ADCT

Good morning, ladies and gentlemen, and welcome to the ADC Therapeutics Q1 2026 earnings conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star 0 for the operator. This call is being recorded on Monday, May 4, 2026. I would now like to turn the conference over to Nicole Riley, Head of Investor Relations and Corporate Communications. Please go ahead.

Thank you, operator. Today, we issued a press release announcing our first quarter 2026 financial results and business updates. This release and the slides we will use in today's presentation are available on the Investors 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, followed by our Chief Financial Officer, Jose Carmona, who will review our first quarter 2026 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 first quarter 2026 earnings release for information and reconciliation of historical non-GAAP measures to the comparable GAAP financial measures. I will now turn the call over to our CEO, Ameet Mallik. Ameet.

Thank you, Nicole. We continue to make good progress in the first quarter of 2026 as we advance towards multiple important milestones for ZYNLONTA over the remainder of the year, beginning with the expected LOTIS-5 top-line readout in the second quarter. From a commercial perspective, 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. First quarter net product revenues were $20.0 million as compared to the prior year's first quarter net product revenues of $17.4 million. The increase was driven primarily by normal quarter-to-quarter variability in customer ordering with underlying demand broadly stable.

Looking toward the second-line plus setting where we believe the largest growth opportunity lies, for LOTIS-5, our phase III confirmatory trial of ZYNLONTA plus rituximab, we expect to share top-line data before the end of June, potentially bringing us another step closer to providing this combination to significantly more patients. While this timeline is rapidly approaching, I do wanna highlight that we are currently still blinded to the data. Turning to LOTIS-7, we expect to complete enrollment of approximately 100 patients at the selected dose level of ZYNLONTA plus ofatumumab in the second quarter, with full data anticipated by year-end.

In indolent lymphomas, we continue to anticipate data publication between the end of 2026 and mid-2027 from the multicenter investigator-initiated trials of ZYNLONTA in combination with rituximab to treat relapsed or refractory follicular lymphoma and of ZYNLONTA as a monotherapy to treat relapsed or refractory marginal zone lymphoma. We continue to pay close attention in the quarter to managing our cost base and optimizing our balance sheet. On a non-GAAP basis, we reduced our total operating expenses by 13% versus Q1 2025, and we ended the first quarter of 2026 with a healthy cash balance of $231 million. This maintains our expected cash runway at least into 2028, enabling us to deliver against our strategy.

We are building off the well-established role of ZYNLONTA as a single-agent therapy in third-line plus DLBCL, where ZYNLONTA has a profile of rapid, deep, and durable efficacy, as well as manageable safety with simple and convenient administration. We believe the relative stability we've seen in net product revenues over multiple quarters demonstrates that ZYNLONTA has a clear place in this market. This is just a starting point as we believe in the potential for ZYNLONTA 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 have been consistently encouraging, with the potential to be highly differentiating.

Through expansion into these settings in DLBCL and into indolent lymphomas, we are confident that ZYNLONTA has the potential to reach peak annual revenues of $600 million-$1 billion in the U.S., assuming both Compendia listing and regulatory approval. The upcoming LOTIS-5 trial readout, if positive, will begin to unlock the value of our lifecycle management efforts with ZYNLONTA. Taken together with the upcoming data expected from LOTIS-7 and the indolent lymphoma studies, we expect to accelerate our revenue growth trajectory starting in 2027. I would like to turn the call over to Jose Carmona, our CFO, who will discuss financial results for the first quarter. Pepe.

Thank you, Ameet. On the financial front, ZYNLONTA net product revenues in the first quarter of 2026 were $20 million as compared to $17.4 million in the same quarter in 2025. Licensing revenues and royalties were lower this year due to a $5 million milestone we received from our partner in the prior year period. Cost product sales increased by $1.6 million to $3.6 million for the three months ended March 31, 2026. This increase reflects a shift in the allocation of certain personnel costs due to a change in focus from research and development activities to commercial manufacturing activities. Total operating expenses were $46.1 million for the first quarter. On a non-GAAP basis, total adjusted operating expenses were $42.9 million for the quarter.

Total adjusted operating expenses were down by 13% over the prior year period, primarily driven by lower R&D expenses. As Ameet noted, we're managing our costs carefully, and we remain disciplined in our capital allocation towards potential value creation while driving efficiencies. On a GAAP basis, we reported a net loss of $33 million for the first quarter of 2026, or $0.21 per basic and diluted share, as compared to a net loss of $38.6 million or $0.36 per basic and diluted share for the same period in 2025. On a non-GAAP basis, the adjusted net loss was $19.7 million for the first quarter of 2026, as compared to a net loss of $24 million for the same period in 2025.

The lower net loss on both GAAP and non-GAAP basis was primarily due to reduced R&D expenses. The year-over-year reductions on a per-share basis were additionally impacted by the higher number of weighted average shares outstanding. You can find the reconciliation of GAAP to non-GAAP measures for the first quarter in the accompanying financial tables of the press release issued earlier today and in the appendix of this presentation. At the end of the first quarter, we had cash and cash equivalents of $231 million, as compared to $261.3 million as of December 31, 2025. This provide us with an expected cash runway at least into 2028. Turning to upcoming milestones, we expect to have multiple data catalysts during the remainder of 2026 across the ZYNLONTA program.

First, we expect to share the top-line data for LOTIS-5 before the end of June, with publication of full results anticipated by the year-end. As Ameet noted, we're currently blinded to the data. Until the top-line data has been presented, we will remain in a blackout period, which means we may need to cancel our participation in any conferences as well as meetings with investors and analysts. Assuming the results are positive, we plan to submit a supplemental Biologics License Application to the FDA by year-end, with potential publication and Compendia inclusion in the first half of 2027 and confirmatory approval to follow thereafter. With LOTIS-7, we're on track to complete enrollment in the second quarter. We plan to share the next update with full data at a medical meeting by the end of 2026.

In addition, assuming positive results, we plan to pursue Compendia inclusion as well as assess a regulatory strategy. With indolent lymphomas, we expect the lead investigator to share additional data at medical conferences between the end of 2026 and mid-2027, and we plan to assess regulatory and Compendia strategies once sufficient data are available. I will now turn the call back over to Ameet.

Thank you, Jose Carmona. To close, I am pleased with our start to 2026. We have achieved solid commercial performance while maintaining our strict capital discipline as we look forward to multiple anticipated value-creating catalysts, beginning with the expected LOTIS-5 readout. We are excited about delivering on our strategy and confident we can drive significant potential long-term growth starting in 2027. We can now open the line for questions. Operator?

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the one on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment please for your first question. Your first question comes from Maury Raycroft with Jefferies. Your line is now open.

Hi. Good morning. Congrats on the progress and thanks for taking my question. You mentioned on the call that you remain blinded to the data. Can you clarify if the database is locked at this point and when you reach the 262 events? From a process standpoint, can you say what's happening currently and what are the drivers that will allow you to unblind the data?

Yeah, thanks for the question. What I can tell you is we're on track to be able to read the data. We're completely blinded to the data, so I don't know any information yet. As soon as the database gets locked and we do the statistical analysis, we'll then be able to disclose top-line data. We're not at that point yet.

Got it. Understood.

We are on track to basically share the data this quarter.

Got it. Okay. For when you reach the 262 events, is there anything more on that you're saying from a timing perspective?

Yeah. We're not commenting on exactly, you know, when we're hitting the events. What I can tell you is, we're on track to, you know, to basically to get to the top-line results this quarter, in the second quarter.

Okay. Okay, understood. Maybe one other quick question. Following the site-level interventions you implemented to address the early dropout and censoring, do you have any perspective potentially from the IDMC to provide any indication that censoring rates improved after those changes? I guess any more color on that could be helpful.

I can't comment further. What I can tell you is the last IDMC look, which was from a safety standpoint, was last fall. Again, that the recommendation was to proceed as is. There's been any other looks from the IDMC at the data.

Understood. Okay. Thanks for taking my questions.

Yeah. Thank you so much. Appreciate it.

Your next question comes from Michael Schmidt with Guggenheim. Your line is now open.

Oh, hey, guys. Good morning. Thanks for taking my questions. I had a couple. Maybe first, commercially, the $20 million in Q1, it's about 15% growth annually. I know you mentioned ordering pattern, but it just seems a more growth than we've seen in recent quarters. Just curious if there's anything else going on in terms of driving more volume, perhaps in the approved indication in the market. Then the other question I just had on LOTIS-5. You know, great to hear that the data is still on track for this quarter. Could you just comment on how much of the result you'll be able to disclose in a top-line announcement?

Will you be able to share things like median PFS or perhaps, hazard ratios, et cetera, in the, in the top-line release? Thanks so much.

Yeah. Thanks, Michael. First in sales, as you recall, Q3 was quite low, and Q4 was quite strong. We have $16.8 million, then $22.3 million. Now we're at $20 million. I think it's too soon to call a change in trend, to be honest right now. I think what we're seeing is, you know, definitely very good execution. We're happy that we've been able to maintain, you know, our share despite, you know, a very competitive environment. There is quarter-to-quarter variability. As we saw, like Q3 was one of the lowest quarters, and then Q4 was one of the higher quarters in the last couple years. I think after 2 quarters in that $20-plus million range, it's encouraging, but too soon to call a trend.

I think if this continues, that may cause us to sort of change where we think the range is going to be. I think at this point, just given the variability we've seen in the last couple of years, I think we're still in the range of normal demand within the, you know, patterns of customer ordering, variability. With regards to LOTIS-5, yeah, we plan to share all the relevant information on the primary endpoints, of course, like median PFS, hazard ratio, any information that we have on key secondary endpoints, as well as top-line safety data. We do want to make sure that the disclosure is clear with the information that we have and well understood what the result is.

At the same time, you know, a lot of sub-analyses and other things that are typically less relevant for a top-line result, but critical for, let's say, a medical conference or publication, those would be details that would come later in the year.

Thank you.

Yeah. Thanks, Michael.

Your next question comes from Eric Schmidt with Cantor. Your line is now open.

Thanks for a very efficient call. A couple of questions for me also on LOTIS-5. First, with regard to, procedures, do I take Jose's comments to mean that you're now entering the quiet period? Is that starting after today?

We started actually a quiet period. We have to do earnings, of course, but we haven't been engaging with analysts or investors since April 1. For the whole quarter until we disclose the data. Yeah.

Thank you. Ameet, on the information that you'll be able to disclose with regard to the top-line data for LOTIS-5 this quarter, will we get some thoughts on how survival is trending? I know the trial's primary endpoint is PFS and you're well-powered there. Wondering if you'll be able to provide color on OS trends, and then if you know at this point how many OS events or how mature the OS data might be at the time of the PFS top-line look. Thanks.

In addition to PFS, which obviously will be mature, we will give the information that we have on overall survival. Whether it's mature or it's a trend, we will provide the information that we have on overall survival as well as the other key secondary endpoints as well, like response rate, duration of response. We plan to share all the information we have. I can't comment right now on how many events we have with regards to overall survival, what I can tell you is, You know, with whatever information we have, we will make it part of the disclosure.

Maybe just one modeling note for Jose Carmona. The change that we saw, from personnel from R&D into cost of goods. Is that an ongoing transition? Are we expecting costs to be inflated in subsequent quarters as well?

It is gonna continue throughout all quarters from now on. It's a reallocation of those expenses into cost of goods and we capitalize one time inventory, but the cost of goods are gonna increase because of this fixed cost and now it's getting allocated. Yeah.

Thank you very much.

Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Sudan Loganathan with Stephens. Your line is now open.

Hi. Good morning. Appreciate taking the question. My first one, wanted to ask, you know, will you believe the immediate impacts post the LOTIS-5 top line results in the second quarter, you know, could be, you know, as for instance, if it is positive, good PFS readout, you know, how this may change, how ZYNLONTA is prescribed or viewed in the second half of this year, even prior to Compendia listing? Secondly, just wanted to ask even, push over to the IITs, you know, how does that add some incremental value, you know, over the, like, next year or two? Thanks.

Sure. Yeah. Once we get to the top line readout, assuming it's positive, we then would work to go down 2 paths. One is to prepare the sBLA submission. That typically takes 4 to 5 months. We expect to have that certainly before the end of this year. That could lead to an approval thereafter next year. In addition, we plan to submit to a medical congress and publication by the end of this year to be able to share the full details of result. That would be the basis that we would submit to Compendia, we expect that we could get Compendia inclusion sometime in the first part of next year, an approval sometime thereafter in 2027. We don't expect any revenue impact this year.

We expect this year to be largely in line with what the previous years are and only see a revenue trajectory increase next year. As you know, we'll only start promoting the product once we have formal approval sometime around the middle of next year. Your second question was around the IITs, correct?

Yeah, yeah.

Okay. With the IITs, we have both marginal zone and the follicular lymphoma IITs. Both of those, the data on the full study will be disclosed sometime between the end of this year and the middle of next year. We expect publications to happen around that same time and then to be submitted for Compendia inclusion after that. In addition, we're evaluating the regulatory approach for that we would take in indolent lymphomas when we move forward in parallel.

Great. I appreciate the details and looking forward to the readout.

Yeah. Thank you.

No further questions at this time. I will now turn the call over to Ameet Mallik for closing remarks.

Thank you all for joining the call today and for your continued support. We look forward to keeping you updated on our progress and look forward to speaking soon. Operator, you may now end the call. Thank you.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating. In that say, please disconnect your lines.

Good morning, ladies and gentlemen, and welcome to the ADC Therapeutics Q4 2025 Earnings Conference Call. [Operator Instructions] I will now turn the call over to Nicole Riley, Head of Investor Relations and Corporate Communications for ADC Therapeutics. Nicole, please go ahead.

Thank you, operator. Today, we issued a press release announcing our fourth quarter and full year 2025 financial results and business updates. This release and the slides we will use in today's presentation are available on the Investors 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, followed by our Chief Financial Officer, Pepe Carmona, who will review our fourth quarter and full year 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 fourth quarter full year 2025 earnings release for information and reconciliations of historical non-GAAP measures to the comparable 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. We are pleased to share an update on our achievements in 2025 and our excitement for the future. Before I get into the details, I'd like to take a moment to reflect on the progress we've made over the past few years and why we believe this positions us strongly for the future. We have implemented a strategic plan to focus on ZYNLONTA with optimized life cycle management. This includes advancing LOTIS-5 as well as initiating the bispecific combination study, LOTIS-7 and IITs in indolent lymphomas. By focusing the company, we reduced our operating cost structure by approximately 50%. At the same time, we refined our go-to-market model, which resulted in strengthened KOL advocacy, and a sustained market position in the third-line plus DLBCL setting despite the entry of the bispecific class. Central to these achievements, we upgraded leadership and talent across the organization which resulted in improved execution. Lastly, we strengthened our balance sheet through equity and BD and improved our strategic flexibility with an amended HCR agreement. Having set the strategic course for our company, we see 3 horizons for potential value creation. These are centered around final data disclosures, approval and compendia inclusion and ultimately delivering growth. As we advance across these horizons, our vision is to first establish ZYNLONTA as a backbone therapy with a differentiated clinical profile across combinations in second-line plus DLBCL. Second, provide significant patient benefit in indolent lymphoma, including follicular lymphoma and marginal zone lymphoma. And third, achieve potential annual U.S. peak revenue opportunity of $600 million to $1 billion, assuming compendia inclusion and regulatory approval with a highly leveraged cost structure providing us with broader opportunities to invest in complementary hematology assets. 2025 was a year of substantial progress for our company. We further derisked our portfolio with multiple exciting milestones achieved for key ZYNLONTA trials in both second-line plus DLBCL and through the indolent lymphoma IITs. We undertook a strategic reprioritization to focus resources on ZYNLONTA expansion opportunities, positioning the company for long-term growth with significantly reduced operating expenses, and we significantly strengthened our balance sheet, providing us with the ability to deliver against our objectives. Among our accomplishments from a commercial perspective, 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. Building off an unusually low Q3. Performance was strong in Q4 with net product revenues of $22.3 million, primarily driven by variability in customer ordering patterns, as well as activation of some new accounts. Sales for the year were $73.6 million and remained roughly stable in line with our expectations in the third-line plus setting. Looking toward the second-line plus setting, where we believe the real growth opportunity lies, with LOTIS-5, we expect to share top line data in the second quarter of 2026, potentially bringing us another step closer to providing this combination treatment to significantly more patients. With LOTIS-7, we expanded target enrollment to approximately 100 patients at the selected dose level and shared updated safety and efficacy data on 49 efficacy evaluable patients in December, which we believe continues to support the potential for this regimen to be a best-in-class combination in a highly competitive market. Indolent lymphoma's promising Phase II data was also shared in 2025 from the multicenter investigator-initiated trials of ZYNLONTA in combination with rituximab to treat relapsed or refractory follicular lymphoma and of ZYNLONTA as a monotherapy to treat relapsed or refractory marginal zone lymphoma with presentations at the International Conference on malignant lymphoma and the international workshop on non-Hodgkin lymphoma. We anticipate publication of data across these IITs between the end of 2026 and mid-2027. Most recently, we were pleased to have entered into an amendment to our royalty purchase agreement with HealthCare Royalty. This update to the terms of our agreement is a reflection of ACR's conviction and the long-term value of ZYNLONTA, and we believe these new terms give us greater strategic flexibility. Finally, from a corporate perspective, through strict capital management in 2025, including a strategic reprioritization and multiple financings, we ended the year with a cash balance of $261 million with an expected cash runway at least into 2028. With this significant progress, we are confident in our path ahead as we work to make an impact for more patients moving forward. As a single-agent therapy and 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 differentiated. We continue to believe that through expansion into these settings, ZYNLONTA has the potential to reach peak annual revenues of $600 million to $1 billion in the U.S. Our current indication, as I noted earlier, has 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 million to $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 of the monotherapy, we expect to gain share in the second line offsetting and improved duration of therapy. With LOTIS-7, we estimate we can expand the total opportunity for ZYNLONTA in DLBCL to $500 million to $800 million in peak annual revenue with both regulatory approval and compendia listing. If the data continues to be compelling, we believe ZYNLONTA plus glofitamab has the potential to transform the future of 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 million to $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 setting, 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 like CAR-T, transplant and biospecifics. The second segment comprises more broadly accessible therapies which all physicians can administer in the outpatient setting and include ADCs, monoclonal antibodies and chemotherapy. The launch of bispecifics is monotherapy in the third-line plus study 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 or added last year 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 7, we believe ZYNLONTA combinations have the potential to raise the borrowing efficacy in second-line plus DLBCL in their respective treatment segments, establishing ZYNLONTA as a backbone therapy with a differentiated clinical profile across combinations and 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 signals 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 Ib trial, we are combining ZYNLONTA with a highly effective bispecific, glofitamab in second-line plus patients. In December, we reported updated data from the trial, which demonstrated a 90% best overall response rate and a 78% complete response rate across 49 efficacy evaluable patients with a minimum of 6-month follow-up. Not only did this support a clinically meaningful benefit for patients, but the data also showed the combination continues to generally be well tolerated with a manageable safety profile. Taken together, we are encouraged by the expanding data set, 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 across these 2 treatment segments, we believe the emerging clinical profile of ZYNLONTA plus glofitamab in LOTIS-7 positions us well among complex therapies. And at the same time, the clinical profile of ZYNLONTA plus rituximab in LOTIS-5 has the potential to differentiate us among broad-based sensible therapies. Together, we believe these combinations have the potential to double the addressable patient population as we move into second-line and increase the duration of therapy moving, on average, from 3 cycles to 5 to 6 cycles. We have established a place for ZYNLONTA monotherapy today in later lines because it works quickly. CRs, when achieved, are durable, and it has manageable safety and a convenient dosing schedule. As compared to our current indication as a monotherapy, we believe an improved CR rate in a broader patient population with LOTIS-5 will makes ZYNLONTA more relevant among both academic and community treaters, especially for patients who cannot access, are not suitable for or progress on a CAR-T or bispecific based therapy. When you take into account the fact that there are approximately 12,000 patients in the second line, in addition to the approximately 6,000 in our currently addressable third-line plus patient population and the average number of cycles in ZYNLONTA will increase from approximately 3 to 5. We believe that once in the second-line setting, we will be positioned to reach more patients with additional cycles and we'll capture share accordingly. In the second line setting, every 10 points of share translates to approximately $200 million in revenue and every 10 points of share in the third-line plus setting to approximately $100 million based on the expected longer duration of therapy for this combination. We have already achieved an approximately 10% share in the third-line plus setting as a monotherapy with a CR rate lower than that of competitive combination-based therapies. Therefore, if we maintain a 10% share we have today in the third-line plus setting, achieving only 5% to 10% share in the second-line setting, would translate to roughly $200 million to $300 million in peak sales opportunity for the ZYNLONTA plus rituximab combination alone. Taken together with the DLBCL bispecific combination and indolent lymphoma opportunities, we believe we could deliver on our vision of a combined potential peak annual revenue of $600 million to $1 billion in the U.S. assuming compendia listings and regulatory approvals. Now I will turn the call over to Pepe Carmona, our CFO, who will discuss financial results for the fourth quarter. Pepe?

Thank you, Ameet. On the financial front, ZYNLONTA net product revenues in the fourth quarter of 2025 were $22.3 million as compared to $16.4 million in the same quarter in 2024. On a full year basis, net product revenues were $73.6 million versus $69.3 million in 2024 with an underlying volume broadly flat. Total operating expenses were $41 million and $202.9 million for the fourth quarter and full year ended December 31, 2025, respectively. On a non-GAAP basis, total adjusted operating expenses were $39.4 million and $181.3 million for the quarter and full year ended December 31, 2025, respectively. Total adjusted operating expenses were down over prior year by 15% and 6%, respectively. The reduction in total adjusted operating expenses for the fourth quarter was primarily driven by lower R&D expenses. The decrease in total adjusted operating expenses for the full year was across all major lines of the income statement. We continue to be disciplined in our market allocation towards potential value creation while driving efficiencies across the portfolio. On a GAAP basis, we reported a net loss of $6.4 million for the fourth quarter of 2025 or $0.04 per basic and diluted share as compared to a net loss of $30.7 million or $0.29 per basic and diluted share for the same period in 2024. Net loss for the full year ended December 31, 2025 was $142.6 million or a net loss of $1.12 per basic and diluted share as compared to a net loss of $157.8 million or a net loss of $1.62 per basic and diluted share for the full year ended December 31, 2024. The lower net loss over both periods was primarily due to a higher cumulative catch-up adjustment gain associated with our deferred royalty obligation and reduced R&D expenses partially offset by a restructuring impairment and related costs incurred in connection with the strategic realization and restructuring plan. You can find the reconciliation of GAAP to non-GAAP measures for the fourth 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 $261.3 million compared to $250.9 million as of December 31, 2024. We significantly strengthened our balance sheet in 2025 by entering into a $100 million PIPE financing in June 2025 and a $60 million PIPE financing in October 2025, providing an expected cash runway at least into 2028. We expect to have multiple data catalysts in 2026 across the ZYNLONTA program. For LOTIS-5, we expect to provide top line data in the second quarter of 2026. We expect to publish full results by the year-end. Assuming the results are positive, we will file a supplemental biologic license application submission to the FDA with potential publication and compendia inclusion in the first half of 2027 and confirmatory approval to follow in mid-2027. With LOTIS-7, we plan to share the next update with full data at a medical meeting and through publication by the end of 2026. In addition, assuming positive results, we plan to pursue competing inclusion as well as assess a regulatory strategy. Within indolent lymphomas, we expect additional data to be shared at medical conferences by the lead investigators between the end of 2026 and mid-2027 and we plan to assess regulatory and competitive strategies while sufficient data are available. I will now turn the call back over to Ameet.

Thank you, Pepe. To close, we achieved meaningful progress across our ZYNLONTA clinical program in DLBCL and through investigator-initiated trials in indolent lymphomas this past year. And we believe we have laid the foundation for multiple anticipated value-created catalysts ahead, as Pepe just highlighted. With our strengthened cash runway, we are confident we will drive significant potential long-term growth beginning in 2027. We can now open the line for questions. Operator?

[Operator Instructions] Our first question comes from Maury Raycroft from Jefferies.

Congrats on the priors. I'm going to ask one on LOTIS-5. At a high level, how are PFS events tracking relative to the 262 events required to trigger the top line analysis? Is there any chance the readout could get bumped into third quarter? And then wondering if you can clarify what will be included in the top line and whether CR durability could be included in that update? Or is that more likely to be reserved for a later medical conference?

Yes. Thanks so much for the question. So we are confident in the Q2 timing of the top line readout. So we expect to be able to hit the events in time, and we will be able to share top line data in Q2. We're very confident in that. In terms of what we expect to share, we're going to share the primary endpoint, which is PFS for the trial. That's what the study is powered to show. In addition, we're going to share all the secondary endpoints that are mature as of the time of the top line data as well as key safety tables. So we want to make sure that we're as transparent as possible with the market without compromising obviously, publication that we expect to happen by the end of the year.

Your next question comes from Michael Schmidt from Guggenheim.

Another one on LOTIS-5. And so just thinking about your market projections in second-line DLBCL. I think you spoke about an incremental $200 million to $300 million opportunity, assuming maintaining sort of a 10% share in that setting. And I was just wondering if that is perhaps too conservative. I'm just curious how you think about the market, especially now that we've seen Monjuvi perhaps moving into first-line, we see some of the bispecific antibody data reading out, perhaps below expectations. And so I'm just curious if there's upside perhaps to your LOTIS-5 opportunity assessment? And then I had a follow-up question.

Yes. I mean, I think based on the profile we saw in the safety run and if the final results look similar, obviously very highly confident that we can play a meaningful role in second-line plus DLBCL with this combination. To your point, we've already achieved an approximately 10% share in the third-line plus setting as a monotherapy. And I would say it has some attributes that physicians really like the fact that it works very quickly, very durable CRs, manageable safety profile, convenient dosing. One of the drawbacks right now is we have a less than competitive CR rate because we're competing against combination. So of course, now with the combination, we expect to have competitive and potentially been differentiating CR rates with a positive Phase III study. So we do feel confident we should be able to maintain that share in the 10% range in the third-line plus setting. And if we're able to maintain that same 10% in second- line, that would translate to $300 million. The exact, I would say, peak sales opportunity, we're going to know when we know the clinical profile because we think we can achieve this even with a competitive profile relative to other competitors. If we have a more differentiated profile, potentially we could do more. But we'll revisit the peak sales opportunity once we know the final clinical profile of the combination.

Yes. That makes sense. And then just another question on LOTIS-5. So just curious whether you've allowed crossover in this study? Especially as it pertains to getting an early look at overall survival, whether that's something that could perhaps be achieved? And then the other question related to that, I had is how are you thinking about potential use of bispecific antibodies post-progression perhaps impacting OS. Obviously, that could happen in either arms of the study. But I'm just curious, in general, perhaps how meaningful or how important you think OS could be as a differentiator in the setting, which obviously was not achieved by some of the other programs in second-line.

Yes. So we obviously don't know whether and how the subsequent therapies are between the different arms. So that's -- whether there were CAR-T bispecifics, as you said, or any other therapies, we're not obviously certain, we're completely blinded in terms of the study. Obviously, subsequent therapies can affect overall survival. I think the way we look at this is if we have a positive PFS without any detrimental effect to overall survival and overall a positive benefit risk profile, we think that we'll have a very good submission for the FDA.

Your next question comes from Eric Schmidt from Cantor.

This is Alexa on for Eric. And congrats on a great year. So one question for me. So R&D spend was down about $10 million from the previous quarter. So do you expect what we're seeing in Q4 to be the current run rate going forward?

Thanks, Alexa. I appreciate the question. So Pepe I'll turn that question to you around R&D spend in Q4 and what we expect going forward.

Yes. Thanks for the question. So we expect that as we move to 2026 and 2027, R&D expenses should go down, assuming we maintain the current number of trials and the current pipeline that we have as the LOTIS-5 trial will continue to wind down and then LOTIS-7, we'll get to a peak, but then will go down. So R&D expenses are expected to fluctuate quarter-over-quarter, but in general, for '26 and '27 to be going down.

Your next question comes from Sudan Loganathan from Stephens.

The first one, given the amended health care royalty agreement, they expect the cash flow weigh into 2028. How should we think about the capital allocation priorities between commercial investment behind ZYNLONTA or advancing combination strategies and then the potential business development angle, especially considering the remaining deferred royalty and term loan obligations?

Yes. I'll start off, and then Pepe, feel free to add. So I would say that right now, we feel pretty confident with our cash runway guidance that even with relatively stable revenues until we get to the new indications, which we expect to happen in 2027 with LOTIS-5 and as well as with the cost guidance that Pepe just mentioned, for all the activities that we have currently planned, our current LOTIS-5, our current LOTIS-7, our current IITs, all of our current ongoing activity as well as investing more prelaunch in both commercial and medical affairs activities. That's -- those are all the assumptions that we have in our current guidance. Obviously, if we were to do any additional life cycle management or new activities that would not be currently based within our cash runway guidance that we have right now. We think the ACR agreement provides strategic flexibility now because, obviously, by reducing the change in control payment just allows more strategic flexibility and optionality for the company going forward. And so we're really pleased by that. In exchange, of course, they continue the royalties, which given that our COGS is low to mid-single digit, when you add on the royalty agreement, the gross margin is still quite good for this product even when you add both of those things then. But Pepe is there anything else you would add to what I just said?

Yes. I think you gave all the details. It's -- at the end of the day, we are solely focused on driving ZYNLONTA growth, and that's by completing the LOTIS-5 and LOTIS-7 and indolent lymphoma trials. That capital has been allocated and is part of our cash runway as well as all the prelaunch activities and launch activities of ZYNLONTA in 2027 in the second-line setting. It does also cover some of those expenses related to a loan. So it's all included. We believe we have a really strong cash position right now to execute on our plan.

And if I could, just a second one real quick. I wanted to ask about if you can give any details on maybe your market strategy as you get some of these last final data readouts this year and looking -- going towards the regulatory -- compendia and regulatory inclusion pathway first half of next year. Could you give us any details on how your marketing strategy could change to get into the DLBCL space, the second-line space?

I mean the good thing is we have a very good footprint. So our field force already covers about 90% of the potential of DLBCL. We have a full MSL team as well. and a strong headquarter team. So we will make some incremental increases, both on the commercial and MSL footprint as well as some additional expenses in terms of A&P and other expenses from a headquarters basis. But I would say incremental because we think we're already pretty well covered. Obviously, when you do a prelaunch and launch activities, and we can expand into a much bigger population, the second-line population, which we think also with a better profile than we have today. Those incremental investments are going to help us to make sure that we drive education around the product use, particularly with -- when we anticipate a LOTIS-5 approval sometime in the middle of next year. We think LOTIS-5 obviously, is also key because once we get to the top line readout next year, it really actually unlocks the total value of the life cycle management plan for ZYNLONTA because that is our full approval. And we think that the total opportunity that we have for ZYNLONTA, not just with LOTIS-5, but assuming we can have regulatory approvals and compendia for the other indications, it could take the total peak revenue opportunity for ZYNLONTA to $600 million to $1 billion. So we think ZYNLONTA LOTIS-5 readout to Q2 is really a key unlocking event to start driving the value of the total asset potential.

And your last question comes from Leonid Timashev from RBC Capital Markets.

I just wanted to ask on sort of the current commercial run rate for ZYNLONTA. I guess you've had a couple of stronger quarters. I guess at what point do you think that becomes a trend where you're actually seeing genuinely more enthusiasm and use from investigators in the current labeled indication? Or is there still seasonality? And maybe what does that tell you about potential future launch of ZYNLONTA as you expand the indication?

Yes. I mean I think we're pleased that over the last couple of years, since bispecifics have launched, we've basically been able to maintain our share within a space that's gotten a lot more competitive. So I think we feel really good about that. If you look more broadly at 2025 versus 2024, volumes are roughly stable. There's some slight increase in sales mainly driven to slight increases in net price. So as you know, we don't provide any annual net revenue guidance, but we still -- we expect this year, sales again to remain broadly in line with what we've seen in the recent years. And the real inflection point will start when we get the approval for LOTIS-5 next year where we think we can really significantly increase the potential sales opportunity for ZYNLONTA.

Thank you. As there are no further questions at this time, we may proceed with the conference.

Well, I want to thank you all for joining our call today and for your continued support. We look forward to keeping you updated on our progress. Operator, you may now end the call.

Ladies and gentlemen, this does conclude your conference call for today. We thank you very much for your participation. You may now disconnect. Have a great day.