ADC Therapeutics' third-quarter 2025 was defined by encouraging indolent-lymphoma data and a strengthened balance sheet, offset by a soft commercial print. ZYNLONTA net product revenue fell to $15.8 million from $18 million a year earlier on customer ordering variability, one of the weakest quarters in two years, underscoring that the growth story hinges on label expansion rather than the mature third-line-plus base. Clinically, the Phase II follicular lymphoma investigator-initiated trial of ZYNLONTA plus rituximab showed a 98.2% overall response rate and an 83.6% complete response rate across 55 patients, with median PFS not reached at 28 months. Financially, a $60 million October private placement led by TCGX lifted pro forma cash to about $292.3 million and reinforced a runway at least into 2028, while non-GAAP operating expenses fell 12.1% year over year to $45 million and GAAP net loss narrowed to $41 million ($0.30 per share). Management guided to a LOTIS-7 corporate update before year-end covering all efficacy-evaluable patients with at least six months of follow-up, LOTIS-5 top-line data in the first half of 2026 with approval and compendia inclusion targeted for the first half of 2027, and reaffirmed the $600 million to $1 billion U.S. peak revenue framework. Analyst questions focused on accelerating LOTIS-7 enrollment and the size of the year-end dataset, the timing and pace of a revenue inflection, the community-versus-academic treatment split, and the economics of each share point across the 2L and 3L+ settings.
Thank you, Operator. Today, we issued a press release announcing our third quarter 2025 financial results and business updates. This release and the slides we will use in today's presentation are available on the Investor section of the ADC Therapeutics website. I'm joined on today's call by our Chief Executive Officer, Ameet Mallik, who will discuss our operational performance and recent business highlights. Our Chief Medical Officer, Mohamed Zaki, who will discuss our clinical programs and updates, followed by our Chief Financial Officer, Pepe Carmona, who will review our third quarter 2025 financial results. We will then open the call to questions. Before we begin, I would like to remind listeners that some of the statements made during this conference call will contain forward-looking statements within the meaning of the Safe Harbor Provisions of the U.S. Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to certain known and unknown risks and uncertainties, and actual results, performance, and achievements could differ materially. They are identified and described in the accompanying slide presentation and in the company's filings with the SEC, including Form 10-K, 10-Q, and 8-K. ADC Therapeutics is providing this information as of today's date and does not undertake any obligation to update any forward-looking statements contained in this conference call as a result of new information, future events, or circumstances, except as required by law. The company cautions investors not to place undue reliance on these forward-looking statements. Today's presentation also includes non-GAAP financial reporting. These non-GAAP measures should be considered in addition to, and not in isolation or as a substitute for, the information prepared in accordance with GAAP.
You should refer to the company's third quarter earnings release for information and reconciliation of historical non-GAAP measures to the corporate GAAP financial measures. I will now turn the call over to our CEO, Ameet Mallik. Ameet.
Thanks, Nicole, and hello, everyone. Thank you for joining us on today's call. In the third quarter of 2025, we continue to focus on execution and delivering on our commercial strategy, maintaining ZYNLONTA as a differentiated treatment option for third-line plus DLBCL patients while advancing data across key trials. Net product revenues were $15.8 million in the third quarter, reflecting variability in customer ordering patterns and were broadly in line with the quarterly run rate over the past two years. We continue to progress against our key ZYNLONTA trials in second-line plus DLBCL and expect to share additional data in the coming months. We plan to provide an update on LOTIS-7, our phase I-B trial evaluating ZYNLONTA in combination with the bispecific antibody glofitamab before the end of the year.
In the first half of 2026, we plan to announce top-line results from LOTIS-5, our phase III confirmatory trial of ZYNLONTA in combination with rituximab once the pre-specified number of PFS events is reached and data are available. Within indolent lymphomas, the lead investigator on the phase II IIT of ZYNLONTA in combination with rituximab recently presented encouraging updated relapsed or refractory follicular lymphoma data at the 22nd International Workshop on Non-Hodgkin lymphoma. The trial is on track to enroll 100 patients. In addition, the phase II IIT of ZYNLONTA in relapsed or refractory marginal zone lymphoma continues to enroll to the target of 50 patients. Beyond ZYNLONTA, we continued with IND-enabling activities for our PSMA-targeting ADC, which are on track to be completed by the end of the year.
Lastly, just after the quarter end, we secured a $60 million private placement led by TCGX, including participation from Redmile Group and other existing investors. This financing takes our expected cash runway at least to 2028. With our strengthened balance sheet, I am confident that we are well positioned to further invest in ZYNLONTA as we anticipate advancing into earlier lines of therapy for DLBCL and into indolent lymphomas. As a single-agent therapy in third-line plus DLBCL, ZYNLONTA has a profile of rapid, deep, and durable efficacy, as well as manageable safety with simple and convenient administration. Beyond our current indication, we believe in the potential to reach significantly more patients by expanding use into earlier lines of therapy in DLBCL and into indolent lymphomas. The data we've seen across these settings so far has been consistently encouraging, with the potential to be highly differentiating.
We continue to believe that through expansion into these settings, ZYNLONTA has the potential to reach peak annual revenues of $600 million-$1 billion in the U.S. Our current indication has, as I noted earlier, shown relative stability in net revenues over multiple quarters, demonstrating ZYNLONTA has a clear place in the market as a monotherapy. We believe LOTIS-5 has the potential to lift peak annual revenue for ZYNLONTA to $200-$300 million as we expand into the second-line setting. Not only would this double the addressable patient population, but with an improved clinical profile versus our current indication as a monotherapy, we expect to gain share in the second-line plus setting and improve duration of therapy.
With LOTIS-7, we estimate we can expand the total opportunity for ZYNLONTA in DLBCL to $500-$800 million in peak annual revenue with both regulatory approval and compendia listing. If the data continue to be compelling, we believe ZYNLONTA plus glofitamab has the potential to transform the future lymphoma treatment paradigm by becoming the preferred bispecific combination in the second-line plus DLBCL setting. On top of this, we see additional potential for ZYNLONTA in relapsed or refractory marginal zone lymphoma and relapsed or refractory follicular lymphoma. If the encouraging initial data in the phase II IITs are maintained in larger patient numbers, we believe these indolent lymphomas could provide additional peak annual revenue for ZYNLONTA of $100-$200 million with both regulatory approval and compendia listing, primarily driven by MZL.
Let's drill down a little more into the specifics of the DLBCL treatment landscape to explain why we believe ZYNLONTA has the opportunity to play a significant role. In both the second and third-line plus settings, there are two main segments. The first segment includes complex therapies which require unique infrastructure and expertise to handle logistical requirements and patient management. These are primarily confined to the academic centers and more sophisticated community centers and include therapies CAR-T, transplant, and bispecifics. The second segment comprises more broadly accessible therapies which all physicians can administer in the outpatient setting and includes ADCs, monoclonal antibodies, and chemotherapy. The launch of bispecifics as monotherapy in the third-line plus setting has resulted in an evolution of the treatment landscape where we estimate there is currently a 60/40 split between complex and broadly accessible segments.
In the second-line setting where bispecifics have not yet been approved but were recently added to NCCN guidelines for use in combination, we expect that they will continue to gain share and grow the use of complex therapies. Through LOTIS-5 and LOTIS-7, we believe ZYNLONTA combinations have the potential to raise the bar on efficacy in second-line plus DLBCL in their respective treatment segments, offering complementary approaches to addressing unmet needs. In LOTIS-5, our phase III confirmatory study, we are combining ZYNLONTA with the most widely used agent, rituximab, in patients with second-line plus DLBCL. As a reminder, initial data from the safety lead-in portion showed an overall response rate of 80% and a complete response rate of 50% with no new safety siG&Als, demonstrating that this combination has the potential to provide competitive second-line plus efficacy with a favorable safety profile, allowing broad accessibility.
In LOTIS-7, our phase I-B trial, we are combining ZYNLONTA with the highly effective bispecific glofitamab in second-line plus patients. Data presented in June at EHA and ICML based on the April 2025 cutoff showed the combination was generally well tolerated with a manageable safety profile. Furthermore, we believe it demonstrated clinically meaningful benefit with an overall response rate of 93.3% and a complete response rate of 86.7% across 30 efficacy-evaluable patients. We are encouraged by the promising early data, which we believe demonstrates the potential for ZYNLONTA plus glofitamab to be a best-in-class combination in a highly competitive market.
When you look at the CR rates among both currently available and emerging therapies in these two treatment segments, we believe the emerging clinical profile of ZYNLONTA plus glofitamab in the LOTIS-7 trial positions us well among complex therapies, and at the same time, the clinical profile of ZYNLONTA plus rituximab in the LOTIS-5 trial has the potential to differentiate us among broadly accessible therapies. Together, we believe these combinations have the potential to double the addressable patient population as we move into the second line and increase the duration of therapy, moving on average from three cycles to five- to six cycles. Now, I will turn the call over to our Chief Medical Officer, Mohamed Zaki, who will share the latest on the phase II follicular lymphoma IIT data. Mohamed?
Thank you, Ameet. I am pleased to share updated data from the phase II investigator-initiated trial of ZYNLONTA in combination with rituximab in relapsed refractory follicular lymphoma. The data were presented in September at the 22nd International Workshop on Non-Hodgkin lymphoma by the lead investigator, Dr. Juan Pablo Andujar from the Sylvester Comprehensive Cancer Center, part of the University of Miami Miller School of Medicine. The data presented from the 55 efficacy-evaluated patients to date in this trial continue to demonstrate encouraging results with an overall response rate of 98.2% and a complete response rate of 83.6%. After median follow-up of 28 months, median PFS was not reached, and the 12-month PFS was 93.9%. In this trial, no new safety siG&Als were observed, and safety was consistent with the known profile of ZYNLONTA.
The University of Miami is actively enrolling toward the target of 100 high-risk relapsed refractory follicular lymphoma patients and is opening the study at additional U.S. cancer research centers. As soon as sufficient data are available, we plan to assist regulatory and update the compendia pathways. Now, I will turn the call over to Pepe Carmona, our CFO, who will discuss financial results for the third quarter.
Thank you, Mohamed. On the financial front, ZYNLONTA net product revenues in the third quarter of 2025 were $15.8 million as compared to $18 million in the same quarter in 2024.
Total operating expenses for the quarter were $45 million on a non-GAAP basis, representing a 12.1% net decrease over the prior year. The reduction was primarily driven by lower R&D expenses, with sales and marketing expenses stable year over year. We continue to be disciplined in our capital allocation towards potential value creation while driving efficiencies across the portfolio.
On a GAAP basis, we reported a net loss of $41 million for the second quarter of 2025, or $0.30 per basic and diluted share, as compared to a net loss of $44 million or $0.42 per basic and diluted share for the same period in 2024. The decrease in net loss for the quarter is primarily attributable to lower R&D and G&A expenses. You can find the reconciliation of GAAP to non-GAAP measures for the third quarter and year-to-date in the compounding financial tables of the press release issued earlier today and in the appendix of this presentation. At the end of the quarter, we had cash and cash equivalents of $234.7 million, which compared to $250.9 million as of December 31, 2024.
In October, we entered into a $60 million tight financing, which, on a pro forma basis, expanded our cash and cash equivalents to approximately $292.3 million as of that date. This strengthening of our balance sheet allows us to execute our strategy with an expected cash runway extending at least to 2028. Across the LOTIS-5, LOTIS-7, and MZL's ZYNLONTA programs, we expect to have data catalysts in the remainder of 2025 and 2026. For LOTIS-5, we expect to provide top-line data in the first half of 2026 once the pre-specified number of PFS events is reached and data are available. Subject to positive results, a supplemental biologics license application submission to regulatory authorities will follow, with potential confirmatory approvals in second-line plus DLBCL, as well as publication and compendia inclusion in the first half of 2027.
With LOTIS-7, following presentation of the data at EHA and ICML in June, we observed an acceleration in enrollment in the study at the selected 150 micrograms per kilogram dose level. We plan to provide a clinical update on all efficacy-evaluable patients with a minimum of six months of follow-up through a corporate announcement before the end of the year. Once sufficient data with longer follow-up are available, we plan to engage with the FDA. In addition, assuming positive results, we plan to pursue publication and compendia inclusion in the first half of 2027. With indolent lymphomas, we expect additional data to be shared at medical conferences by the lead investigators, and we plan to assess regulatory and compendia strategies once sufficient data are available. Beyond ZYNLONTA, we continue to advance our exatecan-based PSMA targeting ADC with completion of IND-enabling activities anticipated toward the end of this year.
I will now turn the call back over to Ameet.
Thank you, Pepe. Let me close by saying that I am pleased with how we are executing against our strategy and continue to be excited by the consistently encouraging ZYNLONTA data we are generating across our ongoing trials. We have a clear vision to unlock the true potential of the company with multiple potential value-creating milestones ahead and a balance sheet that enables us to deliver on our strategy. We can now open the line for questions. Operator?