ADC Therapeutics’ Earnings Call: Clinical Wins Amid Challenges

ADC Therapeutics Ltd ((ADCT)) has held its Q1 earnings call. Read on for the main highlights of the call.

ADC Therapeutics Ltd’s recent earnings call painted a picture of both optimism and caution. The company celebrated significant clinical achievements, particularly with the promising data from the LOTIS-7 trial, while also demonstrating effective cost management and revenue stability. However, the discontinuation of the ADCT602 trial and a notable net loss were points of concern. Despite these challenges, the company’s financial outlook remains strong, supported by a solid cash runway.

Promising LOTIS-7 EHA Abstract Data

The highlight of the earnings call was the impressive results from the LOTIS-7 trial. The combination of ZYNLONTA and glofitamab achieved an overall response rate of 95.5% and a complete response rate of 90.9% among 22 efficacy-evaluable patients. These figures are significantly higher than typical rates observed in other bispecific combination trials, underscoring the potential of this treatment regimen.

Financial Performance

ADC Therapeutics reported total first quarter revenues of $23 million. This included net product revenues of $17.4 million and an additional $5.6 million from milestone and royalty payments. These figures reflect a stable revenue stream, aligning with the first quarter sales of 2024 and showing improvement over the fourth quarter of 2024.

Cost Management

The company demonstrated effective cost management, with total operating expenses for the first quarter amounting to $49.1 million on a non-GAAP basis. This represents a 5% net decrease over the prior year, primarily driven by a reduction in selling, general, and administrative expenses.

Cash Runway

As of March 31, 2025, ADC Therapeutics held cash and cash equivalents of $194.7 million. This positions the company with a cash runway expected to fund operations into the second half of 2026, providing a strong financial foundation for future endeavors.

ADCT602 Trial Discontinuation

The earnings call also addressed the discontinuation of the ADCT602 trial. Sponsored by the University of Texas MD Anderson Cancer Center, the trial was evaluating ADCT602 in patients with relapsed or refractory B-cell acute lymphoblastic leukemia. The decision to discontinue was based on available clinical data, marking a setback in the company’s research efforts.

Net Loss

The company reported a net loss of $38.6 million for the first quarter of 2025, an improvement from the $46.6 million net loss in the same period of 2024. This reduction in net loss is attributed to increased licensing revenues and reduced expenses.

Cash Position Decrease

ADC Therapeutics experienced a decrease in cash and cash equivalents from $250.9 million on December 31, 2024, to $194.7 million on March 31, 2025. This decrease was primarily driven by net loss from operations and the timing of cash receipts and payments.

Forward-Looking Guidance

The company provided forward-looking guidance, emphasizing the promising data from the LOTIS-7 trial and plans to expand patient enrollment to support regulatory discussions. Additionally, the Phase 3 LOTIS-5 trial continues to progress, with expectations to reach the pre-specified number of progression-free survival events by the end of 2025. ADC Therapeutics maintains a cash runway expected to fund operations into the second half of 2026, ensuring financial stability for ongoing and future projects.

In summary, ADC Therapeutics Ltd’s earnings call presented a mixed bag of achievements and challenges. While the company celebrated significant clinical successes and maintained a strong financial outlook, the discontinuation of the ADCT602 trial and a notable net loss were areas of concern. Nonetheless, with a solid cash runway and promising trial data, ADC Therapeutics remains well-positioned for future growth and development.