SAN DIEGO, CA & SUZHOU, China - Jul 01, 2025 - Adagene Inc. (Nasdaq: ADAG), a clinical-stage biotechnology company pioneering novel antibody-based cancer immunotherapies, has secured a strategic investment of up to $25 million from Sanofi (Euronext: SAN FP). The funding, announced today, will drive Adagene’s research and development, particularly the clinical advancement of muzastotug (ADG126), a masked anti-CTLA-4 SAFEbody, through a randomized phase 2 trial targeting microsatellite stable colorectal cancer (MSS CRC). The investment also expands a 2022 partnership with Sanofi, including a phase 1/2 clinical trial and a third SAFEbody discovery program.
Founded in 2012 by Peter Luo, Ph.D., Adagene operates from San Diego, California, and Suzhou, China, leveraging its proprietary Dynamic Precision Library (DPL) platform, which includes NEObody™, SAFEbody™, and POWERbody™ technologies. The SAFEbody platform uses precision masking to shield antibody binding domains, enabling tumor-specific targeting while reducing off-tumor toxicity. Adagene’s lead candidate, muzastotug (ADG126), targets a unique CTLA-4 epitope in regulatory T cells within the tumor microenvironment, showing promise in phase 1b/2 trials with a 29–33% overall response rate (ORR) in MSS CRC when combined with Merck’s KEYTRUDA® (pembrolizumab). Adagene employs approximately 201 people across North America, Asia, and Europe, with annual revenue reaching $75 million.
Funding Details
The $25 million strategic investment from Sanofi, announced on July 1, 2025, builds on a 2022 collaboration agreement. Combined with Adagene’s $85.2 million cash reserves as of December 31, 2024, the funds are expected to sustain operations into 2027. The investment supports:
- Clinical Development of Muzastotug: Funding for a randomized phase 2 trial in MSS CRC, focusing on patients without liver metastases. The trial, endorsed by the FDA in a July 2025 Type B meeting, will enroll approximately 60 patients across two dosing arms (10 mg/kg and 20 mg/kg), with ORR as the primary endpoint.
- Phase 1/2 Combination Trial: Adagene will supply Sanofi with muzastotug for a trial involving over 100 patients with advanced solid tumors, evaluating safety, efficacy, pharmacokinetics, and biomarker data in combination with other anticancer therapies.
- Third SAFEbody Program: Sanofi exercised an option for a third bispecific therapeutic program with undisclosed targets, triggering an option fee, milestones, and royalties under the 2022 agreement.
| Funding Event | Amount | Date | Investor | Purpose |
|---|---|---|---|---|
| Strategic Investment | Up to $25M | July 1, 2025 | Sanofi | R&D, including muzastotug phase 2 trial |
| Previous Rounds (7) | Undisclosed | 2012–2024 | Various | Platform development, early trials |
Strategic Goals
Adagene aims to achieve several milestones with this investment:
- Advance Muzastotug Development: The phase 2 trial, set to begin enrollment in late 2025, will build on promising phase 1b/2 data showing a 29% ORR at 20 mg/kg with less than 20% Grade 3 adverse events. The trial targets MSS CRC, a challenging indication with limited immunotherapy options.
- Expand Combination Therapies: The Sanofi-sponsored phase 1/2 trial will explore muzastotug’s potential in combination with other anticancer therapies, potentially broadening its application across solid tumors.
- Strengthen SAFEbody Platform: The third SAFEbody program reinforces Adagene’s technology versatility, applicable to antibody-drug conjugates, T-cell engagers, and Fc-enhanced antibodies. Partnerships with Sanofi, Exelixis, and ConjugateBio validate its potential.
- Global and Financial Stability: With a cash runway extended to 2027, Adagene plans to pursue additional collaborations and milestones, including FDA discussions in Q3 2025 to fast-track muzastotug into pivotal trials.
Peter Luo, Chairman, CEO, and President of R&D, stated, “Expanding our partnership with Sanofi highlights the potential of our SAFEbody platform and the clinical proof of concept for ADG126, the most advanced of its kind. This strategic partnership reinforces our shared vision of ADG126’s promise in advanced solid tumors, including MSS CRC, where dose-limiting challenges have hindered anti-CTLA-4 therapies.”
Market Context
The global immuno-oncology market is projected to reach $140 billion by 2030, driven by rising cancer incidence and unmet needs in solid tumors like MSS CRC. Adagene’s SAFEbody technology addresses critical safety challenges in anti-CTLA-4 therapies, which have been limited by toxicity. Competitors like Bristol Myers Squibb (ipilimumab) face similar challenges, but Adagene’s masking technology offers a potential best-in-class therapeutic index. The company’s partnerships with Sanofi, Roche, and Exelixis, including a $17.5 million deal for initial programs, highlight its growing influence in the biotech sector.
Leadership and Impact
Adagene’s leadership, including Chief Strategy Officer Mickael Chane-Du and key scientific advisors, is driving its clinical and partnership strategy. The addition of a Sanofi representative to the Scientific Advisory Board strengthens strategic alignment. The company’s stock surged 6.1–9.74% in pre-market trading following the announcement, reflecting investor optimism.
Looking Ahead
Adagene is poised for significant milestones in 2025:
- Q2 2025: Initiation of MSS CRC combination trials, including patients with liver metastases.
- Q3 2025: FDA meetings to clarify muzastotug’s path to pivotal trials.
- ASCO 2025: Presentation of updated phase 1b/2 data for muzastotug at the American Society of Clinical Oncology Annual Meeting.
- Long-Term: Potential licensing deals for T-cell engagers (ADG138, ADG152) and further SAFEbody programs.
With a robust pipeline and strategic partnerships, Adagene is well-positioned to transform immunotherapy for solid tumors, leveraging its SAFEbody platform to address critical unmet needs.
