ADC Therapeutics (ADCT) Q1 2025: Lotus 7 Response Rate Hits 95.5%, Accelerating Compendia Path
ADC Therapeutics’ Q1 showcased standout Lotus 7 efficacy data and a disciplined cost base, sharpening focus on regulatory and compendia strategies. The company’s expanding clinical pipeline and cash runway into 2026 underpin a multi-pronged approach to value creation, with pivotal readouts and guideline inclusion now in sharper view.
Summary
- Lotus 7 Data Ups the Bar: Zynlanta plus glofitamab posted a 95.5% response rate, with 90.9% complete responses in efficacy-evaluable patients.
- Cost Control Bolsters Runway: Operating expenses fell 5% YoY, extending cash runway into H2 2026.
- Regulatory and Compendia Push: Management is prioritizing guideline inclusion and regulatory dialogue as pivotal trial data matures.
Performance Analysis
ADC Therapeutics delivered Q1 total revenues of $23 million, with net product sales of $17.4 million for Zynlanta, maintaining volume in a competitive third-line plus DLBCL (diffuse large B-cell lymphoma) market. The quarter also benefited from $5.6 million in milestone and royalty payments, including a milestone tied to Health Canada approval. Operating expenses on a non-GAAP basis declined 5% YoY, reflecting lower SG&A spend and disciplined cost management, while the net loss narrowed to $38.6 million from $46.6 million a year ago.
Cash and equivalents ended at $194.7 million, down from $250.9 million at year-end, driven by operating losses and timing of partner payments and rebates. Management highlighted a cash runway into the second half of 2026, aided by continued expense discipline and milestone receipts. The company’s revenue mix remains heavily weighted to Zynlanta, with early-stage pipeline and licensing revenue contributing modestly.
- Revenue Stability: Zynlanta sales held steady, underscoring persistent demand in third-line plus DLBCL despite intensifying competition.
- Expense Management: SG&A reductions and low R&D outlays for discontinued programs supported a leaner cost base.
- Cash Burn Moderation: Milestone timing and rebates influenced quarterly cash flows, but the extended runway offers strategic flexibility for upcoming catalysts.
Near-term financial health is anchored by prudent spending and milestone receipts, but future revenue inflection will hinge on clinical and regulatory progress, especially for earlier-line and combination regimens.
Executive Commentary
"We are encouraged by the promising Lotus 7 EHA abstract data demonstrating the potential for Zynlanta plus glofitamab to be a best-in-class combination in a highly competitive market... The data we've seen across these settings so far has been consistently encouraging with the potential to be highly differentiating."
Amit Malik, Chief Executive Officer
"Total operating expenses for the quarter were $49.1 million on a non-GAAP basis, representing a 5% net decrease over prior year, driven primarily by a reduction in SG&A... With an expected cash runway into the second half of 2026, I'm confident that ADC Therapeutics is well positioned to deliver on our catalyst and drive value creation for all our stakeholders."
Pepe Carmona, Chief Financial Officer
Strategic Positioning
1. Zynlanta Combination Strategy
The company is doubling down on Zynlanta, antibody-drug conjugate for DLBCL, as the anchor for both monotherapy and combination regimens. The Lotus 7 trial, combining Zynlanta with glofitamab, has yielded an unprecedented 95.5% overall response rate and 90.9% complete response rate in efficacy-evaluable patients. This efficacy, coupled with a manageable safety profile, positions the regimen as a potential new standard for second-line plus DLBCL—especially against the backdrop of CAR-T and other bispecific combinations, where complete response rates have historically peaked in the 47% to 70% range.
2. Compendia and Regulatory Pathways
Management is pursuing a dual-track strategy: aiming for both regulatory approval and inclusion in clinical guidelines (compendia) for expanded Zynlanta use. Recent precedent suggests compendia listing can be achieved with robust data from approximately 100 patients with sufficient follow-up. The company is actively assessing expansion of Lotus 7 to this threshold and plans regulatory discussions in the second half of 2025, while also preparing for guideline submissions.
3. Pipeline Rationalization and Capital Allocation
ADC Therapeutics discontinued the ADCT602 program (CD22-targeted ADC for ALL), reallocating resources toward its exotecan-based ADC research and Zynlanta clinical programs. The pipeline now emphasizes differentiated targets like PSMA and CLAUDIN6, with out-licensing and partnering discussions ongoing. This focus aims to maximize capital efficiency and prioritize assets with the greatest commercial and clinical impact.
4. Value Creation Catalysts
The company’s near-term value inflection points are tightly linked to clinical milestones: updated Lotus 7 data at EHA/ICML, top-line Lotus 5 results (Zynlanta plus rituximab in second-line plus DLBCL) expected by early 2026, and progress on compendia inclusion. Management is confident these catalysts, combined with cash runway, will support sustained value creation and improved market positioning.
Key Considerations
This quarter’s narrative is defined by a sharp focus on clinical differentiation and operational discipline, with management leveraging data momentum to drive both regulatory and commercial expansion.
Key Considerations:
- Exceptional Efficacy Signal: Lotus 7’s 95.5% response rate sets a new benchmark for DLBCL combinations, raising the bar for future competitors and supporting guideline pursuit.
- Guideline Inclusion as Revenue Lever: Compendia listing could unlock broader Zynlanta usage and payer access without requiring full regulatory approval, accelerating commercial uptake.
- Financial Flexibility: A cash runway into H2 2026 provides a buffer to execute on pivotal trials and business development, with expense discipline further supporting strategic options.
- Pipeline Focus: Discontinuation of lower-priority programs and emphasis on high-value combinations and novel ADC targets reflect a pragmatic approach to capital allocation.
Risks
Key risks center on durability of Lotus 7 responses, as current follow-up is limited and longer-term efficacy and safety data are needed to secure regulatory and guideline milestones. Competitive pressure remains intense, with multiple CAR-T, bispecific, and chemo-based regimens vying for market share. Delays in pivotal trial readouts or compendia decisions could impact revenue trajectory and market adoption, while reliance on a single commercial product heightens execution risk.
Forward Outlook
For Q2 2025, ADC Therapeutics expects:
- Updated Lotus 7 data at EHA and ICML, including expanded patient cohorts and longer follow-up.
- Additional milestone and royalty receipts, with continued stable Zynlanta sales.
For full-year 2025, management maintained guidance:
- Cash runway into H2 2026, supported by prudent expense management and milestone-driven revenue.
Management emphasized several forward drivers:
- Progressing toward 100-patient Lotus 7 cohort to support compendia and regulatory submissions.
- Top-line Lotus 5 data by early 2026 as a pivotal catalyst for expanded Zynlanta use.
Takeaways
ADC Therapeutics enters the next phase of its strategy with clear clinical momentum and financial discipline, but must deliver on durability and compendia milestones to unlock meaningful commercial upside.
- Lotus 7 efficacy is a standout differentiator, but durability and broader patient data will be scrutinized by regulators and payers.
- Compendia strategy could accelerate Zynlanta adoption, offering a non-traditional path to expanded revenue ahead of full regulatory approval.
- Investors should watch for guideline inclusion, pivotal trial readouts, and signals of durable response in larger patient cohorts as the next major inflection points.
Conclusion
ADC Therapeutics’ Q1 2025 results highlight a company executing with focus: Lotus 7’s early efficacy data, disciplined spending, and a dual-path regulatory strategy set the stage for pivotal catalysts in the coming quarters. Success now hinges on converting clinical promise into durable, guideline-backed commercial growth.
Industry Read-Through
The Lotus 7 results reinforce the rising bar for efficacy in DLBCL and the growing importance of combination regimens that deliver both depth and durability of response. Compendia listing strategies are emerging as viable accelerants for commercial uptake in oncology, especially where regulatory timelines are protracted. Peer companies in the ADC and bispecific antibody space should note the increasing emphasis on real-world guideline inclusion, as well as the necessity of demonstrating not just response rates but durable, manageable safety profiles. Capital allocation discipline and pipeline prioritization are becoming table stakes for clinical-stage biotechs facing long development timelines and competitive markets.