Adagene has entered a licensing agreement with Third Arc Bio for rights to utilize the former’s SAFEbody precision masking technology to develop two novel masked CD3 T cell engagers.
The deal is potentially worth up to $845 million, with $5 million upfront. Adagene stands to gain significantly more from future successes, with potential development and commercial milestone payments reaching up to $840 million. Additionally, Adagene will receive royalties on sales of any resulting products.
The agreement also gives Adagene a no-cost option to develop and commercialize the two candidate molecules in key Asian markets, specifically Greater China, Singapore, and South Korea. The collaboration centers on creating therapies that target unique tumor-associated antigens, aiming to improve the therapeutic window for potent T cell-engaging treatments.
Following the deal announcement, Adagene stock was up 12.8% at market open on 13 November, compared to the market close on the previous day.
The Technology: SAFEbody Precision Masking
The core of the partnership is Adagene’s SAFEbody technology. This platform is designed to enhance the safety profile of antibody-based therapies. It works by “masking” the binding domain of the therapeutic antibody while it circulates in the bloodstream. The mask is designed to be removed only upon reaching the tumor microenvironment.
This tumor-specific activation aims to minimize “on-target, off-tumor” toxicity, thereby potentially allowing for higher, more effective dosing.
“Our SAFEbody technology allows activation of an antibody when it reaches the tumor microenvironment,” said Dr. Peter Luo, CEO of Adagene. “The resulting wider therapeutic index from improved safety allows for higher dosing and potentially better efficacy.”
“Adagene’s SAFEbody technology expands the reach of our ArcStim Platform to additional novel targets,” stated Dr. Peter Lebowitz, CEO of Third Arc Bio. The agreement will help the company build its portfolio of CD3- and CD28-targeting engagers with molecules that have a potentially superior therapeutic index.
A Year of Strategic Moves for Adagene
This agreement with Third Arc Bio marks the fourth new or expanded partnership announced by Adagene in 2025, underscoring a year of significant business development activity for the company.
Earlier in the year, Adagene expanded its existing collaboration with ConjugateBio for the use of its POWERbody technology. While the companies did not disclose the financials. The deal saw Adagene receive an undisclosed upfront payment, as well as milestone and royalty payments. The company also retains all non-antibody-drug conjugate (ADC) rights to this partnered antibody.
In September, Adagene and Exelixis entered a research collaboration and license agreement to develop masked antibody-based therapeutics. Exelixis will pay Adagene $11 million upfront and can nominate two targets. Adagene will receive milestones and royalties on sales of products developed from these targets.
In July, Adagene secured a strategic equity investment of up to $25 million from Sanofi to fund a Phase II trial of muzastotug (ADG126), an anti-CTLA-4 SAFEbody, for microsatellite stable colorectal cancer (MSS CRC). Additionally, Sanofi exercised its option to select a third SAFEbody discovery program, utilizing Adagene’s technology and expertise. This bispecific therapeutic will involve option exercise fees, milestones, and royalties per their 2022 partnership agreement.
