ADC Therapeutics SA ($ADCT)

Welcome to our fireside chat with ADC Therapeutics. I'm Robert Burns, the Managing Director and Senior Biotech, H.C. Wainwright and I'm joined now by Ameet Mallik, the CEO of ADC. Ameet, thank you for joining us today.

Thank you so much. It's a pleasure to be here.

So why don't we just dive in. So for those who may be unfamiliar with ADC, could you please provide a brief overview of the company?

Sure. Yes. So ADC Therapeutics is a commercial stage company focused on antibody drug conjugates, obviously, 1 of the pioneers. And the focus of our company is really on our CD19 directed approved product ZYNLONTA. ZYNLONTA is currently approved as a third-line -- in the third-line plus DLBCL setting. But beyond our current approval, we have multiple studies to move into earlier lines of DLBCL as well as to move into indolent lymphomas. And that's the strategy of the company is really maximizing the value of ZYNLONTA. In particular, we have our LOTIS-5 study, which is our Phase III confirmatory of ZYNLONTA in combination with rituximab. That's actually in a readout in the second quarter of this year. So it's coming soon. And then we also have our LOTIS-7 study, which is a study looking at sin plus glofitamab in second-line plus DLBCL as well. That study will read out by the end of this year. And then, of course, we also have indolent lymphoma studies as well.

Before we get into LOTIS-5 and LOTIS-7, why don't we talk about the sort of sales trajectory over the past 4 quarters? And how you envisage the potential sales growth of ZYNLONTA in 2026?

Yes. So we don't provide any annual net revenue guidance, but we do expect that the ZYNLONTA sales in 2026 to be broadly in line with what we've seen in recent quarters. As you know, we have a third-line plus label as a monotherapy, and our sales have been relatively stable over the last couple of years. So we expect that to be the case in 2026. We think the real growth opportunity starts when we move into the second-line setting. And following the approval, the anticipated approval of LOTIS-5 in 2027, we think we'll start seeing growth in 2027 and even more substantial long-term growth starting in 2028 and beyond.

When we think about Q4 of last year, obviously, there's $22.3 million sales of ZYNLONTA versus $15.8 million in Q3 and $18.1 million in Q2. Obviously, there's a little bit of variability in there. Can we expect to see that variability as we move into 2026?

Yes. You can -- I think with this product, we've seen quarter-to-quarter about our variability. What's it driven by? I think it's really driven by 2 things. One is in -- particularly in academic centers or large community centers, because we're a relatively low-volume product, and it's a rare disease, you may be ordering -- you may get an order from a big academic center and then nothing in the next quarter and then you get an order in the next quarter because they're ordering a set of aisle. So there's a little bit of that kind of inventory fluctuation. The other thing is it's just patient variability, particularly in the community where a community doctor may see 1, 2, 3, third-line plus patients in a year. And they could see 2 in 1 quarter and then not see any for the next 2 quarters at all. So there's a little bit of variability that we've seen in the brand. We're averaging around $18 million a quarter. That's what we've been averaging in the last couple of years, but that does vary. As you just mentioned, the last 3 quarters were going like $18 million, $16 million and $22 million. So we're kind of -- I think we do expect this to continue to see variability. But for the overall annual sales to be roughly in line with what we've seen in a couple of years.

All right. Well, why don't we move -- so obviously, as the ZYNLONTA approved in the third-line plus setting, you got LOTIS-5, LOTIS-7, which are going into the second-line. So why do we talk about the treatment paradigm in that second-line setting? And how does that differ between community and academic medical centers?

Yes. So I think when you look at the overall treatment landscape, whether it's the second-line or the third-line call setting, there's really 2 main segments that exist. And I'll tell you how they different in terms of use in the academic community settings. The first is there's more complex therapies. These are therapies like CAR-Ts and transplant bispecifics. And these are therapies that require more unique infrastructure and expertise to handle the logistical requirements for example, to do a CAR-T, it could be a CAR-T administer side, there's about 150 in the country. To administer bispecifics, you need access to a hospital. So you need capabilities to administer these therapies that not all centers have. Now typically, these therapies are available on all the academic centers, but the majority of the community does not have access to the therapies. Then you have more broadly accessible therapy is the second segment, which are therapies like antibody drug conjugates, monoclonal antibodies, chemotherapy. These are simple outpatient therapies that really anyone can give, whether it be in the academic center or the community setting. So academic centers have access to both of these therapies. The community largely has access to the broadly accessible. There is a portion of the more sophisticated or larger community centers that have access to bispecific based therapies. But for the majority of the community, they're really focused on broadly accessible therapies.

Okay. Obviously, there are a few trials for these competitive agency C19 targeted CAR-Ts as well as CD25 bispecifics that are being evaluated in the frontline setting, right? Alpha-1 is a great example of that. ZUMA-23 or the SKYGLO trial. So when we think about those specific trials, if those regimens were to be approved in that frontline setting, how does that affect the market opportunity for ZYNLONTA in the second-line context?

Yes. So there's more and more going on in the frontline line setting. I would say many are R-CHOP or R-CHP regimens outside of CAR-T. So we can talk about that separately. So most things are adding on the standard of care. We know in the frontline setting that 60% to 70% of patients are cured. So the frontline treatments are quite effective and work quite well. The only approval we've had within the last 20 years in the frontline setting is the POLARIX study, which prepared to or chip to R-CHOP, right, and had a modest PFS improvement, not really overall survival improvement. And that was a big breakthrough. So I would say the bar is high in frontline because these therapies work extremely well. If you look at what's being studied though, in terms of the bispecifics or Monjuvi, other things, I think it's possible that they play a role. Most of those regimens are being extended in the high IPI population sort of where the POLARIX extending we've also studied, that's about 2/3 of patients. Polivy has already captured about 35% share in that frontline setting. So they already captured about half of the total addressable market of the IPI patients. I think the bispecific based therapies, we'll have to see what the outcome is, what's the efficacy look like, what's the safety profile. If it's positive and can get approved. There's certainly take some of that share. But I think it's unlikely that the majority of patients are going to get access to that, and that it's obviously breakthrough therapy like a breakthrough clinical profile. So the reality is the majority of patients are still going to need access to these therapies in the second-line. But we also like having the benefit of having LOTIS-5 and LOTIS-7, because, for example, if a patient was exposed to a bispecific upfront, they could get a LOTIS-5 regimen. If they weren't, then you could get a LOTIS-7 regimen. So we like having multiple regimens in that second-line post setting. When you look at CAR-Ts, most of the CAR-T studies are looking at only high -- the IPI definition is different. So whereas for the bispecific based therapies, it's IPI 3 to 5. This is only 4 to 5, which is about 20% of patients. And so the majority of patients, I would say, are unlikely to get a CAR-T in the frontline. We already see a second-line and third-line where you see more patients being treated in academic center than the frontline setting. Only 20 kind of patients in either of those settings gets access to a CAR-T. In this case, because they're being studied mostly in that higher IPI, the 4 and 5 patients, that's only about 20% of patients that could get access to our CAR-T. So we think, again, the majority of patients will not get access to our CAR-T frontline and it won't significantly change the patient population for the second-line plus opportunities that we're studying.

Okay. One of the competitive threats that I've taken a note of is Lyell's Ronde-cel. Now that targets both CD19 and CD20. And it's not really demonstrated any Grade 3 CRS in the trials that we've seen previously. And it's also been evaluated in the second-line setting. So I wanted to get your thoughts as to the uptake of an agent like that in the academic center and how it might erode like physician preference for that agent versus the combination of, let's say, glofitamab and ZYNLONTA in the second-line setting?

Yes. Look, I think Ronde-cel, as you said, it's a CAR-T that targets CD19 supports the rationale for combinations we're setting. Obviously, CD19 is CD20-based therapies, both of which we see in LOTIS-5 and LOTIS-7, I think those -- that combination makes a lot of sense. I think it sort of supports what we're doing with our combinations. I think the reality is when you look at the CAR T market, about 20% of patients in that second-line plus sending have access and are getting -- receiving a CAR-T. It hasn't changed in the last few years. It's been relatively stable. So while there's been share movement between products, there hasn't been actually a fundament of growth in the class. And so we think even that trial is positive, which most likely wouldn't happen before 2030, it's going to compete primarily with the CAR-T class and be limited to the academic centers. I don't think it's going to broadly impact the spaces that we're going after with LOTIS-7 and LOTIS-5.

Okay. Obviously, we've seen more Americans of these trispecific T-cell engagers. I wanted to get your thoughts as to, let's say, you were to see a CD19 trispecific or C19, C20, CD22 agent move into that second line setting as well. How would you view that competitive threat?

Yes. It's hard to speculate without real, I think, robust clinical data. there's a lot of theory that sounds good. I think at the end of the day, it's what efficacy are you offering? Are you getting to a high rate of CRs are they durable? And is it with a manageable safety profile in a fixed duration nonchemotherapy regimen. I mean I think that's essentially what physicians really want. And speculate on early-stage compounds. I think what we would -- what I would say is if I look at the competitive landscape today or what's emerging in the next few years, I think LOTIS-5 and LOTIS-7 are very well positioned in that kind of landscape.

Okay. Obviously, you noted earlier that top line data from LOTIS-5 trial, which is evaluating the combination ZYNLONTA plus Rituxan versus Rituxan Gevo the treatment of second-line plus transplant and eligible BSLs we expected by mid-2026. So given that upcoming data set, can you remind us of the safety running results that you presented at EHA last year? And how far expectations or investors regarding this upcoming release.

Sure. Yes. So LOTIS-5, as a reminder, is our Phase III confirmatory study of ZYNLONTA plus rituximab. It's -- the comparator arm is our GEMOX. So that's what we're going against. The initial safety results because we got approved as an accelerated pathway as a monotherapy. We had to do first a 20-patient safety Ronan before we started this randomized Phase III study. In those 20 patients, with this combination, we saw an overall response rate of 80% and a complete response rate of 50%. Also, we saw that the durability look really good. The median duration of CR was reached even after 2 years of follow-up for those patients. And we didn't see any new safety signals and the safety profile was overall well manageable. So we think that's a really good starting point. Of course, now we have a 420-patient randomized study that's ongoing, and that sudden it's going to read out in the second quarter this year. In that second quarter, we plan to be able to share, obviously, PFS, which is our primary endpoint of the trial, and that's what the study is powered for. But we also will share all secondary endpoints that are mature as well as key safety tables -- so I think investors will be able to get a good view of what this data is. So we're going to be as transparent as we can without compromising obviously, publication and medical congress that we expect by the end of this year.

So what do you need to have a positive study for instance, Rio, can you talk a little bit about the powering of this study with regard to PFS? And what would success look like in terms of meaningful clinical differentiation for you guys?

Yes. So the primary endpoint of the study, which was discussed and agreed to with the FDA is PFS. So in Lotus, the PFS is powered at 90% to show a hazard ratio of 0.67. So in other words, we need to show up hazard-ratio 0.67 or less to have a positive primary end point. If you look at R-GEMOX, which is the standard of care in the cycle setting is why the used comparator really across almost every Phase III study in relapsed/refractory DLBCL, including those 5. When you look at across the data from our GEMOX as a comparator arm across most of the recent studies, it's really anywhere from 2.3 to 5 months. When you look at the most recent study, it's typically between 3 and 4 months. So you look at the 2 most recent Phase III studies are in that 3- to 4-month range. So what this means is if Remo, for example, delivered a form of median PFS, ZYNLONTA plus rituximab would have to deliver 2mordifference to be positive with a hazard ratio of 0.67. In the context of our primary endpoint, that's positive. With no detrimental effect on overall survival and a positive benefit risk profile, we think we have a very good submission to the FDA. Ability, I think, is differentiating because Rob, like outside of CAR-T and chemotherapy, there's no full approvals in second line. Monjuvi has an accelerated approval, which could turn into a full approval to their frontline trial gets approved. But right now, there's very few full approvals in second line. So getting a full approval is in and itself differentiating.

Yes. Given the sort of benchmarks that you cited for R-GEMOX from a PFS perspective as well as what we've seen in that safety run in and all the previous assets, it seems like there's really high confidence behind this trial being successful. Would you take me to agree with that statement?

We're confident. I mean, I think we ran the study -- we're confident for really 2 reasons. I would say. One is the design of the study. If I think about other setbacks from competitors. One is you want to have a really good clinical trial design and conduct of the study. And I think we feel quite confident about that. This is a sufficient size with 420 randomized patients. It's powered at 90% with 1 to 1 randomization and so that gives us a lot of confidence. The other thing I'd take it as confidence is we know how [indiscernible] performed, which is typically, as I mentioned, that 3- to 4-month range. we saw in our safety run in a median PFS of 8.3 months. And so with a CR rate of 50%. And so I think that's what gives us confidence that even if you saw some erosion essential you're keeping rituximab the same in both arms, you're preparing our ADC, Talanta to GEMOX. And based on the data that's motion other studies as well as the data we saw in the safety run and that's what gives us confidence. I think the other thing is that there was an interim futility analysis that was conducted in the second quarter of 2024. We have an independent data monitoring committee that is looking -- we are all blinded -- completely blinded to the data, but they're able to look at the data unwinded from an efficacy and safety standpoint. And even in the interim futility announcement, which was an efficacy look at the data there's a prespecified efficacy boundary that had to be met, that was passed and the IDMC to us to kick in. In addition, they've looked at the safety of this multiple times, including most recently, last fall, and again, told us to continue without any modifications as it is. So those are the data points we have, we're blinded to the study, but I think just based on the information that we know, those are the things that give us confidence.

Okay. Obviously, PFS is an event-driven endpoint. So is there any possibility of slippage for this data readout to go into like third quarter or potentially longer.

No, we're confident that we're going to have a top line readout in the second quarter.

So assuming the top line data readout comes out positive, talk to me a little bit about the regulatory strategy that you tend to pursue with regard to the LOTUS 5 data set?

Yes. So assuming a positive study happens in Q2, it typically takes about 4 to 5 months to file the BLA followed by what we expect to be a 10-month review period. That gets you to an expected approval sometime in the middle of 2027.

Let's say, were to be approved for the LOTIS-5 trial. What sort of incremental market opportunity would you expect to see from the LOTIS-5 trial dataset alone, excluding LOTIS-7?

Yes. I think when you look at it today, we basically are playing in the third line plus market. So there's about 6,000 patients in the third month market. We have about a 10% share and with an average of 3 cycles that translates to $70 million to $75 million. That's basically where our sales have been. If you look at the second line -- if you add the second line opportunity and the third line opportunity, cycline adds an additional 12,000 patients. So if we're able to just maintain that same 10% train the third line in the second-line setting with the expected increased number of doses. So in the safety on we saw patients were getting 5 cycles versus monotherapy 3 cycles. So with the extra patients keeping the same share but with a longer duration of therapy, that would get you to $300 million just with the same share. So conservatively, I think we've guided to -- even if you only get 5% to 10% share in second line, and maintain the same temperature in the line with a longer duration to get to $200 million to $300 million. We think that's very doable.

Design to [indiscernible] listings from, let's say, LOTIS-7?

No, no, that would be all incremental on top of that. The low to 7 and in lymphoma opportunity is on top of that. We think the total opportunity with approvals and perpetuals things for ZYNLONTA could be anywhere between $600 million to $1 billion in peak sales. So LOTIS-5 is only a portion of that total opportunity that we believe we could have.

Okay. Talk to me a little bit more about the trial design here as well. Because obviously, we know that gross silver can affect various survival endpoints. Is there a crossover in this trial?

There's no crossover.

Okay. Perfect. Why don't we shift gears now to the combination with glofitamab and that's being evaluated in react/refractory NHL in the low-7 trial. You recently presented updated data at ASH 2026. So can you give us a high-level overview of those results?

Yes. So I mean LOTIS-7, we're looking -- it's a Phase Ib trial, and we're combining ZYNLONTA with highly effective bispecific glofitamab in second line plus DLBCL patients. We know that outside of CAR-T, the only products that have ever been approved as single agents in any line of therapy in DXL the 2 bispecific products, acretivam and glofitamab and ZYNLONTA. So we're combining 2 of the only products that are ever been approved to single agents together. So these are 2 of the most potent molecules and we're very pleased so far with the initial results. We have in the first 49 efficacy evaluable patients, which all had a minimum of 6 months of follow-up, we were to demonstrate a 90% overall response rate and a 78% complete response rate across those 49 patients. So -- and then -- so that means 38 of the patients achieved a CR. Of those 3 of those 38 remain a CR of the data cutoff. We had all patients with at least 6 months of follow-up. We have patients going out to almost 2 years. And in that population, we also had about 8 patients. We had 8 patients that were previously treated with CAR-T. 6 of those patients achieved a CR. So we really believe that this combination can provide clinically meaningful benefit for patients data showed that the combination, in addition to having very strong efficacy, continue to be generally well tolerated with a manageable safety profile and the safe side effects that we're seeing were known side effects with either 1 of the agents. We didn't see any new side effects. And so taken together, we think together with LOTIS-5 we think that also having LOTIS-7, we really can provide multiple options to physicians depending on what's accessible and suitable for patients in that second-line plus setting and that these 2 approaches are very complementary for us to play a meaningful role in that second-line plus WCL setting.

Yes. Given the data that we've seen with the CD25 specifics in us large piece of lymphoma, what sort of CR delta relative to those historical controls would you want to see in order to pursue these regulatory or compendia pathways?

Yes. So if you look at there's 3 different biospecific accommodations that are preferred right now in NCCN guidelines, and they all have set rates anywhere between 51% and 61%. And what physicians have told us that if you're in the 6 already differentiate yourself on the pack, right? If you get to 7% or above from a CR standpoint, it can be transformative. But that's obviously our goal is to be transformative both in terms of the depth of response, but we also want to make sure the durability of those responses is very meaningful tangible safety profile. So that's the, I would say, the scenario we're going for. But I think we -- given that we showed a 78% complete response rate in 49 patients, I think we feel quite confident with where we can land with the 100-patient result that we expect to share by the end of this year.

Yes. I know that there was a paper that was published last year by Hutchinson colleagues in the JCO and presented results for glofitamab plus poison the second line plus DLBCL setting and in that paper, we saw a 78.3% objective response rate, 59.7% CR rate with an MPFS and MOS of 1.3 and 33.8 months, respectively. Now when I compare that data set to what we saw at ASH. Obviously, your DAS set looks better from an efficacy statement of a cross-trial comparison basis. But we do note that there were more third line plus patients in that trial than in LOTIS-7. So I'm curious to get your thoughts as to how you see the combination of vofinamab plus polatuzumab stacking up against Elantascofinumab on whether there's an opportunity here to particularly move into the frontline setting as well.

Yes. So actually, first of all, we're well balanced. If you look at the data cost of [indiscernible] patients between second-line patients and third-line prostates are very well balanced, like most other studies, I would say we have -- it's almost 50-50 between patients who had 1 prior line of therapy versus 2 or more. So it's pretty balanced between the second line and the third line cost settings. I think what's unique about obviously, glofitamab is 1 of the 2 most potent bispecific products, right? It's a very, very good product. Combining with Polivy though, is a product that doesn't have a strong single-agent activity, which never approved as a single agent drug as opposed to ZYNLONTA, which has very strong single-agent activity. So we think it's a more active drug, and that's why this combination is so powerful. The other thing I think to note is that Polo is playing a very important role in the frontline setting. It's -- the POLARIX data led to a 35% share in that frontline setting. So a lot of patients are getting exposed to poll to be upfront. I think most of the business don't want to retreat for patients that progress on the therapy in the next line of therapy. So again, I think the fact that we have very equipment single-agent activity, the data so far looks best-in-class from a biospecific combination standpoint. And we're not being used in that frontline setting. I think those are all advantages. In terms of could we move to the front line, there's a lot of physicians that are excited about it because they ask if you can get to CR rate in the second line cross setting where you have heavily pretreated patients. We have high-risk groups. We have high-grade B-cell lymphoma. We have high IPI patients, post CAR-T patients. We have a lot of high-risk groups, a lot of time are refractory. We looked at our data, a lot of primary refractory patients in our study and yet we still have a strong aggregacy, what could it be in frontline, could you get to significantly more. So that's something we'll consider in the future. I think right now, what we're focused on is how do we make sure that we can deliver on these studies and really create a very meaningful commercial opportunity in that second-line plus setting.

Yes. One of the things that I'm calling logs I remember a data set that you guys presented, where it showed that the efficacy in ZYNLONTA host CD19 CAR-T isn't really affected by the prior CD19 CAR-T usage. So do you really expect any sort of erosion in market opportunity if the senior 1 CAR-Ts go into the frontline setting? Yes. Obviously, the ipi score, the IPI classifications , it's much more stringent for the cars, but just based on that data set alone, it doesn't seem like you would have much erosion just from CD19 CAR T going to the front line.

I think it could be an opportunity because we get a lot of our use special again centers, post CAR-T or post-CAR-T that correct? We get a lot of our use today in that setting. And so if CAR T sort of move up front, again, they're playing in that IPI4 and 5 population, which is about 30% of the population that could be eligible for CAR-T. So even if all 20% were to get a CAR T, those same patients, remember the chair that CAR-T has in second line and third line plus is also only 20%. So if a lot of patients get treated in frontline, I think that will reduce the number of patients that get it in the second line of potline app, it's actually an opportunity for us. And we know that the product today is being used pretty extensively in that post-profit biospecific setting.

Yes. One of the questions that I get a lot is how do you see the utilization of LOTIS-7 versus LOTIS-5 in that second-line setting? Like if physicians didn't have -- if they got just like the POLARIX trial regimen, how -- which reset do you think a physician would sort of reach to LOTIS-5 or LOTIS-7?

I think it all depends on what's accessible and what's suitable for the patient. Obviously, the LOTIS-7 regimen is likely to be much more powerful, potent, right? I mean efficacy, we haven't seen efficacy like this from any of these combination regimens. So it's definitely a more potent combination. But not everyone has access to or suitable bispecific based therapy. So if you look today in the second-line setting, about 10% of patients get a bispecific based product. In the third-line setting, cost selling, it's about 35%. So I think it depends how this market shapes up between complex therapies and broadly accessible therapies. Right now, the split between those 2 settings in the second line is 35% complex therapies like CAR Ts and bispecifics, 65% broadly accessible. In the third line setting, it's actually 60% complex every versus 40% broadly accessible. I think what we like is that between LOTIS-5 and LOTIS-7, we're playing in both of those segments and depending on what the physicians have access to and depending on what's suitable based on also the comorbidities and patient characteristics. What's the most suitable therapy, we can play in both of those segments. Every 10 share points in that second-line plus setting with our product is worth about $300 million. So if we get to 10% sure, that will be 30 we're going to get to 20% share between the 2 therapies, that $600 million. So depending on the share we can get across both therapies, you can see how this can be a significant opportunity for us between LOTIS-5 and LOTIS-7.

Yes. Obviously, when we think about that frontline setting again, Allogene's approach is differentiated relative to ZUMA-23 and some of the other CAR T trials in the frontline setting. Is there any specific impact from the way that Allogene is conducting their trial? And like is there any direct read through as to the opportunity for you guys in that second setting?

Look, I'd say -- so far, what we've seen is that when new CAR T products come out, they tend to cannibalize each other. We've seen a lot of share movement between products, but the class hasn't really grown. For the last several years, really, it's been kind of stuck at that roughly 20% penetration. The more outpatient they get, the more accessible they could be in the community. I think you're still competing with then bispecific based combinations, which are how deep are the response is, how durable. That's always been the question on some of the allogeneic CAR-T around durability I think it's dependent on the clinical profile. I think we feel very good on the data that we've shared so far with LOTIS-7 on both the depth of response and the durability of response and the potential even for this to go outpatient, if you remember like the CRS, or GLOFIT on its own, if you look at the label has about a 70% all-grade CRS. Most of that was Grade 1 and 2, but there was even some grade 3 4. And those 49 patients that we showed we significantly are able to reduce the CRS. In fact, at the 150 dose of ZYNLONTA, which is our approved dose, that's the dose we're expanding and moving forward with, we were able to reduce the CRS to 25% all grade. So that could be a substantial improvement versus other bispecific based therapies. So we think we have a chance to differentiate on doubt the response, durability of response and safety profile. And so where the CAR-Ts are going to have to compete against to, suppose the allogenic CAR-Ts.

Yes. I completely agree with you there with regard to differentiation, both from an equity perspective, but also a CRS perspective with these ZYNLONTA combinations. Just a high level, I want to get your thoughts on in vivo CAR T and whether you see any potential impact on you guys from that next wave of CAR-T ingenuity?

Yes, I don't want to expect. I think it's all going to depend on the clinical efficacy. And what I said is so far outside of the autologous CAR-Ts, we haven't seen -- we've definitely seen more convenience. I think it's all going to come down to the durability. And it's too soon to tell, I'd say, because I think what's so good about the autologous part is that for 30% of patients they're still in a CR 5 years later, essentially, they call it punctually care, right? And I think that's going to always be the question about any of these newer PRT platforms is can you get to that same level of durability and long-term response that you see with [indiscernible]. I think it's still just an open question right now.

Okay. Why don't we shift gears a little bit to MCL and follicular lymphoma. Obviously, we've seen some data from these investigator-initiated files provide an overview of those data sets is how are you thinking about pursuing or whether you're pursuing potential registrational trials in either of those indications?

Yes. So we have really promising Phase II data from both 2 different multicenter IITs. One is Enanta in combination with rituximab in a relapsed or refractory follicular lymphoma. We also have another study with ZYNLONTA as a monotherapy to treat relapsed/refractory marginal zone lymphoma. The data was presented at medical congresses for both of these last year. We're encouraged that, for example, in follicular lymphoma, there was data presented from 55 advocacy valuable patients, and these are in high-risk relapsed/refractory FL patients. The overall response rate is 98% with a complete response rate of 84%. When you look at it versus competitive benchmarks, it's really outstanding data. Similarly the data presented on the first 26 advocacy evaluable patients last year at ICML, showed an overall such rate of 85% and a CR rate of 69%. Both of these also combinations combination of Poland the monotherapy and MCL had a very manageable safety profile. So we think these can be highly differentiating. But the pathway right now is a 100-patient study with molecular 50 patients studied with marginal zone. We expect that both of these studies to read out and be presented at Medical Congress as sometime between the end of this year and the middle of next year, we think that can form the basis for a companion inclusion after the publication. In addition to the competition strategy that we are evaluating regulatory strategies, in particular, for MCL, where -- when you look at the data sets that led to the approval, for example, R-squared or BTK inhibitors, it's on the basis of 70 patients or less, typically 60 to 70 patients. And so we already have a 50-patient study ongoing. We will discussed with the FDA about potential pathways for accelerated approval or what the regulatory pathway could be for the into [indiscernible].

Yes. Obviously, you mentioned both potentially pursuing regulatory pathways with the FDA as well as compendia listings. Could you sort of help frame what the incremental benefit would be, not just from Compendia but also from FDA approval. Like can you say you get a company listing for MZL or for the low 7 regroom right? Maybe you'd see 5% uptake. What sort of incremental uptick would you see with an FDA approval?

Yes. So I mean, obviously, if it's only in compendia not yet approved, that's an off-label indication. And although it would be reimbursed, we will not promote off-label. So your ability to educate on the regimen, if it's not approved, you're not going to promote the product. And so the uptake generally is less with Compendia than it would be with the full approval, we could promote, particularly in the community set. Academic physicians tend to be very aware of it tend to be very knowledgeable. And it's up to them to decide what they think is best for their patients to treat. Of course, as I said, we're not going to promote it. But it's up to them. Where is the community they tend to be less aware. And so although companion strategies can provide a point of access for business to use a product if it's in the patient's best benefit because of no promotion, they tend to be used less. So I don't want to give you an order of magnitude. But when you look to say an MDL, for example, there's 2 main regimens that are approved, 2 main regimens that are compendia. The 2 main regimens that are approved have the majority of the market. So it definitely helps to get approval. But data matters as well. So when you look at the square and the BTK inhibitors, the CR rates are typically around 30% or less. And what we've seen, again, with our study is 69% CR rate. So I think the clinical profile matters as well, and we feel good about the data we're generating right now and plan to continue to finish out these monies to get into competitive but also then we'll discuss with the other regulatory bots about potential approval pathways as well.

Okay. Last month, you announced an amended health care royalty financing agreement. Could you sort of discuss the name what that provides to the company.

Yes. So we have a relative agreement with Healthcare Royalty where initially, they gave the invested $300 million into the company in exchange for a royalty strip. That royalty right now is at 7%, but could go up to, depending on where the revenue is up to 10%. So that's what the essence the basic agreement is. Also in that agreement, there was a change of control provision that would be $750 million, should there be a strategic transaction. And so what we negotiated is to reduce that change in control payments from $750 million to $150 million, if something were to have between now and the end of 2027, thereafter, it would be $200 million. And then in the event of a change in control in exchange for that, health care at will continue to receive the same royalties that they were up to this point, that 7% to 10% until the original royalty cap is reached. And of course, that $150 to $200 million are change in control would also contribute to the royalty rumors. So they don't get more money in total, but that will happen. And in addition, we granted HCR warrants to purchase approximately $9.8 million of common shares with an exercise price of $3.81. So these are exercisable through the end of 2030, but there are subject to a lockup through the end of 2027. So that's the basic provision of this I think for us, it just provides the company more strategic flexibility. And I think it shows the great partnership we have with ACR and also the confidence that they have in ZYNLONTA long term to be able to restructure this deal like this.

Last question for me. It's actually a 2-part question. In the past, we've seen some preclinical data for some of your earlier stage assets, I know you don't really talk about that much anymore. But how are you thinking about potential BD opportunities moving forward? And then the second part of the question is, what's your current cash position and what sort of runway does it provide?

Yes. So I think in terms of BD right now, we're really focused on executing these ZYNLONTA trials and really helping to translate that into a significant opportunity for ZYNLONTA starting with growth in 2027. That's the core focus of the company. But as a company eventually transitions to a profitable P&L with our current indications that can allow us to continue to invest, to some combination of either more life cycle management for ZYNLONTA, but also potentially complementary hematology assets. And those are the things that we'll explore as we get into a positive cash position as a company. Again, right now, we're focused on executing and delivering on what we have. And then in terms of our cash position, we have a very strong cash position. We raised last year about $160 million. So we ended the year with a cash balance of $261 million. That will give us an expected cash runway to at least into 2028. And so together with all the milestones that we have this year, where we have LOTIS-5 and LOTIS-7 data coming this year, the inland data coming in between the end of this year and middle of next year. And the ability, we think, to compendia through regulatory approvals for this asset to get to $600 million to $1 billion, we think we're really well financed to be able to do that. And as the data gets unlocked this year, and we think it will significantly de-risk the growth opportunity that we see starting next year.

Awesome. So is there anything we haven't touched on today, they sort of want to highlight for investors?

No, I would just say, look, this is an exciting year. This is really, as I mentioned, a year where the -- the data gets unlocked and it's going to open up an opportunity to start the growth of ZYNLONTA and then that growth can be further accelerated through additional life cycle management or to potentially complementary new assets. And we think this is a key year. Last year it was key for us to execute finance the company well, and we think this is a key unlocking year across from a data standpoint.

Well, so we look forward to all the data that's going to be presented later this year. Ameet, thank you so much for joining us today.

Thank you, Rob. I really appreciate it.