KT209

Sanofi is back in the T cell engager business after a couple years of fluctuating interest, extending its support to a relatively unknown California startup in a large upfront deal that also carries $1.05 billion in down-the-road potential. Kali Therapeutics teamed with the French drug giant in a licensing pact worth $180 million in upfront and near-term payments. The tie-up centers around KT501, a trispecific TCE that goes after the well-known targets of CD19, BCMA and CD3. The deal was signed in December but not disclosed until now because the startup wanted KT501 to be in the clinic before making a splash, Kali CEO Weihao Xu told Endpoints News . Kali last week said it began dosing the first cohort of adults with rheumatoid arthritis. A federal clinical trials database lists an Australian site as the sole location for the Phase 1a study. Some drug developers are positioning this class of medicines as an easier-to-use modality than cell therapies, with the potential for destroying cancers as well as wiping out autoimmune conditions. The FDA has approved about 10 TCEs so far. The work with Kali marks a recommitment to T cell engagers for Sanofi and follows a series of recent deals in the space from the likes of UCB and others. The French drugmaker had made a $1 billion bet on TCEs with the purchase of Amunix in 2021, only to then divest those assets to Vir Biotechnology in 2024. Sanofi has dropped other TCEs along the way, including an anti-GPC3 nanobody-based candidate . The pharma company, which is now attempting to brand itself as an “AI-powered” and “R&D-driven” biopharma, has tried in recent years to become an immunology powerhouse. That transformation is still bearing out, though, and Sanofi’s board decided not to renew CEO Paul Hudson’s contract for another term. His replacement, Belén Garijo , starts April 29. Kali almost followed the NewCo route, in which investors form a new biotech to advance investigational medicines discovered by Chinese drug developers. That’s been a particularly hot path for startups developing T cell engagers. In an interview, Xu said he had investors willing to give him $150 million to advance TCEs that they would’ve licensed out of a Chinese biotech. But he wasn’t inspired by the target product profile of those assets, or of those in another TCE deal the investors pitched at $120 million. Instead, Xu went forward with a team of his own to develop a pipeline of in-house assets. His cofounders include chief medical officer Min Bao , scientific chief John Zhong Wang and chief technical officer Jay Zhao . The nimble team has raised a relatively small amount from LYFE Capital, which has backed biotechs such as Genmab-acquired ProfoundBio. The Kali CEO declined to disclose the exact amount of funding. The Sanofi-allied asset is just one of multiple medicines the startup hopes to bring into the clinic. With a large upfront package from its partner, Kali now likely has the ability to power a broad pipeline. That includes two more TCEs that are slated to enter the clinic this year: the CD19xCD3-targeted KT502 for autoimmune conditions and the CD19xCD20xCD3-aimed KT209 for hematology indications. Behind those are additional TCEs for type 1 diabetes, graft-versus-host disease, mast cell depletion and other areas. Kali is named after the Hindu goddess of destruction. It also serves a double meaning as a nod to the company’s California roots. The goddess is powerful and destructive, but also “enriches the rebirth,” Xu said, mirroring the “cycle of life.” “The Kali goddess is like our T cell engager: very potent, but by taking out the pathological antibody creating B cells, you get a clean ground for the B cells to regrow, to have immune reset,” Xu said.