Welcome to our Fireside Chat with ADC Therapeutics. I'm Robert Burns, a managing director and senior biotech analyst at H.C. Wainwright, and I'm joined now with Ameet Mallik, the CEO of ADC. Ameet, thank you for joining us today. Yeah, thank you, Robert. Appreciate the opportunity. Why don't we just dive in? For those of you who may be unfamiliar with ADC, could you provide a brief overview of the company? Sure, yeah, so ADC Therapeutics is a commercial-stage global leader and one of the pioneers in the field of antibody-drug conjugates. We've been focused on advancing a proprietary set of ADC technologies to treat both hematological malignancies as well as solid tumors in patients. The robust technology toolbox that we've developed over years, as well as specialized end-to-end capabilities, has helped us to really kind of propel our pipeline forward. Our core product right now, which is approved, is Zynlonta. It's approved in third-line plus DLBCL, but we have multiple studies ongoing right now to move it into earlier lines of DLBCL, as well as into indolent lymphomas. Beyond that, we have a robust solid tumor pipeline, including one product in clinical trials, our ADCT-601 targeting AXL, as well as an earlier stage pipeline using our novel exatecan-based payload. So given the revenue generated by Zynlonta over the past four quarters, could you discuss how you view future sales opportunities for that asset in DLBCL, follicular lymphoma, and MCL? Sure, yeah. So right now, we're playing actually in the smallest part of the opportunity that we hope to eventually play in, which is in the third-line plus DLBCL setting. Within that setting, we expect the peak revenues that we can progressively grow, and that the peak revenues will be somewhere in the $80-$100 million range. But when we move beyond that, as we're studying in earlier lines of therapy in DLBCL, as well as in follicular lymphoma and marginal zone lymphoma, in total, the potential for this opportunity, if those opportunities are all positive, is to have peak sales in excess of $500 million. So we have a lot of opportunity coming, especially as we move into earlier lines of therapy in DLBCLs, and, as well as in lymphomas. So when you think about the second-line opportunity in DLBCL, obviously the LOTIS-5 trial is currently ongoing, and that's evaluating Zynlonta plus Rituxan versus Rituxan versus chemotherapy for the treatment of second-line plus treatment transplant-eligible DLBCL, and that's expected to be completed later this year. Could you remind us of the safety run-in results you presented at SOHO last year? And how do you view the competition from other CD19-targeted cell therapies, as well as bispecifics, as well as the CD20-targeted bispecifics? Yeah, that's a great question. I mean, as you kind of noted in your question, it's a very fast-evolving environment with lots of innovation in that second-line plus setting. So first of all, just LOTIS-5, it is our phase 3 confirmatory study of Zynlonta in combination with rituximab. We expect to complete enrollment of the phase 3 study by the end of this year, with a readout potentially by the end of next year. Within the safety run-in, which you referred to, that was presented at SOHO last year, which is the first 20 patients, we demonstrated an overall response rate of 80% and a CR rate of 50%. So that was very encouraging, with no new safety signals versus either of the agents on their own. Since that time, also, we just recently had an independent data monitoring committee, which conducted an interim analysis for futility with pre-specified efficacy boundaries on PFS, as well as looking at the safety. And the IDMC, it recommended that the study continue without any modification. So that provides further confidence for us around the study. Obviously, we have to look at the data only blinded, but they're able to look at the data unblinded. Now, if positive, we believe that the LOTIS-5 trial will help us to move into second-line indication. We know the second line, there's twice the number of patients as you see in third line plus. Plus, we see a higher duration of therapy typically in our earlier line studies and combination than we do in the third line-only setting. So together, this provides a really robust opportunity for us, and we expect that we can have an approval as early as the end of 2026. So this is a really exciting opportunity. In terms of- So- I'm sorry, go ahead. Sorry, sorry to cut you off, continue, please. I was just gonna say, in terms of the competitive landscape, CAR Ts obviously play a role here, but really primarily in the academic setting. We estimate that, you know, roughly 20% of patients in the second line are getting a CAR T, but when you look at the sales progression of all the approved agents, it's been relatively flat. So we think that they sort of peaked roughly at about 20% market share. That means 80% of patients are getting other therapies, and I think it's gonna fall. Right now, it's falling into some targeted therapies, as well as some chemotherapies, but as bispecific combinations work, as well as other novel-targeted and ADC-approach combinations, come out, I believe the use of systemic chemo will go down, as well as some of the less efficacious combinations will probably get hurt. So we believe we have a strong place with Zynlonta and rituximab. When you have 50% CR, that's really competitive. It's actually better than really anything approved outside of CAR T right now. And then also, we'll talk about later, obviously, the combinations we have with bispecific. So together, between the two approaches, we think we should be able to cover the unmet need, for the patients, both in the academic and the community setting. So when we think about the movement of those competitive therapies into the front-line setting, do you see any effect on potential opportunity in second line for Zynlonta? Yeah, I mean, there's a lot being studied, obviously, in frontline, mostly in combination with chemo, either R-CHOP. Those study readouts are still pretty far away. So the one agent that's already been approved last year was Polivy R-CHOP. That's already moved primarily to the frontline. About a third of patients, we estimate, are using Polivy in the frontline setting. But that creates space also for opportunities in the second and third line. So Polivy, for example, was used a lot with BR in second line and third line plus. Now it's mostly used as front line, so that does open up opportunity, the second line plus setting for other agents. Similarly, bispecifics right now are being studied in the front line setting. That could open up opportunities, but right now the big move I would say if you look at the next several years is more bispecific combinations moving into the second line setting. And again, that opens up opportunity in the third line setting, 'cause most of these therapies, especially in the near term, given the number of choices that patients have, won't be recycled line after line. So there's typically going to go after different mechanisms. So that provides opportunity for us, but also we're, as you know, studying to be combined with bispecifics in the second line setting. So we're also capturing, I think, one of those opportunities in the second line setting as well. So we think there's room to play with Zynlonta. You know, we're the only CD19-directed ADC. We know the CD19 plays a big role in this disease, as does CD20, and so both with the rituximab combination, as well as our combination with glofitamab, those both combine both the CD19 and CD20 approach in both of those combinations. One question I'm sort of curious about. Obviously, we saw that Merck in-licensed the CD19 bispecific recently. How do you view that asset as a competitor to Zynlonta? Yeah, I mean, that's a very early-stage asset, so I think it's hard to say right now in terms of a competitor. I personally believe the CD20, CD3 bispecifics have demonstrated a lot of efficacy. And so the CD19 ADC approach that we take, I think is very complementary to that. So it's hard to comment on, you know, what could theoretically happen with the CD19 bispecific. I think we have to see data. But those are pretty early stage. I think right now, if you look at most of the work going on in DLBCL, it's really based on the CD20, CD3 bispecific combinations. Talk about the CD20 targeted bispecifics. Obviously, we know about the LOTIS-7 trial. Could you remind investors about that trial design, as well as the initial findings you've released? Sure. Yeah, so there's two parts of the phase 1 study. Part 1 was where we did the dose escalation, and then we're currently in part 2, where we're doing the dose expansion. So in part 1, we looked at the combination of Zynlonta plus glofitamab, as well as Zynlonta plus mosunetuzumab, where we did a dose escalation of Zynlonta at three different dose levels in the combination of the full doses of the bispecifics. We were really encouraged by the initial safety and tolerability profile, as well as the anti-tumor activity we saw in the majority of the patients in that part 1 study. Just to give you a sense, within that glofitamab Zynlonta arm, as well as in the mosunetuzumab Zynlonta arm, those were 18 patients in total. We didn't see any high-grade CRS. We didn't see any ICANS, and there were no DLTs, so that's really encouraging. As you know, that's one of the barriers for broader adoption in the community, is the possibility of high-grade CRS and ICANS, and the need potentially for hospitalization. So we were encouraged by that, but also by the efficacy signal that we saw. Now we're in dose expansion, and we see the potential where we're studying in 40 different patients, two different dose levels. And we've now moved to focus just on Zynlonta plus glofitamab in the second line plus DLBCL setting. We think that this could become a standard of care if we can demonstrate, you know, efficacy that's in line with what we've seen from, you know, other bispecific combinations, but hopefully also with a more favorable safety profile, specifically one related to CRS and ICANS, as well as some of the systemic chemo regimens that are being combined. You know, they carry a lot of toxicity, and so moving to a systemic chemo-free regimen where we're able to pre-dose the Zynlonta before glofitamab, ideally reducing the tumor burden, lowering some of the immune-related effects, like CRS and ICANS, plus having efficacy that hopefully approaches, you know, the 60% mark, I think that will be a very favorable profile. Since a data update is expected later this year for LOTIS-7, can you help frame expectations around that release? What sort of objective response rate delta relative to historical controls do you want to see before moving that combo forward? Sure. Yeah, so we plan. So as I mentioned, we're currently enrolling forty patients right now in the dose expansion. We expect to complete the enrollment of those by the end of the year, but we'll only have a subset of those patients that we actually have evaluable twelve-week scans. So we plan to share that initial data by the end of this year, and then the full data, more mature data, on all forty patients in the first half of next year. In terms of the profile, obviously with the STARGLOW data, we've seen, you know, data in the 58%-59% CR rate. I think we want to be in that same range of efficacy, you know, approaching 60%. I think that's the bar for efficacy now. And then we also hope to see, though, a reduction in the frequency and grade of CRS, and, you know, eliminating the need for hospitalization. I think for any subsequent trial, we'd want to be able to move forward without that hospitalization requirement. We think that's important. And we believe that, you know, you can achieve this high level of efficacy. That starts to... When you get to 60%, you're kind of approaching CAR T, right? You start approaching those levels, and without a hospital stay and a lot of the logistical barriers. That's what we believe for those 80% of patients, and potentially more, who are not getting a CAR T, even some of the referrals and other things, this has the opportunity to become one of the key standards of care. So I'm really encouraged by that combination. Obviously, outside of DLBCL, you know, we saw some data from an investigator-sponsored trial in MCL. You know, how do you view that opportunity relative to follicular lymphoma, and what is your plan to move that asset forward in that setting? Yeah, we're really excited about the IITs that we have ongoing, both in relapsed refractory MCL, as well as in relapsed refractory follicular lymphoma, so MCL, you know, as you know, is one of the indolent non-Hodgkin lymphomas, and it's actually the third-most common NHL subtype. The initial results that we saw, these are, the investigator's currently studying this in a multi-center study with 50 patients, but the first 15 patients that were tested, he presented the data and showed 13 of the first 15 patients tested achieved a complete response. One achieved a partial response. And when you think of that data, that's pretty impressive, especially into consideration that when you look at all the agents that were included in the second-line plus NCCN preferred guidelines, all of them, in terms of the data that was submitted to get there, had less than a 30% CR rate. You know, when we talk to investigators and say, "If you can get to a fixed-duration therapy with manageable side effects," which is really key for indolent lymphomas, "with a 40% or more CR rate," you know, that's really, really... That would be a big step up versus the treatments we have. You know, many of the treatments, for example, like BTK inhibitors, require systemic use, so you have to continue to stay on the, which is obviously more of a hassle for a patient. But also not just from a clinical standpoint of having to stay on a therapy as opposed to having a short, fixed duration of therapy, but also just from a financial standpoint, you know, Part D drug versus a Part B drug. So I think there's a lot of benefits in terms of the profile that we could demonstrate within this patient group. And then in follicular, we're currently studying right now on high-risk and POD24 patients. So far, in the first set of patients, nearly 30 patients that were evaluable, there was an oral presentation at ASH last year, which showed that Zynlonta plus rituximab demonstrated an overall response rate of 96% and a complete response rate of 85%. Particularly when you think of, you know, what's out there, CR rates typically in this population is less than 40%, and we're talking about the highest-risk patients with more than half of them were POD24. These are some of the toughest-to-treat patients. So we think there's a clear unmet need in these patient populations for both MCL and follicular. We continue to study these. You know, so we'll study a total of 50 patients in MCL, 100 patients in follicular. And then based on the data, we plan to approach both the FDA, in terms of next steps, as well as the NCCN guidelines. So moving forward, outside of Zynlonta, obviously, we're gonna be seeing a data update for your AXL-targeted ADC, ADCT-601. You know, can you provide your opinion as to why other AXL-targeted approaches have yielded relatively disappointing results? And how are you thinking about the market opportunity for that agent? Yeah, so and we know AXL is overexpressed in you know small areas like sarcoma, but also, you know, more larger opportunities like pancreatic cancer and non-small cell lung cancer. I don't want to comment specifically on competitors, but I can say that we definitely have clear differences in terms of our target binding approach, our payload, as well as our patient selection approach. So those are all obviously critical factors, not only in terms of the design of the molecule, but in terms of the patients that are being tested. So we think we have a good clinical development approach, at least, you know, to test the hypothesis if the compound will work. We're focusing on indications that I mentioned that either have high prevalence of AXL expression, like sarcoma and pancreatic, or in patient populations where we can clearly select for high expression of AXL in larger indications, like non-small cell lung cancer. We're not only studying this in single agent, we're also looking at combinations with standards of care in these different tumor types, and we've developed and have an approved very sensitive and specific assay that we're using in phase one, both for retrospective analysis and prospective patient selection and our enrichment of AXL-expressing patients, so this is key, I think, for being able to test this. It allows for a more accurate identification of the right population, and we believe can help to increase the PTRS of subsequent studies. So we're right now in dose optimization and dose expansion right now in these different tumor types. And we expect to have, you know, some initial data by the end of this year, but a more full data set in the first half of next year. So when we think about your earlier-stage pipeline, obviously, you've got several targets that you're going after. Could you talk about how you're thinking about pursuing them, and discuss the advantages of those agents over similarly targeted ADCs, for example, your exatecan payload? Sure, yeah, so first off, let me just take a step back. Our solid tumor research strategy is really focused on three key elements. First, we just try to identify areas of high unmet need in solid tumors where there's still a lot of chemo use, because we know that's a clear place, obviously, where ADCs can play. Then we have to make sure within those areas, within those tumor types, what are the targets that are really amenable to an ADC approach, where they're expressed more in tumor cells versus healthy cells that can be internalized, and, you know, the different aspects that make them approachable. Then we make sure that we can design with the different components, whether it be the antibody, the linker conjugation technology, or the payload, the optimal design to make sure that we can actually hit the target and deliver efficacy within that certain tumor type. When we bring all those elements together, we've right now prioritized four different targets that we're advancing: NaPi2b, Claudin-6, PSMA, and ASCT2, which is a novel first-in-class target. Each of these, we believe, has a chance to improve the standard of care for cancer patients, and each of them uses our novel exatecan-based platform. We believe that our novel exatecan-based platform has certain advantages over other approved TOPO1 inhibitors. We know that the TOPO1 space is getting quite hot within ADCs. We think we have a very distinct way of how we're approaching this, given our very novel linker that we're using, and this has resulted in a superior therapeutic index. So if you look at our preclinical data, based on the studies we've had in monkeys, it supports a dosing strategy in patients for up to five mg per kg or even higher. We've also seen, you know, good tolerability, which we think will allow for the combination with standard of care of these ADCs, which is really critical, especially as you move into earlier lines of therapy in some of these tumors. And we are able to combine with orthogonal modes of action. Also importantly, we haven't seen any interstitial lung disease, which, you know, with other TOPO-based approaches, like the DXd platform, it's a very severe side effect, but it's associated obviously with the use of other ADCs in this space. And then in terms of efficacy, we've also seen increased bystander activity, increased potency, in our internal studies. And because we know exatecan is not reported to be a Pgp substrate, we also have observed deeper responses in patients. Given that you've got four preclinical assets, how- I should say we, we hope to observe deeper responses. We've seen deeper responses in animal studies, but as we move to the clinic, we hope to see deeper responses in patients. So, given the four targets that you have from a preclinical asset perspective, how are you thinking about prioritizing which one to move forward and the sequence with which you move them into the clinic? Yeah, I mean, it's, you know, it's. We're fortunate that we have a lot to choose from. You know, obviously, I think we've talked about in the past that Zynlonta is the core of our capital allocation strategy, just given the fact that we have an approved asset with, we believe, with the near-term clinical readouts that can help take that franchise towards profitability. We're also simultaneously investing in the solid tumor side. But we know that the approach there is that we can't do everything on our own. So we have already chosen. We haven't disclosed which one of the programs that we're going to advance on our own to IND, but to advance a broader portfolio, that will also require research collaborations so that we can continue to fund and share some of the development costs and risk with partners, but also share on the upside as well. You know, when we look at these things, we obviously look at the commercial opportunity, the competitive landscape, where we think we can play a role, the ability to combine and move into earlier lines, how differentiated we think we are versus other approaches, so we evaluate a number of different criteria, and I think we're fortunate that we think all four of these really have pretty compelling value propositions. So I can't disclose more at this point. I can just say that, you know, we do plan to move at least one of these on our own forward towards IND, but then our approach will be to, partner some as well, to be able to move a broader, portfolio of ADC targets and compounds forward. I certainly look forward to that. You know, when we think about the NaPi2b and the claudin-6 asset that you have, you know, considering the data generated by Genentech's NaPi2b-targeted ADC, as well as BioNTech's claudin-6 targeted cell therapy, you know, how are you thinking about patient selection as well as market opportunity for those two targets in particular? Yeah, I think it's a really good point. I mean, you know, obviously, we think, whenever you're looking at any targeted therapy, you have to look at the expression levels and, you know, can you work in just high expressers or also any expressers? And depending on the expression level, typically, you're going to need to have an IHC, you know, biomarker-based approach as well. And so that's something we're working on, especially as we move into the clinic, is to make sure that we have an IHC assay so that we're able to select the right patients. And of course, one of the things you figure out in phase 1 is the sensitivity, right? So ideally, because if the more potent your compound is, the higher your therapeutic index is, the more you hope to be able to cover not only the high expressers, but potentially the low and medium expressers, so you can have a broader patient pool that you can go after. And so, you know, as we think about that, that determines what the opportunity can be. You know, as I think about the approach versus other agents, I'd say, first of all, the payload is different. You know, the binding of the antibody is different, the linker approach is different. So there's a lot of differences in terms of the design of the molecule. We believe, based on our preclinical data, that we have, again, really strong efficacy that we've been able to demonstrate and a really high therapeutic index. And so we're again very excited about the four targets. All of them have high-value market opportunity. So in each of these cases, especially as you move into combination approaches and move into earlier lines, all of the tumors that we're going after with these approaches are pretty high value, whether it be ovarian or non-small cell lung cancer. These are big markets, especially as you move into earlier lines of therapy. So I think we've pretty much covered your entire portfolio. Last question from me. You know, when we think about your operational runway, you know, are you thinking about potentially diluting more with equity raises? You know, talk to me a little bit about your financing currently. Yeah, we've been pretty disciplined, as you know, in terms of how we manage our operating expenses. We reduced operating expenses double digit in the last couple of years. We cut our operating expenses from where they were in twenty twenty-two by about 25% to where they are now. We've really been very disciplined in terms of how we manage expenses. We have a strong balance sheet, so we had, as of the middle of the year, roughly $300 million of cash. That helps us because we believe we're well-financed now with a cash runway into the middle of twenty twenty-six, to be able to pursue our strategy and get to all these readouts. You know, the majority of our readouts are happening between now and the middle of 2025, so we think we have a cash runway that's going to help us to do that. As I mentioned before, we allocate most of our capital towards hematology, specifically to Zynlonta, because we think it's the most de-risk approach to take this company towards profitability. Given that it's an approved asset, we've already seen, you know, compelling data, whether it be in the LOTIS-5 safety run-in, the initial LOTIS-7 phase 1 data, MZL data, follicular data. I mean, all the data that we've seen and have been generating has been quite encouraging, and so we think that's, you know, hopefully a de-risk pathway to get toward this company towards profitability. But at the same time, we know that the space is moving quickly. We've invested a lot in new technology. We have a lot of novel compounds and targets, and so in that regard, we know in order to be, you know, prudent with how we allocate our capital, we're not going to be able to do all of that on our own. You know, obviously, solid tumor, early-stage bets are all higher-risk, higher-return bets. Some of them we're going to do on our own, but some we're going to look to collaborate with, so that we can share the development and financial risk as well as the reward, as things go forward, so that's our approach. You know, in terms of equity financing, I think it depends, obviously, you know, on how the data reads out on business development efforts, which could also potentially expand and extend our cash runway. So we feel like we're in a pretty good place to have the balance sheet that we do, along with the multiple shots on goals that we have, both with Zynlonta, lifecycle management, as well as our solid tumor portfolio. Me, I really appreciate your time today, and I really look forward to the additional data that's going to be coming out later this year. Thank you. Thank you so much, Robert. I appreciate the opportunity. Awesome.