Sanofi Bets on CD3 Masking to Bring T-Cell Engagers Into Autoimmune Disease

Kali Therapeutics' experimental drug KT501 entered human testing on March 18, 2026 — the first patient dosed in a Phase Ia study in rheumatoid arthritis — and within hours, Sanofi confirmed it had secured the worldwide license. The French pharma is paying $180 million upfront, with up to $1.05 billion more in milestones tied to clinical and commercial milestones, according to a press release from Kali (https://www.prnewswire.com/news-releases/kali-therapeutics-announces-worldwide-exclusive-license-agreement-with-sanofi-for-next-generation-tri-specific-t-cell-engager-for-autoimmune-diseases-302719567.html). Total deal ceiling: $1.23 billion.

The headline is a pharma partnership. The interesting part is the mechanism.

KT501 is a tri-specific antibody — an IgG-like molecule that binds three targets simultaneously: CD3 on T cells, CD19 on B cells, and BCMA on antibody-producing plasma cells. The third arm is the point. Current CD19-targeted CAR-T therapies and bispecific antibodies like Amgen's Blinatumomab can deplete circulating B cells, but they largely spare long-lived plasma cells lodged in bone marrow and lymphoid tissue — a reservoir that allows autoimmune disease to simmer back to life after treatment. Hitting BCMA alongside CD19 is meant to drain that reservoir in autoimmune disease.

The harder problem, and the one Sanofi's bet is riding on, is toxicity. T-cell engagers work by redirecting T cells against B cells — a mechanism that potently depletes B cell populations but also triggers cytokine release syndrome, the immune overreaction that sent Blinatumomab's oncology reputation sideways and has kept TCEs out of autoimmune entirely. KT501 uses a CD3 masking technology — a stealth layer over the CD3 binding domain that Kali says keeps the drug quiet until it encounters its B-cell targets, decoupling potency from the cytokine cascade. In non-human primate studies presented at the American College of Rheumatology (https://acrabstracts.org/abstract/kt501-a-cd19-bcma-cd3-trispecific-antibody-leads-to-rapid-and-deep-b-cell-depletion-with-well-tolerated-safety/), a single subcutaneous dose of 1 mg/kg drove serum IgG down 44 percent, IgA down 67 percent, and IgM down 39 percent by day 26. Cytokine levels — checked across CRS-relevant markers — returned to baseline within 24 hours of dosing. The lowest dose tested, 0.01 mg/kg, depleted peripheral CD20+ B cells within a day. By both metrics, the drug performed better in vitro than Blinatumomab while producing lower cytokine release.

That NHP profile is what got Sanofi to the table. The company already sells Kevzara, a rheumatoid arthritis drug co-developed with Regeneron, and in March 2025 acquired DR-0201 from Dren Bio (https://www.sanofi.com/en/media-room/press-releases/2025/2025-03-20-06-00-00-3045945) — a CD20-directed bispecific that depletes B cells via targeted phagocytosis. KT501 is a different mechanism with a different target set, and Sanofi's willingness to pay $180 million upfront for a Phase Ia-stage asset signals they see it as a meaningful addition to the B-cell depletion portfolio rather than redundancy.

"This collaboration highlights the potential of our unique CD3 masking technology to decouple potency from toxicity, aiming to provide safer, more effective options for patients," Weihao Xu, Kali's chief executive, said in the press release.

Kali has raised roughly $5 million across its lifetime, per PitchBook — the kind of number that makes a $180 million upfront payment look like a clean validation event for a seed-stage company's first pharma partnership. The Phase Ia is designed to evaluate safety and tolerability as primary endpoints, with initial dose-escalation results expected before the trial's estimated August 2027 completion date. Whether the cytokine profile holds in humans is the question that will determine whether this is a genuine advance or a promising NHP result that didn't translate.

What makes the deal worth watching beyond RA: the same B-cell depletion logic applies to lupus, myasthenia gravis, and other autoantibody-driven diseases where long-lived plasma cells are part of the disease architecture. If KT501 clears Phase I safely, the label expansion potential is the real prize — and Sanofi is betting $1.23 billion that it's there to be claimed.