All righty. So welcome to this next fireside chat with ADC Therapeutics. My name is Michael Schmidt, biotech analyst with Guggenheim. And with me today I have Ameet Mallik, CEO of ADCT. And so Ameet, welcome. Thanks for joining us.
Thank you.
So just again, to remind folks of the story, can you just set the stage by giving us a quick background on the company?
Sure. Yeah. So ADCT is an integrated company with development, commercial stage capabilities. We have one product on the market, Zynlonta, which is approved in the third line plus DLBCL setting. Also with multiple opportunities and trials that we're running to expand the use of the product in earlier lines of DLBCL and in the lymphomas, and then we also have a solid tumor portfolio using our novel exatecan-based platform with multiple programs that are on the IND enabling stage.
Great. And yeah, maybe then just diving right in. Zynlonta, as you mentioned, has been on the market, which is approved for third- or later-line DLBCL for some time now. And just remind us or remind folks perhaps of the differentiating attributes of Zynlonta relative to some of the other approved therapies for lymphomas.
Sure. Yeah, I would say really three things. One around efficacy, rapid, deep, and durable efficacy, so rapid, you get to median duration of time to get to CR in about one and a half months. Deep, we have a high level of response rate, including CRs, and then durable in that even after two years, the median duration of response for CRs wasn't achieved, so rapid, deep, durable efficacy, manageable side effect profile. We don't have any of the irreversible toxicities that you see with chemo. We don't have harder-to-treat toxicities like CRS or ICANS that are typically associated with bispecifics and CAR-T, and then it's also very accessible. It's a 30-minute infusion every three weeks with a fixed duration of therapy up to eight cycles, so overall, rapid, deep, durable efficacy, manageable safety, easily accessible across settings.
Correct. And then I know the interesting thing is that the product's on the market. I think you talked about cash flow breakeven right now of the commercial business. And so yeah, maybe talk a bit about how much more incremental near-term growth opportunity is there in the approved indication?
Yeah. I think in the approved indication, I'm really proud that we've been able to basically maintain our sales sort of at the similar level, about $16 million-$18 million a quarter, despite significantly new competitors coming in, particularly the bispecifics, right? Bispecifics entered about 18 months ago and have taken about a third of the third line plus market. And yet our sales have been in that kind of $16 million-$18 million a quarter. So we've been able to hold our own by continuing to penetrate both the academic and community settings. I think the real growth opportunity comes with new indications and new opportunities, both through regulatory approvals as well as guidelines. And we think we have multiple pathways to do that in the future.
Right. Yeah. Maybe then just following up on that. So you did obviously have some very impressive phase II data presented in indolent lymphoma. So I know you have data in follicular lymphoma and then also in marginal zone lymphoma. And some of that was presented at ASH recently, I think. And so yeah, can you talk a bit about the potential for NCCN guideline inclusion of some of that and how that might affect its commercial trajectory perhaps?
Yeah. So we're really excited about our indolent lymphoma data. As you mentioned, in both relapsed/ refractory FL as well as in MZL, we had data presented at ASH. So if you look at the relapsed/ refractory follicular lymphoma data, we're really studying just the high-risk population. More than half the patients being included in this 100-patient study are POD 24 patients. So they're really the highest risk patients that progress quickly. What was shown in that study in the first patients is a 77% complete response rate, which is really outstanding. I mean, that's really the upper end of efficacy. And we're looking at the highest risk patient populations. Also with the fixed duration and a manageable safety profile, which is really important in indolent lymphomas. You typically see much lower uses of, for example, CAR-T products and much later line than you would in more aggressive lymphomas.
And so having a manageable safety profile with high efficacy and a fixed duration of therapy is really key in these indolent lymphomas. In marginal zone lymphoma, we're running a 50-patient study with an investigator-initiated study. And in that study, the investigator showed a 70% complete response rate. Just by way of reference, the best data that's been shown either in terms of approved products or those in guidelines is only about 29% CR rate. So it's really outstanding data. That was on the first 23 patients. That multi-center study continues to enroll. If you look at what's in the guidelines, for example, for MZL, it's all been based on patient sample size of 36-68 patients. So we think the 50-patient study that's enrolling right now should be sufficient to pursue that pathway. We will also approach the FDA with that data as well.
Similarly, with follicular, given that we're going after only the high-risk patient population, that's the pathway we'll pursue for follicular as well.
Right. And I think the idea to approach the FDA perhaps to get a more formal approval with these data. So what time frame are you thinking to do that?
Yeah, so right now, both studies are really enrolling well. The MZL study is already about halfway done with the data that was presented in December. Follicular is close to halfway done, so I think both of these opportunities could translate into guidelines as soon as 2027.
Understood. Okay. And then yeah, as it pertains to the data, how should we look at this perhaps in terms of read-through to the overall, in terms of the overall clinical profile of Zynlonta and perhaps other trials that are currently ongoing?
I think what we're so impressed by is just the consistency with which we're seeing the efficacy and safety profile of the molecule. So we obviously saw it's single agent, which is what led to the accelerated approval of the drug. If you look at the indolent lymphoma data, again, in marginal zone, we're looking at it single agent, again, showing very high levels of efficacy that really haven't been seen before in that disease setting. With follicular lymphoma, we're looking at the combination of Zynlonta plus rituximab. That's the same combination that we're using in our pivotal phase III study, LOTIS-5, which is combining that same combination in second line plus DLBCL. And then we've seen outstanding data also when we're combining Zynlonta in combination with glofitamab, the bispecific. So I think we've seen a lot of consistency.
In particular, I think the read-through in aggressive FL patients, high-risk FL patients, seeing that same combination show good data, the same data that we're going to show in combination with Zynlonta plus rituximab in LOTIS-5, we think is positive.
Right. Maybe then a few questions on LOTIS-5. So again, this is your phase III randomized study in second-line DLBCL. And I think you completed enrolling the study at this point. So how are you tracking towards reading out top-line data?
Yeah. So we completed the enrollment of the study at the end of the year, just right on time with what our commitments have been and what we anticipated. Now it's events-driven. So of course, any readout depends on what we hit the prespecified number of PFS events. But right now, we assume and believe that we'll have top line results based on those events probably by the end of this year. And then soon after, we'd file the drug in 2026 and then an approval expected thereafter. So of course, this is events-driven, but based on what we anticipate right now, that's what we'd expect.
Right. And then just remind us in historical data in this context and what are you expecting Zynlonta to demonstrate?
Yeah, so because we got approval in the third line setting as a single agent, and then we're moving in combination with rituximab in the second line setting, we started off doing a safety run-in first, and in the first 20 patients of the safety run-in, we showed an overall response rate of 80% and a CR rate of 50%, so this is very competitive data in this setting. Then we moved on to the randomized portion, so of course, we'll see the full study results once we hit the prespecified number of events, but 50% CR rate with a manageable side effect profile is very competitive in this setting. Really, outside of CAR-T and bispecific-based combinations, it's better than anything else that's out there.
And we know that a subset of patients are going to get CAR-T and bispecific combinations, but not every patient's going to have access because of the care setting requirements needed, particularly hospitalization. And not every patient from an underlying disease, for example, if you have neuropathy or autoimmune disease or risk of infection, some of those other therapies may not be suitable. And so we believe there's a clear place and positioning for Zynlonta plus rituximab for patients either who don't have access or are not suitable for bispecifics or CAR-T.
Yeah. Perhaps remind us of how you think about the incremental additional commercial opportunity for Zynlonta in second-line DLBCL based on LOTIS-5. And I'm thinking perhaps relative to some of these other therapies. I know we saw overall survival data recently for glofitamab in second-line. And yeah, I'm just curious how you think about that sort of near-term growth opportunity commercially.
Yeah. We think just with Zynlonta plus rituximab, which would be the next indication, this could take the opportunity. The drug right now is roughly $70 million. We had $69 million last year, and the first three quarters kind of track in that similar trend. We believe that this could grow the opportunity to $200 million-$300 million. One of the interesting things is we did market research, quantitative market research with an external firm looking not only at the profile of our drug, but all the new combinations, including all the new bispecific combinations they're going to launch. We believe we can get a reasonable share both in the second line and third line plus setting, but every share point in second line for us is worth about $15 million.
Even if we only capture about 10% share, which is what we have in the third line setting, that's an incremental $150 million opportunity. Even with our current share with a higher duration of therapy that we expect, that's another $100 million even without any share gains. Of course, when you're doubling the efficacy from going from 25% CR to 50% CR, we think there's an opportunity for share improvement. Conservatively, we believe the opportunity can be about a $200 million-$300 million opportunity.
Right. Right. And then obviously, you're also doing the LOTIS-7 study, which is a much more active combination with glofitamab itself, which is already approved in second-line. And so I know you had some data recently, some early phase I data. So just remind us of the key takeaways from that.
Yeah, we studied because we know that bispecifics and Zynlonta, outside of CAR-T, are the only drugs that are approved as single agent drugs in DLBCL in any line of therapy. We know they're very potent drugs with complementary mechanisms of action. One of the things we did is first started out with a dose escalation where we studied three different doses of Zynlonta plus the full dose of glofitamab. We cleared all those doses with no DLTs. Now we're doing a dose expansion of the two higher dose levels of Zynlonta plus glofitamab. In the first 18 patients across those two dose cohorts, what we saw was of the 18 patients, 17 had an overall response. We had a, and then we had 13 of the 18 that had a complete response.
So we had a 72% complete response rate, which is very, very encouraging, especially as we know that responses can improve over time. We saw, for example, with Zynlonta monotherapy that about 20% of patients who started out with a PR converted to a CR over time. We saw some of those conversions already happen in this case. And we're seeing good maintenance of the 13 CRs. 12 of them were maintained as of the data cutoff. So we're also seeing good durability. So we're continuing to enroll. We want to enroll 20 patients in each of these dose cohorts. We'll have all 40 of those patients enrolled the first half of this year. We expect to share more data in the first half of this year and full mature data on those 40 patients in the second half of this year.
And yeah, then remind us. I know there was some discussion of the safety profile perhaps in context of the known safety profile of each of the two drugs alone.
Yeah. I'd say there were overall, most of the grade three or above were very consistent with the known profiles of the two drugs. I think one thing we were pleased about is if you look at some of the heme toxicity, the biggest grade three for adverse events associated with each of the drugs individually is neutropenia. Some of these heme toxicities are about 30%. If you look at the labels of each, we saw similar levels within the combination. We didn't really see additive heme toxicity, which is important. When it comes to CRS and ICANS, we saw about 35% CRS levels, which are about half of what glofitamab has in the monotherapy label, partially because we're dosing the Zynlonta before the step-up dosing of glofitamab to debulk the tumor and then give the two drugs concomitantly after, both for a fixed duration.
And we also saw only low grades of ICANS, two cases that we saw, both of which fully resolved with steroid treatment. So I think we were very encouraged by the safety profile as well as the efficacy profile.
Okay. And then I know there was some discussion by some investors around a couple of the discontinuations due to treatment-emergent adverse events. So can you just help us understand what some of those discontinuations were about?
Yeah, sure. So there were three discontinuations of the 29 patients treated because, of course, in the dose escalation, we were looking at all lymphomas and then the dose expansions only in second line plus DLBCL. So the safety database is bigger. Of the 29 patients in the safety database, three discontinued. One discontinued both drugs because of ICANS. So of the two patients, although they fully resolved, one patient discontinued, the other recontinued treatment, got to a CR and maintained a CR. And the two others, one because of edema, one because of pleural effusion, discontinued the therapies.
Gotcha. Okay. And then yeah, so remind us again sort of next steps here. You mentioned 40 patients is the target enrollment goal. And so yeah, how much of this data will we be able to share this year?
Yeah. We'll be able to share all 40 patients with more mature follow-up and longer follow-up in the second half of the year. But we're already going to share a subset of that data in the first half of this year. So there'll be two different data disclosures this year on LOTIS-7. Based on us getting to the 40 patients, we plan to discuss with the FDA the selected dose and what a potential regulatory pathway could be. And in parallel, we're evaluating compendia strategy because we know that if you look at recent precedents, to get into NCCN guidelines, typically takes about 80- 100 patients. So we'll already have 20 patients at each dose.
By expanding and adding in the chosen dose, 60 - 80 additional patients, that should be sufficient to be able to submit to NCCN guidelines while we also evaluate the regulatory approach with the FDA.
Understood, and I guess what is the target profile? Sort of what are you trying to achieve perhaps relative to the LOTIS-5 study?
Yeah. So whereas LOTIS-5, we expect the CR rate to be in that 50% range based on what we've seen so far. I think what we've seen is north of 70% already. I think if we get 70%+ CR rate, it's a home run scenario. I mean, it clearly differentiates on efficacy from any other therapy out there that's not a CAR-T. You're kind of in the realm of CAR-T. Of course, we have to see the durability. But versus any other therapy, I think it would clearly could be best in class. Even if we get to the 60% range, I think there's a lot of advantage because the safety profile looks really good. And we're also combining glofitamab with Zynlonta, which is not a treatment that was given in the front line setting.
We know that polatuzumab, which is one of the combination partners that's being used in a lot of the bispecific trials, has been embedded really quite well on the front line, and about a third of the patients get polatuzumab front line. Retreatment is not always the best option, or with GemOx, which is a chemotherapy, it's not always the best combination partner because it also has some irreversible toxicities like neuropathy. So I do believe having a competitive efficacy regimen like in the 60% range with a better safety profile is still very differentiating.
Right. And then yeah, to what degree do you think this could expand upon the LOTIS-5 opportunity that you outlined or perhaps even glofitamab use and perhaps other therapies in second-line?
Yeah. I think they're very complementary because like we've seen with CAR-Ts and with the bispecifics, they have great efficacy. But because of the safety profile and accessibility, they don't get used by every patient. So efficacy is not the only parameter. I do believe bispecific combinations are going to play probably the largest role in the second line setting. And so LOTIS-7 represents our biggest single opportunity. But there will be probably 40% or so of patients that don't have access or are not suitable for either a CAR-T or bispecific. I think the LOTIS-5 profile fits perfectly there where R-based regimens, whether it be R2 or R-based chemo, are commonly used. And having an R-ADC combination fits in really well.
It's a combination that not only delivers efficacy that's near that of the bispecific combinations, but also with a more manageable safety profile and accessibility, which can be given across all care settings. I think the two approaches are very complementary. We have a chance in both of these segments to have best-in-class profiles.
Right. And then so you mentioned there's compendia listing strategy sort of pending on more data by the end of this year. Any plans to formally explore a regulatory strategy that would lead to an actual label indication longer term? What are your plans there?
Yeah. You mean for LOTIS-7?
Yeah.
Yeah. Yeah. And we're looking at both in parallel. So we will engage with the FDA in the second half of this year once we have data on all 40 patients on the selected dose and on potential regulatory strategies to expand the use. And in parallel, we're exploring the opportunity to expand this study to be able to submit the 80-100 patients in CAR-T. So we are pursuing both of those strategies in parallel right now.
Understood. All right. Great. So looking forward to that. And then I know you do have also a portfolio of early-stage ADC product candidates in development. I know there's some investor interest in those. And so yeah, just remind us of your ongoing activities with your exatecan-based ADC platform.
Yeah. So we have a novel exatecan-based platform. It uses a very novel hydrophilic linker, which allows the traceless release of exatecan. It has a lot of advantages versus DXd and other topoisomerase inhibitors. So for example, we see really high bystander effect. We don't see some of the safety effects like interstitial lung disease in a lot of our animal studies. We're seeing very high therapeutic index. So we're seeing therapeutic index across our molecules greater than 10, which really allows us, whether these products are used in monotherapy or in combination, a really wide range of effective dosing that we'd be able to administer for these products. The four targets that we're going after are Claudin-6, PSMA, NaPi2b, and ASCT2. All of those are in the IND-enabling stage. What we've said is that we plan to move one forward to the IND on our own.
The others really depend on external funding through a research collaboration, and so we're in discussions and pursuing partnerships to be able to fund the broader set of the research platform.
Gotcha. And how do you prioritize which ones to keep and which ones to potentially license out?
Yeah. So we look at obviously the clinical pathway. We look at how differentiating the data. We look at the competitive landscape of where can this fit in and what the market opportunity will be. And so we've assessed all of that. Obviously, a few of these stand out more from a market opportunity from a competitive landscape, but also from what the clinical path forward can be and what the data that we have right now. So we think they're all interesting, but a few obviously stand out even more.
Right. And so what is the time frame for potential updates? What's the next thing we'll hear on these? Will it be IND filings or any other news?
Yeah. I think you'll see more updates. I think one of the key things for us is really around partnering and getting financing to be able to do a broader set of the portfolio. So I'd say over the course of this year, you'll hear more updates on the research platform.
Sounds good. Well, great. Well, thank you. So we'll keep an eye out on those while we await more data on Zynlonta from LOTIS-7 this year. So thank you, Ameet. Really appreciate the time.
Well, I appreciate it. Thank you so much.
Thanks.