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What changed in ADC Therapeutics SA's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ADC Therapeutics SA's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+564 added−551 removedSource: 10-K (2026-03-10) vs 10-K (2025-03-27)

Top changes in ADC Therapeutics SA's 2025 10-K

564 paragraphs added · 551 removed · 373 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

168 edited+108 added−107 removed214 unchanged
Biggest changeThe Loan Agreement also contains customary events of default, after which the term loan may become due and payable immediately, including payment defaults, material inaccuracy of representations and warranties, covenant defaults (including creation of any liens other than those that are expressly permitted), bankruptcy and insolvency proceedings, cross-defaults to certain other agreements, judgments against us and our subsidiaries and change in control. 19 Table of Contents Government Regulation Government authorities in the United States at the federal, state and local level and in other countries and jurisdictions, including the European Union, extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of drug and biological products, such as our investigational medicines and any future investigational medicines.
Biggest changeGovernment Regulation Government authorities in the United States at the federal, state and local level and in other countries and jurisdictions, including the European Union, extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of drug and biological products, such as our investigational 17 Table of Contents medicines and any future investigational medicines.
Many competitors and potential competitors have substantially greater scientific, research and product development capabilities, as well as greater financial, marketing and human resources than we do. Many companies are active in the oncology market and are developing or marketing products for the specific therapeutic markets that we target, including both antibody drug conjugate (“ADC”) and non-antibody drug conjugate therapies.
Many competitors and potential competitors have substantially greater scientific, research and product development capabilities, as well as greater financial, marketing and human resources than we do. Many companies are active in the oncology market and are developing or marketing products for the specific therapeutic markets that we target, including both antibody drug conjugate (“ADC”) and non-ADC therapies.
This trial was used as the basis to obtain accelerated approval in the U.S. and conditional approvals in Europe and China. Clinical Trial Design The primary objective of the clinical trial was to evaluate the efficacy of ZYNLONTA in patients with relapsed or refractory DLBCL, measured by ORR based on the 2014 Lugano Classification Criteria.
This trial was used as the basis to obtain accelerated approval in the U.S. and conditional approvals in Europe, China and Canada. Clinical Trial Design The primary objective of the clinical trial was to evaluate the efficacy of ZYNLONTA in patients with relapsed or refractory DLBCL, measured by ORR based on the 2014 Lugano Classification Criteria.
In the relapsed or refractory DLBCL setting, for which we have developed ZYNLONTA, current 3L treatment options include CAR-T, allogeneic stem cell transplant, polatuzumab in combination with bendamustine and a rituximab product, selinexor, tafasitamab in combination with lenalidomide, chemotherapy using small molecules and bispecifics antibodies.
In the relapsed or refractory DLBCL setting, for which we have developed ZYNLONTA, current 3L treatment options include CAR-T, allogeneic stem cell transplant, polatuzumab in combination with bendamustine and a rituximab product, selinexor, tafasitamab in combination with lenalidomide, brentuximab in combination with bendamustine and a rituximab product, chemotherapy using small molecules and bispecifics antibodies.
The process generally involves the following: • completion of extensive preclinical laboratory and animal studies in accordance with applicable regulations, including studies conducted in accordance with good laboratory practice (GLP) requirements; • submission to the FDA of an investigational new drug (“IND”) application, which must become effective before human clinical trials may begin; • approval by an institutional review board (“IRB”) or independent ethics committee at each clinical trial site before each clinical trial may commence; • performance of adequate and well-controlled human clinical trials in accordance with applicable IND regulations, good clinical practice (“GCP”) requirements and other clinical trial-related regulations to establish the safety and efficacy of the investigational product for each proposed indication; • submission to the FDA of a BLA; • a determination by the FDA within 60 days of its receipt of a BLA to file the submission for review; • satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the biologic, or components thereof, will be produced to assess compliance with current good manufacturing practice (“cGMP”) requirements to assure that the facilities, methods and controls are adequate to preserve the biologic’s identity, strength, quality and purity; • satisfactory completion of any potential FDA audits of the clinical trial sites that generated the data in support of the BLA to assure compliance with GCPs and integrity of the clinical data; • payment of any user fees for FDA review of the BLA; • FDA review and approval of the BLA, including consideration of the views of any FDA advisory committee; and • compliance with any post-approval requirements, including REMS, where applicable, and post-approval studies required by the FDA as a condition of approval. 20 Table of Contents The preclinical and clinical testing and approval process requires substantial time, effort and financial resources, and we cannot be certain that any approvals for our product candidates will be granted on a timely basis, or at all.
The process generally involves the following: • completion of extensive preclinical laboratory and animal studies in accordance with applicable regulations, including studies conducted in accordance with good laboratory practice (“GLP”) requirements; • submission to the FDA of an investigational new drug (“IND”) application, which must become effective before human clinical trials may begin; • approval by an institutional review board (“IRB”) or independent ethics committee at each clinical trial site before each clinical trial may commence; • performance of adequate and well-controlled human clinical trials in accordance with applicable IND regulations, good clinical practice (“GCP”) requirements and other clinical trial-related regulations to establish the safety and efficacy of the investigational product for each proposed indication; • submission to the FDA of a BLA; • a determination by the FDA within 60 days of its receipt of a BLA to file the submission for review; • satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the biologic, or components thereof, will be produced to assess compliance with current good manufacturing practice (“cGMP”) requirements to assure that the facilities, methods and controls are adequate to preserve the biologic’s identity, strength, quality and purity; • satisfactory completion of any potential FDA audits of the clinical trial sites that generated the data in support of the BLA to assure compliance with GCPs and integrity of the clinical data; • payment of any user fees for FDA review of the BLA; • FDA review and approval of the BLA, including consideration of the views of any FDA advisory committee; and • compliance with any post-approval requirements, including REMS, where applicable, and post-approval studies required by the FDA as a condition of approval. 18 Table of Contents The preclinical and clinical testing and approval process requires substantial time, effort and financial resources, and we cannot be certain that any approvals for our product candidates will be granted on a timely basis, or at all.
Confirmatory Phase 3 Clinical Trial (LOTIS-5) LOTIS-5 is a Phase 3, randomized, open-label, two-part, two-arm, multi-center clinical trial of ZYNLONTA combined with rituximab compared to immunochemotherapy in patients with relapsed or refractory DLBCL.
Clinical Development Confirmatory Phase 3 Clinical Trial (LOTIS-5) LOTIS-5 is a Phase 3, randomized, open-label, two-part, two-arm, multi-center clinical trial of ZYNLONTA combined with rituximab compared to immunochemotherapy in patients with relapsed or refractory DLBCL.
We believe that some of the disease indications in which our product candidates are currently being or may be developed in the future qualify for this provision, and we will take advantage of this provision as appropriate.
We believe that some of the disease indications in which our product candidates are currently being or may be developed in the future could qualify for this provision, and we will take advantage of this provision as appropriate.
The secondary endpoints of the clinical trial are overall survival (“OS”), overall response rate (“ORR”), complete response (“CR”) rate and duration of response (“DoR”) as well as frequency and severity of adverse events as well as: (i) characterize the safety profile of ZYNLONTA combined with rituximab, (ii) characterize the pharmacokinetic profile of ZYNLONTA combined with rituximab, (iii) evaluate the immunogenicity of ZYNLONTA combined with rituximab and (iv) evaluate the impact of ZYNLONTA combined with rituximab treatment on treatment-related and disease-related symptoms, patient-reported functions and overall health status.
The secondary endpoints of the clinical trial are overall survival (“OS”), ORR, complete response (“CR”) rate and duration of response (“DoR”) as well as frequency and severity of adverse events as well as: (i) characterize the safety profile of ZYNLONTA combined with rituximab, (ii) characterize the pharmacokinetic profile of ZYNLONTA combined with rituximab, (iii) evaluate the immunogenicity of ZYNLONTA combined with rituximab and (iv) evaluate the impact of ZYNLONTA combined with rituximab treatment on treatment-related and disease-related symptoms, patient-reported functions and overall health status.
Beginning in 2025, the IRA eliminates the coverage gap under Medicare Part D by significantly lowering the enrollee maximum out-of-pocket cost and requiring manufacturers to enter into a new manufacturer discount program agreement and pay 10% of Part D enrollees’ prescription costs for brand drugs above a deductible and below the out-of-pocket maximum, and 20% once the out-of-pocket maximum has been reached.
Beginning in 2025, the IRA eliminated the coverage gap under Medicare Part D by significantly lowering the enrollee maximum out-of-pocket cost and requiring manufacturers to enter into a new manufacturer discount program agreement and pay 10% of Part D enrollees’ prescription costs for brand drugs above a deductible and below the out-of-pocket maximum, and 20% once the out-of-pocket maximum has been reached.
This selective targeting allows ADCs to use potent cytotoxins at dose levels that otherwise would not be tolerated and ADCs therefore represent a highly effective treatment approach while maintaining manageable side effects. • Wide Addressable Patient Population. ADCs represent a treatment approach that expands the treatment options available to cancer patients. Many therapies are not appropriate for certain patient populations.
This selective targeting allows ADCs to use potent cytotoxins at dose levels that otherwise would not be tolerated and ADCs therefore represent a highly effective treatment approach while maintaining manageable side effects. • Widely Addressable Patient Population. ADCs represent a treatment approach that expands the treatment options available to cancer patients. Many therapies are not appropriate for certain patient populations.
We also solely own eight patent families directed to antibodies, ADCs with Exatecan or other warheads, linker technology and therapeutic uses of these antibodies and ADCs. Any utility patents granted from the pending applications in these families are expected to expire between 2041 and 2044. ZYNLONTA The antibody for ZYNLONTA is in the public domain.
We also solely own eight patent families directed to antibodies, ADCs with Exatecan or other warheads, linker technology and therapeutic uses of these antibodies and ADCs. Any utility patents granted from the pending applications in these families are expected to expire between 2041 and 2046. ZYNLONTA The antibody for ZYNLONTA is in the public domain.
In the event of contamination or injury, or failure to comply with environmental, health and safety laws and regulations, we could be held liable for any resulting damages, fines and penalties associated with such liability, which could exceed our assets and resources. Environmental, health and safety laws 30 Table of Contents and regulations are becoming increasingly more stringent.
In the event of contamination or injury, or failure to comply with 32 Table of Contents environmental, health and safety laws and regulations, we could be held liable for any resulting damages, fines and penalties associated with such liability, which could exceed our assets and resources. Environmental, health and safety laws and regulations are becoming increasingly more stringent.
The royalties payable to us are subject to downward adjustment in certain circumstances, including the expiration of a patent covering ZYNLONTA, generic or biosimilar competition, and required royalty payments to third parties. MTPC will conduct clinical studies and be responsible for the development and commercialization of ZYNLONTA in Japan and bear the associated costs.
The royalties payable to us are subject to downward adjustment in certain circumstances, including the expiration of a patent covering ZYNLONTA, generic or biosimilar competition, and required royalty payments to third parties. TPC will conduct clinical studies and be responsible for the development and commercialization of ZYNLONTA in Japan and bear the associated costs.
Under the agreement, we are obligated to pay to HCR (i) a 7% royalty on the worldwide (excluding China, Hong Kong, Macau, Taiwan, Singapore and South Korea) net sales of ZYNLONTA and any product that contains ZYNLONTA and on any upfront or milestone payments we receive from licenses that we grant to commercialize ZYNLONTA or any product that contains ZYNLONTA in any region other than China, Hong Kong, Macau, Taiwan, Singapore and South Korea, (ii) a 7% royalty on the worldwide net sales of Cami and any product that contains Cami and on any upfront or milestone payments we receive from licenses that we grant to commercialize Cami or any product that contains Cami in the United States and Europe, and (iii) outside the United States and Europe, a 7% share of any upfront or milestone payments derived from licenses that we grant to commercialize Cami or any product that contains Cami and, in lieu of the royalty on net sales under such licenses, a mid-teen percentage share of the net royalty we receive from such licenses.
Under the agreement, we are obligated to pay to HCR (i) a 7% royalty on the worldwide (excluding China, Hong Kong, Macau, Taiwan, Singapore and South Korea) net sales of ZYNLONTA and any product that contains ZYNLONTA and on any upfront or milestone payments we receive from licenses that we grant to commercialize ZYNLONTA or any product that contains ZYNLONTA in any region other than China, Hong Kong, Macau, Taiwan, Singapore and South Korea, (ii) a 7% royalty on the worldwide net sales of Cami, a now-discontinued product candidate, and any product that contains Cami and on any upfront or milestone payments we receive from licenses that we grant to commercialize Cami or any product that contains Cami in the United States and Europe, and (iii) outside the United States and Europe, a 7% share of any upfront or milestone payments derived from licenses that we grant to commercialize Cami or any product that contains Cami and, in lieu of the royalty on net sales under such licenses, a mid-teen percentage share of the net royalty we receive from such licenses.
At the same time, safety and further 21 Table of Contents pharmacokinetic and pharmacodynamic information is collected, possible adverse effects and safety risks are identified, and a preliminary evaluation of efficacy is conducted. • Phase 3 clinical trials generally involve a large number of patients at multiple sites and are designed to provide the data necessary to demonstrate the effectiveness of the product for its intended use, its safety in use and to establish the overall benefit/risk relationship of the product, and provide an adequate basis for product labeling.
At the same time, safety and further pharmacokinetic and pharmacodynamic information is collected, possible adverse effects and safety risks are identified, and a preliminary evaluation of efficacy is conducted. • Phase 3 clinical trials generally involve a large number of patients at multiple sites and are designed to provide the data necessary to demonstrate the effectiveness of the product for its intended use, its safety in use and to establish the overall benefit/risk relationship of the product, and provide an adequate basis for product labeling.
Both exatecans and PBD dimers cause a bystander effect, which occurs when a released warhead (from a target positive cells which has internalized and processed the ADC) is able to diffuse into and kill neighboring cells in the tumor microenvironment, irrespective of those cells’ antigen expression.
PBD dimers cause a bystander effect, which occurs when a released warhead (from a target positive cells which has internalized and processed the ADC) is able to diffuse into and kill neighboring cells in the tumor microenvironment, irrespective of those cells’ antigen expression.
Unless terminated earlier, the agreement terminates upon the occurrence of the earliest of (i) the expiration of the last-to-expire patent covering ZYNLONTA in Japan, (ii) the expiration of exclusivity with respect to ZYNLONTA granted to MTPC by a regulatory authority, and (iii) ten years after the first commercial sale of ZYNLONTA in Japan.
Unless terminated earlier, the agreement terminates upon the occurrence of the earliest of (i) the expiration of the last-to-expire patent covering ZYNLONTA in Japan, (ii) the expiration of exclusivity with respect to ZYNLONTA granted to TPC by a regulatory authority, and (iii) ten years after the first commercial sale of ZYNLONTA in Japan.
Pediatric Information Under the Pediatric Research Equity Act (“PREA), BLAs or supplements to BLAs must contain data to assess the safety and effectiveness of the biological product for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which the biological product is safe and effective.
Pediatric Information Under the Pediatric Research Equity Act (“PREA”), BLAs or supplements to BLAs must contain data to assess the safety and effectiveness of the biological product for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which the biological product is safe and effective.
This period may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan drug designation, for example because the product is sufficiently profitable not to justify continued market exclusivity.
This period may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan medicinal product designation, for example because the product is sufficiently profitable not to justify continued market exclusivity.
Other potential consequences include, among other things: • restrictions on the marketing or manufacturing of the product, suspension of the approval, complete withdrawal of the product from the market or product recalls; • fines, warning or other enforcement-related letters or holds on post-approval clinical studies; • refusal of the FDA to approve pending BLAs or supplements to approved BLAs, or suspension or revocation of product license approvals; • product seizure or detention, or refusal to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
Other potential consequences include, among other things: • restrictions on the marketing or manufacturing of the product, suspension of the approval, complete withdrawal of the product from the market or product recalls; • fines, warning or other enforcement-related letters or holds on post-approval clinical studies; • refusal of the FDA to approve pending BLAs or supplements to approved BLAs, or suspension or revocation of product license approvals; 24 Table of Contents • product seizure or detention, or refusal to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
In addition, MTPC may terminate the agreement at its discretion upon 180 days’ notice to us, each party may terminate the agreement for the other party’s material breach or insolvency and we may terminate the agreement if MTPC engages in certain challenges of patents covering ZYNLONTA.
In addition, TPC may terminate the agreement at its discretion upon 180 days’ notice to us, each party may terminate the agreement for the other party’s material breach or insolvency and we may terminate the agreement if TPC engages in certain challenges of patents covering ZYNLONTA.
Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug or biologic has been associated with unexpected serious harm to patients.
Similarly, an IRB can suspend or terminate a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug or biologic has been associated with unexpected serious harm to patients.
Part 1 of the study uses a 3+3 dose escalation in third-line(“3L”)/3L+ heavily pre-treated patients with ZYNLONTA doses starting at 90 µg/kg and then proceeding to 120 µg/kg and 150 µg/kg.
Part 1 of the study used a 3+3 dose escalation in third-line (“3L”)/3L+ heavily pre-treated patients with ZYNLONTA doses starting at 90 µg/kg and then proceeding to 120 µg/kg and 150 µg/kg.
U.S. Federal Contracting and Pricing Requirements Manufacturers are also required to make their covered drugs, which are generally drugs approved under NDAs or BLAs, available to authorized users of the Federal Supply Schedule (“FSS”) of the General Services Administration.
Federal Contracting and Pricing Requirements Manufacturers are also required to make their covered drugs, which are generally drugs approved under NDAs or BLAs, available to authorized users of the Federal Supply Schedule (“FSS”) of the General Services Administration.
Phase 1 clinical trials may be designated as Phase 1a, which may involve dose escalation to determine the maximum tolerated dose, or Phase 1b, which may involve dose expansion at one or more dose levels to determine the recommended dose level for Phase 2 clinical trials. • Phase 2 clinical trials generally involve studies in disease-affected patients to evaluate proof of concept and/or determine the dosing regimen(s) for subsequent investigations.
Phase 1 clinical trials may be designated as Phase 1a, which may involve dose escalation to determine the maximum tolerated dose, or Phase 1b, which 19 Table of Contents may involve dose expansion at one or more dose levels to determine the recommended dose level for Phase 2 clinical trials. • Phase 2 clinical trials generally involve studies in disease-affected patients to evaluate proof of concept and/or determine the dosing regimen(s) for subsequent investigations.
For instance, the FDA closely regulates the post-approval marketing and promotion of biologics, including standards and regulations for direct-to-consumer advertising, off-label promotion, industry-sponsored scientific and educational activities and promotional activities involving the internet. Biologics may be marketed only for the approved indications and in a manner consistent 25 Table of Contents with the provisions of the approved labeling.
For instance, the FDA closely regulates the post-approval marketing and promotion of biologics, including standards and regulations for direct-to-consumer advertising, off-label promotion, industry-sponsored scientific and educational activities and promotional activities involving the internet. Biologics may be marketed only for the approved indications and in a manner consistent with the provisions of the approved labeling.
The full approval for this indication will be contingent upon the results of the subsequent confirmatory randomized controlled trial. We intend to satisfy this requirement through our LOTIS-5 Phase 3 clinical trial.
The full approval for this indication will be contingent upon the results of the subsequent confirmatory randomized controlled trial, which we intend to satisfy through our LOTIS-5 Phase 3 clinical trial.
The median time to first response was 41.0 days. • ZYNLONTA’s favorable clinical activity was observed across a broad patient population in this clinical trial, including transplant eligible and ineligible patients, patients who have not responded to first-line therapy or any prior therapy, double-hit and triple-hit disease and transformed disease and patients who had received prior CD19 therapies or SCT. 9 Table of Contents • The median DoR was 13.37 months for patients who achieved a response.
The median time to first response was 41.0 days. • ZYNLONTA’s favorable clinical activity was observed across a broad patient population in this clinical trial, including transplant eligible and ineligible patients, patients who have not responded to first-line therapy or any prior therapy, double-hit and triple-hit disease and transformed disease and patients who had received prior CD19 therapies or SCT. • The median DoR was 13.37 months for patients who achieved a response.
ADC Design An ADC consists of three components: (i) an antibody that selectively targets a distinct antigen preferentially expressed on tumor cells; (ii) a cytotoxic molecule, often referred to as the toxin or the warhead, that kills the target cell; and (iii) a chemical linker that joins together the antibody and the warhead.
Antibody Drug Conjugates An ADC consists of three components: (i) an antibody that selectively targets a distinct antigen preferentially expressed on tumor cells; (ii) a cytotoxic molecule, often referred to as the toxin or the warhead, that kills the target cell; and (iii) a chemical linker that joins together the antibody and the warhead.
The randomized part of the clinical trial was initiated after the last 7 Table of Contents patient in the safety run-in completed the first treatment cycle and it was observed that there were no significant increases in toxicity of the combination as compared to historical safety data of ZYNLONTA used as a monotherapy.
The randomized part of the clinical trial was initiated after the last patient in the safety run-in completed the first treatment cycle and it was observed that there were no significant increases in toxicity of the combination as compared to historical safety data of ZYNLONTA used as a monotherapy.
Competitors, however, may receive approval of either a different product for the same indication or the same 23 Table of Contents product for a different indication. In the latter case, because healthcare professionals are free to prescribe products for off-label uses, the competitor’s product could be used for the orphan indication despite another product’s orphan exclusivity.
Competitors, however, may receive approval of either a different product for the same indication or the same product for a different indication. In the latter case, because healthcare professionals are free to prescribe products for off-label uses, the competitor’s product could be used for the orphan indication despite another product’s orphan exclusivity.
The FDA may also perform certain confirmatory tests on lots of some products, such as viral vaccines, before releasing the lots for distribution by the manufacturer. In addition, the FDA conducts laboratory research related to the regulatory standards on the safety, purity, potency, and effectiveness of biological products.
The FDA may also perform certain confirmatory tests on lots of some products, such as viral vaccines, before releasing the lots for distribution by the manufacturer. In addition, the FDA conducts laboratory research related to the regulatory standards on the safety, purity, potency, and effectiveness of 23 Table of Contents biological products.
CMS selected the Medicare Part D products for negotiation in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced. The price cap for each of these products, which cannot exceed a statutory ceiling price, will take with the negotiated price taking effect in 2026.
CMS selected 10 Medicare Part D products for negotiation in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced. The price cap for each of these products, which cannot exceed a statutory ceiling price, will take effect in 2026.
The royalty term with respect to a product in a given country begins upon the first commercial sale of the product in the country and terminates upon the latest of (x) 10 years after the first commercial sale of the product in the country, (y) the expiration of the last-to-expire valid patent claim covering the product in the country and (z) the expiration of regulatory exclusivity for the product in the country.
The royalty term with respect to a product in a given country begins upon the first commercial sale of the product in the country and terminates upon the latest of (x) 10 years after the first commercial sale of the product in the country, (y) the expiration of the last-to- 16 Table of Contents expire valid patent claim covering the product in the country and (z) the expiration of regulatory exclusivity for the product in the country.
The FDA may take certain actions with respect to breakthrough therapies, including holding meetings with the sponsor throughout the development process, providing timely advice to the product sponsor regarding development and approval, involving more senior staff in the review process, assigning a cross-disciplinary project lead for the review team and taking other steps to design the clinical studies in an efficient manner.
The FDA may take certain actions with respect to breakthrough therapies, including holding meetings with the sponsor throughout the development process, providing timely advice to the product sponsor regarding development and approval, involving more senior staff in the review process, 22 Table of Contents assigning a cross-disciplinary project lead for the review team and taking other steps to design the clinical studies in an efficient manner.
In the future, we or our licensors may apply for patent term extension for our owned or licensed patents to add patent life beyond their current expiration date, depending on the expected length of the clinical trials and other factors involved in the filing of the relevant BLA.
In the future, we or our licensors may apply for patent term extension for our owned or licensed patents to add patent life beyond their current expiration date, depending on the expected length of the clinical trials and other factors applicable to the relevant BLA.
After a drug has been authorized and launched, it is a condition of maintaining the marketing authorization that all aspects relating to its quality, safety and efficacy must be kept under review. Sanctions may be imposed for failure to adhere to the conditions of the marketing authorization.
After a medicinal product has been authorized and launched, it is a condition of maintaining the marketing authorization that all aspects relating to its quality, safety and efficacy must be kept under review. Sanctions may be imposed for failure to adhere to the conditions of the marketing authorization.
Any authorization which is not followed by the actual placing of the drug on the EU market (in case of centralized procedure) or on the market of the authorizing member state within three years after authorization shall cease to be valid (the so-called “sunset clause”).
Any authorization which is not followed by the actual placing of the medicinal product on the EU market (in case of centralized procedure) or on the market of the authorizing Member State within three years after authorization shall cease to be valid (the so-called “sunset clause”).
The FDA, the IRB, or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including non-compliance with regulatory requirements or a finding that the patients are being exposed to an unacceptable health risk.
The FDA, the IRB, or the sponsor may suspend or terminate a clinical trial in whole or in part at any time on various grounds, including non-compliance with regulatory requirements or a finding that the patients are being exposed to an unacceptable health risk.
“PBD Warhead,” “PBD Warhead with Linker” Platform Patent Protection As of December 31, 2024, with respect to the PBD-based warhead and ADC technology we use to develop our product candidates, we have exclusively licensed from MedImmune for particular target molecules, various patent families directed to different aspects of the chemistry of the PBD molecules and methods of using the molecules in the treatment of proliferative diseases.
“PBD Warhead,” “PBD Warhead with Linker” Platform Patent Protection With respect to the PBD-based warhead and ADC technology we use to develop our product candidates, we have exclusively licensed from MedImmune for particular target molecules, various patent families directed to different aspects of the chemistry of the PBD molecules and methods of using the molecules in the treatment of proliferative diseases.
The accelerated approval pathway is contingent on a sponsor’s agreement to conduct additional post-approval confirmatory studies to verify and describe the 24 Table of Contents product’s clinical benefit. These confirmatory trials must be completed with due diligence, and, in some cases, the FDA may require that the trial be designed, initiated, and/or fully enrolled prior to approval.
The accelerated approval pathway is contingent on a sponsor’s agreement to conduct additional post-approval confirmatory studies to verify and describe the product’s clinical benefit. These confirmatory trials must be completed with due diligence, and, in some cases, the FDA may require that the trial be designed, initiated, and/or fully enrolled prior to approval.
When an application is submitted for a marketing authorization in respect of a drug for human use which is of major interest from the point of view of public health and in particular from the viewpoint of therapeutic innovation, the applicant may request an accelerated assessment procedure pursuant to Article 14(9) of Regulation (EC) 726/2004.
When an application is submitted for a marketing authorization in respect of a medicinal product for human use which is of major interest from the point of view of public health and in particular from the viewpoint of therapeutic innovation, the applicant may request an accelerated assessment procedure pursuant to Article 14(9) of Regulation (EC) No. 726/2004.
We maintain the right to control clinical trials for the Licensed Products conducted both in and out of the Territory, and the license agreement sets forth the division of costs between us and Overland ADCT BioPharma with respect to clinical trials depending on the territories within which such trials are conducted or relate to.
We maintain the right to control global clinical 14 Table of Contents trials for the Licensed Products conducted both in and out of the Territory, and the license agreement sets forth the division of costs between us and Overland ADCT BioPharma with respect to clinical trials depending on the territories within which such trials are conducted or relate to.
The main observed efficacy findings were as follows: • Thirty-six patients, or 24.8% of patients, achieved a complete response and another 34 patients, or 23.4% of patients, achieved a partial response, resulting in a 48.3% ORR.
The main observed efficacy findings were as follows: • Thirty-six patients, or 24.8% of patients, achieved a CR and another 34 patients, or 23.4% of patients, achieved a partial response (“PR”), resulting in a 48.3% ORR.
Marketing authorization for an orphan drug leads to a 10-year period of market exclusivity, which means that no similar medicinal product can be authorized in the same indication.
Marketing authorization for a medicinal product designated as an orphan medicinal product leads to a 10-year period of market exclusivity, which means that no similar medicinal product can be authorized in the same indication.
Accordingly, we are required to file reports and other information with the SEC, including annual, quarterly and current reports and proxy and information statements. The SEC maintains an internet site at sec.gov that contains reports, proxy and information statements and other information we have filed electronically with the SEC. 33 Table of Contents Our website address is adctherapeutics.com .
Accordingly, we are required to file reports and other information with the SEC, including annual, quarterly and current reports and proxy and information statements. The SEC maintains an internet site at sec.gov that contains reports, proxy and information statements and other information we have filed electronically with the SEC. Our website address is adctherapeutics.com .
Instead, we contract with third-party current Good Manufacturing Process-compliant CMOs that have the facilities and capabilities to manufacture on our behalf the intermediate components and the final product candidates for use in clinical trials and commercial supply.
Instead, we contract with third-party current Good Manufacturing Process-compliant CMOs that have the facilities and capabilities to manufacture on our behalf the intermediate components 11 Table of Contents and the final product candidates for use in clinical trials and commercial supply.
At MPTC’s option, it may also participate in any clinical studies of ZYNLONTA outside of Japan by bearing a portion of the costs of such studies. In addition, MPTC agreed that it will not engage in certain activities with respect to products that are similar to ZYNLONTA.
At TPC’s option, it may also participate in any clinical studies of ZYNLONTA outside of Japan by bearing a portion of the costs of such studies. In addition, TPC agreed that it will not engage in certain activities with respect to products that are similar to ZYNLONTA.
The median DoR was not reached for patients who achieved a complete response and was 5.68 months for patients who achieved a partial response.
The median DoR was not reached for patients who achieved a complete response and was 5.68 months for patients who achieved a PR.
Spirogen Sàrl subsequently transferred the PBD technology to MedImmune Limited, which, together with MedImmune LLC, is the global biologics research and development arm of AstraZeneca plc.
Spirogen Sàrl subsequently transferred the PBD technology to MedImmune Limited, which, together with MedImmune LLC, is the 13 Table of Contents global biologics research and development arm of AstraZeneca plc.
Orphan Drug Designation Regulation (EC) 141/2000 states that a drug shall be designated as an orphan drug if its sponsor can establish (i) that it is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition affecting not more than five in 10,000 persons in the European Union when the application is made, or that it is intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition in the European Union and that without incentives it is unlikely that the marketing of the drug in the European Union would generate sufficient return to justify the necessary investment; and (ii) that there exists no satisfactory method of diagnosis, prevention or treatment of the condition in question that has been authorized in the European Union or, if such method exists, the drug will be of significant benefit to those affected by that condition.
Orphan Drug Designation and Exclusivity Regulation (EC) No. 141/2000 and Commission Regulation (EC) No. 847/2000 provide that a medicinal product shall be designated as an orphan medicinal product by the European Commission, if its sponsor can establish (i) that the medicinal drug is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition affecting not more than five in 10,000 persons in the European Union when the application is made, or that it is intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition in the 28 Table of Contents European Union and that without incentives it is unlikely that the marketing of the medicinal product in the European Union would generate sufficient return to justify the necessary investment; and (ii) that there exists no satisfactory method of diagnosis, prevention or treatment of the condition in question that has been authorized in the European Union or, if such method exists, the medicinal product will be of significant benefit to those affected by that condition.
The clinical trial enrolled patients with pathologically confirmed relapsed or refractory DLBCL who are not considered by the investigator to be a candidate for stem cell transplantation (“SCT”) and who had failed at least one multi-agent systemic treatmen t regimen. Enrollment was completed in 2024.
The clinical trial enrolled patients with pathologically confirmed relapsed or refractory DLBCL who are not considered by the investigator to be a candidate for stem cell transplantation (“SCT”) and who had failed at least one multi-agent systemic treatmen t regimen.
The primary objective of the clinical trial is to determine the recommended dosing regimen of loncastuximab tesirine in DLBCL or HGBCL patients with moderate and severe hepatic impairment.
The primary objective of the clinical trial is to determine the recommended dosing regimen of ZYNLONTA in DLBCL or HGBCL patients with moderate and severe hepatic impairment.
In connection with such joint venture, we entered into a license and collaboration agreement with the joint venture entity, Overland ADCT BioPharma (CY) Limited (“Overland ADCT BioPharma”) pursuant to which we granted Overland ADCT BioPharma an exclusive license or sublicense (as applicable) under all applicable patents and know-how now or in the future owned or controlled by us relating to ZYNLONTA, ADCT-602, ADCT-601 and ADCT-901 (collectively, the “Licensed Products”) in order to use, sell, offer for sale, import and commercialize such product candidates in China, Hong Kong, Macau, Taiwan and Singapore (the “Territory”).
In connection with such joint venture, we entered into a license and collaboration agreement with the joint venture entity, Overland ADCT BioPharma (CY) Limited (“Overland ADCT BioPharma”) pursuant to which we granted Overland ADCT BioPharma an exclusive license or sublicense (as applicable) under all applicable patents and know-how now or in the future owned or controlled by us relating to the Licensed Products in order to use, sell, offer for sale, import and commercialize such product candidates in China, Hong Kong, Macau, Taiwan and Singapore (the “Territory”).
If ZYNLONTA is approved for use as a 2L treatment for DLBCL patients, we will continue to compete with CAR-T, 15 Table of Contents autologous stem cell transplant, rituximab in combination with chemotherapies, polatuzumab in combination with bendamustine and a rituximab product, and tafasitamab in combination with lenalidomide.
If ZYNLONTA is approved for use as a 2L+ treatment for DLBCL patients, we will continue to compete with CAR-T, autologous stem cell transplant, rituximab in combination with chemotherapies, polatuzumab in combination with bendamustine and a rituximab product, tafasitamab in combination with lenalidomide and brentuximab in combination with bendamustine and a rituximab product.
The GDPR prohibits the transfer of personal data to countries outside the European Economic Area, such as the United States, which are not considered by the European Commission to provide an adequate level of data protection. Switzerland has adopted similar restrictions.
In addition, the GDPR restricts the transfer of personal data to countries outside the European Economic Area (“EEA”), such as the United States, which are not considered by the European Commission to provide an adequate level of data protection. Switzerland has adopted similar restrictions.
We have entered into strategic agreements to maximize the commercial potential of ZYNLONTA, including an exclusive license agreement with Mitsubishi Tanabe Corporation (“MTPC”) in Japan, and a joint venture with Overland Pharmaceuticals in China (including Hong Kong and Macau), Singapore, and Taiwan, and an exclusive license agreement with Sobi for all other regions, excluding the U.S.
Outside of the United States, we have entered into strategic agreements to maximize the commercial potential of ZYNLONTA, including an exclusive license agreement with Mitsubishi Tanabe Pharma Corporation, now TPC in Japan, and a joint venture with Overland Pharmaceuticals in China (including Hong Kong and Macau), Singapore, and Taiwan, and an exclusive license agreement with Sobi for all other regions, excluding the U.S. and Japan.
Other ZYNLONTA Clinical Trials LOTIS-7 Clinical Trial Design LOTIS-7 is a Phase 1b global multicenter, multi-arm study in patients with relapsed or refractory B-cell non-Hodgkin lymphoma (B-NHL), including Part 1 (dose escalation) and Part 2 (dose expansion). The three dosing arms include ZYNLONTA plus polatuzumab vedotin, ZYNLONTA plus glofitamab, and ZYNLONTA plus mosunetuzumab.
LOTIS-7 Clinical Trial Design LOTIS-7 is a Phase 1b global multicenter, multi-arm open-label study in patients with relapsed or refractory B-cell non-Hodgkin lymphoma (B-NHL), including Part 1 (dose escalation) and Part 2 (dose expansion). The three dosing arms in Part 1 included ZYNLONTA plus polatuzumab vedotin, ZYNLONTA plus glofitamab (COLUMVI®), and ZYNLONTA plus mosunetuzumab.
We have sufficient commercial-grade drug 13 Table of Contents product, ZYNLONTA, in stock and we believe we and our CMOs will be able to conduct additional manufacturing at the scheduled times.
We believe we have sufficient commercial-grade drug product, ZYNLONTA, in stock and we believe we and our CMOs will be able to conduct additional manufacturing at the scheduled times.
Pivotal Phase 2 Clinical Trial in Relapsed or Refractory Diffuse Large B-Cell Lymphoma (LOTIS-2) We conducted a 145-patient Phase 2, multi-center, open-label, single-arm clinical trial to evaluate the safety and efficacy of ZYNLONTA in patients with relapsed or refractory DLBCL.
Pivotal Phase 2 Clinical Trial in Relapsed or Refractory Diffuse Large B-Cell Lymphoma (LOTIS-2) We conducted a 145-patient Phase 2, multi-center, open-label, single-arm clinical trial to evaluate the safety and efficacy of ZYNLONTA in patients with relapsed or refractory DLBCL after two or more lines of systemic therapy.
However, an extension might not be granted because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable eligibility or other requirements.
However, an extension might not be granted because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable eligibility or other requirements. Moreover, the extension awarded could be less than requested.
The licenses are subject to certain retained rights as specified in the agreement. 18 Table of Contents Under the agreement, we received an upfront payment of $55 million in July 2022 and $50 million in February 2023 for the approval of a Marketing Authorization Application (“MAA”) by the European Commission for ZYNLONTA in 3L DLBCL, and are eligible for up to $332.5 million in other regulatory and net sales-based milestones, as well as tiered royalties ranging from the mid-teens to the mid-twenties based on net sales of ZYNLONTA in the Covered Territory.
Under the agreement, we received an upfront payment of $55 million in July 2022 and $50 million in February 2023 for the approval of a Marketing Authorization Application (“MAA”) by the European Commission for ZYNLONTA in 3L DLBCL, and are eligible for up to $332.5 million in other regulatory and net sales-based milestones, as well as tiered royalties ranging from the mid-teens to the mid-twenties based on net sales of ZYNLONTA in the Covered Territory.
The process regarding approval of medicinal products in the European Union follows roughly the same lines as in the United States and likewise generally involves satisfactorily completing each of the following: • preclinical laboratory tests, animal studies and formulation studies all performed in accordance with the applicable EU GLP regulations; • submission to the relevant national authorities of a clinical trial application (“CTA”) for each trial in humans, which must be approved before the trial may begin in each country where patient enrollment is planned; • performance of adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication; • submission to the relevant competent authorities of an MAA, which includes the data supporting safety and efficacy as well as detailed information on the manufacture and composition of the product in clinical development and proposed labelling; • satisfactory completion of an inspection by the relevant national authorities of the manufacturing facility or facilities, including those of third parties, at which the product is produced to assess compliance with strictly enforced cGMP; • potential audits of the non-clinical and clinical trial sites that generated the data in support of the MAA; and • review and approval by the relevant competent authority of the MAA before any commercial marketing, sale or shipment of the product. 27 Table of Contents Preclinical Studies Preclinical tests include laboratory evaluations of product chemistry, formulation and stability, as well as studies to evaluate toxicity in animal studies, in order to assess the quality and potential safety and efficacy of the product.
The process regarding approval of medicinal products in the European Union follows roughly the same lines as in the United States and likewise generally involves satisfactorily completing each of the following: • preclinical laboratory tests, animal studies and formulation studies all performed in accordance with the applicable EU GLP regulations; • submission to the relevant national authorities of a clinical trial application (“CTA”) through the EU central single entry point: the Clinical Trials Information System (“CTIS”) for each trial in humans, which must be approved before the trial may begin in each country where patient enrollment is planned; • performance of adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication; • submission to the relevant competent authorities of an MAA, which includes the data supporting safety and efficacy as well as detailed information on the manufacture and composition of the product in clinical development and proposed labelling; • satisfactory completion of an inspection by the relevant national authorities of the manufacturing facility or facilities, including those of third parties, at which the product is produced to assess compliance with strictly enforced EU GMP; • potential audits of the non-clinical and clinical trial sites that generated the data in support of the MAA; and • review and approval by the relevant competent authority of the MAA before any commercial marketing, sale or shipment of the product.
Applications under the BPCA are treated as priority applications, with all of the benefits that designation confers. Post-Approval Requirements Once a BLA is approved, a product will be subject to certain post-approval requirements.
Applications to change labeling after performance of studies under the BPCA are treated as priority applications, with all of the benefits that designation confers. Post-Approval Requirements Once a BLA is approved, a product will be subject to certain post-approval requirements.
Even if such data and information are submitted, the FDA may decide that the BLA does not satisfy the criteria for approval. As a condition of BLA approval, the FDA may require a risk evaluation and mitigation strategy (“REMS”) to help ensure that the benefits of the biologic outweigh the potential risks to patients.
Even if such data and information are submitted, the FDA may decide that the BLA does not satisfy the criteria for approval. As a condition of BLA approval, the FDA may require a REMS to help ensure that the benefits of the biologic outweigh the potential risks to patients.
Product-Specific Patent Protection As of December 31, 2024, we co-own with MedImmune, and have exclusive rights to, approximately 12 patent families directed to ADCs with PBD warheads and targeting moieties that bind to specific target molecules, combinations of these ADCs with other therapeutic molecules and therapeutic uses of these ADCs. These families include approximately 13 issued U.S. utility patents.
Product-Specific Patent Protection We co-own with MedImmune, and have exclusive rights to, approximately 6 patent families directed to ADCs with PBD warheads and targeting moieties that bind to specific target molecules, combinations of these ADCs with other therapeutic molecules and therapeutic uses of these ADCs. These families include approximately 6 issued U.S. utility patents.
The clinical trial is enrolling patients with relapsed or refractory B-cell NHL who have previously received two or more multi-agent systemic treatment regimens (in the dose escalation part) or who have previously received one or more multi-agent sy stemic treatment regimens (in the dose expansion part). The clinical trial is expected to enroll up to approximately 200 patients.
The clinical trial is enrolling patients with relapsed or refractory B-cell NHL who have previously received two or more multi-agent systemic treatment regimens (in the dose escalation part) or who have previously received one or more multi-agent sy stemic treatment regimens (in the dose expansion part).
The Centers for Medicare & Medicaid Services (“CMS”) administers the Medicaid drug rebate agreements with manufacturers which provide, among other things, that the drug manufacturer will pay rebates to each state Medicaid agency on a quarterly basis and report certain price information on a monthly and quarterly basis.
CMS administers the Medicaid drug rebate agreements with manufacturers which provide, among other things, that the drug manufacturer will pay rebates to each state Medicaid agency on a quarterly basis and report certain price information on a monthly and quarterly basis.
Sobi License Agreement In July 2022, we entered into a license agreement with Swedish Orphan Biovitrum AB (publ) (“Sobi”) to develop and commercialize ZYNLONTA in all territories other than the United States, greater China, Singapore and Japan (the territories subject to the agreement, collectively, the “Covered Territory”).
Sobi License Agreement In July 2022, we entered into a license agreement with Sobi to develop and commercialize ZYNLONTA in all territories other than the United States, greater China, Singapore and Japan (the territories subject to the agreement, collectively, the “Covered Territory”).
Date of first licensure does not include the date of licensure of (and a new period of exclusivity is not available for) a biological product if the licensure is for a supplement for the biological product or for a subsequent application by the same sponsor or manufacturer of the biological product (or licensor, predecessor in interest, or other related entity) for a change that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device or strength, or for a modification to the structure of the biological product that does not result in a change in safety, purity or potency.
Date of first licensure does not include the date of licensure of (and a new period of exclusivity is not available for) a biological product if the licensure is for a supplement for the biological product or for a subsequent application by the same sponsor or manufacturer of the biological product (or licensor, predecessor in interest, or other related entity) for a change that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device or strength, or for a modification to the structure of the biological product that does not result in a change in safety, purity or potency. 25 Table of Contents Regulatory Approval in the European Union The European Medicines Agency (the “EMA”) is a scientific agency of the European Union.
We are committed to providing global access to ZYNLONTA for patients who may benefit from this treatment. In Europe, ZYNLONTA has received conditional approval from the European Commission for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
We are committed to providing global access to ZYNLONTA for patients who may benefit from this treatment. ZYNLONTA has received conditional approval from the European Commission, China NMPA and Health Canada for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
In extreme cases, the authorization may be revoked, resulting in withdrawal of the product from sale. 28 Table of Contents Conditional Approval and Accelerated Assessment As per Article 14(7) of Regulation (EC) 726/2004, a medicine that would fulfill an unmet medical need may, if its immediate availability is in the interest of public health, be granted a conditional marketing authorization on the basis of less complete clinical data than are normally required, subject to specific obligations being imposed on the authorization holder.
Conditional Approval and Accelerated Assessment As per Article 14-a of Regulation (EC) No. 726/2004, a medicine that would fulfill an unmet medical need may, if its immediate availability is in the interest of public health, be granted a conditional marketing authorization on the basis of less complete clinical data than are normally required, subject to specific obligations being imposed on the authorization 27 Table of Contents holder.
MTPC License Agreement In January 2022, we entered into a license agreement with Mitsubishi Tanabe Pharma Corporation (“MTPC”) to develop and commercialize ZYNLONTA in Japan, pursuant to which we granted MPTC an exclusive license under all applicable patents and know-how relating to ZYNLONTA in order to use, sell, offer for sale, import and commercialize ZYNLONTA for all cancer indications in Japan.
TPC License Agreement In January 2022, we entered into a license agreement with TPC, to develop and commercialize ZYNLONTA in Japan, pursuant to which we granted TPC an exclusive license under all applicable patents and know-how relating to ZYNLONTA in order to use, sell, offer for sale, import and commercialize ZYNLONTA for all cancer indications in Japan.
In addition, there is ongoing litigation that may restrict the number of third-party contract pharmacies that can dispense drugs that manufacturers sell to 340B covered entities and who qualify as patients of these 340B covered entities.
In addition, there is ongoing litigation that may restrict the number of third-party contract pharmacies that can dispense drugs that manufacturers sell to 340B covered entities and who qualify as patients of these 340B covered entities. The outcome of this litigation may change the scope of the 340B program in coming years.
We are driving utilization of ZYNLONTA in the 3L+ setting of DLBCL through increased awareness of ZYNLONTA’s efficacy and manageable safety profile and its suitability for use across treatment settings. • Seek to expand ZYNLONTA into earlier lines of DLBCL and indolent lymphomas as a single agent and in combination with other therapies.
We are driving utilization of ZYNLONTA in the 3L+ DLBCL setting through increased awareness of ZYNLONTA’s efficacy and manageable safety profile and its suitability for use across treatment settings. • Seek to expand ZYNLONTA into earlier lines of DLBCL and indolent lymphomas .
To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and efficacy of the investigational product to the satisfaction of the FDA. FDA approval of a BLA must be obtained before a biologic or drug may be marketed in the United States. The cost of preparing and submitting a BLA is substantial.
To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the 20 Table of Contents safety and efficacy of the investigational product to the satisfaction of the FDA. FDA approval of a BLA must be obtained before a biologic or drug may be marketed in the United States.
Under the centralized authorization procedure, the Committee for Medicinal Products for Human Use (the “CHMP”) serves as the scientific committee that renders opinions about the safety, efficacy and quality of human products on behalf of the EMA.
Under the centralized authorization procedure, the Committee for Medicinal Products for Human Use (the “CHMP”) – EMA’s committee responsible for human medicines – serves as the scientific committee that renders opinions about the safety, efficacy and quality of human products.
The clinical trial is enrolling pat ients with relapsed or refractory DLBCL or HGBCL with hepatic impairment . The clinical trial is expected to enroll approximately 56 patients. Pediatric Trial ‘Glo-BNHL’ is an international multi-center, adaptive, platform trial of novel agents in pediatric and adolescent relapsed or refractory B-cell NHL.
The clinical trial is expected to enroll approximately 56 patients. Pediatric Trial ‘Glo-BNHL’ is an international multi-center, adaptive, platform trial of novel agents in pediatric and adolescent relapsed or refractory B-cell NHL.
Patients are randomly assigned 1:1 to receive either ZYNLONTA in combination with rituximab or rituximab in combination with gemcitabine and oxaliplatin. In August 2023, we announced updated safety run-in results from the clinical trial.
Patients are randomly assigned 1:1 to receive either ZYNLONTA in combination with rituximab or rituximab in combination with gemcitabine and oxaliplatin. LOTIS-5 Updated Data In July 2025, we announced updated safety run-in results from the clinical trial.
European Data Collection and Processing The collection, transfer, processing and other use of personal information, including health data, in the European Union is governed by the GDPR.
European Data Collection and Processing The collection, transfer, processing and other use of personal information, including health data, in the European Union is governed by the General Data Protection Regulation (“GDPR”).

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeVirginia’s Consumer Data Protection Act, which took effect on January 1, 2023, requires businesses subject to the legislation to conduct data protection assessments in certain circumstances and requires opt-in consent from consumers to acquire and process their sensitive personal information, which includes information revealing a consumer’s physical and mental health diagnosis and genetic and biometric information that can identify a consumer.
Biggest changeFor example, the California Consumer Privacy Act of 2018 (“CCPA”), as amended by the California Privacy Rights Act of 2020 (“CPRA”) requires business to provide specific disclosures in privacy notices, affords California residents certain rights related to their personal data, although it exempts some data processed in the context of clinical trials, and expands consumers’ rights with respect to certain sensitive personal information; Virginia’s Consumer Data Protection Act requires businesses subject to the legislation to conduct data protection assessments in certain circumstances and requires opt-in consent from consumers to acquire and process their sensitive personal information, which includes information revealing a consumer’s physical and mental health diagnosis and genetic and biometric information that can identify a consumer; and other states have enacted, proposed and are considering data privacy laws, which could further complicate compliance efforts, increase our potential liability and adversely affect our business.
In addition, manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to “cause” the submission of false or fraudulent claims. • HIPAA, which, among other things, imposes criminal liability for executing or attempting to execute a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, or willfully obstructing a criminal investigation of a healthcare offense, and creates federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation, or making or using any false writing or document knowing the same to contain any materially false, fictitious or fraudulent statement or entry in connection with the delivery of or payment for healthcare benefits, items or services. • HIPAA, as amended by HITECH, and its implementing regulations, which impose privacy, security and breach reporting obligations with respect to individually identifiable health information upon entities subject to the law, such as health plans, healthcare clearinghouses and certain healthcare providers, known as covered entities, and their respective business associates and covered subcontractors that perform services for them that involve individually identifiable health information.
In addition, manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to “cause” the submission of false or fraudulent claims. • HIPAA, among other things, imposes criminal liability for executing or attempting to execute a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, or willfully obstructing a criminal investigation of a healthcare offense, and creates federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation, or making or using any false writing or document knowing the same to contain any materially false, fictitious or fraudulent statement or entry in connection with the delivery of or payment for healthcare benefits, items or services. • HIPAA, as amended by HITECH, and its implementing regulations, which impose privacy, security and breach reporting obligations with respect to individually identifiable health information upon entities subject to the law, such as health plans, healthcare clearinghouses and certain healthcare providers, known as covered entities, and their respective business associates and covered subcontractors that perform services for them that involve individually identifiable health information.
The risk of our inability to establish market acceptance may be heightened as our products represent novel treatment methods and be influenced by factors beyond our control, including perceptions of ADC products generally or those of our competitors and coverage and reimbursement for our products.
The risk of our inability to establish market acceptance may be heightened as our products represent novel treatment methods and may be influenced by factors beyond our control, including perceptions of ADC products generally or those of our competitors and coverage and reimbursement for our products.
Any of the foregoing could have a material adverse effect on our business, results of operations, financial condition and prospects.
Any of the foregoing could have a material adverse effect on our business, results of operations, financial condition and prospects.
Events that could impede our ability to complete clinical trials on a timely basis include but are not limited to: • delays in the timely commencement of clinical trials due to negative preclinical data, delays in receiving the required regulatory clearance from the appropriate regulatory authorities, delays in reaching an agreement on 38 Table of Contents acceptable terms with prospective clinical research organizations (“CROs”) and clinical trial sites and difficulties in obtaining required IRB or ethics committee approval at each clinical trial site; • challenges in recruiting and enrolling suitable patients that meet the study criteria to participate in clinical trials, which challenges may be heightened for clinical trials that seek to enroll patients with characteristics that are found in a small population and by the novel nature of our products and product candidates; • competition from alternative clinical trials in a similar space or new treatments in similar indications which may limit or ability to recruit and enroll new subjects; • difficulties in retaining and following up with subjects and subsequent censoring of patients; • any failure by us or CROs, CMOs, and other third parties to adhere to applicable requirements, which risk may be heightened by our reliance on third parties, and which may result in delays, trial suspension or the imposition of clinical holds; • safety issues, including occurrence of TEAEs and SAEs, which may result in trial suspension or the imposition of clinical holds; • the inability to manufacture adequate quantities of a product or a product candidate or other materials necessary in accordance with cGMPs to conduct clinical trials, including, for example, quality issues and delays in the testing, validation, manufacturing delays or failures at our CROs and delivery of the product or product candidate to the clinical trial sites; • the ability to obtain on a timely basis and on commercially reasonable terms an adequate supply of products or product candidates to be used in combination with our products and product candidates; • changes in regulatory requirements and guidance; • changes in the treatment landscape, such as new therapies or the withdrawal of a competing product; and • lack of adequate funding to continue the clinical trial.
Events that could impede our ability to complete clinical trials on a timely basis include but are not limited to: • delays in the timely commencement of clinical trials due to negative preclinical data, delays in receiving the required regulatory clearance from the appropriate regulatory authorities, delays in reaching an agreement on acceptable terms with prospective clinical research organizations (“CROs”) and clinical trial sites and difficulties in obtaining required IRB or ethics committee approval at each clinical trial site; 40 Table of Contents • challenges in recruiting and enrolling suitable patients that meet the study criteria to participate in clinical trials, which challenges may be heightened for clinical trials that seek to enroll patients with characteristics that are found in a small population and by the novel nature of our products and product candidates; • competition from alternative clinical trials in a similar space or new treatments in similar indications which may limit our ability to recruit and enroll new subjects; • difficulties in retaining and following up with subjects and subsequent censoring of patients; • any failure by us or CROs, CMOs, and other third parties to adhere to applicable requirements, which risk may be heightened by our reliance on third parties, and which may result in delays, trial suspension or the imposition of clinical holds; • safety issues, including occurrence of TEAEs and SAEs, which may result in trial suspension or the imposition of clinical holds; • the inability to manufacture adequate quantities of a product or a product candidate or other materials necessary in accordance with cGMPs to conduct clinical trials, including, for example, quality issues and delays in the testing, validation, manufacturing delays or failures at our CROs and delivery of the product or product candidate to the clinical trial sites; • the ability to obtain on a timely basis and on commercially reasonable terms an adequate supply of products or product candidates to be used in combination with our products and product candidates; • changes in regulatory requirements and guidance; • changes in the treatment landscape, such as new therapies or the withdrawal of a competing product; and • lack of adequate funding to continue the clinical trial.
In addition, the Swiss takeover regime imposes certain restrictions and obligations on bidders in a voluntary public takeover offer that are designed to protect shareholders. However, these protections are applicable only to issuers that list their equity securities in Switzerland and, because our common shares are listed exclusively on the NYSE, are not be applicable to us.
In addition, the Swiss takeover regime imposes certain restrictions and obligations on bidders in a voluntary public takeover offer that are designed to protect shareholders. However, these protections are applicable only to issuers that list their equity securities in Switzerland and, because our common shares are listed exclusively on the NYSE, are not applicable to us.
In the relapsed or refractory DLBCL setting, for which we have developed ZYNLONTA, current 3L treatment options include CAR-T, allogeneic stem cell transplant, polatuzumab in combination with bendamustine and a rituximab product, selinexor, tafasitamab in combination with lenalidomide, chemotherapy using small molecules and bispecific antibodies.
In the relapsed or refractory DLBCL setting, for which we have developed ZYNLONTA, current 3L treatment options include CAR-T, allogeneic stem cell transplant, polatuzumab in combination with bendamustine and a rituximab product, selinexor, tafasitamab in combination with lenalidomide, brentuximab in combination with bendamustine and a rituximab product, chemotherapy using small molecules and bispecific antibodies.
For example, subject to certain exceptions, the Loan Agreement restricts our ability to incur indebtedness and the HCR Agreement restricts our ability to sell, finance or loan any additional royalties on ZYNLONTA outside of China, Hong Kong, Macau, Taiwan, Singapore and South Korea or on Cami, and to incur indebtedness exceeding 20% of our market capitalization.
For example, subject to certain exceptions, the Loan Agreement restricts our ability to incur indebtedness and the HCR Agreement restricts our ability to sell, finance or loan any additional royalties on ZYNLONTA outside of China, Hong Kong, Macau, Taiwan, Singapore and South Korea, and to incur indebtedness exceeding 20% of our market capitalization.
Risks Related to Regulatory Approval and Government Regulation We may be unable to obtain, or experience delays in obtaining, regulatory approval for our product candidates. Our product candidates must be approved by the FDA in the United States, by the EMA in the European Union and by comparable regulatory authorities in other jurisdictions prior to commercialization.
Risks Related to Regulatory Approval and Government Regulation We or our partners may be unable to obtain, or experience delays in obtaining, regulatory approval for our product candidates. Our product candidates must be approved by the FDA in the United States, by the EMA in the European Union and by comparable regulatory authorities in other jurisdictions prior to commercialization.
If our operations are found to be in violation of any of these laws or any other current or future 46 Table of Contents healthcare laws that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations, any of which could substantially disrupt our operations.
If our operations are found to be in violation of any of these laws or any other current or future healthcare laws that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non- 49 Table of Contents compliance with these laws, and the curtailment or restructuring of our operations, any of which could substantially disrupt our operations.
If ZYNLONTA is approved for use as a 2L treatment for DLBCL patients, we will continue to compete with CAR-T, autologous stem cell transplant, rituximab in combination with chemotherapies, polatuzumab in combination with bendamustine and a rituximab product, and tafasitamab in combination with lenalidomide.
If ZYNLONTA is approved for use as a 2L treatment for DLBCL patients, we will continue to compete with CAR-T, autologous stem cell transplant, rituximab in combination with chemotherapies, polatuzumab in combination with bendamustine and a rituximab product, tafasitamab in combination with lenalidomide and brentuximab in combination with bendamustine and a rituximab product.
If we are required to conduct additional clinical trials or other testing of any of our products and product candidates beyond those that are contemplated, we may incur significant additional costs and regulatory approval may be delayed or prevented.
If we or our partners are required to conduct additional clinical trials or other testing of any of our products and product candidates beyond those that are contemplated, we or our partners may incur significant additional costs and regulatory approval may be delayed or prevented.
In addition, we expect potential future competition from bispecific antibodies such as glofitamab and epcoritamab alone or in combinations with chemotherapies or polatuzumab to gain approval in the 2L treatment of DLBCL.
In addition, we expect potential future competition from bispecific antibodies such as glofitamab, mosunetuzumab and epcoritamab alone or in combinations with chemotherapies or polatuzumab to gain approval in the 2L treatment of DLBCL.
There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution, but the exceptions and safe harbors are drawn narrowly and require strict compliance in order to offer protection. 45 Table of Contents • Federal civil and criminal false claims laws, such as the False Claims Act (“FCA”), which can be enforced by private citizens through civil qui tam actions, and the Civil Monetary Penalties Law prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, false, fictitious or fraudulent claims for payment of federal funds, and knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government.
There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution, but the exceptions and safe harbors are drawn narrowly and require strict compliance in order to offer protection. • Federal civil and criminal false claims laws, such as the False Claims Act (“FCA”), which can be enforced by private citizens through civil qui tam actions, and the Civil Monetary Penalties Law prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, false, fictitious or fraudulent claims for payment of federal funds, and knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to avoid, decrease or conceal an obligation to pay money to the federal government.
In addition, laws and regulations on executive compensation, including legislation in our home country, Switzerland, may restrict our ability to attract, motivate and retain the required level of qualified personnel including those that (i) impose an annual binding shareholders’ “say-on-pay” vote with respect to the compensation of the members of the executive committee and the board of directors, (ii) prohibit severance, advances, transaction premiums 57 Table of Contents and similar payments to the members of the executive committee and the board of directors, and (iii) require companies to specify various compensation-related matters in their articles of association, thus requiring them to be approved by a shareholders’ vote.
In addition, laws and regulations on executive compensation, including legislation in our home country, Switzerland, may restrict our ability to attract, motivate and retain the required level of qualified personnel including those that (i) impose an annual binding shareholders’ “say-on-pay” vote with respect to the compensation of the members of the executive committee and the board of directors, (ii) prohibit severance, advances, transaction premiums and similar payments to the members of the executive committee and the board of directors, and (iii) require companies to specify various compensation-related matters in their articles of association, thus requiring them to be approved by a shareholders’ vote.
They may refuse to accept any application or may decide that our data are insufficient for approval and require additional clinical trials or other studies.
They may refuse to accept any application or may decide that data are insufficient for approval and require additional clinical trials or other studies.
In addition, any products for which we receive regulatory approval in a particular jurisdiction and the activities associated with their commercialization, including testing, manufacture, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, will be subject to comprehensive regulation by the FDA, the EMA or comparable regulatory authorities in other jurisdictions.
In addition, any products for which we or our partners receive regulatory approval in a particular jurisdiction and the activities associated with their commercialization, including testing, manufacture, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, will be subject to comprehensive regulation by the FDA, the EMA or comparable regulatory authorities in other jurisdictions.
Alternatively, we have established collaborations with third parties to commercialize our product. See “Item 1. Business—Material Contracts.” In such collaborations, we depend on the performance of the contractual counterparty, over which we have limited control. Therefore, such collaborations may generate lower product revenues or profit than if we were to commercialize our products ourselves.
Alternatively, we have established collaborations with third parties to commercialize our product in certain jurisdictions. See “Item 1. Business—Material Contracts.” In such collaborations, we depend on the performance of the contractual counterparty, over which we have limited control. Therefore, such collaborations may generate lower product revenues or profit than if we were to commercialize our products ourselves.
We and any potential collaborators may be subject to federal, state, local and foreign laws and regulations that apply to the collection, use, retention, protection, disclosure, transfer and other processing of personal data, including the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”), the Regulation 2016/679, known as the General Data Protection Regulation (the “GDPR”), as well as European Union member state implementing legislations, the UK General Data Protection Regulation (“UK GDPR”) and the Swiss Federal Act on Data Protection.
We and any potential collaborators may be subject to federal, state, local and foreign laws and regulations that apply to the collection, use, retention, protection, disclosure, transfer and other processing of personal data, including the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”), the Regulation 2016/679, known as 47 Table of Contents the General Data Protection Regulation (the “GDPR”), as well as European Union Member State implementing legislations, the UK General Data Protection Regulation (“UK GDPR”) and the Swiss Federal Act on Data Protection.
The PILA provides in principle that a judgment rendered by a non-Swiss court may be enforced in Switzerland only if: • the non-Swiss court had jurisdiction pursuant to the PILA; • the judgment of such non-Swiss court has become final and non-appealable; • the judgment does not contravene Swiss public policy; • the court procedures and the service of documents leading to the judgment were in accordance with the due process of law; and 62 Table of Contents • no proceeding involving the same parties and the same subject matter was first brought in Switzerland, or adjudicated in Switzerland, or was earlier adjudicated in a third state, and this decision is recognizable in Switzerland.
The PILA provides in principle that a judgment rendered by a non-Swiss court may be enforced in Switzerland only if: • the non-Swiss court had jurisdiction pursuant to the PILA; • the judgment of such non-Swiss court has become final and non-appealable; • the judgment does not contravene Swiss public policy; • the court procedures and the service of documents leading to the judgment were in accordance with the due process of law; and • no proceeding involving the same parties and the same subject matter was first brought in Switzerland, or adjudicated in Switzerland, or was earlier adjudicated in a third state, and this decision is recognizable in Switzerland.
In that event, we may be required to expend significant time and resources to redesign our technology, products, 54 Table of Contents product candidates or the methods for manufacturing them or to develop or license replacement technology, all of which may not be feasible on a technical or commercial basis.
In that event, we may be required to expend significant time and resources to redesign our technology, products, 59 Table of Contents product candidates or the methods for manufacturing them or to develop or license replacement technology, all of which may not be feasible on a technical or commercial basis.
These requirements include, 42 Table of Contents without limitation, submissions of safety and other post-marketing information and reports, registration and listing requirements, the FDA’s cGMP requirements or comparable requirements in foreign jurisdictions, requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, including periodic inspections by the FDA, the EMA or comparable regulatory authorities in other jurisdictions, requirements regarding the distribution of samples to physicians, tracking and reporting of payments to physicians and other healthcare providers and recordkeeping.
These requirements include, without limitation, submissions of safety and other post-marketing information and reports, registration and listing requirements, the FDA’s cGMP requirements or comparable requirements in foreign jurisdictions, requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, including periodic inspections by the FDA, the EMA or comparable regulatory authorities in other jurisdictions, requirements regarding the distribution of samples to physicians, tracking and reporting of payments to physicians and other healthcare providers and recordkeeping.
As part of regulatory approval, we may be subject to a number of post-marketing requirements and commitments, such as post-marketing studies or clinical trials, surveillance to monitor the safety or efficacy of any approved product and risk evaluation and mitigation strategies.
As part of regulatory approval, we or our partners may be subject to a number of post-marketing requirements and commitments, such as post-marketing studies or clinical trials, surveillance to monitor the safety or efficacy of any approved product and risk evaluation and mitigation strategies.
We are organized under the laws of Switzerland and our registered office and domicile is located in Epalinges, Canton of Vaud, Switzerland. Moreover, a number of our directors are not residents of the United States, and all or a substantial portion of the assets of such persons are located outside the United States.
We are organized under the laws of Switzerland and our registered office and domicile is located in Epalinges, Canton of Vaud, Switzerland. Moreover, some of our directors are not residents of the United States, and all or a substantial portion of the assets of such persons are located outside the United States.
Our articles of association include provisions that: • in certain cases, allow our board of directors (i) to place up to 49,726,929 common shares, as well as any treasury shares that the Company may hold from time to time, and (ii) rights to acquire an additional 38,026,929 common shares with affiliates or third parties, without existing shareholders having statutory pre-emptive rights in relation to this share placement; • allow our board of directors not to register any acquirer of common shares, or several acquirers acting in concert, in our share register as a shareholder with voting rights with respect to more than 15% of our share capital as set forth in the commercial register; • limit the size of our board of directors to nine members; • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by shareholders at shareholder meetings; and • require two-thirds of the votes represented at a shareholder meeting for amending or repealing the above-mentioned voting and recording restrictions, for amending the provision setting a maximum board size or providing for indemnification of our directors and members of our executive committee and for removing the chairman or any member of the board of directors before the end of his or her term of office.
Our articles of association include provisions that: • in certain cases, allow our board of directors (i) to place up to 24,700,246 common shares, as well as any treasury shares that the Company may hold from time to time, and (ii) rights to acquire an additional 38,026,929 common shares with affiliates or third parties, without existing shareholders having statutory pre-emptive rights in relation to this share placement; 68 Table of Contents • allow our board of directors not to register any acquirer of common shares, or several acquirers acting in concert, in our share register as a shareholder with voting rights with respect to more than 15% of our share capital as set forth in the commercial register; • limit the size of our board of directors to nine members; • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by shareholders at shareholder meetings; and • require two-thirds of the votes represented at a shareholder meeting for amending or repealing the above-mentioned voting and recording restrictions, for amending the provision setting a maximum board size or providing for indemnification of our directors and members of our executive committee and for removing the chairman or any member of the board of directors before the end of his or her term of office.
For example, pharmaceutical companies have been prosecuted under the FCA in connection with their alleged off-label promotion of drugs, purportedly concealing price concessions in the pricing information submitted to the government for government price reporting purposes, and allegedly providing free product to customers with the expectation that the customers would bill federal healthcare programs for the product.
For example, pharmaceutical companies have been prosecuted under the FCA in connection with their alleged off-label promotion of drugs, purportedly concealing price concessions in the pricing information submitted to the government for government price reporting purposes, and allegedly providing free 48 Table of Contents product to customers with the expectation that the customers would bill federal healthcare programs for the product.
Many of our competitors have significantly greater financial resources and capabilities in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approval and marketing than we do. Furthermore, mergers and acquisitions in the biotechnology industry may result in even more resources being concentrated among a smaller number of our competitors.
Many of our competitors have 54 Table of Contents significantly greater financial resources and capabilities in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approval and marketing than we do. Furthermore, mergers and acquisitions in the biotechnology industry may result in even more resources being concentrated among a smaller number of our competitors.
In addition, as a result of the United Kingdom’s exit from the European Union, we may face increasingly divergent regulations in Europe, with which may be expensive and time-consuming for us to comply. 59 Table of Contents Our business could be adversely affected by the effects of health epidemics, pandemics and natural disasters.
In addition, as a result of the United Kingdom’s exit from the European Union, we may face increasingly divergent regulations in Europe, with which may be expensive and time-consuming for us to comply. Our business could be adversely affected by the effects of health epidemics, pandemics and natural disasters.
To the extent that any disruption or security breach results in a loss of or damage to our data or applications or other data or applications relating to our technology, products or product candidates, or inappropriate disclosure of confidential or proprietary information, our reputation could be harmed and we could incur significant liabilities and the development and commercialization of our products and product candidates could be disrupted.
To the extent that any disruption or security breach results in a loss of or damage to our data or 64 Table of Contents applications or other data or applications relating to our technology, products or product candidates, or inappropriate disclosure of confidential or proprietary information, our reputation could be harmed and we could incur significant liabilities and the development and commercialization of our products and product candidates could be disrupted.
Side effects or adverse events known or reported to be associated with, or manufacturing defects in, the products sold by us could exacerbate a patient’s condition or could result in serious injury or impairments or even death. This risk is heightened by our use of highly potent ADCs.
Side effects or adverse events known or reported to be associated with, or manufacturing defects in, the products sold by us could 63 Table of Contents exacerbate a patient’s condition or could result in serious injury or impairments or even death. This risk is heightened by our use of highly potent ADCs.
In addition, positive and promising results from preclinical studies and clinical trials of a product or product candidate in one indication may not be predictive of results from clinical trials of that product or product candidate in other indications or in combination with other agents.
In addition, positive and promising results from clinical trials of a product or product candidate in one indication may not be predictive of results from clinical trials of that product or product candidate in other indications or in combination with other agents.
In September 2024, CMS finalized a rule to implement certain provisions of the Medicaid Services Investment and Accountability Act of 2019 that increases the burden for manufacturers to report drug pricing 47 Table of Contents information without error, and their potential liability if they fail to do so.
In September 2024, CMS finalized a rule to implement certain provisions of the Medicaid Services Investment and Accountability Act of 2019 that increases the burden for manufacturers to report drug pricing information without error, and their potential liability if they fail to do so.
Furthermore, if third parties have filed such patent applications on or before March 15, 2013, an interference proceeding in the United States can be initiated by such third parties to determine who was the first to invent any of the subject matter covered by the patent claims of our applications.
Furthermore, if third parties have filed such patent applications 57 Table of Contents on or before March 15, 2013, an interference proceeding in the United States can be initiated by such third parties to determine who was the first to invent any of the subject matter covered by the patent claims of our applications.
Many countries have compulsory licensing laws under which a patent owner may be compelled to 56 Table of Contents grant licenses to third parties, and many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent.
Many countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties, and many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent.
Moreover, if any of our partners recall a product due to an issue with a product or component that we supplied, they may claim that we are responsible for such issue and may seek to recover the costs 58 Table of Contents related to such recall or be entitled to certain contractual remedies from us.
Moreover, if any of our partners recall a product due to an issue with a product or component that we supplied, they may claim that we are responsible for such issue and may seek to recover the costs related to such recall or be entitled to certain contractual remedies from us.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad, as the regulatory environment changes rapidly. We may not receive Orphan Drug Designation for our product candidates.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad, as the regulatory environment changes rapidly. 45 Table of Contents We may not receive Orphan Drug Designation for our product candidates.
Due to our filer status, our independent registered public accounting firm has not reported on the effectiveness of our internal control over financial reporting as of December 31, 2024.
Due to our filer status, our independent registered public accounting firm has not reported on the effectiveness of our internal control over financial reporting as of December 31, 2025.
Further, changes to our commercialization strategy may result in disruptions to and adverse impacts on our commercialization efforts. If we do not successfully commercialize our products, we may not generate significant product revenues and may not receive a satisfactory return on our investment into the research and development of those products.
Further, changes to our commercialization 52 Table of Contents strategy may result in disruptions to and adverse impacts on our commercialization efforts. If we do not successfully commercialize our products, we may not generate significant product revenues and may not receive a satisfactory return on our investment into the research and development of those products.
If pricing is set at unsatisfactory levels or if coverage and adequate reimbursement of our products is unavailable or limited in scope or amount, our revenues and the potential profitability of our products in those countries would be negatively affected. Our products and product candidates are complex and difficult to manufacture.
If pricing is set at unsatisfactory levels or if coverage and adequate reimbursement of our products is unavailable or limited in scope or amount, our revenues and the potential profitability of our products in those countries would be negatively affected. 53 Table of Contents Our products and product candidates are complex and difficult to manufacture.
If we or our licensors are unsuccessful in any interference proceedings to which we or they are subject, we may lose valuable intellectual property rights through the loss of one or more patents owned or licensed or our owned or licensed patent claims may be narrowed, invalidated or held unenforceable.
If we or our licensors are unsuccessful in any interference proceedings to which we or they are subject, we may lose valuable 58 Table of Contents intellectual property rights through the loss of one or more patents owned or licensed or our owned or licensed patent claims may be narrowed, invalidated or held unenforceable.
Such proceedings also may result in substantial cost and require significant time and attention from our scientific 52 Table of Contents and management personnel, even if the eventual outcome is favorable to us. Consequently, there can be no assurance that any product, product candidate or technology we develop will be protectable or remain protected by valid and enforceable patents.
Such proceedings also may result in substantial cost and require significant time and attention from our scientific and management personnel, even if the eventual outcome is favorable to us. Consequently, there can be no assurance that any product, product candidate or technology we develop will be protectable or remain protected by valid and enforceable patents.
Based on our periodic review, the amount and timing of repayment is likely to be different at each reporting period. To the extent the amount or timing of such payments is materially different than our initial estimates, we will record a cumulative catch-up adjustment.
Based on our periodic review, the amount and timing of repayment is likely to be different at each reporting period. To the extent the amount or timing of such payments is materially different than our initial estimates, we will record a cumulative catch-up 38 Table of Contents adjustment.
In addition, relevant tax authorities may not accept our claims of tax loss carryforwards or tax credits. Furthermore, changes in tax law, as well as interpretation of such tax laws, could reduce, eliminate, or otherwise impair our ability to use our tax loss carryforwards and U.S. federal and state tax credits.
Risk Factors” section. In addition, relevant tax authorities may not accept our claims of tax loss carryforwards or tax credits. Furthermore, changes in tax law, as well as interpretation of such tax laws, could reduce, eliminate, or otherwise impair our ability to use our tax loss carryforwards and U.S. federal and state tax credits.
In order to obtain regulatory approval for the commercial sale of any product candidates, we must demonstrate through extensive preclinical studies and clinical trials that the product candidate is safe and effective for use in each target indication and that manufacturing of the product candidate is safe, robust and reproducible.
In order to obtain regulatory approval for the commercial sale of any product candidates, we or our partners must demonstrate through extensive preclinical studies and clinical trials that the product candidate is safe and effective for use in each target indication and that manufacturing of the product candidate is safe, robust and reproducible.
If some investors find our common shares less attractive as a result of our reliance on these reduced disclosure obligations, there may be a less active trading market for our common shares and our price of our common shares may be more volatile. 63 Table of Contents Item 1B. Unresolved Staff Comments None.
If some investors find our common shares less attractive as a result of our reliance on these reduced disclosure obligations, there may be a less active trading market for our common shares and our price of our common shares may be more volatile. Item 1B. Unresolved Staff Comments None.
If we are unable to complete the required confirmatory or post-marketing studies, if such studies fail to meet their safety and efficacy endpoints or if we otherwise fail to comply with post-marketing requirements and regulations, we may be unable to maintain regulatory approval for any approved products.
If we or our partners are unable to complete the required confirmatory or post-marketing studies, if such studies fail to meet their safety and efficacy endpoints or if we otherwise fail to timely comply with post-marketing requirements and regulations, we or our partners may be unable to maintain regulatory approval for any approved products.
However, the FDA has not yet awarded 43 Table of Contents ZYNLONTA such RPE, and the FDA may not do so for unknown reasons. The Biologics Price Competition and Innovation Act of 2009 (the “BPCIA”) established an abbreviated pathway to licensure for follow-on biologics called biosimilars.
However, the FDA has not yet awarded ZYNLONTA such RPE, and the FDA may not do so for unknown reasons. The Biologics Price Competition and Innovation Act of 2009 (the “BPCIA”) established an abbreviated pathway to licensure for follow-on biologics called biosimilars.
See “Item 1. Business—Material Contracts” for a description of such agreements that are material to us. There can be no assurance that we will be able to enter into additional collaboration agreements on favorable terms, or at all.
See “Item 1. Business— 55 Table of Contents Material Contracts” for a description of such agreements that are material to us. There can be no assurance that we will be able to enter into additional collaboration agreements on favorable terms, or at all.
Similarly, the Swiss takeover regime imposes a duty on any person or group of persons who acquires more than one-third of a company’s voting rights to make a mandatory offer for all of the company’s outstanding listed equity securities.
Similarly, the Swiss takeover regime imposes a duty on any person or 67 Table of Contents group of persons who acquires more than one-third of a company’s voting rights to make a mandatory offer for all of the company’s outstanding listed equity securities.
If the results of our confirmatory trial for ZYNLONTA or the additional trials for ZYNLONTA in other indications do not 39 Table of Contents meet their primary endpoints, then we may be unable to maintain regulatory approval for ZYNLONTA or obtain regulatory approval for expanded or new indications for ZYNLONTA.
If the results of our confirmatory trial for ZYNLONTA or the additional trials for ZYNLONTA in other indications do not meet their primary endpoints, then we may be unable to maintain regulatory approval for ZYNLONTA or obtain regulatory approval for expanded or new indications for ZYNLONTA.
In addition, publications of discoveries in the scientific literature often lag behind actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until eighteen months after filing, or in some cases not at all.
In addition, publications of discoveries in the scientific 56 Table of Contents literature often lag behind actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until eighteen months after filing, or in some cases not at all.
The time and resources required to obtain regulatory approval is unpredictable, typically takes many years and significant investment following the commencement of clinical trials and depends upon numerous factors. Regulatory authorities have substantial discretion in the approval process.
The time and resources required to obtain 43 Table of Contents regulatory approval is unpredictable, typically takes many years and significant investment following the commencement of clinical trials and depends upon numerous factors. Regulatory authorities have substantial discretion in the approval process.
Our ability to raise additional funds will depend on financial, economic and market conditions and other factors, over which we may have no or limited control. Further, as a Swiss company, we have less flexibility to raise 35 Table of Contents capital, particularly in a quick and efficient manner, as compared to U.S. companies.
Our ability to raise additional funds will depend on financial, economic and market conditions and other factors, over which we may have no or limited control. Further, as a Swiss company, we have less flexibility to raise capital, particularly in a quick and efficient manner, as compared to U.S. companies.
In particular, there is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, there is no uniform policy for 48 Table of Contents coverage and reimbursement and, as a result, coverage and reimbursement can differ significantly from payor to payor.
In particular, there is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, there is no uniform policy for coverage and reimbursement and, as a result, coverage and reimbursement can differ significantly from payor to payor.
If we or our current or future licensors are unable to obtain or maintain 51 Table of Contents patent protection with respect to such inventions and technology, our business, financial condition, results of operations and prospects could be materially harmed.
If we or our current or future licensors are unable to obtain or maintain patent protection with respect to such inventions and technology, our business, financial condition, results of operations and prospects could be materially harmed.
Patents and other intellectual property rights also will not protect our technology if competitors design around our protected technology without infringing our patents or other intellectual property rights. 53 Table of Contents In addition, our patents or the patents of our licensors may become involved in inventorship or priority disputes.
Patents and other intellectual property rights also will not protect our technology if competitors design around our protected technology without infringing our patents or other intellectual property rights. In addition, our patents or the patents of our licensors may become involved in inventorship or priority disputes.
Furthermore, because of the substantial amount of discovery required in connection with 55 Table of Contents intellectual property litigation or administrative proceedings, there is a risk that some of our confidential information could be compromised by disclosure.
Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation or administrative proceedings, there is a risk that some of our confidential information could be compromised by disclosure.
The failure to maintain controls compliant with Sarbanes-Oxley Act could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our shares.
The failure to maintain controls compliant with Sarbanes-Oxley Act could 65 Table of Contents also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our shares.
Where we develop a product or product candidate for use in combination with a therapy that has not been approved by the FDA, the EMA or comparable regulatory authorities in other jurisdictions, we may not be able to market our product or product candidate for 41 Table of Contents use in combination with such an unapproved therapy, unless and until the unapproved therapy receives regulatory approval.
Where we develop a product or product candidate for use in combination with a therapy that has not been approved by the FDA, the EMA or comparable regulatory authorities in other jurisdictions, we may not be able to market our product or product candidate for use in combination with such an unapproved therapy, unless and until the unapproved therapy receives regulatory approval.
Swiss tax loss carryforwards generally expire seven years after the tax year in which they were incurred; U.S. federal and state tax credits generally expire after 20 years, although some state tax credits expire as quickly as seven years after the tax year in which they were incurred, and others do not expire.
U.S. federal and state tax credits generally expire after 20 years, although some state tax credits expire as quickly as seven years after the tax year in which they were incurred, and others do not expire.
For example, in some jurisdictions the applicable trademark office has rejected our corporate name for registration, or a third party has objected to a published application for a product trademark, which, in some cases, has caused us to abandon or limit our applications, and rely more on the registration for our corporate logo.
For example, in some jurisdictions the applicable trademark office has rejected our corporate name for registration, or a third 62 Table of Contents party has objected to a published application for a product trademark, which, in some cases, has caused us to abandon or limit our applications, and rely more on the registration for our corporate logo.
This shift from the prior approach, which generally determined the maximum tolerated dose, may require sponsors to spend additional time and resources to further explore a product candidate’s dose-response relationship to facilitate optimum dose selection in a target population.
This shift from the prior approach, which generally determined the maximum tolerated dose, may 44 Table of Contents require sponsors to spend additional time and resources to further explore a product candidate’s dose-response relationship to facilitate optimum dose selection in a target population.
Even if we obtain orphan drug designation for our product candidates in specific conditions, we may not be the first to obtain regulatory approval of these product candidates for the orphan-designated condition and therefore we may not be eligible for orphan drug exclusivity in the U.S.
Even if we obtain orphan drug designation for our product candidates in specific conditions, we may not be the first to obtain regulatory approval of these product candidates for the orphan-designated condition and therefore we may not be eligible for orphan drug exclusivity in the United States.
In the past, despite promising results from preclinical studies and early-stage clinical trials, we have discontinued development of product candidates due to the results from late-stage clinical trials.
In the past, despite promising results from early-stage clinical trials, we have discontinued development of product candidates due to the results from late-stage clinical trials.
We are unable to accurately predict whether and when we will achieve profitability. Even if we achieve profitability, we may not be able to sustain profitability in subsequent periods. This risk is heightened as we only have one approved product, ZYNLONTA, at the present time and thus are heavily dependent on its commercial performance and its continued research and development.
Even if we achieve profitability, we may not be able to sustain profitability in subsequent periods. This risk is heightened as we only have one approved product, ZYNLONTA, at the present time and thus are heavily dependent on its commercial performance and its continued research and development.
Under the HCR Agreement, we are obligated to pay to HCR royalties representing a percentage of net sales of ZYNLONTA in certain jurisdictions, a percentage of any upfront or milestone payments we receive from licenses that we grant to commercialize ZYNLONTA in certain jurisdictions, and a percentage of any upfront or milestone payments (or on royalties) we receive from licenses that we grant to commercialize Cami.
Under the HCR Agreement, we are obligated to pay to HCR royalties representing a percentage of net sales of ZYNLONTA in certain jurisdictions, and a percentage of any upfront or milestone payments we receive from licenses that we grant to commercialize ZYNLONTA in certain jurisdictions. See “Item 1.
The FDA may withdraw approval of our products approved under the accelerated approval pathway if, for example, the clinical trial(s) required to verify the predicted clinical benefit of a product fails to verify such benefit or does not demonstrate sufficient clinical benefit to justify the risks associated with the product for any reason, including censoring of patients, other evidence demonstrates that a product is not shown to be safe or effective under the conditions of use, we fail to conduct any required post-marketing confirmatory clinical trial with due diligence or we disseminate false or misleading promotional materials relating to the relevant product.
The FDA may withdraw approval of our products approved under the accelerated approval pathway if, for example, the clinical trial(s) required to verify the predicted clinical benefit of a product fails to verify such benefit or does not demonstrate sufficient clinical benefit to justify the risks associated with the product for any reason, including if the high rate of censoring of patients impacts the reliability of the results, if other evidence demonstrates that ZYNLONTA is not shown to be safe or effective under the conditions of use, we or our partners fail to conduct any required post-marketing confirmatory clinical trial with due diligence and within specified timelines or we or our partners disseminate false or misleading promotional materials relating to the relevant product.
Passive income generally includes interest, dividends, certain non-active rents and royalties, and capital gains. 37 Table of Contents Cash is generally characterized as a passive asset for these purposes. Goodwill is generally characterized as a non-passive or passive asset based on the nature of the income produced in the activity to which the goodwill is attributable.
Passive income generally includes interest, dividends, certain non-active rents and royalties, and capital gains. Cash is generally characterized as a passive asset for these purposes. Goodwill and other intangibles are generally characterized as a non-passive or passive asset based on the nature of the income produced in the activity to which the goodwill or other intangibles are attributable.
A “qualified electing fund” (“QEF”) election or, if our common shares are regularly traded on a qualified exchange, a “mark-to-market” election may be available that will alter the consequences of PFIC status. Because we believe we were a PFIC for the 2023 taxable year, we have provided information necessary for our U.S.
A “qualified electing fund” (“QEF”) election or, if our common shares are regularly traded on a qualified exchange, a “mark-to-market” election may be available that will alter the consequences of PFIC status. If we believe we were a PFIC for any taxable year, we intend to provide information necessary for our U.S.
In addition, we could be found liable for monetary damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a patent.
In addition, we could be found liable for monetary damages, including treble damages and attorneys’ fees, if we are found to 60 Table of Contents have willfully infringed a patent.
Moreover, in many countries outside the United States, a drug must be approved for reimbursement before it can be approved for sale in that country, which can take considerable time and be heavily impacted by political, economic and regulatory developments.
Moreover, in many countries outside the United States, a drug must be approved for reimbursement before it can be approved for sale in that country, which can take considerable time and be heavily impacted by the robustness of the clinical data as well as political, economic and regulatory developments.
There can be no assurance that these third parties will perform services for us in accordance with our timelines, standards and 50 Table of Contents expectations.
There can be no assurance that these third parties will perform services for us in accordance with our timelines, standards and expectations.
Furthermore, payment of future dividends is subject to certain limitations pursuant to our current and future debt instruments, Swiss law and our articles of association. In addition, the Loan Agreement limits our ability to pay dividends.
Furthermore, payment of future dividends is subject to certain limitations pursuant to our current and future debt instruments, such as the Loan Agreement that limits our ability to pay dividends, Swiss law and our articles of association.
Such indebtedness requires us to dedicate a substantial portion of our cash and cash equivalents to the payment of interest on, and principal of, the indebtedness, thereby reducing the amounts available to fund working capital, capital expenditures, research and development efforts, commercialization efforts and other general corporate purposes.
We have significant indebtedness outstanding under the Loan Agreement. Such indebtedness requires us to dedicate a substantial portion of our cash and cash equivalents to the payment of interest on, and principal of, the indebtedness, thereby reducing the amounts available to fund working capital, capital expenditures, research and development efforts, commercialization efforts and other general corporate purposes.
For example, results from the pivotal Phase 2 clinical trial of ZYNLONTA for the treatment of relapsed or refractory DLBCL, or any other clinical trial of ZYNLONTA, may not be predictive of results from other clinical trials of ZYNLONTA, such as the confirmatory Phase 3 clinical trial, particularly those in which ZYNLONTA is used in combination with other agents and those involving different patient populations, such as the Phase 1 LOTIS-7 trial.
For example, results from the pivotal Phase 2 clinical trial of ZYNLONTA for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy, or any other clinical trial of ZYNLONTA, may not be predictive of results from other clinical trials of ZYNLONTA, such as the confirmatory Phase 3 clinical trial, LOTIS-5, those in which ZYNLONTA is used in combination with other agents, and those involving different patient populations, such as the Phase 1b LOTIS-7 trial.
These estimates may be inaccurate or based on imprecise data and are based on assumptions such as labeling, pricing, acceptance by HCPs and patients, patient access and pricing and reimbursement.
These estimates may be inaccurate or based on imprecise data and are based on assumptions such as labeling, pricing, acceptance by HCPs and patients and competitive landscape.
We may be unable to maintain regulatory approval for any approved products. • We or our partners may not be able to successfully commercialize our products. • There can be no assurance regarding the outcome of ongoing or planned clinical trials or the sufficiency of results from such clinical trials. • Coverage and reimbursement may be limited or unavailable for our products. • Our products and product candidates are complex and difficult to manufacture. • We face substantial competition, which may result in others discovering, developing or commercializing products, treatment methods or technologies before, or more successfully than, we do. • We rely on third parties to conduct preclinical studies and clinical trials and for the manufacture, production, storage and distribution of our products and product candidates and certain commercialization activities for our products. • If we are unable to obtain, maintain or protect our intellectual property rights in any products or technologies we develop, or if the scope of the intellectual property protection obtained is not sufficiently broad, third parties could develop and commercialize products and technology similar or identical to ours, and we may not be able to compete effectively in our market. • We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time-consuming and unsuccessful, and our issued patents covering one or more of our products, product candidates or technologies or the technology we use in our products and product candidates, could be found invalid or unenforceable if challenged in court. • We may be subject to claims by third parties asserting that our products infringe their intellectual property or that we or our employees, consultants or advisors have misappropriated their intellectual property, or claiming ownership of what we regard as our own intellectual property. • Product liability lawsuits and product recalls could cause us to incur substantial liabilities and to limit development and commercialization of our products.
We or our partners may be unable to maintain regulatory approval for any approved products. • We or our partners may not be able to successfully commercialize our products. • The market opportunities for our products and product candidates may be smaller than we estimate and any approval that we obtain may be based on a narrower definition of the patient population than we anticipated. • Coverage and reimbursement may be limited or unavailable for our products. • Our products and product candidates are complex and difficult to manufacture. • We face substantial competition, which may result in others discovering, developing or commercializing products, treatment methods or technologies before, or more successfully than, we do. • We rely on third parties to conduct preclinical studies and clinical trials and for the manufacture, production, storage and distribution of our products and product candidates and certain commercialization activities for our products. • Our partners may not perform as expected, and we may be unable to maintain existing or establish additional collaborations for the development and commercialization of our products and product candidates. • If we are unable to obtain, maintain or protect our intellectual property rights in any products or technologies we develop, or if the scope of the intellectual property protection obtained is not sufficiently broad, third parties could 36 Table of Contents develop and commercialize products and technology similar or identical to ours, and we may not be able to compete effectively in our market. • We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time-consuming and unsuccessful, and our issued patents covering one or more of our products, product candidates or technologies or the technology we use in our products and product candidates, could be found invalid or unenforceable if challenged in court. • We may be subject to claims by third parties asserting that our products infringe their intellectual property or that we or our employees, consultants or advisors have misappropriated their intellectual property, or claiming ownership of what we regard as our own intellectual property. • Product liability lawsuits and product recalls could cause us to incur substantial liabilities and to limit development and commercialization of our products.
While our shareholders may authorize our board of directors to issue or cancel shares without additional shareholder approval, Swiss law limits this authorization to 50% of the issued share capital at the time of the authorization.
Swiss law also requires that our shareholders themselves resolve to, or authorize our board of directors to, increase or decrease our share capital. While our shareholders may authorize our board of directors to issue or cancel shares without additional shareholder approval, Swiss law limits this authorization to 50% of the issued share capital at the time of the authorization.
As a result, our Deerfield Warrants and obligations under the HCR Agreement could result in considerable non-cash charges to, and significant volatility in, our consolidated statements of operations. Our ability to use tax loss carryforwards may be limited. As of December 31, 2024, we reported $1,059 million in tax loss carryforwards for Swiss corporate income tax purposes.
As a result, our obligations under the HCR Agreement could result in considerable non-cash charges to, and significant volatility in, our consolidated statements of operations. Our ability to use tax loss carryforwards may be limited. As of December 31, 2025, we reported $1,009 million and $19.3 million in tax loss carryforwards for Swiss and U.S. corporate income tax purposes, respectively.
The foregoing provision may make us a less attractive acquisition target by reducing the benefit accruing to our shareholders in any change-of-control transaction. Our consolidated statements of operations are subject to considerable non-cash charges and volatility due to factors that may be beyond our control.
See “Item 1. Business—Material Contracts.” The foregoing provision may make us a less attractive acquisition target and reduces the benefit accruing to our shareholders in any change-of-control transaction. Our consolidated statements of operations are subject to considerable non-cash charges and volatility due to factors that may be beyond our control.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

2 edited+1 added−0 removed6 unchanged
Biggest changeOur cybersecurity team also engages third-party security experts for risk assessment and system enhancements. Our cybersecurity team is responsible for assessing our cybersecurity risk management program. In addition, our cybersecurity team provides annual training to all employees. Our board of directors has overall oversight responsibility for our risk management and has delegated cybersecurity risk management oversight to the audit committee.
Biggest changeOur cybersecurity team also 69 Table of Contents engages third-party security experts for risk assessment and system enhancements. Our cybersecurity team is responsible for assessing our cybersecurity risk management program. In addition, our cybersecurity team provides annual training to all employees.
In 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident. See “Item 1A. Risk Factors.”
In 2025, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident. See “Item 1A. Risk Factors.”
Added
Our board of directors has overall oversight responsibility for our risk management and has delegated cybersecurity risk management oversight to the audit committee.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed1 unchanged
Biggest changeThe table below sets forth the sizes and uses of our leased facilities as of the date of this Annual Report: Location Primary Function Approximate Size Biopôle Route de la Corniche 3B 1066 Epalinges Switzerland Head office 292 m 2 430 Mountain Avenue, 4th Floor New Providence, New Jersey 07974 United States Clinical, commercial and U.S. operations 965 m 2 84 Wood Lane London, W12 0BZ United Kingdom Research and preclinical development 2,200 m 2 We are not aware of any environmental issues or other constraints that would materially impact the intended use of our facilities. 64 Table of Contents
Biggest changeThe table below sets forth the sizes and uses of our leased facilities as of the date of this Annual Report: Location Primary Function Approximate Size Biopôle Route de la Corniche 3B 1066 Epalinges Switzerland Head office 292 m 2 430 Mountain Avenue, 4th Floor New Providence, New Jersey 07974 United States Clinical, commercial and U.S. operations 965 m 2 We are not aware of any environmental issues or other constraints that would materially impact the intended use of our facilities.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed1 unchanged
Biggest changeAs of the date of this Annual Report, we do not believe that we are party to any claim or litigation, the outcome of which would, individually or in the aggregate, be reasonably expected to have a material adverse effect on our business. Item 4. Mine Safety Disclosure Not applicable. PART II
Biggest changeAs of the date of this Annual Report, we do not believe that we are party to any claim or litigation, the outcome of which would, individually or in the aggregate, be reasonably expected to have a material adverse effect on our business. Item 4. Mine Safety Disclosure Not applicable. PART II 70 Table of Contents

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+0 added−12 removed13 unchanged
Biggest changeSecurities Authorized for Issuance under Equity Compensation Plans The following table is a summary of the common shares authorized for issuance under equity compensation plans as of December 31, 2024: 65 Table of Contents Plan Category Number of common shares to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of common shares remaining available for future issuance under equity compensation plans (excluding common shares to be issued upon exercise of outstanding options, warrants and rights) Equity compensation plans approved by security holders: 2022 Employee Stock Purchase Plan — — — * Conditional Share Capital Plan Options N/A N/A N/A Restricted share units 2,497,349 N/A N/A Total for Conditional Share Capital Plan 2,497,349 N/A 3,355,883 Equity compensation plans not approved by security holders: 2019 Equity Incentive Plan: Options 10,054,588 $ 9.02 N/A Restricted share units 608,961 N/A N/A Total for 2019 Equity Incentive Plan 10,663,549 N/A 4,330,311 Inducement Plan: Options 642,700 3.63 N/A Restricted share units N/A N/A N/A Total for Inducement Plan 642,700 N/A 357,300 * The aggregate number of shares that may be issued pursuant to rights granted under the 2022 Employee Stock Purchase Plan is equal to 1% of our common share capital at the plan’s adoption.
Biggest changeSecurities Authorized for Issuance under Equity Compensation Plans The following table is a summary of the common shares authorized for issuance under equity compensation plans as of December 31, 2025: 71 Table of Contents Plan Category Number of common shares to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of common shares remaining available for future issuance under equity compensation plans (excluding common shares to be issued upon exercise of outstanding options, warrants and rights) Equity compensation plans approved by security holders: 2019 Equity Incentive Plan: Options 9,481,763 $ 8.90 N/A Restricted share units 2,654,427 N/A N/A Total for 2019 Equity Incentive Plan 12,136,190 N/A 7,055,177 2022 Employee Stock Purchase Plan — — — * Conditional Share Capital Plan Options N/A N/A N/A Restricted share units 1,970,000 N/A N/A Total for Conditional Share Capital Plan 1,970,000 N/A 2,127,252 Equity compensation plans not approved by security holders: Inducement Plan: Options 932,542 3.33 N/A Restricted share units N/A N/A N/A Total for Inducement Plan 932,542 N/A 1,033,308 * The aggregate number of shares that may be issued pursuant to rights granted under the 2022 Employee Stock Purchase Plan is equal to 1% of our common share capital at the plan’s adoption.
In connection with a change of control, the compensation committee may, in its discretion, take any one or more of the following actions with respect to outstanding awards: (i) cancel any such award, in exchange for a payment in cash, securities or other property or any combination thereof with a value equal to the value of such award based on the per share value of common shares received or to be received by other shareholders in the event (or without payment of consideration if the committee determines that 67 Table of Contents no amount would have been realized upon the exercise of the award or other realization of the participant’s rights); (ii) require the exercise of any outstanding option; (iii) provide for the assumption, substitution, replacement or continuation of any award by the successor or surviving corporation, along with appropriate adjustments with respect to the number and type of securities (or other consideration) of the successor or surviving corporation, subject to any replacement awards, the terms and conditions of the replacement awards (including performance targets) and the grant, exercise or purchase price per share for the replacement awards; (iv) make any other adjustments in the number and type of securities (or other consideration) subject to (a) such awards and in the terms and conditions of such awards in order to prevent the dilution or enlargement of benefits intended to be made available under the Inducement Plan and (b) awards that may be granted in the future; (v) provide that any such award shall be accelerated and become exercisable, payable and/or fully vested with respect to all shares covered thereby or (vi) provide that any award shall not vest, be exercised or become payable as a result of such event.
In connection with a change of control, the compensation committee may, in its discretion, take any one or more of the following actions with respect to outstanding awards: (i) cancel any such award, in exchange for a payment in cash, securities or other property or any combination thereof with a value equal to the value of such award based on the per share value of common shares received or to be received by other shareholders in the event (or without payment of consideration if the committee determines that no amount would have been realized upon the exercise of the award or other realization of the participant’s rights); (ii) require the exercise of any outstanding option; (iii) provide for the assumption, substitution, replacement or continuation of any award by the successor or surviving corporation, along with appropriate adjustments with respect to the number and type of securities (or other consideration) of the successor or surviving corporation, subject to any replacement awards, the terms and conditions of the replacement awards (including performance targets) and the grant, exercise or purchase price per share for the replacement awards; (iv) make any other adjustments in the number and type of securities (or other consideration) subject to (a) such awards and in the terms and conditions of such awards in order to prevent the dilution or enlargement of benefits intended to be made available under the Inducement Plan and (b) awards that may be granted in the future; (v) provide that any such award shall be accelerated and become exercisable, payable and/or fully vested with respect to all shares covered thereby or (vi) provide that any award shall not vest, be exercised or become payable as a result of such event.
In addition to the foregoing, on the first day of each calendar year beginning on January 1, 2024 and ending on and including January 1, 2033, the number of common shares available for issuance under the 2022 Employee Stock Purchase Plan is increased by that number of common shares equal to the least of (a) 1% of the common shares outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of common shares as determined by the board of directors.
In addition to the foregoing, on the first day of each calendar year beginning on January 1, 2023 and ending on and including January 1, 2033, the number of common shares available for issuance under the 2022 Employee Stock Purchase Plan is increased by that number of common shares equal to the least of (a) 1% of the common shares outstanding on the final day of the immediately preceding calendar year and (b) such smaller number of common shares as determined by the board of directors.
The maximum number of common shares in respect of which awards may be granted under the Inducement Plan is 1,000,000 common shares (including share-based equity awards granted to date, less awards forfeited), subject to adjustment in the event of certain corporate transactions or events if necessary to prevent dilution or enlargement of the benefits made available under the plan.
The maximum number of common shares in respect of which awards may be granted under the Inducement Plan is 2,000,000 common shares (including share-based equity awards granted to date, less awards forfeited), subject to adjustment in the event of certain corporate transactions or events if necessary to prevent dilution or enlargement of the benefits made available under the plan.
Purchase of Equity Securities Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs October 1, 2024 to October 31, 2024 — N/A — — November 1, 2024 to November 30, 2024 — N/A — — December 1, 2024 to December 31, 2024 — N/A — — Item 6.
Purchase of Equity Securities Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs October 1, 2025 to October 31, 2025 — N/A — — November 1, 2025 to November 30, 2025 — N/A — — December 1, 2025 to December 31, 2025 — N/A — — Item 6.
Termination of Service and Change in Control . In the event of a participant’s termination of employment, the compensation committee may, in its discretion, determine the extent to which an equity incentive award may be exercised, settled, vested, paid or forfeited.
Termination of Service and Change in Control . In the event of a participant’s termination of employment, the compensation committee may, in its discretion, determine the extent to which an equity incentive award may be exercised, 72 Table of Contents settled, vested, paid or forfeited.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares are listed on the NYSE under the symbol “ADCT.” Holders As of March 17, 2025, we had 170 shareholders of record of our common shares.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common shares are listed on the NYSE under the symbol “ADCT.” Holders As of March 2, 2026, we had 182 shareholders of record of our common shares.
The 2019 Equity Incentive Plan is administered by the compensation committee of our board of directors, subject to the board of directors’ discretion to administer or appoint another committee to administer it. Eligible Participants .
Inducement Plan Plan Administration . The Inducement Plan is administered by the compensation committee of our board of directors, subject to the board of directors’ discretion to administer or appoint another committee to administer it. Eligible Participants .
The number of shares reported in this column represents the number of common shares available for future issuance as of December 31, 2024. The material features of the equity compensation plans adopted without shareholder approval are described below.
The number of shares reported in this column represents the number of common shares available for future issuance as of December 31, 2025. The material features of the equity compensation plans adopted without shareholder approval are described below. Any such material plans under which awards in Company shares may currently be granted are included as exhibits to this Annual Report.
Removed
Any such material plans under which awards in Company shares may currently be granted are included as exhibits to this Annual Report. 2019 Equity Incentive Plan Plan Administration .
Removed
The administrator is able to offer equity awards at its discretion under the 2019 Equity Incentive Plan to: (1) any employees of us or any of our subsidiaries; (2) any non-employee directors serving on our board of directors; and (3) any consultants or other advisors to us or any of our subsidiaries.
Removed
The administrator of the plan may determine that an award for the benefit of a non-employee director will be granted to an affiliate of such director, but only to the extent consistent with the registration of shares offered under the plan on Form S-8 under the Securities Act. Awards .
Removed
The maximum number of common shares in respect of which awards may be granted under the 2019 Equity Incentive Plan is 17,741,355 common shares (including share-based equity awards granted to date, less awards forfeited), subject to adjustment in the event of certain corporate transactions or events if necessary to prevent dilution or enlargement of the benefits made available under the plan.
Removed
Equity incentive awards under the 2019 Equity Incentive Plan may be granted in the form of options, share appreciation rights, restricted shares, restricted share units, performance awards or other share-based awards but not “incentive stock options” for purposes of U.S. tax laws.
Removed
Options and share appreciation rights will have an exercise price determined by the administrator but will not be less than fair market value of the underlying common shares on the date of grant. Vesting . The vesting conditions for grants under the equity incentive awards under the 2019 Equity Incentive Plan are set forth in the applicable award documentation.
Removed
In the event of our termination of a participant’s employment without cause or a participant’s resignation for good reason (as defined in the 2019 Equity Incentive Plan) upon or within 18 months following a change in control of the company (as defined in the 2019 Equity Incentive Plan), any awards outstanding to the 66 Table of Contents participant (unless otherwise provided in the award agreement) will immediately vest and settle, and options and share appreciation rights will become fully exercisable.
Removed
In connection with a change of control, the compensation committee may, in its discretion, take any one or more of the following actions with respect to outstanding awards: (i) cancel any such award, in exchange for a payment in cash, securities or other property or any combination thereof with a value equal to the value of such award based on the per share value of common shares received or to be received by other shareholders in the event (or without payment of consideration if the committee determines that no amount would have been realized upon the exercise of the award or other realization of the participant’s rights); (ii) require the exercise of any outstanding option; (iii) provide for the assumption, substitution, replacement or continuation of any award by the successor or surviving corporation, along with appropriate adjustments with respect to the number and type of securities (or other consideration) of the successor or surviving corporation, subject to any replacement awards, the terms and conditions of the replacement awards (including performance targets) and the grant, exercise or purchase price per share for the replacement awards; (iv) make any other adjustments in the number and type of securities (or other consideration) subject to (a) such awards and in the terms and conditions of such awards in order to prevent the dilution or enlargement of benefits intended to be made available under the 2019 Equity Plan and (b) awards that may be granted in the future; (v) provide that any such award shall be accelerated and become exercisable, payable and/or fully vested with respect to all shares covered thereby or (vi) provide that any award shall not vest, be exercised or become payable as a result of such event.
Removed
Termination and Amendment . Unless terminated earlier, the 2019 Equity Incentive Plan will continue for a term of ten years. Our board of directors has the authority to amend or terminate the 2019 Equity Incentive Plan subject to shareholder approval with respect to certain amendments.
Removed
However, no such action may impair the rights of the recipient of any options unless agreed to by the recipient. Inducement Plan Plan Administration . The Inducement Plan is administered by the compensation committee of our board of directors, subject to the board of directors’ discretion to administer or appoint another committee to administer it. Eligible Participants .
Removed
Termination of Service and Change in Control . In the event of a participant’s termination of employment, the compensation committee may, in its discretion, determine the extent to which an equity incentive award may be exercised, settled, vested, paid or forfeited.
Removed
In the event of a change in control that involves a merger, acquisition or other corporate transaction, any outstanding award not assumed, substituted, replaced or continued in connection with the transaction will immediately vest and settle, and options and share appreciation rights will become fully exercisable.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

55 edited+28 added−31 removed27 unchanged
Biggest changeResults of Operations The following table summarizes our results of operations for the years ended December 31, 2024 and 2023: Year Ended December 31, (in thousands, except percentages and per share) 2024 2023 Change % Change Revenue Product revenues, net $ 69,280 $ 69,060 $ 220 0.3 % License revenues and royalties 1,557 498 1,059 212.7 % Total revenue, net 70,837 69,558 1,279 1.8 % Operating expense Cost of product sales (5,949) (2,529) (3,420) 135.2 % Research and development (109,633) (127,127) 17,494 (13.8) % Selling and marketing (44,015) (57,464) 13,449 (23.4) % General and administrative (41,894) (48,424) 6,530 (13.5) % Total operating expense (201,491) (235,544) 34,053 (14.5) % Loss from operations (130,654) (165,986) 35,332 (21.3) % Other income (expense) Interest income 12,272 10,540 1,732 16.4 % Interest expense (50,211) (46,325) (3,886) 8.4 % Other, net 12,457 6,352 6,105 96.1 % Total other expense, net (25,482) (29,433) 3,951 (13.4) % Loss before income taxes (156,136) (195,419) 39,283 (20.1) % Income tax expense (166) (39,106) 38,940 (99.6) % Loss before equity in net losses of joint venture (156,302) (234,525) 78,223 (33.4) % Equity in net losses of joint venture (1,544) (5,528) 3,984 (72.1) % Net loss $ (157,846) $ (240,053) $ 82,207 (34.2) % Net loss per share, basic and diluted $ (1.62) $ (2.94) $ 1.32 (44.9) % Revenue Product Revenues, net We generate product revenue through the sale of ZYNLONTA in the United States.
Biggest changeResults of Operations The following table summarizes our results of operations for the years ended December 31, 2025 and 2024: Year Ended December 31, (in thousands, except percentages and per share) 2025 2024 Change % Change Revenue Product revenues, net $ 73,551 $ 69,280 $ 4,271 6.2 % License revenues and royalties 7,806 1,557 6,249 401.3 % Total revenue, net 81,357 70,837 10,520 14.9 % Operating expense Cost of product sales (5,798) (5,949) 151 (2.5) % Research and development (104,005) (109,633) 5,628 (5.1) % Selling and marketing (43,374) (44,015) 641 (1.5) % General and administrative (36,559) (41,894) 5,335 (12.7) % Restructuring, impairment and other related costs (13,120) — (13,120) 100.0 % Total operating expense (202,856) (201,491) (1,365) 0.7 % Loss from operations (121,499) (130,654) 9,155 (7.0) % Other income (expense) Interest income 8,810 12,272 (3,462) (28.2) % Interest expense (51,633) (50,211) (1,422) 2.8 % Other, net 22,714 12,457 10,257 82.3 % Total other expense, net (20,109) (25,482) 5,373 (21.1) % Loss before income taxes (141,608) (156,136) 14,528 (9.3) % Income tax expense (1,015) (166) (849) 511.4 % Loss before equity in net losses of joint venture (142,623) (156,302) 13,679 (8.8) % Equity in net losses of joint venture — (1,544) 1,544 (100.0) % Net loss $ (142,623) $ (157,846) $ 15,223 (9.6) % Net loss per share, basic and diluted $ (1.12) $ (1.62) $ 0.50 (30.8) % 74 Table of Contents Revenue Product Revenues, net We generate product revenue through the sale of ZYNLONTA in the United States.
We plan to continue to fund our operating needs through our existing cash and cash equivalents, revenues from sales of ZYNLONTA, potential milestone and royalty payments under our licensing agreements and additional equity financings, debt financings and/or other forms of financing, as well as funds provided by collaborations.
We plan to continue to fund our operating needs through our existing cash and cash equivalents, revenues from sales of ZYNLONTA, potential milestone and royalty payments under our licensing agreements and additional equity financings, debt financings and/or other forms of financing, as well as potential funds provided by collaborations.
Revenue is recognized when control is transferred to the customer at the net selling price, which includes reductions for gross-to-net (“GTN”) sales adjustments such as government rebates, chargebacks, distributor service fees, other rebates and administrative fees, sales returns and allowances and sales discounts.
Revenue is recognized when control is transferred to the customer at the net selling price, which includes reductions for gross-to-net (“GTN”) sales adjustments such as government rebates, chargebacks, distributor service fees, other rebates and administrative fees, sales returns and allowances and sales discounts.
Our research and development expense may fluctuate from period to period based on a number of factors, including the timing, progress and stage of clinical trials, costs associated with regulatory approval processes and manufacturing costs associated with commercialization activities prior to the receipt of regulatory approval.
Thereafter, our research and development expense may fluctuate from period to period based on a number of factors, including the timing, progress and stage of clinical trials, costs associated with regulatory approval processes and manufacturing costs associated with commercialization activities prior to the receipt of regulatory approval.
Research and development expense consists primarily of employee related expenses, including share-based compensation expense; costs for production of preclinical and clinical-stage product candidates by CMOs; fees and other costs paid to contract research organizations in connection with the performance of preclinical studies and clinical trials; costs of related 70 Table of Contents facilities, materials and equipment; external costs associated with obtaining intellectual property; depreciation; and upfront fees and achieved milestone payments associated with R&D collaboration arrangements.
Research and development expense consists primarily of costs for production of preclinical and clinical-stage product candidates by CMOs; fees and other costs paid to contract research organizations in connection with the performance of preclinical studies and clinical trials; costs of related facilities, materials and equipment; external costs associated with obtaining intellectual property; depreciation; upfront fees and achieved milestone payments associated with R&D collaboration arrangements; and employee related expenses, including share-based compensation expense.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making judgments about the carrying values of assets and liabilities and the reported amounts of revenues and expenses that are not readily apparent from other sources.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making 81 Table of Contents judgments about the carrying values of assets and liabilities and the reported amounts of revenues and expenses that are not readily apparent from other sources.
Given the annual nature of the proposed reporting schedule we will continue to estimate periodically discarded drug rebate liabilities. 76 Table of Contents Deferred royalty obligation On August 25, 2021, we entered into a royalty purchase agreement with certain entities managed by Healthcare Royalty Partners (“HCR”).
Given the annual nature of the proposed reporting schedule we will continue to estimate periodically discarded drug rebate liabilities. Deferred royalty obligation On August 25, 2021, we entered into a royalty purchase agreement with certain entities managed by Healthcare Royalty Partners (“HCR”).
We accounted for the initial cash received as debt, less transaction costs and will subsequently account for the value of the debt at amortized cost. The amount received by us will be accreted to the total estimated royalty payments over the life of the agreement which will be recorded as interest expense.
We accounted for the initial cash received as debt, less transaction costs and will subsequently account 82 Table of Contents for the value of the debt at amortized cost. The amount received by us will be accreted to the total estimated royalty payments over the life of the agreement which will be recorded as interest expense.
License Revenue and Royalties We generate license revenue and royalties from our strategic agreements for the development and commercialization of ZYNLONTA and other product candidates outside of the United States. Under these agreements, we receive upfront payments and are eligible for certain milestone payments and royalties. See “Item 1.
License Revenue and Royalties We generate license revenue and royalties from our strategic agreements for the development and commercialization of ZYNLONTA outside of the United States. Under these agreements, we receive upfront payments and are eligible for certain milestone payments and royalties. See “Item 1.
We expect a relatively consistent level of GTN sales adjustments as a percentage of gross sales, but may 69 Table of Contents also experience variability in GTN sales adjustments due to additional information and actual experience such as actual rebate and return rates.
We expect a relatively consistent level of GTN sales adjustments as a percentage of gross sales, but may also experience variability in GTN sales adjustments due to additional information and actual experience such as actual rebate and return rates.
We recorded an income tax expense of $0.2 million for the year ended December 31, 2024 as compared to $39.1 million for the year ended December 31, 2023, primarily driven by our U.S. operations and the full valuation allowance recognized on our deferred tax assets .
We recorded an income tax expense of $1.0 million for the year ended December 31, 2025 as compared to $0.2 million for the year ended December 31, 2024, primarily driven by our U.S. and U.K. operations and the full valuation allowance recognized on our deferred tax assets .
We believe the following critical accounting policies and estimates describe the more significant judgments and estimates used in the preparation of our consolidated financial statements. Product revenues, net We generate revenue from sales of ZYNLONTA in the U.S. for the treatment of relapsed or refractory DLBCL.
We believe the following critical accounting policies and estimates describe the more significant judgments and estimates used in the preparation of our consolidated financial statements. Product revenues, net We generate revenue from sales of ZYNLONTA in the U.S. for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
We expect to incur substantial expenses as we continue to devote substantial resources to research and development and marketing and commercialization efforts, in particular to grow ZYNLONTA in the 3L+ DLBCL setting, continue to study and advance ZYNLONTA in earlier lines of therapy and in combinations to potentially expand our market opportunity and further develop our pipeline and our ADC platform.
We expect to incur substantial expenses as we continue to devote substantial resources to research and development and marketing and commercialization efforts, in particular to grow ZYNLONTA in the 3L+ DLBCL setting, continue to study and advance ZYNLONTA in earlier lines of therapy and in combinations to potentially expand our market opportunity.
The adjustment to the carrying amount is recognized in Other, net as an adjustment in the period in which the change in estimate occurred. The cumulative catch-up adjustment income was $11.2 million for the year ended December 31, 2024 as compared to $5.0 million for the year ended December 31, 2023, a change of $6.2 million.
The adjustment to the carrying amount is recognized in Other, net as an adjustment in the period in which the change in estimate occurred. The cumulative catch-up adjustment income was $22.2 million for the year ended December 31, 2025 as compared to $11.2 million for the year ended December 31, 2024, a change of $11.0 million.
Liquidity and Capital Resources As of December 31, 2024, we had cash and cash equivalents of $250.9 million and believe that our current cash position and capital resources are sufficient to fund our operation and meet capital requirements for at least the next twelve months from the date of filing this Annual Report on Form 10-K.
Liquidity and Capital Resources As of December 31, 2025, we had cash and cash equivalents of $261.3 million and believe that our current cash position and capital resources are sufficient to fund our operation and meet capital requirements for at least the next twelve months from the date of filing this Annual Report on Form 10-K.
Factors such as inflation may increase our cost of product sales as a percentage of product revenue if we are not able to increase the price at which we sell ZYNLONTA to offset such increases in our cost of product sales.
Factors such as inflation, tariffs and other external factors may also increase our cost of product sales as a percentage of product revenue if we are not able to increase the price at which we sell ZYNLONTA to offset such increases in our cost of product sales.
For information relating to our non-cancelable obligations under third party manufacturing agreements see Note 14, “Commitments and contingencies”, included in the Notes to our audited consolidated financial statements. 74 Table of Contents The Company has entered into various collaborations with development partners, including in-licensing and manufacturing agreements.
For information relating to our non-cancelable obligations under third party manufacturing agreements see Note 14, “Commitments and contingencies,” included in the Notes to our audited consolidated financial statements. The Company has entered into certain collaborations with development partners, including in-licensing and manufacturing agreements.
We have now received from CMS the first annual report and invoice for 2023, the payment of which has been paid in the first quarter of 2025, and was generally consistent with our estimate and no significant prior period adjustments were made. We will continue to rely on projection methodologies and expect annual reports to be received from CMS.
We have now received from CMS the invoices for 2023 and 2024, the payments of which have been paid in 2025, and were generally consistent with our estimate and no significant prior period adjustments were made. We will continue to rely on projection methodologies and expect annual reports to be received from CMS.
The increase in share-based compensation expense of $0.6 million was primarily due to forfeitures of awards in connection with prior year employee terminations.
The increase in share-based compensation expense of $0.7 million was primarily driven by the forfeitures of awards in connection with employee terminations in the prior year.
Selling and marketing expenses were $44.0 million for the year ended December 31, 2024 as compared to $57.5 million for the year ended December 31, 2023, a decrease of $13.4 million, or 23.4%.
Selling and marketing expenses were $43.4 million for the year ended December 31, 2025 as compared to $44.0 million for the year ended December 31, 2024, a decrease of $0.6 million, or 1.5%.
Other, net as of December 31, 2024 and 2023 included the following: Year Ended December 31, (in thousands) 2024 2023 Change Cumulative catch-up adjustment income, deferred royalty obligation $ 11,178 $ 4,972 $ 6,206 Deerfield warrant obligation, change in fair value income 296 497 (201) Exchange differences loss (80) (52) (28) R&D tax credit 1,063 935 128 Total $ 12,457 $ 6,352 $ 6,105 Cumulative catch-up adjustment income, deferred royalty obligation We periodically assess the expected payments to HCR based on our underlying revenue projections and to the extent the amount or timing of such payments is materially different than our initial estimates we will record a cumulative catch-up adjustment to the deferred royalty obligation.
Other, net as of December 31, 2025 and 2024 included the following: Year Ended December 31, (in thousands) 2025 2024 Change Cumulative catch-up adjustment income, deferred royalty obligation $ 22,212 $ 11,178 $ 11,034 Deerfield warrant obligation, change in fair value income — 296 (296) Exchange differences loss (670) (80) (590) R&D tax credit 1,172 1,063 109 Total $ 22,714 $ 12,457 $ 10,257 Cumulative catch-up adjustment income, deferred royalty obligation We periodically assess the expected payments to HCR based on our underlying revenue projections and to the extent the amount or timing of such payments is materially different than our initial estimates we will record a cumulative catch-up adjustment to the deferred royalty obligation.
General and administrative expenses were $41.9 million for the year ended December 31, 2024 as compared to $48.4 million for the year ended December 31, 2023, an overall decrease of $6.5 million, or 13.5%.
General and administrative expenses were $36.6 million for the year ended December 31, 2025 as compared to $41.9 million for the year ended December 31, 2024, an overall decrease of $5.3 million, or 12.7%.
Equity in Net Losses of Joint Venture Year Ended December 31, (in thousands) 2024 2023 Change Share of Overland ADCT BioPharma net loss $ (1,544) $ (5,528) $ (3,984) 73 Table of Contents We recorded our proportionate share of Overland ADCT BioPharma’s net loss of $1.5 million and $5.5 million for the years ended December 31, 2024 and 2023, respectively.
Equity in Net Losses of Joint Venture Year Ended December 31, (in thousands) 2025 2024 Change Share of Overland ADCT BioPharma net loss $ — $ (1,544) $ (1,544) We recorded our proportionate share of Overland ADCT BioPharma’s net loss of $1.5 million for the year ended December 31, 2024 .
Cost of Product Sales Cost of product sales primarily includes direct and indirect costs relating to the third-party manufacture and distribution of ZYNLONTA, royalties payable to a collaboration partner based on net product sales of ZYNLONTA and inventory write-downs.
The increase was also attributable to increased royalty revenue from Sobi . Operating Expenses Cost of Product Sales Cost of product sales primarily includes direct and indirect costs relating to the third-party manufacture and distribution of ZYNLONTA, royalties payable to a collaboration partner based on net product sales of ZYNLONTA and inventory write-downs.
The aggregate amount of such potential milestone payments (excluding royalty payments), under all such collaboration agreements, was $212.2 million, including approximately $79.3 million contingent on the achievement of various research, development and regulatory approval milestones and approximately $132.9 million in sales-based milestones.
The aggregate amount of such potential milestone payments (excluding royalty payments), under 80 Table of Contents all such collaboration agreements, was $59.6 million, including approximately $29.2 million contingent on the achievement of various research, development and regulatory approval milestones and approximately $30.4 million in sales-based milestones.
Net Cash Provided by Financing Activities Net cash provided by financing activities was $97.1 million for the year ended December 31, 2024 and primarily related to the net proceeds received from the completion of the Company’s 2024 Equity Offering in May 2024.
Net cash provided by financing activities was $97.1 million for the year ended December 31, 2024 and primarily related to the net proceeds received from the completion of the Company’s 2024 Equity Offering in May 2024. Off-Balance Sheet Arrangements During the periods presented, we did not have, and we do not currently have, any off-balance sheet arrangements.
We are seeking to continue expanding ZYNLONTA internationally, and into earlier lines of DLBCL and indolent lymphomas, including marginal zone lymphoma (“MZL”) and follicular lymphoma (”FL”), as a single agent and in combination through our LOTIS-5 confirmatory Phase 3 clinical trial and LOTIS-7 Phase 1b clinical trial as well as through investigator-initiated trials (“IITs”) at leading institutions.
We are pursuing expansion of ZYNLONTA internationally, and into earlier lines of diffuse large B-cell lymphoma (“DLBCL”) through our LOTIS-5 confirmatory Phase 3 clinical trial (rituximab combination) and LOTIS-7 Phase 1b clinical trial (bispecific combination) as well as into indolent lymphomas, including marginal zone lymphoma (“MZL”) and follicular lymphoma (”FL”), through investigator-initiated trials (“IITs”) at leading institutions.
Income tax expense associated with our U.S. and UK operations was $0.2 million for the year ended December 31, 2024 driven by current period income tax expense of $0.5 million and partially offset by US and UK tax returns true-up benefit of $0.3 million.
Income tax expense associated with our U.S. and UK operations was $1.0 million for the year ended December 31, 2025, consisting primarily of $1.2 million of current‑period UK income tax expense, partially offset by a $0.2 million benefit resulting from true‑ups of prior‑year U.S. and UK income tax returns.
In the long term, we expect that our product revenue will increase as we execute our business strategy, although our product revenue may fluctuate from period to period based on a number of factors, including patient demand, as well as the timing, dose and duration, of patient therapy and customers’ buying patterns and GTN deductions.
Our product revenue may fluctuate from period to period based on a number of factors, including patient demand, as well as the timing, dose and duration of patient therapy and customers’ ordering patterns, pricing and GTN deductions.
Losses were not recognized in excess of our total investment, as we have not incurred legal or constructive obligations or committed to additional funding on behalf of the joint venture.
We recorded our share of Overland ADCT BioPharma’s net loss up until the point at which our share of losses exceeded our interest in Overland ADCT BioPharma. Losses were not recognized in excess of our total investment, as we have not incurred legal or constructive obligations or committed to additional funding on behalf of the joint venture.
Cost of product sales were $5.9 million for the year ended December 31, 2024 as compared to $2.5 million for the year ended December 31, 2023, an increase of $3.4 million, or 135.2%.
Cost of product sales were $5.8 million for the year ended December 31, 2025 as compared to $5.9 million for the year ended December 31, 2024, a decrease of $0.1 million, or 2.5%.
The significant assumptions used to estimate the discarded drug rebate include legal interpretations of applicable laws and regulations, historical experience with discarded volumes and time lags in the processing of claims and invoicing from CMS.
The provision is recorded to Other current liabilities or Other long-term liabilities depending on when the annual refunds are expected to come due. The significant assumptions used to estimate the discarded drug rebate include legal interpretations of applicable laws and regulations, historical experience with discarded volumes and time lags in the processing of claims and invoicing from CMS.
S&M includes employee costs and share-based compensation expense for commercial employees and external costs related to commercialization (including professional fees, communication costs and IT costs, travel expenses and depreciation of property and equipment).
Selling and marketing costs (“S&M”) are expensed as incurred and are primarily attributable to commercialization of ZYNLONTA in the United States. S&M includes employee costs and share-based compensation expense for commercial 76 Table of Contents employees and external costs related to commercialization (including professional fees, communication costs and IT costs, travel expenses and depreciation of property and equipment).
The net decrease in external costs and overhead was primarily attributable to a reduction of $12.0 million in marketing and advertising expenses as a result of cost cutting initiatives. The decrease in employee expenses was primarily due to lower wages and benefits of $2.3 million primarily due to decreased headcount, as well as lower recruitment costs of $0.2 million.
The decrease in external costs and overhead was primarily attributable to $2.0 million in lower spend on marketing and advertising expenses as a result of reduced spending initiatives within the U.S. The increase in employee expenses was primarily due to an increase in wages and benefits of $0.3 million.
Cash Flows The following table summarizes our cash flows for the years ended December 31, 2024 and 2023: Year Ended December 31, (in thousands) 2024 2023 Change Net cash (used in) provided by: Operating activities $ (123,835) $ (118,686) $ (5,149) Investing activities (867) (3,216) 2,349 Financing activities 97,054 73,875 23,179 Net change in cash and cash equivalents $ (27,648) $ (48,027) $ 20,379 Net Cash Used in Operating Activities Net cash used in operating activities increased to $123.8 million for the year ended December 31, 2024 from $118.7 million for the year ended December 31, 2023, an increase of $5.1 million.
Cash Flows The following table summarizes our cash flows for the years ended December 31, 2025 and 2024: Year Ended December 31, (in thousands) 2025 2024 Change Net cash (used in) provided by: Operating activities $ (141,174) $ (123,835) $ (17,339) Investing activities 395 (867) 1,262 Financing activities 150,945 97,054 53,891 Net change in cash and cash equivalents $ 10,166 $ (27,648) $ 37,814 Net Cash Used in Operating Activities Net cash used in operating activities increased to $141.2 million for the year ended December 31, 2025 from $123.8 million for the year ended December 31, 2024, an increase of $17.3 million.
General and Administrative Expenses The following table summarizes our general and administrative expenses for the year ended December 31, 2024 and 2023: Year Ended December 31, (in thousands) 2024 2023 Change External costs and overhead $ 17,683 $ 20,542 $ (2,859) Employee expenses (1) 18,705 18,017 688 Share-based compensation expense 5,506 9,865 (4,359) General and administrative expenses $ 41,894 $ 48,424 $ (6,530) (1) Excludes share-based compensation expense.
General and Administrative Expenses The following table summarizes our general and administrative expenses for the year ended December 31, 2025 and 2024: Year Ended December 31, (in thousands) 2025 2024 Change External costs and overhead $ 13,913 $ 17,683 $ (3,770) Employee expenses (1) 18,125 18,705 (580) Share-based compensation expense 4,521 5,506 (985) General and administrative expenses $ 36,559 $ 41,894 $ (5,335) (1) Excludes share-based compensation expense.
Critical Accounting Estimates A summary of the significant accounting policies is provided in Note 2 “Summary of significant accounting policies,” included in the notes to our audited consolidated financial statements. 75 Table of Contents The preparation of financial statements in accordance with generally accepted accounting principles, or GAAP, requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities.
The preparation of financial statements in accordance with generally accepted accounting principles, or GAAP, requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. We evaluate our estimates on an ongoing basis.
The change was primarily due to revised revenue forecasts incorporated into the valuation model in 2024 having a greater effect on the expected payments to HCR relative to the 2023 revised revenue forecasts. Revisions in both years were primarily attributable to changes in assumptions in the Company’s updated strategic and development plans, revenue projections and associated timing thereof.
The change was primarily due to revised revenue forecasts incorporated into the valuation model in 2025 having a greater effect on the expected payments to HCR relative to the 2024 revised revenue forecasts.
The decrease in external costs and overhead of $2.9 million was primarily related to lower professional fees of $1.5 million and lower insurance and IT costs of $1.3 million. The increase in employee expenses was primarily due to higher wages and benefits of $0.4 million and higher recruitment costs.
The decrease in external costs and overhead was primarily related to lower professional fees of $2.1 million primarily as a result of lower legal and accounting expenses, VAT recoveries of $0.5 million, lower insurance costs of $0.7 million and lower travel and IT costs of $0.5 million.
Product revenues, net, were $69.3 million for the year ended December 31, 2024 as compared to $69.1 million for the year ended December 31, 2023, an increase of $0.2 million, or 0.3%. The increase is primarily attributable to a higher selling price and favorability in prior period GTN sales adjustments, partially offset by lower sales volume.
Product revenues, net, were $73.6 million for the year ended December 31, 2025 as compared to $69.3 million for the year ended December 31, 2024, an increase of $4.3 million, or 6.2%. The increase is principally attributable to a higher sales price, with consistent sales volume on a period over period basis.
Our actual results may differ materially from those anticipated in these forward-looking statements. See “Forward-Looking Statements.” Overview ADC Therapeutics is a commercial-stage global pioneer in the field of antibody drug conjugates (“ADCs”). The Company is advancing its proprietary ADC technology to transform the treatment paradigm for patients with hematologic malignancies and solid tumors.
Our actual results may differ materially from those anticipated in these forward-looking statements. See “Forward-Looking Statements.” 73 Table of Contents Overview ADC Therapeutics is a commercial-stage global pioneer in the field of antibody drug conjugates (“ADCs”), transforming treatment for patients through our focused portfolio with ZYNLONTA (loncastuximab tesirine-lpyl), a CD19-directed ADC. ZYNLONTA received accelerated approval from the U.S.
Income Tax Expense We are subject to corporate taxation in Switzerland. We are also subject to taxation in other jurisdictions in which we operate, in particular, the United States and the United Kingdom, where our two wholly-owned subsidiaries are incorporated.
Revisions in both years were primarily attributable to changes in assumptions in the Company’s updated strategic and development plans, revenue projections and associated timing thereof. 78 Table of Contents Income Tax Expense We are subject to corporate income taxation in Switzerland and in other jurisdictions in which we operate, including the United States and the United Kingdom, where our two wholly-owned subsidiaries are incorporated.
Our R&D expenses were $109.6 million for the year ended December 31, 2024 as compared to $127.1 million for the year ended December 31, 2023, a decrease of $17.5 million, or 13.8%, as driven by the following programs and activities: ZYNLONTA Research and development expenses for ZYNLONTA were $58.3 million for the year ended December 31, 2024 as compared to $68.5 million for the year ended December 31, 2023, a decrease of $10.2 million, or 14.8%.
Our R&D expenses were $104.0 million for the year ended December 31, 2025 as compared to $109.6 million for the year ended December 31, 2024, a decrease of $5.6 million, or 5.1%.
We are entitled under Swiss laws to carry forward any losses incurred for a period of seven years, which could be used to offset future taxable income. We are also entitled under U.S. tax law to carry forward R&D tax credits for a period of up to 20 years, which could be used to offset future taxable income.
Under Swiss law, we are permitted to carry forward net operating losses for up to seven years, which may be used to offset future taxable income. Under U.S. tax law, research and development tax credits may generally be carried forward for up to 20 years and used to offset future tax liabilities, subject to statutory requirements.
The increase was attributable to increased royalty revenue from our exclusive license agreement with SOBI to develop and commercialize ZYNLONTA in all territories other than the United States, greater China, Singapore and Japan.
License revenues and royalties were $7.8 million for the year ended December 31, 2025 as compared to $1.6 million for the year ended December 31, 2024, an increase of $6.2 million attributable to our exclusive license agreement with Sobi to develop and commercialize ZYNLONTA in all territories other than the United States, greater China, Singapore and Japan.
In our hematology program, our flagship product, ZYNLONTA, a CD19-directed ADC, received accelerated approval from the U.S. Food and Drug Administration (“FDA”) conditional approval from the European Commission and 68 Table of Contents conditional approval from the NMPA for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
Food and Drug Administration (“FDA”) and conditional approval from the European Commission, China National Medical Products Administration (“NMPA”) and Health Canada for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
Interest Expense Interest expense is primarily related to the accretion of our deferred royalty obligation with HCR and the senior secured term loan facility. Interest expense was $50.2 million for the year ended December 31, 2024 as compared to $46.3 million for the year ended December 31, 2023, an increase of $3.9 million, or 8.4%.
Interest expense was $51.6 million for the year ended December 31, 2025 as compared to $50.2 million for the year ended December 31, 2024, an increase of $1.4 million, or 2.8%.
Ultimately, the net profit at each subsidiary is subject to local income tax. During the year ended December 31, 2024 , with respect to our U.S. operations, current income tax expense of $0.3 million was recorded and no deferred tax expense was recorded due to full valuation allowance on deferred tax assets.
No current or deferred income tax expense was recorded for our U.S. operations for the year ended December 31, 2025, primarily due to the deductibility of domestic research and development expenditures under OBBB legislation and the existence of a full valuation allowance on U.S. deferred tax assets.
Interest income was $12.3 million for the year ended December 31, 2024 as compared to $10.5 million for the year ended December 31, 2023, an increase of $1.7 million, or 16.4%. The increase was primarily due to higher yields received on our cash deposits.
Interest income was $8.8 million for the year ended December 31, 2025 as compared to $12.3 million for the year ended December 31, 2024, a decrease of $3.5 million, or 28.2%.
Selling and Marketing Expenses The following table summarizes our selling and marketing expenses for the year ended December 31, 2024 and 2023: Year Ended December 31, (in thousands) 2024 2023 Change External costs and overhead $ 21,442 $ 33,006 $ (11,564) Employee expenses (1) 22,269 24,780 (2,511) Share-based compensation expense (reversal) 304 (322) 626 Selling and marketing expenses $ 44,015 $ 57,464 $ (13,449) (1) Excludes share-based compensation expense (reversal). 71 Table of Contents Selling and marketing costs (“S&M”) are expensed as incurred and are primarily attributable to commercialization of ZYNLONTA in the United States.
Selling and Marketing Expenses The following table summarizes our selling and marketing expenses for the year ended December 31, 2025 and 2024: Year Ended December 31, (in thousands) 2025 2024 Change External costs and overhead $ 19,485 $ 21,442 $ (1,957) Employee expenses (1) 22,594 22,269 325 Share-based compensation expense 1,295 304 991 Selling and marketing expenses $ 43,374 $ 44,015 $ (641) (1) Excludes share-based compensation expense.
The decrease was driven by fluctuations in our share price as well as forfeitures of awards in connection with employee terminations.
The increase in share-based compensation expense of $1.0 million was primarily driven by the forfeitures of awards in connection with employee terminations in the prior year.
We are continuously exploring strategic collaborations, business combinations, licensing opportunities or similar strategies for our early-stage research pipeline and for clinical development and commercialization of ZYNLONTA and/or our product candidates.
We are continuously exploring strategic collaborations, business combinations, licensing opportunities or similar strategies for clinical development and commercialization of ZYNLONTA and/or our PSMA-targeting ADC. However, we may be unable to obtain such future financing, licensing and collaboration arrangements on favorable terms, if at all.
Net Cash Used in Investing Activities Net cash used in investing activities decreased to $0.9 million for the year ended December 31, 2024 from $3.2 million for the year ended December 31, 2023, a decrease of $2.3 million. The decrease in net cash used in investing activities primarily relates to the timing of property and equipment purchases.
Net Cash provided by (used in) Investing Activities Net cash provided by investing activities was $0.4 million for the year ended December 31, 2025. Net cash used in investing activities was $0.9 million for the year ended December 31, 2024.
Net cash provided by financing activities was $73.9 million for the year ended December 31, 2023 and primarily related to the proceeds received under the deferred royalty obligation with HCR upon the first commercial sale of ZYNLONTA in the United Kingdom or any European Union country.
Net Cash Provided by Financing Activities Net cash provided by financing activities was $150.9 million for the year ended December 31, 2025 and primarily related to the net proceeds received from the completion of the Company’s June 2025 and October 2025 Private Placements.
This was partially offset by lower interest on our senior secured term loan facility of $1.8 million as a result of a lower effective interest rate. 72 Table of Contents Other, net Other, net consists primarily of cumulative catch-up adjustments related to our deferred royalty obligation, changes in the fair value (gains or losses) of the Deerfield warrant obligation and the R&D tax credit from our UK operations.
Other, net Other, net consists primarily of cumulative catch-up adjustments related to our deferred royalty obligation and the R&D tax credit from our UK operations.
Removed
We have a validated and differentiated technology platform with multiple payloads, linkers and conjugation chemistry, enabling the design of next-generation potent ADCs with an enhanced therapeutic index. Our strategy is focused on expanding and maximizing the ZYNLONTA opportunity in hematology and pursuing our early-stage research portfolio in solid tumors.
Added
Our goal is to be a leading ADC company bringing meaningful therapies to patients in need by leveraging our decade-long experience in the ADC field, with multiple INDs, and a proven track record of success. We are focused on maximizing the ZYNLONTA opportunity through expansion into earlier lines of therapies of DLBCL and indolent lymphomas.
Removed
We are a pioneer and leader in the ADC field with specialized end-to-end capabilities for developing optimized ADCs.
Added
On June 11, 2025, the Board of Directors approved a strategic reprioritization and restructuring plan (the “2025 Restructuring”) to focus resources on ZYNLONTA expansion opportunities and the advancement of its preclinical exatecan-based PSMA-targeting ADC. The Company closed down its UK facility, and has reduced its global workforce across functions by approximately 30%.
Removed
This includes a strong, integrated research & development organization and a validated technology platform with clinical-stage product candidates currently in the pipeline, multiple next-generation ADCs being developed and a proven executional track record that includes ZYNLONTA, the first PBD-based ADC receiving accelerated approval from the FDA, conditional approval from the European Commission and conditional approval from the NMPA in China for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy.
Added
In March 2025, the Company recognized $5.0 million in license revenue in connection with a milestone due upon ZYNLONTA’s conditional approval by Health Canada for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy, which was paid to us by Sobi in the second quarter of 2025.
Removed
In addition, we are investigating a CD-22 targeted compound, ADCT-602, in collaboration with the MD Anderson Cancer Center in a Phase 1/2 IIT in relapsed or refractory B-cell acute lymphoblastic leukemia.
Added
The decrease in cost of product sales was primarily driven by a $1.1 million batch cancellation fee recognized during the year ended December 31, 2024, partially offset by higher inventory write-downs of $0.8 million during the year ended December 31, 2025 primarily attributable to the manufacturing of a batch that did not meet our specifications. 75 Table of Contents Research and Development Expenses The following table summarizes our research and development expenses for our major development programs for the years ended December 31, 2025 and 2024: Year Ended December 31, (in thousands) 2025 2024 Change External costs and overhead $ 54,602 $ 61,483 $ (6,881) Employee expenses (1) 46,800 46,229 571 Share-based compensation expense 2,603 1,921 682 Research and development expenses $ 104,005 $ 109,633 $ (5,628) (1) Excludes share-based compensation expense.
Removed
In our solid tumor program, we have early stage preclinical research programs, including a portfolio of next-generation investigational ADCs targeting Claudin-6, PSMA, NaPi2b, and ASCT2, the most advanced of which are PSMA and Claudin-6. In addition, we are advancing research with a range of payloads, linkers and conjugation technologies against undisclosed targets.
Added
We expect our research and development expense to decrease for fiscal year 2026, as compared to 2025, primarily driven by an expected reduction in spending on discontinued programs and our preclinical product candidates and research pipeline as a result of the 2025 Restructuring, as well as reduced spend on ZYNLONTA due to the timing, progress and stage of clinical trials.
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The Company is seeking to maximize the value of its solid tumor program through strategic partnerships, collaborations and license arrangements for one or more of its research programs.
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The decrease in external costs and overhead of $6.9 million was driven primarily by a reduction in spending on discontinued programs, including ADCT-601 that was discontinued in November 2024, and our preclinical product candidates and research pipeline as a result of the 2025 Restructuring.
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License revenues and royalties were $1.6 million for the year ended December 31, 2024 as compared to $0.5 million for the year ended December 31, 2023, an increase of $1.1 million.
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These decreases were partially offset by an increase in spending on our PSMA-targeting ADC program due to the timing of costs incurred in connection with IND-enabling activities and an increase in ZYNLONTA spend due to the timing and enrollment of our ZYNLONTA clinical trials and related costs incurred in connection with the LOTIS 5 trials.
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The increase is primarily attributable to higher stability, shipping and storage costs of $1.8 million, a $1.1 million batch cancellation fee and $0.6 million of commercial inventory used for the validation at a new CMO facility which was expensed as a period cost.
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The increase in employee expenses of $0.6 million was primarily driven by higher temporary project help of $4.0 million, partially offset by lower wages and benefits of $3.4 million due to headcount reduction as a result of the 2025 Restructuring.
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Research and Development Expenses The following table summarizes our research and development expenses for our major development programs for the years ended December 31, 2024 and 2023: Year Ended December 31, (in thousands) 2024 2023 Change ZYNLONTA $ 58,311 $ 68,461 $ (10,150) ADCT-601 (1) 17,624 10,755 6,869 Preclinical product candidates and research pipeline 17,340 12,830 4,510 ADCT-602 1,170 1,851 (681) Discontinued programs (2) 5,056 21,707 (16,651) Not allocated to specific programs (3) 8,211 7,572 639 Share-based compensation 1,921 3,951 (2,030) Research and development expenses $ 109,633 $ 127,127 $ (17,494) (1) ADCT-601 was discontinued in November 2024.
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The decrease in employee expenses of $0.6 million was primarily due to lower wages and benefits of $0.4 million and lower recruitment costs of $0.4 million, partially offset by $0.2 million in higher temporary project help. The decrease in share-based compensation expense of $1.0 million was primarily due to the timing of forfeitures of awards in connection with employee terminations.
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(2) As of December 31, 2024, Cami, ADCT-901 and ADCT-212 were included in Discontinued programs. For the year ended December 31, 2023 these programs were separately presented as major development programs. Prior periods have been recast to conform to the current period presentation.
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Restructuring, Impairment and Other Related Costs In connection with the 2025 Restructuring, we incurred Restructuring, impairment, and other related costs of $13.1 million for the year ended December 31, 2025, which consisted of $6.0 million in employee severance and related benefit costs, the majority of which were paid by the end of 2025, $5.8 million in impairment of long-lived assets and prepaid expenses, and $1.3 million in legal fees, dilapidations, lease termination and other related costs associated with the UK facility closure.
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(3) Includes third-party contracting and employee expenses, as well as expense for preclinical research, storage, shipping and lab consumables that span multiple programs.
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We did not incur restructuring, impairment and other related costs for the year ended December 31, 2024. Other Income (Expense) Interest Income Interest income includes interest received from banks on our cash balances.
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The overall decrease was primarily due to a net decrease in external clinical trial costs of $5.1 million (decrease in costs associated with LOTIS 5 and other trials offset by an increase in LOTIS 7), lower professional fees of $2.4 million, lower employee expenses of $1.6 million and lower CMC costs of $0.7 million as a result of the implementation of productivity initiatives and focused investment in prioritized development programs.
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The decrease was primarily due to lower yields received on our cash deposits and cash equivalents and lower average balances. 77 Table of Contents Interest Expense Interest expense is primarily related to the accretion of our deferred royalty obligation to HCR and the senior secured term loan facility.
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ADCT-601 Research and development expenses for ADCT-601 were $17.6 million for the year ended December 31, 2024 as compared to $10.8 million for the year ended December 31, 2023, an increase of $6.9 million, or 63.9%. The increase is primarily attributable to higher patient enrollment and progress towards the completion of the study.

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