Adagene Inc. (NASDAQ:ADAG) saw its shares rise by 6.1% on Tuesday after the biotech firm revealed a strategic investment deal with French pharmaceutical giant Sanofi (EPA:SASY) worth up to $25 million, further deepening their existing partnership.
The new capital will support Adagene’s ongoing research and development efforts, with a particular focus on advancing clinical trials for muzastotug (ADG126), an anti-CTLA-4 SAFEbody. The funding will help push the program into a randomized phase 2 study targeting microsatellite stable colorectal cancer (MSS CRC).
As part of the updated agreement, Adagene will continue supplying Sanofi with doses of muzastotug to assess its performance when combined with other oncology treatments. The upcoming phase 1/2 clinical trial will enroll more than 100 patients diagnosed with advanced solid tumors. Adagene retains global commercial rights to the candidate.
Sanofi has also exercised an option under the companies’ 2022 agreement to initiate a third SAFEbody discovery project. This move triggers an option fee, and Adagene stands to receive additional milestone payments and royalties related to the program, which leverages the firm’s proprietary antibody masking and engineering technology.
“Expanding our partnership with Sanofi highlights the potential of our SAFEbody platform and the clinical proof of concept for ADG126, our masked anti-CTLA-4 program and the most advanced of its kind,” stated Peter Luo, Chairman, CEO and President of R&D at Adagene.
As of the end of 2024, Adagene reported $85.2 million in audited cash and cash equivalents. With Sanofi’s contribution, the company now anticipates having sufficient capital to support its operations through 2027.
In addition, a Sanofi representative will join Adagene’s Scientific Advisory Board to offer expert guidance on both clinical and scientific strategy as the company continues advancing its pipeline.