Upfront cash fee with total value of $7.0 million, comprised of a $3.5 million cash payment and $3.5 million in-kind payment in the form of a transferable equity interest in licensee

Initiation of Phase 1 clinical study in China by licensee expected in the first half of 2027

HCW Biologics has “free” option to reclaim the rights to the Americas territory

 HCW Biologics Inc. (the “Company”) (NASDAQ: HCWB), a U.S.-based commercial- and clinical-stage biopharmaceutical company focused on supporting or developing novel fusion immunotherapies to treat autoimmune diseases, cancer, and senescence-associated dysplasia, announced the receipt of full payment of the upfront license fee with a value of $7.0 million from its licensee, Beijing Trimmune Biotech Co., Ltd. (“Trimmune”).

Trimmune is a new operating entity responsible for the development and commercialization of HCW11-006, which was formed by WY Biotech Co., Ltd. (“WY Biotech”), a China-based company specializing in the early-stage development of recombinant protein drugs and gene/cell therapies, and the Company. Trimmune investors include CITIC Medical Fund, a multi-billion-dollar investment fund focused on innovative companies primarily targeting pharmaceuticals, biotechnology, medical devices, and diagnostics, and TigerYeah Capital Fund of TigerMed, a global leading Contract Research Organization. Trimmune is led by a team with an impressive track record for success in the development and commercialization of innovative drugs that treat diseases with large, unmet medical needs for the Chinese market.

The upfront license fee included a cash fee of $3.5 million and a minority co-founder transferable equity position in Trimmune valued at $3.5 million based on the most recent round of financing with third parties. HCW Biologics is also eligible to receive significant development milestone payments and double-digit royalties on future product sales, as well as a portion of the proceeds from future transaction(s) involving the licensed molecule, if such a transaction occurs. In addition HCW Biologics has a payment-free, milestone-free, and royalty-free option to recapture all rights to the development and commercialization of HCW11-006 for in vivo applications in the United States, Canada, Central America, and South America (Opt-in Territory) after the conclusion of the Phase 1 clinical trial in China. Trimmune is responsible for all costs associated with the Phase 1 clinical trial in China. The deal also provides Trimmune an option to license the exclusive regional China rights to manufacture, develop and commercialize HCW9302, HCW Biologics’ clinical stage molecule currently being evaluated in an autoimmune disorder. HCW Biologics is entitled to receive additional payments if Trimmune exercises its option to license HCW9302 for regional China rights.