ADC Therapeutics SA 2026 Q2 Earnings Call

Please go ahead. Thank you, operator.

Today, we issued a press release announcing our second quarter 2026 financial results and business updates. This release and the slides we will use in today's presentation are available on the investor section of the ADC Therapeutics website. I am joined on today's call by our Chief Executive Officer, Ameet Mallik, who will discuss our operational performance and recent business highlights. Followed by our Chief Medical Officer, Mohamed Zaki, who will provide clinical and regulatory updates. Lastly, our Chief Financial Officer, Pepe Carmona, who will review our second quarter 2026 financial results. We will then open the call to questions. Before we begin, I would like to remind listeners that some of the statements made during this conference call will contain forward-looking statements within the meaning of the Safe Harbor Provisions of the U.S. Private Securities Litigation Reform Act of 1995.

These forward-looking statements are subject to certain known and unknown risks and uncertainties, and actual results, performance, and achievements could differ materially. They are identified and described in the accompanying slide presentation and in the company's filings with the SEC, including Form 10-K, 10-Q, and 8-K. ADC Therapeutics is providing this information as of today's date and does not undertake any obligation to update any forward-looking statements contained in this conference call as a result of new information, future events or circumstances, except as required by law. The company cautions investors not to place undue reliance on these forward-looking statements. Today's presentation also includes non-GAAP financial reporting. These non-GAAP measures should be considered in addition to, and not in isolation or as a substitute for, the information prepared in accordance with GAAP.

You should refer to the company's second quarter 2026 earnings release for information and reconciliation of historical non-GAAP measures to the comparable GAAP financial measures. I will now turn the call over to our CEO, Ameet Mallik.

Ameet. Thank you, Nicole. We are pleased to share that ZYNLONTA's commercial performance in the second quarter of 2026 continued to be broadly in line with recent quarters.

We remain confident in the role ZYNLONTA will continue to play as a differentiated single-agent treatment option for third-line plus DLBCL patients. Turning to our pipeline progress. As previously disclosed, we announced top-line results for LOTIS-5 in June. Based on this data, we held a pre-sBLA meeting with the FDA, and following the meeting, we are assessing the best regulatory path forward. Mohamed will share more details regarding the FDA feedback and our regulatory strategy. Further to this, the full LOTIS-5 data have now been submitted for presentation at ASH, and we are preparing to submit for publication with compendia submission to follow.

For LOTIS-7, we were pleased to complete enrollment of 100 patients at the selected dose level of ZYNLONTA plus glofitamab, as shared in June, and have submitted an abstract to ASH for presentation of the data, which we continue to believe demonstrates the most compelling combination data generated to date in second-line plus DLBCL, with a safety profile generally consistent with prior LOTIS-7 disclosures. With these data, we believe that ZYNLONTA plus glofitamab offers an opportunity to take a leading second-line position in the context of the evolving competitive landscape, solidifying ZYNLONTA as a foundational therapy in DLBCL. Beyond this, we are preparing to submit for publication of the LOTIS-7 data with compendia submission to follow. Simultaneously, we are exploring the potential regulatory pathway for this combination and expect to submit for breakthrough designation this year.

With respect to the multi-center investigator-initiated trials of ZYNLONTA in indolent lymphomas, updated marginal zone lymphoma data was submitted to ASH with publication and compendia submission to follow. Presentation of updated follicular lymphoma data is anticipated in the second quarter of 2027, with publication and compendia submission to follow. We also intend to assess potential regulatory pathways for these indolent lymphomas and expect to submit for a breakthrough designation for MZL. Moving now to corporate updates. We announced a strategic reorganization in June. As part of this, we implemented a reduction in our workforce of approximately 17%, as well as additional operational efficiencies, resulting in cost savings of approximately $10 million on an annualized basis.

As shared at that time, with these changes, we are resourced to deliver on our key clinical, regulatory, and manufacturing activities while maintaining the full externally facing footprint to support the continued commercialization of ZYNLONTA in the third-line plus DLBCL setting. Finally, we ended the second quarter of 2026 with a healthy cash balance of $219.1 million, maintaining our expected cash runway at least into 2028 and enabling us to deliver against our strategy. Now, I'd like to take a moment to remind everyone of our strategy to grow ZYNLONTA. Currently, ZYNLONTA plays a clear role in the third-line plus DLBCL setting. As monotherapy, ZYNLONTA has a well-established profile of rapid, deep, and durable efficacy, as well as manageable safety with simple and convenient administration. Since FDA accelerated approval in 2021, ZYNLONTA monotherapy has been used in treating approximately 5,000 patients in the U.S.

We believe this is just the starting point as we see the potential for ZYNLONTA to reach significantly more patients by expanding use into earlier lines of therapy in DLBCL and into indolent lymphomas. I would now like to turn the call over to Mohamed, our CMO, to share more on our pipeline.

Thank you, Ameet. I would now like to share more on our LOTIS-5 and LOTIS-7 studies as we continue to work towards expansion of ZYNLONTA in earlier lines of DLBCL. As a reminder, LOTIS-5 is our phase III confirmatory study of ZYNLONTA in combination with rituximab versus R-GemOx in patients with second-line DLBCL, which recently read out and met the primary endpoint of progression-free survival. As noted, we held a meeting with the FDA in early August to present and discuss the totality of the LOTIS-5 data, along with the potential regulatory pathway. During this meeting, the FDA noted substantial concerns regarding the benefit-risk or verification of taken benefit observed in LOTIS-5 trial. As such, the company is now assessing the regulatory path forward. We plan to provide an update on regulatory strategy and timing in the future. Beyond this, the data has been submitted to ASH.

We are simultaneously pursuing publication for LOTIS-5 and potential compendia inclusion starting in 2027. Turning now to LOTIS-7, our phase I-B trial combining ZYNLONTA with the highly effective bispecific glofitamab in second-line plus DLBCL patients. We recently announced completion of enrollment of 100 patients at the 150 microgram per kg dose. Of note, consistent with other glofitamab trials, the protocol for LOTIS-7 recommends prophylaxis, including vaccination for viral, fungal, and bacterial infections, including PJP and herpes virus, which was not part of the LOTIS-5 protocol. Here, we continue to be encouraged by the promising LOTIS-7 data shared to date, which we believe demonstrates the potential for ZYNLONTA plus glofitamab to be the best-in-class combination. With data on larger number of patients with longer follow-up has been submitted to ASH for presentation.

This data support the company's belief that ZYNLONTA plus glofitamab demonstrates the most compelling combination data generated to date in second-line DLBCL with a safety profile generally consistent with prior LOTIS-7 disclosures. Separately, we are preparing for submission of the full LOTIS-7 data for publication and following that, plan to submit to compendia for potential inclusion starting in 2027. In addition, based on this potentially practice-changing LOTIS-7 data, the company plans to submit for breakthrough designation this year and is assessing a phase III trial for the combination of ZYNLONTA plus glofitamab. Moving forward, we plan to work closely with the FDA to determine the best path forward to achieve the full approval and advance the ZYNLONTA combinations into earlier lines of therapy in DLBCL.