Sanofi Bets $180M on a San Mateo Startups Plan to Reset the Immune System
Sanofi Bets $180M on a San Mateo Startup's Plan to Reset the Immune System
Sanofi has licensed worldwide exclusive rights to KT501, a first-in-class trispecific T-cell engager developed by Kali Therapeutics, a small San Mateo startup that dosed its first patient just five days ago.
The deal: $180 million upfront and near-term, plus up to $1.05 billion in milestones and tiered royalties on product sales ranging from high single to double digits. For a company that only entered the clinic last week, that is an extraordinary check.
The molecule is what makes it interesting. KT501 is a trispecific antibody — it grabs three targets at once: CD19 (on most B cells), BCMA (on plasma cells, the antibody factories), and CD3 (on T cells, the killers). The idea is to redirect T cells to wipe out the entire B cell lineage, including the long-lived plasma cells that standard B cell therapies like rituximab leave behind. Those survivors are thought to be the reason autoimmune patients relapse.
"By depleting a broad range of B cell populations effectively while minimizing cytokine release, we believe KT501 can address significant unmet needs of autoimmune patients," said Weihao Xu, Kali's CEO, in the company's announcement.
The CRS problem is the reason this deal exists. T-cell engagers are extraordinarily potent — that is also why they are dangerous. Redirecting T cells to kill en masse triggers cytokine storms, which can hospitalize or kill patients. Kali's pitch is a proprietary CD3 masking platform that decouples potency from toxicity. In preclinical cynomolgus monkey studies presented at ACR Convergence 2025, a single subcutaneous injection depleted B cells across peripheral blood, bone marrow, spleen, and lymph nodes — with cytokine levels returning to baseline within 24 hours. No fever. No clinical signs at any dose level, up to 10 mg/kg.
That preclinical data is compelling, but it is monkey data. The human trial — a Phase 1a dose-escalation in rheumatoid arthritis patients (NCT07234773) — is measuring safety, tolerability, and B cell kinetics. Real answers are months away.
Why Sanofi Is Stacking Bets
This is not a one-off. Sanofi has now made three B cell depletion deals in the past 12 months:
The pattern is clear: Sanofi is building a portfolio of immune reset approaches across multiple modalities. If the thesis is right — that deep, broad B cell depletion can functionally cure autoimmune diseases — whoever gets there with the safest, most convenient delivery wins a market currently worth tens of billions annually across RA, lupus, MS, and other indications.
The convenience angle matters. KT501 is an off-the-shelf subcutaneous injection. CAR-T immune reset therapies, which have shown remarkable results in lupus and other autoimmune diseases, require harvesting a patient's own T cells, engineering them, and reinfusing — a process that costs hundreds of thousands of dollars and takes weeks. A single shot that achieves similar B cell depletion, if it works in humans, changes the economics entirely.
The Skeptic's View
Kali is a pre-revenue company with no human efficacy data. The CD3 masking platform has never been tested in people. Monkey CRS data, while encouraging, is not the same as human CRS data — the field has been burned before by preclinical safety margins that evaporated in the clinic.
The deal structure reflects this uncertainty. The $180 million upfront is real money, but the $1.05 billion in milestones is contingent on development and commercial success. Sanofi is paying for optionality, not a proven product.
And the competition is brutal. BMS and JanuX Therapeutics, AbbVie and EvolveImmune, Candid Therapeutics with WuXi Biologics — everyone with an immunology franchise is chasing the same immune reset thesis. The question is not whether the biology works (CAR-T data suggests it does) but who can deliver it at scale with an acceptable safety profile.
Kali's answer is Phase 1. The rest is a bet.