Q2 2022 ADC Therapeutics SA Earnings Call

Operator: Welcome to the ADC Therapeutics second quarter 2022 financial results conference call.

Welcome to the ADC Therapeutics second quarter 2022 financial results Conference call. My name is Gigi and I'll be your operator for today's call. At this time all participants are in a listen only mode. Later, we will conduct a question answer session during the call.

Operator: My name is Gigi, and I'll be your operator for today's call.

Jennifer Heron: So, you know, as we started off our launch, by design and strategy, we developed our national and regional thought leaders, and many times they reside in the academic centers.

And the answer session. If you have a question. Please press Star then one on your Touchtone phone I will now turn the call over to Amanda Hamilton Investor Relations manager Amanda you may begin.

Operator: At this time, all participants are, in a listen-only mode.

Jennifer Heron: And so in the academic centers, we've seen utilization of Zalanta across the entire spectrum of the indication.

Operator: Later, we will conduct a question and answer session.

Jennifer Heron: I think the prioritized business, opportunities, as we see it in this fairly dynamic marketplace, are in the post-partee setting.

Operator: During the question and answer session, if you have a question, please press star, then 11 on your touchtone phone.

Thank you operator. This morning, we issued a press release announcing our second quarter 2022 financial results.

Business update.

The release is available on the ADC <unk> web site at IR Dot ADC Therapeutics Dot com under the press releases section.

Operator: I will now turn the call over to Amanda Hamilton,

On today's call, Amit Malik Chief Executive Officer, Jennifer Herron, Chief Commercial Officer, Joe <unk>, Chief Medical Officer, and Jen Creel, Chief Financial Officer will discuss recent business highlights and review our second quarter 2022 financial results before opening the call for questions.

As a reminder, this conference call may contain forward looking statements such statements are subject to risks and uncertainties for additional information concerning forward looking statements and factors that could cause actual results to differ materially from those expressed or implied in these statements. We refer you to the section titled cautionary statement regarding forward looking.

Statements in exhibit 99.2 of our report on form 6K filed with the U S Securities and Exchange Commission earlier today.

Such statements speak only as of the date of this conference call and we expressly disclaim any obligation or undertaking to update these forward looking statements.

Thats required to do so by applicable law today.

Today's presentation also includes non <unk> financial measures. These non <unk> measures have limitations as financial measures and should be considered in addition to and not in isolation or as a substitute for the information prepared in accordance with IRS you.

You should refer to the information contained in the company's second quarter earnings release for definitional information and reconciliations.

Historical non <unk> measures to the comparable <unk> financial measures.

It is now my pleasure to pass the call over to Amit Alec Amit.

Operator: Investor Relations Manager.

Jennifer Heron: And we've heard very strong support from our thought leaders in the post-partee setting.

Thanks, Amanda and thank you for joining us today before we get into the details of the quarter now that I've been in the role of CEO for three months I would like to take this opportunity to share my observations and thoughts on the company and its business plan looking forward.

Operator: Amanda, you may begin.

Jennifer Heron: And then for those patients that are unsuitable for partee, there are a variety of reasons why, a patient would not be eligible or not choose to pursue partee treatment.

I've spent the last three months on a listening tour speaking with physicians and investors and meeting with employees across all sites and levels.

<unk> templates to take a deep dive into all aspects of the business and determine how to best capitalize on our unique science had tremendous talent to maximize the impact we deliver for our stakeholders.

Amanda Hamilton: Thank you, operator.

Jennifer Heron: And with our differentiated product profile, we believe that physicians and patients have a lot to benefit from both the efficacy, including a rapid time to response, the manageable side effect profile, and the very convenient administration.

First and foremost and one of the main reasons why I joined the company as that ADC you'd have emerged as a promising and exciting classic therapies that have the potential to benefit a broad set of patients for years to come.

Amanda Hamilton: This morning, we issued a press release announcing our second quarter 2022, financial results and business updates. This release is available on the ADCT website at ir.adctherapeutics.com under the press releases section.

ADC therapeutics as both a pioneer and leader in the field of Adcs.

Amanda Hamilton: On today's call,

Amanda Hamilton: Amit Malik, Chief Executive Officer, Jennifer Heron, Chief Commercial Officer, Jill Camardo, Chief Medical Officer, and Jen Creel, Chief Financial Officer will discuss recent, business highlights and review our second quarter 2022 financial results before opening the call for questions.

We are fully integrated company with a strong value chain that we built from the ground up starting with our innovative ADC platform and the expertise and capabilities extending from research and clinical development to CMC and commercial.

Amanda Hamilton: As a reminder, this conference call may contain forward-looking statements. Such statements are subject to risks and uncertainties.

Amanda Hamilton: For additional information, concerning forward-looking statements and factors that could cause actual results to differ materially from those expressed or implied in these statements, we refer you to the section titled Cautionary Statement Regarding Forward-Looking Statements in Exhibit 99.2 of our report on Form 6K filed with the U.S. Securities and Exchange Commission earlier today.

Amanda Hamilton: Such statements speak only as of the date of this conference call, and we expressly disclaim any obligation or undertaking to update these forward-looking statements unless required to do so by applicable law.

Amanda Hamilton: Today's presentation also includes non-IFRS financial measures. These non-IFRS measures have limitations as financial measures and should be considered, in addition to, and not in isolation or as a substitute for, the information prepared in accordance with IFRS.

Amanda Hamilton: You should refer to the information contained in the company's second quarter earnings release for definitional information and reconciliation of historical non-IFRS measures to the comparable IFRS financial measures.

Seamless integration of our agile and experienced team has been validated by the approval and launch of <unk> for third line <unk> as well as our advancing pipeline of promising hematology and solid tumor programs.

Amanda Hamilton: It is now my pleasure

So how do we plan to deliver to patients and maximize the potential of our platform and portfolio.

Amanda Hamilton: to pass the call over to Amit Malik.

Amit Malik: Amit?

We think about value creation, and three time horizons, the near mid and long term.

Amit Malik: Thanks, Amanda, and thank you for joining us today.

Starting with the near term horizon in the Hematology program.

We will continue to execute on our plan to maximize the potential of <unk> in the third line plus the <unk> market we.

Amit Malik: Before we get into the details of the quarter, now that I've been in the role of CEO for three months, I would like to take this opportunity to share my observations and thoughts on the company and its business plan looking forward. I've spent the last three months on a listening tour, speaking with physicians and investors and meeting with employees across all sites and levels.

Amit Malik: My intent was to take a deep dive into all aspects of the business and determine how to best capitalize on our unique science and tremendous talent to maximize the impact we deliver for our stakeholders.

Amit Malik: First and foremost, and one of the main reasons why I joined the company, is that ADCs have emerged as a promising and exciting class of therapies that have the potential to benefit a broad set of patients for years to come. ADC therapeutics is both a pioneer and leader in the field of ADCs.

Amit Malik: We are a fully integrated company with a strong value chain that we built from the ground, up, starting with our innovative ADC platform and the expertise and capabilities extending from research and clinical development to CMC and commercial.

Amit Malik: The seamless integration of our agile and experienced team has been validated by the, approval and launch of Zenlanta for third-line DL-BCL, as well as our advancing pipeline of promising hematology and solid tumor programs.

We delivered $17 3 million in Q2, net sales representing 5% growth over Q1.

We have increased awareness and advocacy for us and lots of it and will continue to amplify our messaging.

Amit Malik: So, how do we plan to deliver to patients and maximize the potential of our platform, and portfolio?

We have fine tuned our approach to increase breadth and depth in both the academic setting and in the community within lots of differentiated product profile. We believe tremendous opportunity remains and we are confident in our ability to steadily capture this growth.

Amit Malik: We think about value creation in three time horizons, the near, mid, and long-term. Starting with the near-term horizon and the hematology program, we will continue to execute, on our plan to maximize the potential of Zenlanta in the third-line plus DL-BCL market.

We are also working to move into earlier lines and then combination therapies.

Amit Malik: We delivered $17.3 million in Q2 net sales, representing 5% growth over Q1.

In Q2, we continued to enroll our confirmatory phase III Lotus five trial in combination with Rituximab.

Amit Malik: We have increased awareness and advocacy for Zenlanta and will continue to amplify our, messaging. We have fine-tuned our approach to increase breadth and depth in both the academic setting, and in the community.

Amit Malik: With Zenlanta's differentiated product profile, we believe tremendous opportunity remains, and we are confident in our ability to steadily capture this growth. We are also working to move Zenlanta into earlier lines and in combination therapies.

We also initiated the Lotus seven trial and novel combinations and the load of nine trial and frail and unfit first line patients.

Amit Malik: In Q2, we continue to enroll our confirmatory phase 3 LOTUS-5 trial in combination with, rituximab.

The combination of the Atlanta, and Rituximab offers a sizable expansion opportunity.

Amit Malik: We also initiated the LOTUS-7 trial in novel combinations and the LOTUS-9 trial in frail, and unfit first-line patients.

The Lotus five trial, a double of the current addressable patient population for the Martha and Lotus <unk> serves an additional population with clear unmet medical need in the frontline setting.

Amit Malik: The combination of Zenlanta and rituximab offers a sizable expansion opportunity.

Beyond the U S. We now have three strong strategic partners to expand the reach of <unk> globally.

Amit Malik: The LOTUS-5 trial doubles the current addressable patient population for Zenlanta, and LOTUS-9, serves an additional population with a clear unmet medical need in the front-line setting.

Amit Malik: Beyond the U.S., we now have three strong strategic partners to expand the reach of, Zenlanta globally.

Amit Malik: In Asia, we have our collaborations with Overland ADCT in greater China and Mitsubishi Tanabe, in Japan.

In Asia, we have our collaborations with Oberland ADC in greater China.

And Mitsubishi Tanabe in Japan, We also recently signed an agreement with <unk>, an experienced and committed partner for the development and commercialization of <unk> in Europe , and all other open territories worldwide.

Amit Malik: We also recently signed an agreement with Sobe, an experienced and committed partner, for the development and commercialization of Zenlanta in Europe and all other open territories worldwide, which will allow us to focus even more on executing commercially in the U.S, while making Zenlanta more widely available to patients in need.

This will allow us to focus even more on executing commercially in the U S, while making to not to more widely available to patients in need.

Amit Malik: Our second HIEM program, CAMI for Hodgkin's lymphoma, is based on the same validated PBD-based, ADC platform. We released top-line data from the Phase II pivotal trial in Hodgkin's lymphoma in an, oral presentation at IHA in June.

Our secondhand program can be for Hodgkin's lymphoma is based on the same validated <unk> based ADC platform.

We released top line data from the phase III pivotal trial in Hodgkin's lymphoma.

In an oral presentation at <unk> in June .

Amit Malik: Our pre-BLA meeting with the FDA has been scheduled for September, and based on the, results of that meeting, we plan to complete our regulatory submission in the second half of next year, given the time we need for manufacturing stability data to mature.

Our pre BLA meeting with the FDA has been scheduled for September and based on the results of that meeting we plan to complete our regulatory submission in the second half of next year, given the time, we need for manufacturing stability data to mature.

Amit Malik: Moving to the midterm horizon, where we are leveraging our expertise in ADC development, to advance our solid tumor pipeline, we have five programs, three in the clinic and two heading towards IND filing. These include a mix of clinically validated and novel targets, all of which are supported, by strong scientific rationale and promising preclinical data.

Moving to the midterm horizon, where we are leveraging our expertise in ADC development to advance our solid tumor pipeline. We have five programs three in the clinic in two heading towards IND filings. These include a mix of clinically validated and novel targets all of which are supported by strong scientific rationale and promising preclinical data.

Amit Malik: The long-term horizon provides the opportunity to build upon our proprietary technology toolbox, in new and different directions. We are working on next-generation assets incorporating new antibody constructs and payloads, as well, as broader partnering approaches to expand the toolbox and realize the full value of our ADC platform.

Yes.

The long term horizon provides the opportunity to build upon our proprietary technology toolbox in new and different directions. We.

We are working on next generation assets, incorporating new antibiotic construction payload as well as broader partnering approaches to expand the toolbox and realize the full value of our ADC platform.

Amit Malik: With the signing of the SOBE agreement, we are pleased to now have a cash runway extending, into early 2025. This will allow us the time to execute on our strategy and deliver on our objectives.

With the signing of the <unk> agreement. We are pleased to now have a cash runway extending into early 2025.

This will allow us the time to execute on our strategy and deliver on our objectives.

Amit Malik: We will take a disciplined approach to capital allocation based on science, unmet medical, need, and commercial opportunity. We aim to identify and accelerate promising programs and terminate those that are not, supported by strong data, which will ultimately accelerate the growth of the company and value creation for all stakeholders.

We will take a disciplined approach to capital allocation based on science unmet medical need and commercial opportunity.

The aim to identify and accelerate promising program.

And terminate those that are not supported by strong data, which will ultimately accelerate the growth of the company and value creation for all stakeholders.

Amit Malik: Finally, after having the privilege to visit and meet employees at all of our sites, I'm, struck by the capabilities of our team. I'm impressed by the talent, common purpose, and drive to help cancer patients, and we, are energized about the many opportunities ahead.

Jennifer Heron: And on that topic, we talked about CAR-T as moving to early lines of therapy, and obviously that's well known, and that's helping those patients.

Finally, after having the privilege to visit and meet employees at all of our sites I am struck by the capabilities of our team I am impressed by the talent common purpose and drive to help cancer patients and we are energized about the many opportunities ahead.

Amit Malik: We look forward to keeping you updated on our progress.

We look forward to keeping you updated on our progress.

Amit Malik: I would now like to turn the call over to Jennifer to report on the Zinlata launch.

I would now like to turn the call over to Jennifer to report on this in lots of launch.

Jennifer Heron: Jennifer?

Jennifer Heron: Thank you, Amit, and good morning, everyone.

Jennifer Heron: But there are several competing drugs in second and third line DLVCL outside of CAR-T. Can you comment how that competitive landscape is shaping up, and where do you see Zalanta, fitting in there more specifically?

Jennifer.

Jennifer Heron: Yeah, you know, Boris, I don't think that our positioning, our outlook for the positioning at Zalanta has changed versus our launch positioning.

Thank you Amit and good morning, everyone.

Jennifer Heron: I am pleased to share an update on the Zinlata launch in Q2. Zinlata Q2 net sales were $17.3 million, representing 5% growth versus Q1. We saw steady month-over-month growth in demand as we progressed through the quarter. Just a little over a year into the launch, we have made solid progress in a challenging, environment.

I am pleased to share an update on the <unk> launch in Q2.

And lastly, Q2, net sales were $17 $3 million, representing 5% growth versus Q1.

We saw steady month over month growth in demand as we progressed through the quarter.

Just a little over a year into the launch we have made solid progress in a challenging environment. However, there are many more opportunities for growth in the third line plus <unk> market.

Jennifer Heron: However, there are many more opportunities for growth in the third-line plus DLBPL market.

Jennifer Heron: We have a focused plan in place to capture that opportunity, and we remain confident, that with Zinlata's differentiated product profile, we will drive steady growth in the coming quarters.

We have a focused plan in place to capture that opportunity and we remain confident that with the launch of differentiated product profile, we will drive steady growth in the coming quarters.

Jennifer Heron: Since the launch, we have focused the majority of our efforts on the academic centers. We have built advocacy with team specialists and thought leaders at these institutions, for our influencers across the entire market.

Since the launch we have focused the majority of our efforts on the academic performance.

The advocacy with him ask specialists and thought leaders at these institutions, who are influencers across the entire market.

Jennifer Heron: Although there are more DLBPL patients in the community setting on average, academic-based, clinicians see two to three times the number of third-line plus DLBPL patients as compared to their respective community counterparts.

Although there are more <unk> patients in the community setting on average academic based clinician two to three times. The number of third line plus <unk> bcl patients as compared to their respective community counterpart.

Jennifer Heron: We have made good progress engaging and educating key lymphoma doctors across the country with, approximately 60% of our volume coming from academic accounts.

We have made good progress engaging and educating key lymphoma doctors across the country with approximately 60% of our volume coming from academic accounts.

Jennifer Heron: With this solid foundation in place, we see good opportunity for growth as we continue, to convert awareness to advocacy and building increased breadth and depth in academic accounts.

With this solid foundation in place, we see good opportunity for growth as we continue to convert awareness advocacy and building increased rep on debt while academic is now.

Jennifer Heron: While it made strategic sense to focus on academic centers during the initial launch, period, the broader opportunity is in the community setting where the majority of the third-line plus DLBPL patient population is treated. With the permanent J-code now in place, we are intensifying our efforts to increase awareness, and adoption in these centers.

While it made strategic sense to focus on academic centers. During the initial launch period the broader opportunity is in the community setting where the majority of the third line plus <unk> patient population is treated.

With the permanent J code now in place we are intensifying our efforts to increase awareness and adoption in these centers we.

Jennifer Heron: We are confident that the versatility of Zunlanza's differentiated product profile will resonate, well with physicians and patients in the community. Factors such as significant single-agent efficacy, rapid time to response, manageable side effect, profile, and importantly, our practice and patient-friendly administration schedule.

We are confident that the versatility of <unk> differentiated product profile will resonate well with physicians and patients in the community factors such as significant single agent efficacy rapid time to response.

Manageable side effect profile, and importantly, our practice and patient friendly administration schedule.

Jennifer Heron: For the second half of this year, we have a focused plan to capture the significant, opportunities that remain in the market.

For the second half of this year, we have a focused plan to capture the significant opportunities that remain in the market.

Jennifer Heron: We plan to drive Zalanta awareness, experience, and advocacy, and we have identified three, areas for execution. First, on the healthcare provider level, we are optimizing the execution of all of our, customer-facing teams, as in-person opportunities are increasing, including at local and regional congresses.

Jennifer Heron: So, you know, it really comes down to the differentiated product profile of Zalanta, the robustness of the LOTUS-2 trial, and the fact that in the real world setting, physicians are seeing a LOTUS-2 type of experience with a rapid time to response and have those patients getting into a response.

Plan to drive the Atlanta awareness experienced and advocacy and we have identified three areas for execution.

Jennifer Heron: You know, recall, these are heavily pre-treated patients, and so I think that, you know, Zalanta continues to compete well from a product profile standpoint, where we're putting a little bit more effort is really optimizing the execution of all of our customer facing teams because we have that unique opportunity with access really opening up.

First on the health care provider level, we are optimizing the execution of all of our customer facing team as in person opportunities are increasing including at local and regional Congresses.

Jennifer Heron: This will help us capture a broader and deeper market share in both academic centers and, the community setting.

Jennifer Heron: And so, as Amit mentioned, we have still a bit of opportunity ahead of us, both in the, academic centers and in the community, and that's where we're putting our focus.

This will help us capture a broader and deeper market share in both academic centers and the community setting.

Boris Beaker: Thank you very much for taking my question.

Jennifer Heron: We are encouraged with the increasing access to healthcare providers that we have seen, expand through Q2, with approximately 75% of our total interactions being face-to-face as we exited the quarter.

Operator: Thank you.

We are encouraged with the increasing access to health care providers that we have.

Operator: Our next question comes from the line of Matthew Harrison from Morgan Stanley.

And expand through Q2 with approximately 75% of our total interactions being face to face as we exited the quarter.

Jennifer Heron: This is an important trend, as we know it often takes several visits for new products, such as Zalanta to be embedded into practice.

This is an important trend as we know it often takes several visits for new products, such as Atlanta will be embedded into practice.

Jennifer Heron: Next, we are partnering with key community oncology networks. We are broadening our educational efforts within the network to make sure physicians, understand the differentiated profile of Zalanta.

Next we are partnering with key community oncology networks, we are broadening our educational efforts within the network to make sure physicians understand the differentiated profile of the market.

Jennifer Heron: We also want to ensure the proper positioning of Zalanta in the DLBCL treatment paradigm, so that every patient who may benefit from Zalanta has that opportunity.

We also want to ensure the proper positioning of the launch and the <unk> treatment paradigm.

Every patient who may benefit funds and Martha has that opportunity.

Jennifer Heron: Finally, on the patient level, we recognize the active role patients and their caregivers, can play in discussing and choosing treatment options with their physicians.

Finally on the patient level, we recognize the active role patients and their caregivers can play and discussing and choosing treatment options with their position.

Jennifer Heron: We are intensifying regional and local marketing efforts to build grassroots product advocacy, at the patient level, as well as mobilizing the DLBCL community through a newly launched campaign to educate about our patient-friendly profile.

We are intensifying regional and local marketing efforts to build grassroots product advocacy at the patient level as well as mobilizing the D. L. Bcl community through our newly launched campaign to educate about our patient friendly profile.

Jennifer Heron: A little over a year into the launch, our cross-functionals in Zalanta team has established, a good foundation for us to build on.

A little over a year into the launch are cross functional and lots of team has established a good foundation for us to build on now we will work with <unk>.

Jennifer Heron: Now we will work to expand into unpacked areas.

<unk> into untapped areas.

Jennifer Heron: We have a focused plan in place to continue to grow Zalanta sales over the coming quarter, and remain confident we will establish Zalanta as a third-line standard of care, and over time we see Zalanta as a cornerstone of earlier lines of DLBCL treatment.

Have a focused plan in place to continue to grow as the loss of sales over the coming quarter and remain confident we will establish and losses as the third line standard of care and overtime, we seized in Lhasa as a cornerstone of earlier lines of <unk> treatment.

Jennifer Heron: Now I'll turn the call over to Joe to provide an update on our pipeline.

Chris Hughes: This is Chris Hughes speaking for Matthew.

Now I'll turn the call over to Joe to provide an update on our pipeline Joe.

Joe: Joe?

Chris Hughes: So we have two questions.

Joe: Thank you, Jennifer.

Thank you Jennifer.

Joe: I'm happy to provide an update on our clinical trials. During the quarter, we made good progress on our Zalanta development programs with a, focus to explore novel combinations and the potential to move into earlier lines of treatment. We initiated the LOTUS-7 trial, the Phase 1b clinical trial of Zalanta in combination, with other newer lymphoma drugs, starting with polifuzumab. This combination has shown enhanced activity in our preclinical study.

I'm happy to provide an update on our clinical trials during the quarter. We made good progress on our two months of development programs with a focus to explore a novel combinations and the potential to move into earlier lines of treatment.

Chris Hughes: The first question is regarding Zalanta.

Chris Hughes: Just wondering whether you are getting any patients in the community setting in Q2?

Jennifer Heron: Yes, we are getting patients in the community setting. You know, as I mentioned, the J-code, the permit J-code came through in the beginning, of April, and while that takes away a barrier to prescribing, I think we still have some work to do to really raise the level of awareness in the community that we've achieved in the academic centers. And so about 60 percent of our volume is coming from the academic centers, and so conversely, 40 percent of the volume is coming from the community.

Jennifer Heron: I think the real opportunity for us moving forward is not only the full execution of, the J-code, but also partnering with the community oncology networks.

Jennifer Heron: Yes, and I would just add to what Jennifer said that the adoption typically in a field, like this, later lines, the LBCL, you tend to have slower adoption in the community than the academic, partly because, you know, community doctors on average see just far fewer patients than Jennifer had mentioned, you know, during the earnings call.

Jennifer Heron: You know, and so you have slower adoption in general in all new therapies.

Jennifer Heron: I think as our profile gets more known, more understood by physicians, I think we have, a real opportunity for many of the reasons that Jennifer mentioned.

Jennifer Heron: The fact that we have a really strong efficacy profile, fast time to response, the fact that, it's a manageable safety side effect profile, the fact that it's single agent, the fact that, you know, the molecule also is very easy to administer, one 30-minute infusion every three weeks, so it's really easy to administer.

Jennifer Heron: So I think there's a lot of reasons why it's going to fit well, and as I think Jennifer, and her team have predicted, you'll get later adoption, and it takes longer to get the adoption in the community, but we believe we start to see that happening now in Q2.

Chris Hughes: That's very helpful.

We initiated the Lotus seven trial, the phase <unk> clinical trial of <unk> in combination with other newer lymphoma drugs starting with <unk>.

Chris Hughes: And my second question is regarding Vinlanta in follicular lymphoma.

This combination has shown enhanced activity in our preclinical studies other novel combinations will be added to the study and we will keep you updated as this occurs.

Joe: Other novel combinations will be added to the study, and we will keep you updated as, this occurs.

Joe: In July, we enrolled the first patient into LOTUS-9, the Phase 2 trial to evaluate Zalanta, in combination with rituximab in first-line DLBCL patients who are unfit or frail. I am particularly excited about this study, as it will investigate the potential of Zalanta, with rituximab to address a significant unmet need in front-line patients who are unable to tolerate the RTOP regimen, even at the reduced doses.

In July we enrolled the first patient until August nine.

<unk> two trial to evaluate <unk> in combination, which they took some ads in first line <unk> patients who are unfit or frail.

I am particularly excited about this study will investigate the potential is and lots of with Rituximab.

To address this significant unmet need in frontline patients who are unable to tolerate the R. Chop regiment, even at the reduced doses.

Joe: These patients are often excluded from clinical trials, and so they lag behind advances in, treatment open to younger and more fit.

These patients are often excluded from clinical trials and so they lag behind advances in treatment opened to younger and more patients. We've received positive feedback and high degree of interest from physicians on this initiative.

Joe: Patients.

Joe: We've received positive feedback and a high degree of interest from physicians on this, initiative, and we've activated several sites in the United States.

Debated several sites in the United States.

To execute on our targeted strategy, we have decided to terminate the loaded six trial. It's in line and relapsed refractory Follicular lymphoma due to the comparator I, Delaware should being removed from the U S market.

Joe: To execute on our targeted strategy, we have decided to terminate the LOTUS-6 trial of SIN-LONTA and relapse the refractory follicular lymphoma due to the comparator idelalysid being removed from the U.S. market.

Chris Hughes: You mentioned that the LOTUS-6 is terminated, and do you get any feedback from the FDA, and what's your path forward with Lonca in follicular lymphoma?

Chris Hughes: Yeah, so Joe, do you want to take that?

Joe: While we have discontinued the monotherapy program, we will continue to explore, opportunities for novel combinations with SIN-LONTA for follicular lymphoma.

Joe: Sure.

We have discontinued the monotherapy program, we will continue to explore opportunities for novel combinations with <unk> four silicula lymphoma.

Joe: Yes, thanks for the question.

Joe: We did not get specific information from FDA, but it was very clear from the recent advisory, boards and some of their public statements that FDA is much more interested in earlier treatments for follicular lymphoma, where the chance of a long-term remission remains an option, you know, a possibility.

Joe: Finally, we continue to enroll patients in the randomized part of LOTUS-5, the Phase III registration study of SIN-LONTA in combination with rituximab in second-line DLBCL patients who are not eligible for stem cell transplant. Expansion into the randomized part of the trial was supported by the safety run-in, which was completed in the first quarter, and we look forward to sharing these results at an upcoming major medical meeting.

Joe: You know, the late-line single agents sort of as a rescue don't look like the future, and FDA has actually said that.

Finally, we continue to enroll patients in the randomized part of Lotus five with Phase III registration study of <unk> in combination with Rituximab in second line <unk> patients who are not eligible for stem cell transplant expansion into the randomized part of the trial is supported by the safety running which was completed in the first quarter.

Joe: So we took that into consideration and changed the purpose of our program to look at some, combination data for earlier lines, and so it's going to take some time for us to get that data, but we're doing that, and that looks like a much more promising and, I would say, modern and future way of dealing with follicular lymphoma.

Chris Hughes: Thank you.

Joe: You're welcome.

Operator: Thank you.

Joe: To give you an update on our ex-U.S, activities and partnerships, we are on track to receive a regulatory decision from the EMA by the first quarter of 2023.

Operator: Our next question comes from the line of Tazine Omar from BOFA.

Look forward to sharing these results at an upcoming major medical meeting.

To give you an update on our ex U S activities and partnerships. We are on track to receive a regulatory decision from the EMA by the first quarter of 2023.

Tazine Omar: Thank you for taking my questions.

Joe: In partnership with Mitsubishi Tanabe, we are moving forward with a development plan for registration in Japan.

Tazine Omar: Just wanted to get your sense of what you think the data, catalysts will be over the next 12 months.

In partnership with Mitsubishi Tanabe, we are moving forward with the development plan for registration in Japan and.

Joe: In China, Overland ADCT Bioforma completed enrollment of their single-agent bridging study ahead of schedule, and the joint venture has also dosed the first patient in China in the LOTUS-5 confirmatory Phase III global clinical trial.

In China Overland ADC Biopharma completed enrollment of their single agent bridging study ahead of schedule and the joint venture has also dosed the first patient in China in the Lotus five confirmatory phase III global clinical trial.

Joe: We are focused on the successful execution of the SIN-LONTA trials, and we look forward, to keeping you updated on our progress.

Tazine Omar: With the upcoming oncology conferences in the second half of the year, should we expect any presentations from any of your ongoing programs?

We are focused on the successful execution of just getting lots of trials and we look forward to keeping you updated on our progress.

Tazine Omar: And then lastly, on the slope of the launch for ELANCA, if you had to ask doctors what they would need to feel comfortable prescribing it today, is it simply just a matter of awareness?

Joe: Turning now to CAMI in Hodgkin's lymphoma, the one-year follow-up data from the Phase II study was released at an oral presentation at the EHA Congress in June. This presentation showed an overall response rate of 70 percent, a complete response rate of 33 percent, and a duration of response of 13.7 months for all responders in patients with a median of six prior lines of treatment.

Tazine Omar: Or as you said, for community-based doctors, it's a limited patient pool.

Turning now to candy and Hodgkin's lymphoma, one year follow up data from the Phase II study was released at an oral presentation at the EHR Congress in June .

Amit Malik: I'm just trying, to understand how well doctors today, in your view, might appreciate the benefits of the Yes, so maybe I'll take the question on upcoming milestones, and I'm going to turn it over, to Jennifer to answer the question around ELANCA adoption.

Amit Malik: Yes, I did.

This presentation showed an overall response rate of 70% complete response rate of 33%.

And the duration of response of $13 seven months for all responses in patients with a median of six prior lines of treatment.

Joe: Our advisors have told us these data represent a significant benefit to the patients that were included in this study. Recall these patients had progressive disease despite the use of both frantuximab and, pembrolizumab, as well as other treatments, and over half progressed after stem cell transplant.

Our advisers have told US these data represent a significant benefit to the patients that were included in the study.

All of these patients had progressive disease. Despite the use of both <unk> and <unk> as well as other treatments and over half progressed after stem cell transplant.

Joe: We have a pre-BLA meeting scheduled with the FDA in September, and we will complete a regulatory, submission in the second half of 2023. The timing is driven by the availability and maturity of the manufacturing stability data.

Amit Malik: I just highlighted a few different milestones, let's say, over the next, let's call it 12 to 18 months.

We have a pre BLA meeting scheduled with the FDA in September and we will complete a regulatory submission in the second half of 2023.

Amit Malik: With ELANCA, from Lotus 5, we're going to be presenting the safety lead-in data from, the combination study with rituximab at an upcoming medical meeting.

Amit Malik: So we haven't announced which one, but it will be this year in the second half of the year.

<unk> is driven by the availability and maturity of the manufacturing stability data.

Joe: Before we move on from hematology, I would like to provide an update on ADCT-602. You may recall ADCT-602 is an antibody drug conjugate targeting CD22. This is being evaluated in a Phase I-II clinical trial in patients with relapsed or refractory acute lymphoblastic leukemia.

Amit Malik: We also expect to get a regulatory decision around our European approval from EMA by the Q1 of next year.

Before we move on from Hematology I would like to provide an update on ADC two six or two you.

You may recall ADC to 602 is an antibody drug conjugate targeting CD 22.

This is being evaluated in a phase one two clinical trial in patients with relapsed or refractory acute lymphoblastic leukemia.

Joe: We see early signs of activity and continue to work with MD Anderson to optimize the dosing schedule.

We see early signs of activity and continue to work with MD Anderson to optimize the dosing schedule, we will update you in the future.

Now moving on to our solid tumor portfolio first we have the ongoing <unk> phase <unk> safety and efficacy dose escalation trial in combination with <unk>.

Amit Malik: With CAMI, we have an upcoming meeting that we think is going to be really important, a pre-VLA meeting in September of this year, which will give us clarity on the path forward.

When we complete the escalation in the optimum dose has been determined the study will answer the dose expansion stage from a timing perspective, we expect to have data on the safety and tolerability of the combination as well as any signal of antitumor activity next year.

Amit Malik: And then, as we mentioned, given the timing for the stability data to mature, we plan to complete the submission of that in the second half of next year.

Joe: We will update you in the future.

Amit Malik: With CAMI and with CAG-1, we expect to have initial signs of safety and efficacy data for both, programs in 2023. We're not being more specific because we're still in the process of dose escalation, but we expect to have some initial results from both of those programs next year.

Joe: Now, moving on to our solid tumor portfolio.

Amit Malik: So those are, I'd say, the key milestones that I would highlight over the next 12 to, 18 months.

We are proceeding.

With the phase one trial of <unk>, one targeting <unk>.

Joe: First, we have the ongoing CAMI Phase I-B safety and efficacy dose escalation trial in combination with pembrolizumab. When we complete the escalation and the optimum dose has been determined, the study will enter a dose expansion stage. From a timing perspective, we expect to have data on the safety and tolerability of the combination, as well as any signal of antitumor activity next year.

We continue to dose escalate and expect to have an indication of the safety and tolerability as well as early signals of antitumor activity in 2023.

Joe: Director.

Moving on to ADC <unk> <unk> targeting actual first patient has now been enrolled and dosed in the phase <unk> trial.

Joe: We are proceeding with the Phase 1 trial of ADCT901 targeting CAG1. We continue, to dose escalate and expect to have an indication of the safety and tolerability, as well as early signals of anti-tumor activity in 2023.

The study includes a monotherapy arm in patients with actual gene amplification in the combination arm with gemcitabine in patients with sarcoma.

Joe: Moving on to ADCT601 targeting AXL, the first patient has now been enrolled and dosed in the Phase 1b trial. The study includes a monotherapy arm in patients with AXL gene amplification and a combination arm with gemcitabine in patients with sarcoma.

Joe: Finally, we are completing IND enabling work for two advanced preclinical solid tumor programs.

Finally, we are completing IND, enabling work for two advanced preclinical solid tumor programs.

Joe: ADCT701 targets a DLK1 in neuroendocrine malignancies.

<unk> 701 target to deal K, one in euro and the clinical agencies issues.

Joe: This is a project in collaboration with the National Cancer Institute.

Project in collaboration with the National Cancer Institute, ADC, <unk>, which are optimized second generation TBD based antibody drug conjugate targeting <unk> SMA, a validated target and metastatic prostate cancer.

Joe: ADCT212 is our optimized second generation PBD-based antibody drug conjugate targeting PSMA, a validated target in metastatic prostate cancer.

Joe: We plan to take both of these assets into the clinic next year.

I'll take both of these assets into the clinic next year.

Jen Creel: With that, I will turn the call over to Jen to give a financial update.

Amit Malik: And now I'll turn it, Jennifer, to you to talk about Samantha.

With that I will turn the call over to Jim to give a financial update.

Jen Creel: Thank you, Joe, and good morning, everyone.

Jennifer Heron: Yeah.

Thank you Joe and good morning, everyone.

As of June 30, we had cash and cash equivalents of $377 million.

Jen Creel: As of June 30th, we had cash and cash equivalents, of $377 million as compared to $431 million as of March 31st, 2022. The cash balance does not include the upfront payment of $55 million we received from SOBE in July of this year.

Jennifer Heron: Tejeen, thanks for the question. This past year has been pretty challenging with, a lot less face-to-face interactions or educational opportunities that's really needed for a new product introduction.

As compared to $431 million as of March 31, 2022.

The cash balance does not include the upfront payment of $55 million, we received from <unk> in July of this year.

Jen Creel: Based on our business plan and expected milestones from SOBE and healthcare royalty partners, we now have a cash runway that extends into early 2025. Potential near-term milestone payments from these agreements include the $50 million due, from SOBE upon European regulatory approval of Minlanta and third-line DLBCL, and the potential $75 million milestone from our healthcare royalty partners agreement for the first EU commercial, sale.

Based on our business plan and expected milestones from Sylvie and healthcare royalty partners. We now have a cash runway that extends into early 2025.

Potential near term milestone payments from these agreements include the $50 million due from sobey upon European regulatory approval of <unk> in third line <unk> and the potential $75 million milestone from our healthcare royalty partners agreement, but the first EU commercial sale.

Jen Creel: Turning to the P&L, as we reported in the press release issued earlier today, Minlanta net sales were $17.3 million for the second quarter 2022.

Turning to the P&L as we reported in the press release issued earlier today.

<unk> net sales were $17 3 million for the second quarter 2022.

Cost of product sales was $2 3 million for the quarter compared to <unk> 1 million for the same quarter in 2021.

Jen Creel: Cost of product sales was, $2.3 million for the quarter compared to $0.1 million for the same quarter in 2021. The increase was primarily associated with impairment charges related to the manufacturing, of antibodies that were not within the company's specifications. In addition, cost of product sales increased due to a full second quarter of sales activity in 2022 as compared to the same period in 2021 due to the commencement of the launch of sales in May 2021.

The increase was primarily associated with impairment charges related to the manufacturing of antibodies that were not within the company's specifications.

In addition cost of product sales increased due to a full second quarter of sales activity in 2022.

Compared to the same period in 2021 can you just commencement of <unk> sales in May 2021.

Jen Creel: R&D expenses were $49 million for the second quarter 2022 compared to $40 million for the, same quarter 2021. R&D expense increased for the quarter due to the reversal of previously recorded impairment charges of $6.8 million during the second quarter 2021 based upon the FDA approval of Minlanta during that quarter. In addition, we continue to invest in Minlanta, trials in earlier lines of treatment and our broad portfolio.

R&D expenses were $49 million for the second quarter 2022.

The $40 million for the same quarter of 2021.

R&D expense increased for the quarter due to the reversal of previously recorded impairment charges of $6 8 million during the second quarter 2021 based upon the FDA approval of <unk> during that quarter.

In addition, we continue to invest in larger trials in earlier lines of treatment and our broad portfolio.

Jen Creel: Selling and marketing expenses were $18 million for the second quarter 2022 compared to $15, million for the same quarter 2021. The increase in selling and marketing for the quarter reflects the expenses for the, Zinland to launch and ongoing commercial efforts.

Selling and marketing expenses were $18 million for the second quarter 2022, compared to $15 million for the same quarter 2021.

The increase in selling and marketing for the quarter reflects the expenses for the <unk> launch and ongoing commercial efforts.

Jen Creel: T&A expenses were $18 million for the quarter compared to $19 million for the same quarter, 2021. T&A expenses decreased for the second quarter 2022 as compared to the same quarter in 2021, primarily due to lower share-based compensation expense.

G&A expenses were $18 million for the quarter compared to $19 million for the same quarter 2021.

G&A expenses decreased for the second quarter 2022, as compared to the same quarter in 2021, primarily due to lower share based compensation expense.

Jen Creel: Net loss was $64 million for the second quarter compared to a net loss of $73 million for, the same quarter 2021. Our diluted net loss per share was $0.84 in the second quarter compared to a net loss, of $0.95 for the same quarter 2021. The decrease in net loss for the quarter ended June 30, 2022 as compared to the same period, in 2021 was primarily due to higher product revenue, partially offset by the increase in cost of product sales, R&D, and selling and marketing expenses.

Net loss was $64 million for the second quarter compared to a net loss of $73 million for the same quarter of 2021.

Our diluted net loss per share was <unk> 84 in the second quarter compared to a net loss of 95 for the same quarter of 2021.

The decrease in net loss for the quarter ended June 32022, as compared to the same period in 2021 was primarily due to higher product revenue, partially offset by the increase in cost of product sales R&D and selling and marketing expenses.

Jen Creel: In addition, net loss decreased for the second quarter of 2022 as a result of income arising, from changes in the fair value of derivatives associated with our Deerfield facility agreement. Partially offset by higher interest expense associated with the deferred obligation with, healthcare royalty partners.

In addition, net loss decreased for the second quarter of 2022 as a result of income arising from changes in the fair value of derivatives associated with our Deerfield facility agreement.

Partially offset by higher interest expense associated with the deferred obligation with healthcare royalty partners.

Adjusted net loss a measure that excludes certain items as described in the press release issued earlier today was.

Jen Creel: Adjusted net loss, a measure that excludes certain items as described in the press release, issued earlier today, was $56 million for the second quarter compared to an adjusted net loss of $54 million in the same quarter 2021. Adjusted net loss per share was $0.73 for the second quarter compared to an adjusted, net loss per share of $0.70 in the same quarter 2021.

It was $56 million for the second quarter compared to an adjusted net loss of 54 million in the same quarter of 2021.

Adjusted net loss per share was <unk> 73 for the second quarter compared to an adjusted net loss per share of <unk> 70.

In the same quarter of 2021.

Jen Creel: With that, I will turn the call back to Amit for closing remarks.

With that I will turn the call back to meet for closing remarks.

Amit Malik: Amit?

Okay.

Amit Malik: Thank you, Jennifer, Joe, and Jen.

Thank you, Jennifer Joe and Jen to conclude we remain focused on executing on all areas of the business and we are well positioned to achieve our key objectives going forward.

Amit Malik: To conclude, we remain focused on executing on all areas of the business, and we are well, positioned to achieve our key objectives going forward. This includes driving the Zinlanta launch, working to develop Zinlanta in earlier lines, of therapy, advancing our pipeline of differentiated hematological and solid tumor programs, and expanding our ABC platform.

This includes driving this and lot to launch working to develop and launch it in earlier lines of therapy, advancing our pipeline of differentiated hematological and solid tumor program.

And expanding our ADC platform now.

Amit Malik: Now the team will be available for questions.

Now the team will be available for questions.

Operator: Operator?

Operator.

Operator: Thank you.

Okay.

Thank you we will now begin the question and answer session. If you have a question. Please press star one one on your Touchtone phone. If you are using a speakerphone you may need to pick up the handset first before pressing the numbers. Once again, if you have a question. Please press star one one on your Touchtone phone.

Operator: We will now begin the question and answer session.

Operator: If you have a question, please press star 1-1 on your touchtone phone.

Operator: If you are using a speakerphone, you may need to pick up the handset first before pressing, the numbers.

Operator: Once again, if you have a question, please press star 1-1 on your touchtone phone.

Operator: Our first question comes to the line of Kelly Shi from Jefferies.

Our first question comes from the line of Kelly <unk> from Jefferies.

Kelly Shi: Thank you for taking my question. So for targeted BLA submission of CAMI in the second half of next year, you mentioned, the manufacturing stability data need to mature.

Taking my question, so targeted a BLA submission of <unk> in the second half of next year, you mentioned the manufacturing stability data you need to make sure I'm also curious if the clinical data.

Kelly Shi: I'm also curious if the clinical data package is in good shape, for submission, and for GBS toxicity in the Hodgkin's lymphoma patients, would you anticipate outcomes requested by FDA?

Kelly Shi: Thank you.

Sure.

With our mission and.

For GBS associates need.

In Hodgkins lymphoma patients.

Anticipate ad com.

Kelly Shi: I also have a follow-up.

Yes, I think you also have follow up.

Joe: Yeah, thank you for your question.

Yes. Thank you for your question I'm going to pass this on to Joe to answer.

Joe: I'm going to pass this on to Joe to answer.

Sure, Yes, the clinical data package is in very good condition I mentioned, the response rates and the duration and Thats all very positive.

Joe: Sure.

On the efficacy side on the safety side, you mentioned the calibration drum.

We have been able to.

<unk> developed some very straightforward intervention to make sure that.

GBS is diagnosed early and treated.

We have eight cases in the <unk>.

In the package.

It is true we don't have any I'm sorry.

Of the phase II study for <unk>.

We don't have any rate cases, and so our advisors.

We believe that the balance of efficacy and safety analysis.

Is very positive and the benefit is clear.

Safety can be addressed the last question was.

The last part of that was about an ad com.

Impossible to predict FDA.

Activity, but we are not.

Thinking that there will be an outcome. If there is we will be prepared for it.

Thanks.

Thank you.

Thank you and also have a question on John personnel, so khaki extending into second line in lymphoma patients and <unk> showed a strong revenue increase in the second quarter and also ADC now has a J code you've got cancer since April the price I'm curious.

How are those factors.

Goodnight stocking patterns in Atlanta sales and adjusted <unk> guidance to be all sort of floor.

<unk> thousand 22, but.

Could we think about Q3 and the Q4.

Sales number.

Could it be could it get some clues on the front of house was appointed the sales force, even though the ramp up for the whole year.

Yes, Thanks, Kelly and before I turn it over to Jennifer and one more thing I want to address your previous question, which is you'd also asked about the manufacturing stability. So Joe had said that the clinical packages moving in good shape and we have a meeting planned with the FDA in September the manufacturing stability just to be clear. It's just a matter of time, so when the manufacturing batch.

Joe: Yes, the clinical data package is in very good condition.

Joe: I mentioned the response, rates and the duration, and that's all very positive from the efficacy side.

Joe: On the safety side, you mentioned the Gamma Ray Syndrome.

Joe: We have been able to develop, some very straightforward interventions to make sure that GBS is diagnosed early and treated.

Joe: We only have eight cases in the package of Lotus 2.

Joe: We don't have any, I'm sorry, of the Phase 2 study for CAMI.

<unk> were produced we're just waiting for that stability data to mature and Thats whats going to drive the timing for the for the.

Planned completion of the filing in the second half of next year, but now I'll turn it over on this Atlanta question to Jennifer.

Yes, Kelly Thanks for your question.

Your specific question with regard to car T. We have seen increased utilization in car T and the second line setting.

We have been seeing a lot of post car T used for lots of there are tremendous opportunities ahead of us in the second half of this year.

Jennifer Heron: We are encouraged, though, as we move through Q2, that it's really opening up and hopefully for good.

And we're encouraged because as we move through Q2, we did see month over month growth in demand and an increasing face to face access as we exited the quarter about three quarters of our engagements with physicians was in person, which we think is really important to portray the differentiated product profile of the Atlanta.

Jennifer Heron: And we're seeing a lot more face-to-face interactions.

Jennifer Heron: Our team is doing quite well with face-to-face interactions, even versus the competitors, and industry norms at this time.

And if we think of it specifically about the growth opportunities. We started out this year really focusing on the academic centers and developing national and regional level thought leadership.

Jennifer Heron: We do have quite a few opportunities, as you mentioned, as I mentioned earlier, in the academic centers where we have done a fairly good job with regard to awareness and initial trial.

And influence across the marketplace.

<unk> had really good awareness in the academic centers and as I've mentioned, 60% of our volume is coming from academia.

We still have opportunity in the academic centers not only for depth of prescribing. So converting those triallist two true advocates and embedding fill onto in their treatment paradigm, but also more importantly in the community and you mentioned that the J code. The permanent J code that we got in April definitely takes away a barrier to prescribing and.

Jennifer Heron: We need to convert those trialists really to product advocates and embed them in the treatment paradigm there.

Jennifer Heron: In the community, which represents over half of all Third Line plus DLBCL patients, so a significant opportunity, I think there, with the permanent J code now well in place, we have the opportunity to, raise awareness, to get that initial positive experience with Zinlanta, and really embed Zinlanta in the community as a Third Line standard of care.

Now we are doubling down on our awareness initiatives and partnering with community oncology to realize that opportunity.

Joe: We don't have any late cases.

Joe: And so, our advisors, and we believe that the balance of efficacy and safety now is very positive, and the benefit is clear, and the safety can be addressed.

Great. Thank you.

Thank you. Our next question comes from the line of Gregory <unk> from RBC.

Joe: The last question was, the last part of that was about an adcom.

Jennifer Heron: So I think that the access, has been a challenge for this first year of launch, but I'm very encouraged from what

Hey, good morning.

Congrats on the progress and thanks for taking my questions. Maybe just one for you just more higher level is helpful to hear the feedback from your from your listening tour over the past few months and just laying out the near medium and longer term goals.

Joe: It's impossible to predict FDA activity, but we are not thinking that there will be an adcom.

Amit Malik: I'm seeing, and the receptivity to the profile continues to be strong.

Joe: If there is, we will be prepared for it.

Kelly Shi: Great, thanks.

Im just curious if there's.

Anything in particular Thats jumping out at you certainly helpful to hear about all the positive any particular challenges that you think are.

Our unique with respect to what ADC is facing and even in this in this environment and just how you're thinking about allocating your time across those different time horizons.

Joe: And I also have a question.

Kelly Shi: Thank you, Joe.

Yes, that's a great question and thanks, so much for asking that yeah look I think.

Joe: Thank you.

One challenge that was pretty clear to me and I've spent a lot of time.

Kelly Shi: And I also have a question on the long-term sales.

With Jennifer and Joe's team, particularly in the field with a lot of customers because I always think you get the best insights when you meet with employees on the ground you meet with customers and just looking to meet with investors I mean, you've got a lot of insights.

And Thats, how I spend a lot of my time My first few months. So one thing I would say is.

Within locker this launches in a pretty challenging environment because during this COVID-19 period, where institutions were relatively shut down awareness of the product.

<unk> unaided awareness in the community is still relatively low and while that's a challenge I think is equally provides a big opportunity because as Jennifer mentioned now that we have the J code established which meru is a key barrier for prescribing and access is really we really saw an improvement in Q2, so when I look at the indicators of activity.

Kelly Shi: So, CAR-T extended to second, line in former patients, and Yaskata showed a strong revenue increase in the second quarter, and also ADCC now has a J-code effective since April 1st.

Amit Malik: And to Zin, just to add on to what Jennifer said, I mean, the, You know, the community tends to adopt new products in oncology, hematology, slower anyways than academic physicians.

Amit Malik: I think in this case, it was probably heightened by two things.

Kelly Shi: I'm curious how those factors are going to start impacting long-term sales.

Kelly Shi: And I understood no sales guidance to be offered for 2022, but could we think the Q3 and the Q4 sales number could be, we could get some clue from the first-half reported sales to signal the ramp up for the whole year.

Kelly Shi: Thanks.

Amit Malik: Yeah, thanks, Kelly.

And not only.

The activity, we're getting a lot of initial cost to customers that we hadn't had in the first part of launch so to me as much as it has been a challenge as I see it as an opportunity going forward and at least good early indicators of those sort of things in Q2.

Amit Malik: And before I turn it over to Jennifer, one more thing I want to address from your previous question, which is, you'd also asked about the manufacturing stability.

Amit Malik: So, Joe had said that the clinical package is moving in good shape, and we have a meeting planned with the FDA in September.

Amit Malik: The manufacturing stability, just to be clear, is just a matter of time. So, when the manufacturing batches were produced, we're just waiting for that stability data to mature, and that's what's going to drive the timing for the planned completion of the filing in the second half of next year.

Jennifer Heron: But now I'll turn it over on the Zimlanta question to Jennifer.

Jennifer Heron: Yeah, Kelly, thanks for your question.

When it comes to the midterm.

Jennifer Heron: So, your specific question with regard to CAR-T, we have seen increased utilization in CAR-T in the second line setting.

Jennifer Heron: We have been seeing a lot of post-CAR-T use for Zimlanta.

And our pipeline in general what I would say is just.

Jennifer Heron: There are tremendous opportunities ahead of us in the second half of this year, and we're encouraged because as we moved through Q2, we did see month-over-month growth in demand and in increasing face-to-face access.

For me. The key is we have a lot of things in our pipeline and a lot of activity going on and what I want to make sure that we're really disciplined in terms of our portfolio prioritization and portfolio management. So.

Jennifer Heron: As we exited the quarter, about three-quarters of our engagements with physicians was in person, which we think is really important to portray the differentiated product profile of Zimlanta.

We've implemented we are in the process of implementing a really robust set of.

Cost us in terms of how we're going to manage our portfolio at the research stage, the gaining decisions to move into R&D and clinical stages and the gains decisions to move into later stage clinical development. Because these judges all key investment decisions and I think there is more we can do in terms of the robustness of that criteria and so you see with decisions and I've always said the team if the data doesn't bear if the opportunity is not.

There from a business standpoint, we will stop things because we don't want to just keep putting money. After thanks, because we started things. So that's an area I would say again for opportunity, where we can do even more and thats going to be a big focus for me and then finally on the third horizon.

We've been very <unk> focused in terms of our payload.

And I think <unk> are really really strong payload that for a number of targets, particularly the ones that we picked up our pipeline, they really fit well, but as we want to expand the number.

Strong payloads that for a number of targets, particularly the ones that we picked up our pipeline they really set well, but as we want to expand the number of biological targets that we can go after we want to expand the toolbox and open up the <unk>.

Possibilities, we've done a number of different technology deals in the past, particularly around linker technology Sneaker technology. Some antibiotic construction contribution commentary, we've been a little bit more limited on payloads, but there are things that we've done and theres more to come I would say on that front because.

To continue to lead in the ADC space I think we have to open up our lens in terms of in terms of our technology toolbox. So those are just my initial thoughts of.

Are there still areas for opportunity and where we're focusing on to take the company going forward.

That's really helpful. Thank you so much and maybe just one quick follow up it in case I missed it if you could just comment on the inventory impact from <unk> on the Atlanta and also just note that the launches over a year now do we have a better sense of that predictability.

What the quarters, how are you thinking about the quarters when it comes to inventory build there. Thanks again.

Yes, I'll take that question.

So in terms of inventory for Q2, we believe that the net sales of $17 3 million reflects real time patient demand and we're not aware of any significant inventory build at this time.

And I can't really comment on future future trend there.

Got it thanks again.

Yes, thank you very much.

Thank you. Our next question comes from the line of Boris Becker from Cowen.

Hi, My first question is.

Sticking with Theres been lots of discussion can you maybe give us some kind of a rough patient characteristic of these initiatives and longer adopters.

Certainly for us.

And thanks for the question so as we started off our launch.

Jennifer Heron: And if we think specifically about the growth opportunities, we started out this year really focusing on the academic centers and developing national and regional-level thought leadership and influence across the marketplace. We've had really good awareness in the academic centers, and as I've mentioned, 60 percent of our volume is coming from academia. We still have opportunity in the academic, centers, not only for depth of prescribing, so converting those trialists to true advocates and embedding Zimlanta in their treatment paradigm, but also, more importantly, in the community.

By design and strategy.

<unk>.

Developed our national and regional thought leaders and many times they reside in the academic centers and so in the academic centers, we've seen utilization of <unk> across the entire spectrum of the indications I think the prioritize business opportunities as we see it.

Jennifer Heron: And you mentioned the J-code. The permanent J-code that we got in April definitely takes away a barrier to prescribing, and now we are doubling down on our awareness initiatives and partnering with community oncology to realize that opportunity.

Jennifer Heron: Thank you.

Operator: Our next question comes from the line of Gregory Renza from RV Team.

And that's.

Fairly dynamic marketplace.

In the post car T setting and we've heard very strong support from our thought leaders in the post car T setting and then for those patients that are unsuitable for cars.

Gregory Renza: Hey, good morning, Ameet and team, congrats on the progress and thanks for taking my questions.

There are a variety of reasons why a patient would not be eligible or not choose to to.

To pursue car T treatment and with our differentiated product profile, we believe that physicians and patients have a lot to benefit from both the efficacy, including a rapid time to response, the manageable side effect profile and the very convenient administration.

Gregory Renza: Maybe just one for you, just more higher level, it's helpful to hear the feedback from your, listening tour over the past few minutes and just laying out the near, medium and longer term goals.

And on that topic, we talked about car Ts is moving to earlier lines of therapy and obviously.

Gregory Renza: I'm just curious if there's anything in particular that's jumping out at you, certainly helpful, to hear about all the positive, any particular challenges that you think are unique with respect to what ADC is facing and even in this environment and just how you're thinking about allocating your time across those different time horizons.

Loan amendments, helping those patients, but there are several competing drugs in second or third line <unk> outside of the party can you comment how that competitive landscape is shaping up and where do you see it fitting in there more specifically.

Amit Malik: Yeah, no, it's a great question and thanks so much for asking it.

Amit Malik: Yeah, look, I think, you know, one challenge that was pretty clear to me and I've spent, a lot of time, you know, with Jennifer and Joe's team, particularly in the field and with a lot of customers, because I always think you get the best insights when you meet with employees on the ground, you meet with customers and just like you meet with investors and you get a lot of insights.

Amit Malik: And that's how I spent a lot of my time in the first few months.

Amit Malik: So one thing I would say is with Zinlanta, you know, this launch is in a pretty challenging, environment because during this COVID period where institutions were relatively shut down, the awareness of the product, particularly unaided awareness in the community is still relatively low.

Amit Malik: And, you know, while that's a challenge, I think it equally provides a big opportunity, because, you know, as Jennifer mentioned, now that we have the J code established, which really was a key barrier for prescribing and access is really, we really saw it improve in Q2.

Yeah <unk>.

I don't think that.

Our positioning our outlook for the positioning is Atlanta has changed versus our launch.

Amit Malik: So when I look at the indicators of activity and not only were, you know, the activity, we're getting a lot of initial calls to customers that we hadn't had in the first part of launch.

Amit Malik: So to me, as much as it's been a challenge, I see it as an opportunity now going forward, and at least, you know, good early indicators of those sort of things in Q2, you know, when it comes to the midterm and our pipeline in general, what I would say is just, you know, for me, the key is we have a lot of things in our pipeline and a lot of activity going on.

Positioning so.

Amit Malik: And what I want to make sure is that we're really disciplined in terms of our portfolio, prioritization and portfolio management.

Amit Malik: So, you know, we've implemented, we're in the process, I'd say, of implementing a really, robust set of process in terms of how we're going to manage our portfolio at the research stage, the gaining decisions to move into IND and clinical stages, and the gaining decisions to move into later stage clinical development, because these, I judge, is all key investment decisions.

It really comes down to.

<unk> differentiated product profile is in line to the robustness of the Lotus two trial and the fact that in the real world setting physicians are seeing a lotus to type of experience with a rapid time to response and help those patients getting into into our response.

Amit Malik: And I think there's more we can do in terms of the robustness of that criterion.

Amit Malik: So you see with decisions, you know, I've always told the team, if the data doesn't, bear, if the opportunity is not there from a business standpoint, we will stop things because we don't want to just keep putting money after things because we started things.

Recall. These are these are heavily pretreated patients and so I think that.

I wanted to continues to compete well from a profile standpoint, where we're putting a little bit more effort is really optimizing the execution of all of our customer facing facing.

Facing teams because we have that.

Unique opportunity with access really opening up and so as Amit mentioned, we have still a bit of of opportunity ahead of us both in the academic centers and in the community and that's where we're putting our focus.

Amit Malik: So that's an area, I'd say, again, for opportunity where we can do even more, and that's going, to be a big focus for me.

Amit Malik: One is the lack of access, so just a lack of knowledge about many new therapies, I'd, say, in the community, particularly ours, which is just a year into launch.

Amit Malik: And then finally, on the third horizon, you know, we've been very PVD focused in terms, of our payloads. And you know, I think PVDs are really, really strong payloads that for a number of targets, particularly the ones that we picked in our pipeline, they really sit well. But as we want to expand the number of strong payloads that for a number of targets, particularly, the ones that we picked in our pipeline, they really sit well.

Amit Malik: But as we want to expand the number of biological targets that we can go after, we want to expand, the toolbox and open up… the possibilities.

Amit Malik: We've done a number of different technology deals in the past, particularly around linker technology, some antibody constructs and conjugation chemistry.

Amit Malik: We've been a little bit more limited on payloads, but there are things that we've done and there's, more to come, I would say, on that front, because to continue to lead in the ADC space, I think we have to open up our lens in terms of our technology toolbox.

Great. Thank you very much for taking my question.

Thank you. Our next question comes from the line of Matthew Harrison from Morgan Stanley .

Amit Malik: So those are just my, initial thoughts of where there's still areas for opportunity and where we're focusing on to take the company going forward.

Gregory Renza: That's really helpful.

This is Chris use speech.

Speaking for Matthew So we have two questions.

Gregory Renza: Thank you so much.

Gregory Renza: And maybe just one quick follow up, in case I missed it, if you could just comment on the inventory impact from 2Q on Zalanta, and also just now that the launch is over a year now, do we have a better sense of, that predictability of what the quarters, how are you thinking about the quarters when it comes to inventory and build there?

First question is regarding his in long to.

Amit Malik: Thanks again.

Just wondering what are you getting any patients in the community setting in Q2.

Amit Malik: Yeah, I'll take that question. So in terms of inventory for Q2, we believe that the net sales of $17.3 million reflects real-time patient demand, and we're not aware of any significant inventory build at this time.

Amit Malik: And I can't really comment on future, you know, a future trend there.

Yes, we.

We are getting patients in the community setting.

Gregory Renza: Got it.

Amit Malik: Thanks again.

As I mentioned, the J code the <unk> J code came through in the beginning of April and that while that takes away a barrier to prescribing I think we still have some work to do to really raise the level of awareness in the community that we've achieved in the academic centers and so.

Amit Malik: Yeah, thank you very much.

Operator: Thank you.

60% of our volume is coming from the academic centers and so Conversely, 40% of the volume is coming from the community I think the real opportunity for us moving forward.

Is not only the full execution of the J code, but also partnering with the community oncology networks.

I would just add to what Jennifer said that the adoption typically in a field like this later lines TWC. All you tend to have slower adoption in the community and the academic.

Partly because community doctors on average seat as far fewer patients with Jennifer mentioned during the earnings call.

And so you have slower adoption in general all new therapies.

I think as our profile gets more and more understood by positions I think we have a real opportunity for many of the reasons that Jennifer mentioned, the fact that we have a really strong efficacy profile fast time to response.

Fact that it's a manageable safety.

The side effect profile, the fact that a single agent the fact that.

The molecule. So it's very easy to administer 130 minute infusion every three weeks, so it's really easy to administer.

I think theres a lot of reasons, why it's going to fit well.

I think Jennifer Entertainment predicted Youll get later adoption and it takes longer to get the adoption in the community.

But we believe we should start to see that happening now in Q2.

That's very helpful and much. The second question is regarding the long term in ocular lymphoma.

<unk> debt.

Notice six is terminated.

And do you get any feedback from the FDA and what's the path for forward with <unk> in Follicular lymphoma.

So Joe do you want to take that.

Sure yes, thanks for the question.

We did not get specific information from FCA.

But it was very clear from the recent advisory boards and some of their public statements.

Ta is much more interested in.

Earlier treatments work, so the killing lymphoma, where the chance of a long term remission.

<unk> remains an option or possibility.

The late line single agent surety venture rescue don't look like the future and FDA.

He said that.

So we took that into consideration and changed.

The focus of our program to look at.

Some combination data for earlier launch and so we're just going to take some time for us to get that data, but we're doing that.

It looks like a much more promising and I would say moderate in future way of dealing with Follicular lymphoma.

Thank you.

Operator: Our next question comes in the line of

Youre welcome.

Thank you. Our next question comes from the line of <unk> Ahmad from both of them.

Boris Beaker: Boris Beaker from Cowen.

Okay.

Taking my questions.

Just wanted to get your sense of what you think the data catalysts will be over the next 12 months.

Boris Beaker: My first question is, speaking with the Zalanta discussion, can you maybe give us kind of a rough patient characteristic of the initial Zalanta adopters?

With the upcoming oncology conferences in the second half of the year should we expect any presentations from any of your ongoing programs.

And then lastly on the.

The slope of the launch.

Longer.

If you have.

I'll ask doctors, what they would need to feel comfortable prescribing. It today is it simply just a matter of awareness.

Or as you said for community based doctors, it's limited patient pool.

Just trying to understand how well doctors today in your view might appreciate the benefits of the drug.

Yeah, So maybe I'll take the question on upcoming milestones and then I'm going to turn it over to Jennifer to ask Nick to answer the question around the amount of adoption.

So I'd say I'd just highlight a few different milestones, let's say over the next let's call. It 12 months to 18 months as the Atlanta from Lotus five we're going to be presenting the safety lead in data from the combination study with Rituximab.

At an upcoming medical meetings, we haven't announced which one but it will be this year in the second half of the year.

We also expect to get a regulatory decision.

Round, our European approval from EMA by the Q1 of next year.

Tammy.

An upcoming meeting that we think it can be really important in a pre BLA meeting in September of this year, which will give us clarity on the path forward and then as we mentioned given the timing for the stability data mature we plan to complete the submission of that in the second half of next year.

With <unk> and with <unk>, we expect to have initial signs of safety and efficacy data for both programs in 2023, we're not being more specific because we're still in the process of dose escalation, but we expect to have some initial results from both of those programs next year. So those are I'd say the key milestones that I would highlight over the next two.

18 months, an alternate Jennifer to you and just talk about the Martha Yes, Dan Thanks for the question.

This past year has been has been pretty challenging with a lot less face to face interactions or educational opportunities.

Really needed for our new product introduction, we are encouraged though as we move through Q2 that it's really opening up and hopefully hopefully for good.

And we're seeing a lot more face to face interactions are our team is doing quite well with face to face interactions even versus the competitors and industry norms. At this time, we do.

You have quite a few opportunities that as you mentioned as I mentioned earlier and the academic centers, where we have done a fairly good job with regard to awareness and initial trial.

We need to convert those triallist relates to product advocates and Embeds Atlanta in the treatment paradigm there.

And the community.

Which represents over half of all third line plus <unk> patients. So a significant opportunity I think there with the permanent J code now well in place we have the opportunity to raise awareness to get that initial positive experience with Atlanta, and really Embeds Atlanta in the community as a third line stand.

<unk> care so.

I think that the access has been a challenge for this first year of launch, but I'm very encouraged from what I'm seeing and the receptivity to the profile.

<unk> continues to be strong.

Yes, just to add onto what Jennifer said I mean the.

Sure.

Community tends to adopt new products in oncology or hematology slower anyways and academic physicians I think in this case it was probably tightened by two things one is the lack of access so just a lack of knowledge about many new therapies as I say the community, particularly ours, which is just a year into launch and then the second thing is this the diffuse nature of the patients were <unk>.

Amit Malik: And then the second thing is just the diffuse nature of the patients, where maybe a doctor, may be seeing a patient every three to four months, so that frequency also drives the urgency to learn about new therapies, especially when you're not getting access.

A doctor may be seeing a patient every three to four months. So that frequency also drives the urgency to learn about new therapy use, especially when youre getting access, but I think that remains the big untapped opportunity and I think our profile fit, particularly well in that setting so.

Amit Malik: But I think that remains the big untapped opportunity, and I think our profile fits, particularly well in that setting.

Amit Malik: So for some physicians right now, we're in the early launch phase right now in the community, in terms of the number of interactions they've had, the knowledge of the product. And I think if that picks up, given the access that Jennifer spoke about, I think that's, the much bigger opportunity for growth in the near and midterm.

For some physicians right now we're in the early launch phase right now in the community in terms of the number of interactions I've had the knowledge of the product and I think as that picks up given the access that Jennifer spoke about I think thats, yes.

Tazine Omar: Okay.

The much bigger opportunity for growth.

Near and midterm.

Tazine Omar: Thanks for that, Cullen.

Okay. Thanks for that color and I'm, sorry, if I might've missed this if you've already said it.

Tazine Omar: Thanks, Taylor.

Tazine Omar: And I'm sorry if I might have missed this if you've already said it.

Tazine Omar: What is your split between community docs and academics right now?

What is your split between community docs and academics right now.

Jennifer Heron: Yeah.

Jennifer Heron: So in terms of volume, we still have about 60% of our volume coming from academia.

Yes, so in terms of volume, we still have about 60% of our volume coming from from academia.

Jennifer Heron: In terms of ordering accounts, it's a 50-50 split, but we do see that in terms of ordering, there's a lot more account acquisition opportunity in the community to come.

In terms of ordering accounts, it's a 50 50 split, but we do see that in terms of ordering theres a lot more account acquisition opportunity in the community to come.

But as Andy mentioned, it's going to take time, it will fuel our steady growth in the future.

Jennifer Heron: And that, as Amit mentioned, is going to take time, but it will fuel our steady growth in, the future.

Tazine Omar: Okay.

Tazine Omar: And you don't have any constraints on supply right now, do you?

Okay, and you don't have any constraints on supply right now to you.

Jennifer Heron: There are no issues with regard to commercial supply that I'm aware of.

There are no issues with regard to commercial supply that I'm aware of okay. Great. Thank you.

Tazine Omar: Okay.

Tazine Omar: Great.

Operator: Thank you.

Amit Malik: I would now like to turn the conference back over to Amit Malik for closing remarks.

Thank you I would now like to turn the conference back over to Amit Malik for closing remarks.

Amit Malik: No, thank you.

So thank you and thank you to all of you very much for joining our call today. Thanks for your continued support of ADC Therapeutics, we look forward to keeping you updated on our progress and I hope that you have a nice day. Thank you.

Amit Malik: And thank you to all of you very much for joining our call today.

Amit Malik: Thanks for your continued support of ADC Therapeutics.

Amit Malik: We look forward to keeping you updated on our progress, and I hope that you have a nice, day.

Operator: Thank you.

Operator: This conference call, thanks for participating.

The conference call. Thank you for participating thank you for participating you may now disconnect.

Operator: You may now disconnect.

Jennifer Heron: Certainly, Boris.

The conference will begin shortly, https://www.youtube.com.uk, [music]

The conference will begin shortly.

As Johan during Q&A, you can dial one one.

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