ADC Therapeutics(ADCT) - 2025 Q2 - Quarterly Results

Key Highlights and Strategic Overview ADC Therapeutics reported strong Q2 2025 results, with ZYNLONTA® showing 93.3% ORR and a $100 million private placement extending cash runway - ZYNLONTA® in combination with glofitamab (LOTIS-7 trial) demonstrated a 93.3% overall response rate (ORR) and an 86.7% complete response (CR) rate in 30 efficacy evaluable patients with relapsed/refractory DLBCL[1][3] - Completed a $100 million private placement (PIPE financing), securing net proceeds of $93.1 million and extending the company's expected cash runway into 2028[1][3] - The company has streamlined its strategic focus to pursue the expansion of ZYNLONTA® into earlier lines of therapy, leveraging its strengthened financial foundation[2] Operational and Clinical Development Updates The company advances ZYNLONTA® clinical programs and a new PSMA-targeting ADC, while restructuring to focus resources and reduce its workforce by 30% ZYNLONTA® Clinical Programs ZYNLONTA® showed high efficacy in LOTIS-7 for r/r DLBCL, with FDA engagement planned, while LOTIS-5 is on track for 2025 completion, and an investigator-initiated trial showed 84.6% ORR in marginal zone lymphoma - LOTIS-7 (ZYNLONTA® + glofitamab): The Phase 1b trial is being expanded to 100 patients with r/r DLBCL following strong efficacy data (93.3% ORR, 86.7% CR), with plans to engage with the FDA in H2 2025[1][3] - LOTIS-5 (ZYNLONTA® + rituximab): The Phase 3 confirmatory trial is expected to reach its prespecified progression-free survival (PFS) events by the end of 2025, with a potential sBLA submission anticipated in H1 2026[1][5] - Marginal Zone Lymphoma: An investigator-initiated trial of ZYNLONTA® monotherapy demonstrated an ORR of 84.6% and a CR of 69.2% in 26 patients, with plans to assess a potential regulatory pathway[5] Pipeline and Corporate Strategy The company advances a new PSMA-targeting ADC, with IND-enabling activities concluding by year-end 2025, while strategically restructuring to focus on ZYNLONTA® and reduce its global workforce by 30% - A new exatecan-based, prostate-specific membrane antigen (PSMA)-targeting ADC is advancing, with IND-enabling activities expected to be completed by the end of 2025[5] - Announced a strategic restructuring to focus on ZYNLONTA®, which includes discontinuing early solid tumor programs, shutting down the UK facility, and reducing the global workforce by approximately 30%[5] Second Quarter and First Half 2025 Financial Results ADC Therapeutics reported Q2 2025 net product revenues of $18.1 million, with net loss widening to $56.6 million due to increased R&D and $13.1 million restructuring costs, ending with $264.6 million cash Q2 & H1 2025 Key Financial Metrics (in millions USD, except per share data) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Product Revenues, Net | $18.1 | $17.0 | $35.5 | $34.9 | | Total Operating Expense | $63.0 | $46.5 | $114.5 | $98.1 | | R&D Expense | $30.1 | $24.3 | $59.0 | $50.0 | | Restructuring Costs | $13.1 | $0.0 | $13.1 | $0.0 | | Net Loss | ($56.6) | ($36.5) | ($95.2) | ($83.2) | | Net Loss Per Share | ($0.50) | ($0.38) | ($0.86) | ($0.93) | | Adjusted Net Loss | ($28.7) | ($24.4) | ($52.6) | ($55.5) | | Adjusted Net Loss Per Share| ($0.25) | ($0.25) | ($0.48) | ($0.62) | - The increase in R&D expenses was driven by the timing and enrollment of the ZYNLONTA® clinical trials LOTIS-5 and LOTIS-7, and IND-enabling activities for the PSMA-targeting ADC[5] - The company incurred $13.1 million in restructuring and impairment costs in Q2 2025, consisting of $6.7 million in employee severance and $6.4 million in non-cash asset impairments related to the UK facility closure[5][6] - Cash and cash equivalents stood at $264.6 million as of June 30, 2025, compared to $250.9 million at the end of 2024, with the increase primarily due to the $100 million PIPE financing[10] Appendix: Financial Statements This section presents unaudited condensed consolidated financial statements for Q2 and H1 2025, including Statements of Operations, Balance Sheets, and a detailed reconciliation of GAAP to Non-GAAP financial measures Condensed Consolidated Statements of Operations This statement details the company's revenues, operating expenses, and other income/expenses, culminating in a net loss of $56.6 million for Q2 2025 and $95.2 million for H1 2025 Condensed Consolidated Statements of Operations (Unaudited, in thousands) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Total revenue, net | $18,839 | $17,410 | $41,872 | $35,463 | | Total operating expense | $(62,986) | $(46,451) | $(114,483) | $(98,117) | | Loss from operations | $(44,147) | $(29,041) | $(72,611) | $(62,654) | | Net loss | $(56,646) | $(36,544) | $(95,248) | $(83,150) | | Net loss per share, basic and diluted | $(0.50) | $(0.38) | $(0.86) | $(0.93) | Condensed Consolidated Balance Sheets The balance sheet as of June 30, 2025, shows total assets of $321.6 million, total liabilities of $520.7 million, and a total shareholders' deficit of $199.2 million, with cash at $264.6 million Condensed Consolidated Balance Sheets (Unaudited, in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | ASSETS | | | | Cash and cash equivalents | $264,560 | $250,867 | | Total current assets | $318,755 | $307,390 | | Total assets | $321,561 | $321,980 | | LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY | | | | Total current liabilities | $64,600 | $80,469 | | Total liabilities | $520,745 | $524,622 | | Total shareholders' (deficit) equity | $(199,184) | $(202,642) | Reconciliation of GAAP to Non-GAAP Measures This table reconciles GAAP net loss to non-GAAP adjusted net loss, showing Q2 2025 GAAP net loss of $56.6 million adjusted to $28.7 million after specific non-cash and restructuring items Reconciliation of Net Loss to Adjusted Net Loss (Unaudited, in thousands) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Net loss (GAAP) | $(56,646) | $(36,544) | $(95,248) | $(83,150) | | Share-based compensation expense | $2,062 | $1,988 | $4,483 | $2,146 | | Restructuring charges | $6,677 | $— | $6,677 | $— | | Impairment charges | $6,414 | $— | $6,414 | $— | | Other non-cash/non-recurring items | $12,813 | $10,216 | $25,031 | $24,853 | | Adjusted net loss (Non-GAAP) | $(28,680) | $(24,370) | $(52,643) | $(55,517) |