Core Insights - Adagene Inc. is hosting a virtual key opinion leader (KOL) event on January 25, 2025, to discuss the treatment landscape for advanced/metastatic microsatellite-stable (MSS) colorectal cancer (CRC) and the importance of CTLA-4 targeting for durable responses [1] - The event will provide updates on the Phase 1b/2 study of ADG126 (muzastotug) in combination with KEYTRUDA (pembrolizumab) for advanced/metastatic MSS CRC, which will be presented at the 2025 ASCO Gastrointestinal Cancers Symposium [2] Company Overview - Adagene Inc. is a clinical-stage biotechnology company focused on developing novel antibody-based cancer immunotherapies using computational biology and artificial intelligence [8] - The company’s SAFEbody technology aims to improve safety and tolerability of antibody therapeutics by utilizing precision masking to target tumors while minimizing toxicity to healthy tissues [9] - Adagene's lead clinical program, ADG126, is a masked anti-CTLA-4 SAFEbody currently in Phase 1b/2 studies, specifically targeting MSS colorectal cancer [10] Key Opinion Leaders - Aurélien Marabelle, MD, PhD, is an expert in oncology and immunology, leading early-phase clinical trials of cancer immunotherapies and has published over 280 peer-reviewed articles [4] - Daneng Li, MD, focuses on gastrointestinal malignancies and the development of novel therapeutics, with a strong background in medical oncology [5] - Marwan Fakih, MD, has extensive experience in gastrointestinal cancers and has led numerous clinical trials, particularly in colorectal cancer [6][7]

Safety and Efficacy of ADG126 - ADG126 (Muzastotug) demonstrated improved safety and efficacy profiles compared to ipilimumab, driven by precision masking and enhanced antibody-dependent cellular cytotoxicity (ADCC) [1] - The rate of Grade 3 and higher treatment-related adverse events (TRAEs) for ADG126 in combination with pembrolizumab was significantly lower than historically reported rates for other anti-CTLA-4 therapies [6] - Repeat dosing of ADG126 at 10 mg/kg in combination with pembrolizumab showed encouraging clinical efficacy and well-tolerated safety, supporting its potential as a best-in-class anti-CTLA-4 therapy [7] Clinical Trial Results - The clinical trial for ADG126 in combination with pembrolizumab showed durable disease control and early survival benefits in patients with advanced MSS CRC, with a dose-dependent efficacy observed [5] - One patient in the trial experienced an 80% decrease in target lesions after treatment with ADG126 and pembrolizumab, correlating with a 100% decrease in carcinoembryonic antigen (CEA) levels [6] Dosing Regimen and Future Studies - A single dose of ADG126 at 10 mg/kg resulted in a three-fold increase in active drug exposure in tumor tissue compared to ipilimumab at 1 mg/kg, while maintaining similar plasma active drug levels [6] - Adagene is evaluating a new dosing regimen of ADG126 at 20 mg/kg followed by a 10 mg/kg maintenance dose in combination with pembrolizumab, with data expected in 2025 [7] Technology and Platform - The unique epitope of ADG126 allows for cross-reactivity across species, enhancing pharmacokinetic modeling and tumor-specific engagement of CTLA-4 [3] - The ongoing clinical studies validate the SAFEbody platform's applicability to various antibody-based therapeutic modalities, including antibody-drug conjugates [11] - Adagene's SAFEbody technology aims to minimize on-target off-tumor toxicity while enabling tumor-specific targeting in the tumor microenvironment [10]

Company Performance - Adagene Inc. Sponsored ADR (ADAG) has shown a year-to-date performance increase of approximately 60.5%, significantly outperforming the Medical sector's average return of 10.5% [2] - The Zacks Consensus Estimate for ADAG's full-year earnings has risen by 8.9% over the past quarter, indicating improving analyst sentiment and a positive earnings outlook [2] - Adagene Inc. is currently ranked 2 (Buy) in the Zacks Rank system, which is a stock-picking model based on earnings estimates and revisions [1] Industry Comparison - Adagene Inc. is part of the Medical - Biomedical and Genetics industry, which consists of 497 companies and is currently ranked 82 in the Zacks Industry Rank. This industry has seen a year-to-date gain of about 0.6% [3] - In contrast, DaVita HealthCare (DVA), another stock in the Medical sector, belongs to the Medical - Outpatient and Home Healthcare industry, which has a ranking of 45 and has increased by 15.7% year-to-date [3] - Both Adagene Inc. and DaVita HealthCare are noted for their solid performance, suggesting that they are worth monitoring for investors interested in Medical stocks [3]

Group 1 - Adagene Inc. Sponsored ADR (ADAG) is currently outperforming its peers in the Medical sector with a year-to-date return of 52.7%, compared to the sector average of 11.9% [2][3] - The Zacks Rank for Adagene Inc. is 2 (Buy), indicating a positive earnings outlook and improving analyst sentiment, with a 24.4% increase in the consensus estimate for full-year earnings over the past quarter [2][3] - Adagene Inc. is part of the Medical - Biomedical and Genetics industry, which includes 497 companies and is currently ranked 81 in the Zacks Industry Rank, showing better performance than the industry average gain of 3% this year [3] Group 2 - DaVita HealthCare (DVA) has also shown strong performance, with a year-to-date return of 47% and a Zacks Rank of 2 (Buy) [2][3] - The consensus EPS estimate for DaVita HealthCare has increased by 3.8% over the past three months, reflecting a positive trend in earnings expectations [3] - DaVita HealthCare belongs to the Medical - Outpatient and Home Healthcare industry, which is ranked 60 and has gained 16.4% so far this year [3]

SAN DIEGO and SUZHOU, China, July 12, 2024 (GLOBE NEWSWIRE) -- Adagene Inc. (“Adagene”) (Nasdaq: ADAG), a company transforming the discovery and development of novel antibody-based therapies, today announced a poster presentation at the upcoming ESMO Congress, taking place in Barcelona, Spain, 13-17 September 2024. The poster will report results of an ongoing phase 1b/2 trial of Adagene’s masked anti-CTLA-4 SAFEbody in combination with the anti-PD-1 treatment pembrolizumab. The title is: Increased Therapeut ...

SAN DIEGO and SUZHOU, China, July 12, 2024 (GLOBE NEWSWIRE) -- Adagene Inc. ("Adagene") (NASDAQ:ADAG), a company transforming the discovery and development of novel antibody-based therapies, today announced a poster presentation at the upcoming ESMO Congress, taking place in Barcelona, Spain, 13-17 September 2024. The poster will report results of an ongoing phase 1b/2 trial of Adagene's masked anti-CTLA-4 SAFEbody in combination with the anti-PD-1 treatment pembrolizumab. The title is: Increased Therapeuti ...

SAN DIEGO and SUZHOU, China, May 22, 2024 (GLOBE NEWSWIRE) -- Adagene Inc. ("Adagene") (NASDAQ:ADAG), a company transforming the discovery and development of novel antibody-based therapies, today announced its participation in multiple investor conferences in June 2024. Adagene's Chairman, Chief Executive Officer and President of R&D, Peter Luo, Ph.D., will provide a company update, including progress on the masked, anti-CTLA-4 SAFEbody® ADG126. Company management will also host investor meetings. Jefferies ...

SAN DIEGO and SUZHOU, China, May 22, 2024 (GLOBE NEWSWIRE) -- Adagene Inc. (“Adagene”) (Nasdaq: ADAG), a company transforming the discovery and development of novel antibody-based therapies, today announced its participation in multiple investor conferences in June 2024. Adagene’s Chairman, Chief Executive Officer and President of R&D, Peter Luo, Ph.D., will provide a company update, including progress on the masked, anti-CTLA-4 SAFEbody® ADG126. Company management will also host investor meetings. Jefferie ...

Exhibit 1.1 Adagene Inc. American Depositary Shares Each Representing 1.25 Ordinary Shares ($0.0001 par value per Ordinary Share) SALES AGREEMENT March 29, 2024 LEERINK PARTNERS LLC 1301 Avenue of the Americas, 12 Floor New York, New York 10019 Ladies and Gentlemen: Adagene Inc., an exempted company incorporated with limited liability under the laws of the Cayman Islands (the "Company"), confirms its agreement (this "Agreement") with Leerink Partners LLC (the "Agent"), as follows: | --- | --- | |----------- ...

PART I [Key Information](index=8&type=section&id=Item%203.%20Key%20Information) This section details principal investment risks for Adagene Inc., a Cayman Islands holding company with operations in China and the U.S., covering PRC oversight, financial prospects, clinical development, and potential PFIC status [Risk Factors](index=8&type=section&id=3.D.%20Risk%20Factors) The company faces unique risks due to its Cayman Islands holding structure and operations in China, including regulatory oversight, data privacy concerns, and potential adverse U.S. tax implications as a Passive Foreign Investment Company - The company's Cayman Islands holding structure and operations in PRC and U.S. present unique risks, particularly concerning PRC government influence, regulatory approvals for offshore offerings, cybersecurity, data privacy, and historical limitations on PCAOB inspections[13](index=13&type=chunk) - The company was likely a **Passive Foreign Investment Company (PFIC)** for the 2023 tax year and faces a significant risk of being a **PFIC** in 2024, which could lead to adverse U.S. federal income tax consequences for U.S. investors[24](index=24&type=chunk)[400](index=400&type=chunk)[402](index=402&type=chunk) [Information on the Company](index=84&type=section&id=Item%204.%20Information%20on%20the%20Company) This section details Adagene's corporate history, structure, and operations as a clinical-stage biotechnology company developing novel antibody-based cancer immunotherapies using its proprietary DPL platform [History and Development of the Company](index=84&type=section&id=4.A.%20History%20and%20Development%20of%20the%20Company) Adagene Inc., a Cayman Islands holding company incorporated in 2011, operates through subsidiaries in China and the U.S., having completed its Nasdaq IPO in 2021, while navigating HFCAA and PRC cybersecurity regulations - Adagene Inc. is a Cayman Islands holding company established in 2011, conducting R&D and business operations primarily through its subsidiaries in Suzhou, China, and the United States, completing its IPO on the Nasdaq in February 2021[405](index=405&type=chunk)[406](index=406&type=chunk) - On December 15, 2022, the PCAOB vacated its 2021 determination that it was unable to inspect auditors in mainland China and Hong Kong, leading Adagene not to expect identification as a Commission-Identified Issuer for the fiscal year ended December 31, 2023, though future risk remains as the PCAOB makes annual determinations[410](index=410&type=chunk) - The company believes it is not subject to cybersecurity review under current PRC measures as it does not process personal information of more than one million users and is not considered a 'critical information infrastructure operator', having not been investigated by the CAC or received related inquiries or sanctions as of the report date[415](index=415&type=chunk) [Business Overview](index=89&type=section&id=4.B.%20Business%20Overview) Adagene is a clinical-stage biotech company leveraging its proprietary Dynamic Precision Library (DPL) platform, including NEObody™, SAFEbody®, and POWERbody™ technologies, to develop novel antibody-based cancer immunotherapies and strategic collaborations - Adagene's core is its **Dynamic Precision Library (DPL)** platform, which fuels three proprietary antibody technologies: **NEObody™**, **SAFEbody®**, and **POWERbody™**, designed to create differentiated cancer immunotherapies[425](index=425&type=chunk)[426](index=426&type=chunk)[427](index=427&type=chunk) Adagene's Wholly-Owned Clinical Pipeline | Candidate | Target/Technology | Stage of Development | | :--- | :--- | :--- | | **ADG126** | anti-CTLA-4 SAFEbody | Phase 1b/2 Development | | **ADG116** | anti-CTLA-4 NEObody | Phase 1b/2 Evaluation | | **ADG206** | anti-CD137 POWERbody | Phase 1 Evaluation | | **ADG106** | anti-CD137 NEObody | Phase 1b/2 Evaluation | - The lead candidate, **ADG126**, is a masked anti-CTLA-4 **SAFEbody** in Phase 1b/2 trials, focusing on metastatic microsatellite-stable (MSS) colorectal cancer (CRC), with clinical data suggesting a best-in-class safety profile and differentiated efficacy, particularly in combination with anti-PD-1 therapy[425](index=425&type=chunk)[455](index=455&type=chunk) - Adagene has established key technology licensing collaborations, including agreements with Sanofi and Exelixis to develop antibody-based therapeutics using its **SAFEbody** technology, providing upfront payments, potential milestone payments, and royalties to offset R&D costs[437](index=437&type=chunk)[533](index=533&type=chunk)[534](index=534&type=chunk) [Operating and Financial Review and Prospects](index=149&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) This section analyzes Adagene's financial performance, highlighting a narrowed net loss in 2023 to US$18.9 million due to increased collaboration revenue and reduced R&D expenses, with strong liquidity expected to fund operations into 2026 [Operating Results](index=149&type=section&id=5.A.%20Operating%20Results) Adagene's net loss significantly narrowed to US$18.9 million in 2023, driven by increased collaboration revenue and a 55% reduction in R&D expenses due to strategic prioritization of ADG126 Consolidated Results of Operations (in thousands US$) | Metric | 2021 | 2022 | 2023 | | :--- | :--- | :--- | :--- | | Licensing and collaboration revenue | 10,175 | 9,293 | 18,111 | | Research and development expenses | (68,099) | (81,340) | (36,639) | | Administrative expenses | (14,440) | (11,874) | (8,673) | | **Loss from operations** | **(72,364)** | **(83,921)** | **(23,720)** | | **Net loss attributable to shareholders** | **(73,178)** | **(79,972)** | **(18,946)** | | **Net loss per ordinary share (Basic)** | **(1.46)** | **(1.48)** | **(0.35)** | - Research and development expenses decreased by **55.0%** in 2023 to **US$36.6 million**, down from **US$81.3 million** in 2022, a direct result of the company's strategic decision to focus clinical efforts and prioritize its masked, anti-CTLA-4 **SAFEbody** candidate, **ADG126**[777](index=777&type=chunk) R&D Expenses by Program (in thousands US$) | Program | 2021 | 2022 | 2023 | | :--- | :--- | :--- | :--- | | ADG126 | 3,543 | 19,229 | 20,855 | | ADG116 | 11,236 | 15,271 | 5,779 | | ADG106 | 14,798 | 4,604 | 2,209 | | Preclinical, research pipeline & others | 38,522 | 42,236 | 7,796 | | **Total** | **68,099** | **81,340** | **36,639** | [Liquidity and Capital Resources](index=161&type=section&id=5.B.%20Liquidity%20and%20Capital%20Resources) As of December 31, 2023, Adagene held US$109.9 million in cash and cash equivalents, a decrease from 2022, with management expecting current liquidity to fund operations into 2026 - As of December 31, 2023, the company held **US$109.9 million** in cash and cash equivalents, which management believes is sufficient to fund operations **into 2026**[792](index=792&type=chunk)[795](index=795&type=chunk) Consolidated Cash Flow Data (in thousands US$) | Cash Flow Activity | 2021 | 2022 | 2023 | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | (43,415) | (48,612) | (28,455) | | Net cash used in investing activities | (2,510) | (686) | (77) | | Net cash (used in) generated from financing activities | 145,357 | 17,823 | (5,367) | | **Net increase (decrease) in cash** | **99,240** | **(30,632)** | **(33,825)** | - Net cash used in operating activities decreased to **US$28.5 million** in 2023 from **US$48.6 million** in 2022, primarily due to higher revenue from collaborations and lower R&D and administrative expenses[798](index=798&type=chunk)[800](index=800&type=chunk) [Directors, Senior Management and Employees](index=166&type=section&id=Item%206.%20Directors%2C%20Senior%20Management%20and%20Employees) This section details the company's leadership, board composition, compensation, and employee base, noting a decrease to 174 employees in 2023, with most in R&D - For the fiscal year ended December 31, 2023, the company paid an aggregate of **US$2.6 million** in cash compensation to its executive officers and **US$0.3 million** to its independent directors[854](index=854&type=chunk) - The company utilizes two primary share incentive plans: the 2019 Plan (under which no new awards are granted) and the 2021 Performance Incentive Plan, with outstanding awards under the 2019 Plan covering **2,538,070 ordinary shares** as of February 29, 2024[858](index=858&type=chunk) Employee Headcount by Function (as of Dec 31, 2023) | Function | Number of Employees | | :--- | :--- | | Research and Development | 118 | | General Administration | 53 | | Business Development and Marketing | 3 | | **Total** | **174** | - The total number of employees decreased from **248 at the end of 2022** to **174 employees** at the end of 2023[888](index=888&type=chunk) [Major Shareholders and Related Party Transactions](index=183&type=section&id=Item%207.%20Major%20Shareholders%20and%20Related%20Party%20Transactions) This section details major shareholders, including the Peter Luo act-in-concert group (21.8%), and outlines 2023 related party transactions for R&D services with WuXi AppTec Group and WuXi Biologics Principal Shareholders (as of Feb 29, 2024) | Shareholder | Beneficial Ownership % | | :--- | :--- | | Peter Luo act-in-concert group | **21.8%** | | HAN 2020 IRREVOCABLE TRUST | **10.9%** | | JSR Limited | **9.7%** | | Wuxi Pharmatech Healthcare Fund I L.P. | **9.0%** | | Asia Ventures II L.P. | **8.7%** | | General Atlantic Singapore AI Pte. Ltd. | **8.7%** | | F-Prime Capital Partners Healthcare Fund III LP | **6.1%** | | Panacea Venture Healthcare Fund II, L.P. | **5.0%** | - In 2023, the company purchased research and development services from related parties, including **US$0.8 million** from WuXi AppTec Group and **US$1.9 million** from WuXi Biologics[900](index=900&type=chunk) [Financial Information](index=184&type=section&id=Item%208.%20Financial%20Information) This section presents the company's consolidated financial statements and states its policy of not paying cash dividends, intending to retain earnings for business growth - The company has not previously declared or paid cash dividends and has no plans to do so in the near future, intending to retain earnings to fund business growth[903](index=903&type=chunk) [Additional Information](index=186&type=section&id=Item%2010.%20Additional%20Information) This section details the company's Cayman Islands corporate governance, including tax consequences for shareholders and its likely status as a Passive Foreign Investment Company (PFIC) for 2023 - The company is an exempted company incorporated in the Cayman Islands, and its affairs are governed by its memorandum and articles of association and the Companies Act of the Cayman Islands[909](index=909&type=chunk)[910](index=910&type=chunk) - The company believes it was likely a **Passive Foreign Investment Company (PFIC)** for its 2023 taxable year due to a decline in its market capitalization relative to its cash and cash equivalents, with a significant risk it will also be a **PFIC** for 2024, potentially resulting in adverse U.S. federal income tax consequences for U.S. Holders[947](index=947&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=196&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks include interest rate risk on cash holdings and foreign exchange risk from RMB fluctuations against the U.S. dollar, with no current hedging - The company's main market risks include interest rate risk on cash holdings and foreign exchange risk, particularly from the fluctuation of the RMB against the U.S. dollar[966](index=966&type=chunk)[967](index=967&type=chunk) PART II [Material Modifications to the Rights of Security Holders and Use of Proceeds](index=201&type=section&id=Item%2014.%20Material%20Modifications%20to%20the%20Rights%20of%20Security%20Holders%20and%20Use%20of%20Proceeds) This section details the use of approximately US$145.9 million net proceeds from the February 2021 IPO, with US$83 million allocated primarily to R&D by December 31, 2023 - The company raised net proceeds of approximately **US$145.9 million** from its February 2021 IPO[983](index=983&type=chunk)[984](index=984&type=chunk) - From the IPO date through December 31, 2023, the company has used **US$83 million** of the net proceeds, primarily for research and development activities[985](index=985&type=chunk) [Controls and Procedures](index=201&type=section&id=Item%2015.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2023, based on the COSO framework - Management concluded that as of December 31, 2023, the company's disclosure controls and procedures were effective[987](index=987&type=chunk) - Based on an evaluation using the COSO framework, management concluded that the company's internal control over financial reporting was effective as of December 31, 2023[989](index=989&type=chunk) [Corporate Governance and Other Matters](index=202&type=section&id=Item%2016.%20Corporate%20Governance%20and%20Other%20Matters) This section covers corporate governance, including principal accountant fees (RMB 6.2 million in 2023), adherence to Cayman Islands home country practices as a foreign private issuer, and the company's cybersecurity risk management program - The company, as a foreign private issuer, follows certain Cayman Islands home country practices, exempting it from some Nasdaq corporate governance requirements, such as having a compensation committee composed entirely of independent directors and obtaining shareholder approval for certain securities issuances[1002](index=1002&type=chunk)[1005](index=1005&type=chunk) Principal Accountant Fees (in thousands RMB) | Service | 2022 | 2023 | | :--- | :--- | :--- | | Audit Fees | 5,800 | 6,200 | | **Total** | **5,800** | **6,200** | - The company has a cybersecurity risk management program overseen by its information security committee and managed by the Senior VP of Bioinformatics and IT, with no cybersecurity threats identified in 2023 that materially affected the company's business, operations, or financial condition[1009](index=1009&type=chunk)[1010](index=1010&type=chunk)[1011](index=1011&type=chunk) PART III [Financial Statements](index=205&type=section&id=Item%2018.%20Financial%20Statements) This section presents the audited consolidated financial statements for Adagene Inc. and its subsidiaries for 2021-2023, prepared under U.S. GAAP, including balance sheets, comprehensive loss, equity changes, and cash flows Consolidated Balance Sheet Highlights (in thousands US$) | Account | Dec 31, 2022 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | 143,759 | 109,934 | | **Total Assets** | **152,400** | **115,729** | | Total current liabilities | 55,080 | 31,456 | | **Total Liabilities** | **69,309** | **45,169** | | **Total Shareholders' Equity** | **83,090** | **70,559** | Consolidated Statements of Comprehensive Loss Highlights (in thousands US$) | Account | 2021 | 2022 | 2023 | | :--- | :--- | :--- | :--- | | Licensing and collaboration revenue | 10,175 | 9,293 | 18,111 | | Research and development expenses | (68,099) | (81,340) | (36,639) | | **Net loss attributable to shareholders** | **(73,178)** | **(79,972)** | **(18,946)** |