included in deferred revenue at the beginning of the period	$	33,581	$	9,461	$	78,345	$	28,383

In May 2020, the Company and Gilead entered into the Gilead Collaboration Agreement, Common Stock Purchase Agreement (the Stock Purchase Agreement), and Investor Rights Agreement, (collectively, the Gilead Agreements). Upon closing in July 2020, Gilead made an upfront payment of $175.0 million pursuant to the Gilead Collaboration Agreement and purchased 5,963,029 shares of Arcus common stock for approximately $200.0 million by paying $33.54 per share pursuant to the Stock Purchase Agreement.

In November 2021, the Company and Gilead entered into an amendment to the Gilead Collaboration Agreement (the Amended Gilead Collaboration Agreement), under which Gilead exercised its options to three programs for a total payment of $725.0 million that was received in January 2022. In connection with Gilead’s exercise of its options to these programs, the parties agreed to (i) slightly reduce the royalties for these programs, such that Gilead will pay the Company tiered royalties as a percentage of revenues ranging from the mid-teens to the low twenties and (ii) remove the $100.0 million option continuation payment that was otherwise due on the second anniversary of the Gilead Collaboration Agreement.

In October 2022, the Company and Gilead entered into an amendment to the Investor Rights Agreement (the Amended Investor Rights Agreement), that primarily extended the two-year lockup period to three-years.

As of September 30, 2022, Gilead had obtained licenses to domvanalimab and AB308 (collectively, the anti-TIGIT program), etrumadenant and quemliclustat (collectively, the adenosine pathway programs), and zimberelimab.

Under the terms of the Amended Gilead Collaboration Agreement, Gilead obtained exclusive licenses to zimberelimab, domvanalimab, AB308, etrumadenant, and quemliclustat, and time-limited exclusive options to all of the Company’s current and future clinical programs during the 10-year collaboration term and, for those programs that enter clinical development prior to the end of the collaboration term, for up to an additional three years thereafter. Gilead's opt-in rights to future programs are contingent upon option continuation payments of up to $300.0 million, consisting of a $100.0 million payment due on each of the fourth, sixth, and eighth anniversaries of the agreement. Gilead's option, on a program-by-program basis, will expire after a prescribed period, following the achievement of a clinical development milestone in such program and the Company's delivery to Gilead of the requisite data package. Gilead may exercise its option to any program at any time prior to expiration of the option, and will pay the Company an option fee of

$150.0 million per program. Gilead has exercised its option to all of the clinical programs in existence at the date of the 2020 agreement, and the Company may not exercise its opt-out rights for any of these programs. With respect to domvanalimab, the Company is also eligible to receive up to $500.0 million in potential U.S. regulatory approval milestones.

Under the Amended Gilead Collaboration Agreement, Gilead also has option rights to two research programs for which the Company will lead discovery and early development activities. With respect to these two research programs, Gilead has the right to exercise its option, on a program-by-program basis, either (i) upon the Company's completion of certain IND-enabling activities for an option payment of $60.0 million or (ii) following the achievement of a clinical development milestone for an option payment of $150.0 million. These research programs were not determined to be performance obligations at contract inception, due to the very early stages of the programs and the amounts of the option payments.

The Company’s assessment of the transaction price of the Amended Gilead Collaboration Agreement included an analysis of amounts it expected to receive, which at contract inception consisted of the upfront cash payment of $725.0 million, as well as amounts totaling $165.1 million deferred from the original Gilead transaction, which excluded the $100.0 million option continuation payment that would otherwise have been due on the second anniversary of the Gilead Collaboration Agreement. The Company considers the entire $890.1 million to be the allocable transaction price as of the amendment closing date, due to the Company's history of timely payments from Gilead and receipt of the full $725.0 million in January 2022 per the terms of the amendment.

The Company determined that the Amended Gilead Collaboration Agreement represented a contract modification under the application of ASC 606. At the amendment closing date, the Company allocated the transaction price to the new and remaining performance obligations identified as follows:


			Amount
Allocation of transaction price
Deferred revenues as of 12/21/2021			$	165,086
Option payment for Domvanalimab				275,000
Option payment for Etrumadenant				250,000
Option payment for Quemliclustat				200,000
Total transaction price allocated to performance obligations			$	890,086

Allocation to performance obligations	Distinct	Combined	Amount
Domvanalimab license	*		$	328,838
Etrumadenant license and R&D activities		*		218,722
Quemliclustat license and R&D activities		*		175,618
Domvanalimab R&D activities	*			34,528
Zimberelimab R&D and commercial activities	*			11,243
Access rights related to the Company's research and development pipeline	*			84,076
Material rights to option continuation periods	*			37,061
Total			$	890,086

After Gilead’s exercise of its option to a program, the two companies will co-develop and equally share global development costs for such joint development program, subject to opt-out rights of the Company applicable to certain programs, and expense caps on the Company’s spending and related subsequent adjustments. For each optioned program, provided the Company has not exercised its opt-out rights (if applicable), the Company has an option to co-promote in the United States with equal sharing of related profits and losses. Gilead has the right to exclusively commercialize any optioned programs outside of the U.S., subject to the rights of the Company’s existing partners to any territories, and Gilead will pay to the Company tiered royalties as a percentage of revenues ranging from (i) the mid-teens to the low twenties for the anti-TIGIT and the adenosine pathway programs, (ii) high single digits to low double digits for research programs if Gilead exercises its option rights at the IND stage, and (iii) the high teens to the low twenties for all other programs.

Under the Stock Purchase Agreement, Gilead has the option to purchase additional shares from the Company, up to a maximum of 35% of the Company’s then-outstanding voting common stock, over a five-year period from closing of the initial transaction, at a purchase price equal to the greater of a 20% premium to market (based on a trailing five-day average closing price) at the time Gilead exercises such option, and the $33.54 initial purchase price. The Amended Investor Rights Agreement also includes a three-year standstill and a three-year lockup, pro rata participation rights in certain future financings, and the right to designate two individuals to be appointed to the Company’s Board of Directors.

In the year ended December 31, 2020, Gilead made an equity investment of approximately $200.0 million in the Company by purchasing 5,963,029 shares of the Company's common stock at $33.54 per share pursuant to the Stock Purchase Agreement. Of the $200.0 million equity investment, approximately $90.6 million was determined to be a premium on the purchase of common stock and allocated to the

performance obligations created by the Gilead Collaboration Agreement. Gilead made an additional equity investment in the Company of approximately $56.7 million, net of offering costs, by purchasing 2,200,000 shares of the Company's common stock at $27.50 per share in the May 2020 public offering. In January 2021, the Company and Gilead entered into an Amended and Restated Common Stock Purchase Agreement, which amended and restated in its entirety the Common Stock Purchase Agreement, pursuant to which Gilead purchased from the Company 5,650,000 shares of the Company's common stock at a purchase price of $39.00 per share, for a total of $220.3 million, net of offering costs. All other terms of the original Common Stock Purchase Agreement, including Gilead's option to purchase additional shares from the Company, up to a maximum ownership of 35% of its then-outstanding common stock, remain unchanged.

Pursuant to the Investor Rights Agreement, the Company appointed Gilead's two designees to the Company’s Board of Directors. Based on the value of the Company’s common stock at the contract closing, the right to purchase additional shares had no value. See Note 12 for further discussion of the agreements with Gilead.

The Company evaluated the agreements with Gilead under ASC Topic 808, Collaborative Arrangements (ASC 808) and ASC Topic 606, Revenue from Contracts with Customers (ASC 606) and determined that the licenses to zimberelimab and domvanalimab, and access rights related to the Company's research and development pipeline, were within the scope of ASC 606 because Gilead meets the definition of a customer with respect to those performance obligations.

The Company had $485.9 million and $559.2 million of deferred revenue remaining on its condensed consolidated balance sheets related to this collaboration at September 30, 2022 and December 31, 2021, respectively, allocated between current and noncurrent based on the expected timing of future recognition. During the three and nine months ended September 30, 2022, the Company recorded revenues of $32.1 million and $73.3 million, respectively, from this collaboration. Total revenues recognized during these periods include cumulative catch-up revenue of $8.9 million and $13.1 million, respectively, due to changes in total estimated effort to be incurred in the future to satisfy the performance obligations, primarily related to revised clinical trial assumptions for zimberelimab R&D and commercial activities. This cumulative catch-up reduced net loss per share in the three and nine months ended September 30, 2022, by $0.12 and $0.18, respectively. During the three and nine months ended September 30, 2021, the Company recorded revenues of $7.7 million and $23.1 million, respectively.

Under the Gilead Collaboration Agreement, Gilead obtained an exclusive license to zimberelimab. The standalone selling price of this license was determined using a discounted cash flow method. The Company recognized the full amount associated with this distinct performance obligation in license revenue on the date the transaction closed in July 2020.

Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company’s anti-TIGIT monoclonal antibody program, including domvanalimab and AB308, in exchange for an option payment of $275.0 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $36.7 million of deferred revenue on its consolidated balance sheets related to this performance obligation.

Under the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to domvanalimab in December 2021. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that the program was in later stages of development and it met the criteria for being distinct from the R&D activities required under the Gilead Collaboration Agreement (as amended). Specifically, the domvanalimab program was in a Phase 3 clinical trial at the time that Gilead acquired the license and the Company concluded that: (i) the R&D activities for such later-stage, Phase 3 intellectual property, primarily involved validating the drug’s efficacy; and (ii) the ongoing R&D activities do not significantly modify or customize the drug compound such that the intellectual property is not significantly different at the end of the arrangement as a result of the R&D activities. As the license had been made available in the fourth quarter of 2021, the Company recognized the full $328.8 million of transaction price allocated to this performance obligation as license revenue in December 2021.

Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company’s adenosine receptor program, etrumadenant, in exchange for an option payment of $250.0 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $127.0 million of deferred revenue on its condensed consolidated balance sheets related to this performance obligation.

Under the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to etrumadenant in December 2021. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that it was combined with the R&D activities required under the agreements due to the early stage of the technology and the highly specialized nature of the Company's know-how. Accordingly, transaction price allocated to this license is recognized as revenue as the related R&D activities are performed. The Company determined that it retains obligations to perform further R&D

activities for Gilead related to etrumadenant. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to the combined license and R&D activities as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated total effort to perform the related R&D activities for the program.

Due to the combined nature of the performance obligation, the Company determined that the revenue from the license would be recognized at the same rate and using the same input-driven methodology as the revenue from the R&D activities. The Company determined that its performance of the R&D activities commenced January 1, 2022. The Company recognized $2.3 million and $20.5 million in license and development services revenue associated with these obligations for the three and nine months ended September 30, 2022, respectively. At September 30, 2022, the Company had $198.2 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition.

Gilead obtained the right in the Gilead Collaboration Agreement to exercise an option for exclusive rights to the Company's CD73 program, quemliclustat, in exchange for an option payment of $200.0 million. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had no deferred revenue on its consolidated balance sheets related to this performance obligation. The Company determined that it retains obligations to perform further R&D activities for Gilead related to quemliclustat. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to these R&D activities as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated total effort to perform the related R&D activities for the program.

Effective on the December 2021 closing of the Amended Gilead Collaboration Agreement, Gilead obtained an exclusive license to quemliclustat. The standalone selling price of this license was determined using a discounted cash flow method. The Company further evaluated the delivery of the license, noting that it was combined with the R&D activities required under the agreements due to the expertise and the highly specialized nature of the Company's know-how. Accordingly, transaction price allocated to this license is recognized as revenue as the related R&D activities are performed.

Due to the combined nature of the performance obligation, the Company determined that the revenue from the license would be recognized at the same rate and using the same input-driven methodology as the revenue from the R&D activities. The Company determined that its performance of the R&D activities commenced January 1, 2022. The Company recognized $12.7 million and $16.4 million in license and development services revenue associated with these obligations for the three and nine months ended September 30, 2022, respectively. At September 30, 2022, the Company had $159.2 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition.

The Company determined that it retains separate obligations to perform further R&D activities for Gilead related to domvanalimab. The standalone selling price of this obligation was determined using an expected cost-plus margin approach. The Company will recognize the amounts allocated to these R&D activities as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated total effort to perform the related R&D activities for the program. The Company determined that its performance of the R&D activities commenced as of January 1, 2022. The Company recognized $0.2 million and $2.4 million in license and development services revenue associated with these obligations in the three and nine months ended September 30, 2022, respectively. At September 30, 2022, the Company had $32.2 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition.

The Company determined that it retained an obligation to perform further R&D and commercialization activities for Gilead related to zimberelimab monotherapy. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $9.7 million of deferred revenue on its consolidated balance sheets, related to the two performance obligations. The standalone selling price of this obligation was determined using an expected cost-plus margin approach, and revenue allocated to these R&D activities would be recognized as the performance obligation was satisfied, calculated as an estimated percentage of completion based on management's estimated total effort to perform the related R&D activities for the program.

The Company determined that its performance of the R&D activities had commenced in 2021. The Company recognized $8.5 million and $9.1 million in license and development services revenue associated with these obligations in the three and nine months ended September 30, 2022, respectively. At September 30, 2022, the Company had $1.0 million of deferred revenue remaining on its condensed consolidated balance sheets related to this performance obligation, allocated between current and noncurrent based on the expected timing of future recognition.

Access rights related to the Company’s research and development pipeline and material rights to option continuation periods

Gilead receives exclusive access to the Company’s current programs as well as the future programs for a period of ten years, contingent upon Gilead’s payment of $300.0 million, consisting of three $100.0 million option continuation payments due at Gilead’s option on each of the fourth, sixth, and eighth anniversaries of the agreement. The standalone selling price of this ongoing research and development pipeline access was determined using an expected cost-plus margin approach. The Company uses a time-elapsed input method to measure progress toward satisfying this obligation, which is the method the Company believes most faithfully depicts the Company’s performance in transferring the promised services during the time period in which Gilead has access to the Company’s research and development pipeline. Accordingly, the revenue allocated to the performance obligation is being recognized using this input method over the minimum four-year period. The Company determined that Gilead is not obligated to pay the remaining $300.0 million due over the remainder of the term. Failure to pay the non-obligatory option continuation payments will result in Gilead’s loss of certain rights to access and obtain licenses to the programs arising from the Company’s research and development pipeline. Prior to the closing of the Amended Gilead Collaboration Agreement, the Company had $91.7 million deferred revenue on its condensed consolidated balance sheets related to this performance obligation.

The Company recognized $8.3 million and $24.9 million in other collaboration revenues associated with these obligations in the three and nine months ended September 30, 2022, respectively. The Company recognized $7.7 million and $23.1 million in other collaboration revenues associated with these obligations in the three months and nine months ended September 30, 2021, respectively. At September 30, 2022, the Company had $95.3 million in deferred revenue on its consolidated balance sheets related to this performance obligation, classified as current based on the expected timing of future recognition.

The Company's research and development obligations under the Gilead Collaboration Agreement includes a 50/50 share of the joint development costs associated with optioned programs pursuant to an approved R&D plan and budget. Payments received from Gilead for their share of costs incurred will be recognized as a reduction of R&D expense or G&A expense depending on the type of reimbursable expense. Payments made to Gilead for the Company's share of costs incurred will be recognized as an increase to those expenses depending on the type of reimbursable cost. The Company recognized net reductions of operating expenses totaling $27.1 million and $93.4 million during the three and nine months ended September 30, 2022, respectively, as a result of this cost-sharing provision. The Company recognized net reductions of operating expenses totaling $0.8 million and $6.9 million during the three and nine months ended September 30, 2021, respectively, as a result of this cost-sharing provision.

The Company incurred $7.3 million in costs to obtain the contract in 2020, which consisted of consultant and legal fees that were directly connected to the successful completion of the Gilead Agreements. The Company determined that $1.9 million of these expenses were related to the Stock Purchase Agreement which were recognized as offering costs. The Company allocated the remaining costs between the various performance obligations, to be recognized when the underlying revenue is recognized. The Company incurred an additional $4.5 million in fees to a third party as part of entering into the Amended Gilead Collaboration Agreement in 2021. These fees were combined with the $3.8 million of capitalized fees that remained from the original agreement at the date of closing, and the total $8.3 million was allocated among the performance obligations identified under the Amended Gilead Collaboration Agreement and deferred or recognized accordingly.

The Company recognized $0.2 million and $0.6 million in expense related to these capitalized costs during the three and nine months ended September 30, 2022, respectively. The Company recognized $0.1 million and $0.3 million in expense related to these capitalized costs during the three months and nine months ended September 30, 2021, respectively. As of September 30, 2022, the Company had $4.3 million in capitalized costs to obtain the contract, of which $0.9 million was recorded in prepaid expenses and other current assets and $3.4 million was recorded in other long-term assets.

In September 2017, the Company and Taiho entered into an option and license agreement (the Taiho Agreement) under which Taiho obtained exclusive options to Arcus programs that arose over a five-year period which ended September 2022 (the Option Period). Consistent with the terms of the Taiho Agreement, Taiho retains an option to certain programs developed during the Option Period. If Taiho timely exercises its option, Taiho obtains exclusive development and commercialization rights to investigational products from such Arcus Program for Japan and certain other territories in Asia (excluding China) (the Taiho Territory). In consideration for the exclusive options and other rights contained in the Taiho Agreement, Taiho paid non-refundable, non-creditable cash payments to the Company totaling $35.0 million.

For each option that Taiho elects to exercise, it will be obligated to make an option exercise payment of between $3.0 million to $15.0 million, depending on the development stage of the applicable Arcus Program for which the option is exercised. Upon exercise Taiho is solely responsible for continued development and commercialization in the Taiho Territory. In addition, the Taiho Agreement provides that the Company is eligible to receive additional clinical and regulatory milestones totaling up to $130.0 million per Arcus Program,

and it will be eligible to receive contingent payments of up to $145.0 million per Arcus Program associated with the achievement of specified levels of Taiho net sales in the Taiho Territory.

In addition, the Company will receive royalties ranging from high single-digits to mid-teens on net sales of licensed products in the Taiho Territory. Royalties will be payable on a licensed product-by-licensed product and country-by-country basis during the period of time commencing on the first commercial sale of a licensed product in a country and ending upon the later of: (a) ten (10) years from the date of first commercial sale of such licensed product in such country; and (b) expiration of the last-to-expire valid claim of the Company’s patents covering the manufacture, use or sale or exploitation of such licensed product in such country (the Royalty Term).

The Company determined that the identified performance obligations for the Taiho Agreement, which include the combined performance obligation of the research and development services and the obligation to participate on the joint steering committee, are satisfied over time. The Company uses a time-elapsed input method to measure progress toward satisfying its performance obligation, which is the method the Company believes most faithfully depicts the Company’s performance in transferring the promised services during the time period in which Taiho has access to the Company’s research and development activities. Accordingly, the transaction price of $35.0 million was recognized in other collaboration revenues using this input method over the estimated performance period of five years which ended in September 2022.

In November 2021, Taiho exercised its option under the Taiho Agreement to the Company's anti-TIGIT program, including domvanalimab and AB308, in exchange for a $15.0 million option exercise fee. In November 2019, Taiho exercised its option to the Company's anti-PD-1 antibody program, including zimberelimab, for a fee of $8.0 million. For each of these exercises, the Company identified one performance obligation which was the delivery of the license, which was recognized by the Company as license revenue during the years ended December 31, 2021 and 2019, respectively. Upon the option exercises, Taiho gained sole responsibility for the development and commercialization of the licensed products within the Taiho Territory. As of September 30, 2022, no clinical or regulatory milestones had been achieved under the Taiho Agreement. As of September 30, 2022, no sales milestone or royalty revenue has been recognized.

As of September 30, 2022, Taiho has exercised its option to the Company's adenosine receptor antagonist program (including etrumadenant), its anti-PD-1 program (including zimberelimab), and its anti-TIGIT program (including domvanalimab and AB308) for option payments totaling $26.0 million. The Taiho Agreement will remain in effect until the expiry of all royalty terms for the licensed products.

As of September 30, 2022 and December 31, 2021, the Company had zero and $5.0 million, respectively, in deferred revenue on its condensed consolidated balance sheet.

The Company entered into a license agreement (the WuXi PD-1 Agreement) with WuXi Biologics in August 2017, as subsequently amended, in which the Company obtained an exclusive license to develop, use, manufacture, and commercialize products including an anti-PD-1 antibody worldwide except for Greater China.

From the inception of the WuXi PD-1 Agreement through September 30, 2022, the Company has made upfront and milestone payments of $41.0 million and incurred sub-license fees of $11.3 million. These milestone payments and sub-license fees were recorded as research and development expense, as the products had not reached technological feasibility and did not have alternative future use. During the three and nine months ended September 30, 2022, the Company incurred no milestone expense under the WuXi PD-1 Agreement. During the three and nine months ended September 30, 2021, the Company incurred zero and $10.0 million, respectively, in development milestone expense under the WuXi PD-1 Agreement. The WuXi PD-1 Agreement also provides for clinical and regulatory milestone payments, commercialization milestone payments of up to $375.0 million and tiered royalty payments to be made to WuXi Biologics that range from the high single-digits to low teens of net sales by the Company of licensed products.

In December 2020, the Company entered into a separate license agreement (the WuXi CD39 Agreement) with WuXi Biologics to develop anti-CD39 antibodies. Under the agreement, the Company was granted exclusive worldwide rights to anti-CD39 antibodies discovered under the collaboration and will be responsible for the further development and commercialization of those antibodies. The WuXi CD39 Agreement provides for clinical and regulatory milestone payments totaling $16.5 million, and royalty payments in the low single digits of net sales by the Company of licensed products. From the inception of the WuXi CD39 Agreement through September 30, 2022, the Company has paid a $1.5 million development milestone and $0.5 million in upfront payments, both of which were recorded in research and development expense, as the products are still in research stage. The Company incurred zero and $1.5 million in development milestone expense under the WuXi CD39 Agreement during the three and nine months ended September 30, 2022, respectively. The Company incurred no development milestone expense under the WuXi CD39 Agreement during the three and nine months ended September 30, 2021.

In December 2016, the Company entered into a license agreement (the Abmuno Agreement) with Abmuno Therapeutics LLC (Abmuno) in which the Company obtained a worldwide exclusive license to develop, use, manufacture, and commercialize products that include an anti-TIGIT antibody, including domvanalimab. From the inception of the Abmuno Agreement through September 30, 2022, the Company has made upfront and milestone payments totaling $14.6 million as of September 30, 2022, which were recorded in research and development expense, as the products are still in research stage. The Abmuno Agreement also provides for additional clinical, regulatory and commercialization milestone remaining payments of up to $93.0 million as of September 30, 2022.

The Company incurred no development milestone expense for the three and nine months ended September 30, 2022. The Company incurred zero and $5.0 million in development milestone expense for the three and nine months ended September 30, 2021, respectively.

In October 2020 the Company announced a collaboration with AstraZeneca to evaluate domvanalimab, the Company’s investigational anti-TIGIT antibody, in combination with AstraZeneca’s Imfinzi (durvalumab) in a registrational Phase 3 clinical trial in patients with unresectable Stage III NSCLC, which study the parties refer to as PACIFIC-8. Under the terms of the agreement, each company will retain existing rights to their respective molecules and any future commercial economics. AstraZeneca will conduct the trial, and each company will supply its respective anti-cancer agent to support the trial. Under the terms of the agreement, the Company will reimburse AstraZeneca for its share of the trial costs upon achievement of certain milestones. If the agreement is terminated early, in certain circumstances, the Company is obligated to reimburse AstraZeneca for a portion of the trial costs incurred. This portion of the clinical trial costs that is considered unavoidable is accrued as research and development expenses in advance of the achievement of milestones. From the inception of the agreement through September 30, 2022, the Company has incurred gross expense of $3.7 million which is recorded on the condensed consolidated balance sheet in other long-term liabilities.

This PACIFIC-8 trial forms part of the Arcus and Gilead joint development program for domvanalimab and Arcus’s portion of the trial costs will be shared with Gilead. At September 30, 2022 the Company had recognized a receivable of $1.9 million from Gilead related to the reimbursement of these costs, which is recorded on the condensed consolidated balance sheet in other noncurrent assets.

For the three months and nine months ended September 30, 2022, the Company incurred expenses pursuant to the AstraZeneca Agreement of $1.1 million and $2.7 million, respectively, before expected recoveries from its cost-sharing agreement with Gilead. For the three and nine months ended September 30, 2021, the Company incurred expenses pursuant to the AstraZeneca Agreement of $0.3 million and $0.6 million, respectively, before expected recoveries from its cost-sharing agreement with Gilead.