ADCT sells capped royalty interest on
ZYNLONTATM and Cami for $225 million upon closing with an
additional $100 million in potential near-term milestone
payments
Royalty of 7% terminates upon payment of 2.25x
to 2.50x the purchase price
Proceeds to be used for continued development
and commercialization of ZYNLONTATM and Cami
ADC Therapeutics SA (NYSE:ADCT), a commercial-stage
biotechnology company leading the development of novel antibody
drug conjugates (ADCs) to treat hematological malignancies and
solid tumors, today announced it had entered into a royalty
purchase agreement with HealthCare Royalty Partners (HealthCare
Royalty).
Under the terms of the $325 million financing agreement, ADC
Therapeutics will receive $225 million upon closing, and is
eligible to receive an additional $75 million upon the first
commercial sale of ZYNLONTATM (loncastuximab tesirine) in Europe
and an additional $25 million upon the achievement of a near-term
commercial milestone for ZYNLONTA. In exchange, HealthCare Royalty
will receive a 7% royalty on worldwide net sales and licensing
revenue from ZYNLONTA, with the exception of greater China,
Singapore and South Korea, and a 7% royalty on worldwide net sales
and licensing revenue from Cami (camidanlumab tesirine) (subject to
limited carve-outs). Based on performance tests in 2026 and 2027,
these royalty rates are subject to potential upward adjustment, up
to a maximum of 10%. The total royalty payable by ADCT to
HealthCare Royalty is capped in the range of 2.25x to 2.50x of the
amount paid to ADCT, dependent upon the amount of royalties paid by
2029. Once the cap is hit, the agreement terminates. Upon closing
of this transaction, and together with the Company’s current cash
balance and anticipated business plan, ADC Therapeutics will have a
substantial multi-year working capital runway.
“This transaction reflects the significant value of ZYNLONTA and
Cami. We are delighted to partner with HealthCare Royalty, a
leading healthcare investment firm, to continue the development and
commercialization of ZYNLONTA in combination with other drugs, in
earlier lines of therapy and in new histologies, as well as to
continue our development and commercialization plans for Cami,”
said Chris Martin, Chief Executive Officer of ADC Therapeutics.
“With this transaction, we are well-positioned to continue
executing on our plans and improving the lives of patients.”
“We are pleased to partner with ADC Therapeutics to reach their
vision of developing and commercializing potent and targeted ADCs
for patients with hematological malignancies and solid tumors,”
said Clarke Futch, Chairman and Chief Executive Officer of
HealthCare Royalty. “Our investment reflects our belief in both
ZYNLONTA and Cami to deliver value, and underscores our mission to
facilitate innovation by high growth biopharmaceutical companies
globally.”
The agreement includes customary provisions for a transaction of
this nature, a repayment provision at the Company's option, and
change of control provisions. The Company expects to close the
transaction in early September. The Company has concurrently filed
a Form 6-K which includes further details.
Morgan Stanley & Co. LLC acted as Sole Structuring Agent and
Ropes & Gray LLP and Davis Polk LLP acted as legal advisors to
ADC Therapeutics on the transaction. Gibson Dunn LLP acted as legal
advisors to HealthCare Royalty.
About ZYNLONTA™ (loncastuximab tesirine-lpyl)
ZYNLONTA is a CD19-directed antibody drug conjugate (ADC). Once
bound to a CD19-expressing cell, ZYNLONTA is internalized by the
cell, where enzymes release a pyrrolobenzodiazepine (PBD) payload.
The potent payload binds to DNA minor groove with little
distortion, evading DNA repair mechanisms. This ultimately results
in cell cycle arrest and tumor cell death.
The U.S. Food and Drug Administration (FDA) has approved
ZYNLONTA (loncastuximab tesirine-lpyl) for the treatment of adult
patients with relapsed or refractory (r/r) large B-cell lymphoma
after two or more lines of systemic therapy, including diffuse
large B-cell lymphoma (DLBCL) not otherwise specified (NOS), DLBCL
arising from low-grade lymphoma and also high-grade B-cell
lymphoma. The trial included a broad spectrum of heavily
pre-treated patients (median three prior lines of therapy) with
difficult-to-treat disease, including patients who did not respond
to first-line therapy, patients refractory to all prior lines of
therapy, patients with double/ triple hit genetics and patients who
had stem cell transplant and CAR-T therapy prior to their treatment
with ZYNLONTA. This indication is approved by the FDA under
accelerated approval based on overall response rate and continued
approval for this indication may be contingent upon verification
and description of clinical benefit in a confirmatory trial.
ZYNLONTA is also being evaluated as a therapeutic option in
combination studies in other B-cell malignancies and earlier lines
of therapy.
About Camidanlumab Tesirine (Cami)
Camidanlumab tesirine (Cami, formerly ADCT-301) is an antibody
drug conjugate (ADC) comprised of a monoclonal antibody that binds
to CD25 (HuMax®-TAC, licensed from Genmab A/S), conjugated to the
pyrrolobenzodiazepine (PBD) dimer payload, tesirine. Once bound to
a CD25-expressing cell, Cami is internalized into the cell where
enzymes release the PBD-based payload, killing the cell. This
applies to CD25-expressing tumor cells and also to CD25-expressing
Tregs. The intra-tumoral release of its PBD payload may also cause
bystander killing of neighboring tumor cells, and PBDs have also
been shown to induce immunogenic cell death. All of these
properties of Cami may enhance immune-mediated anti-tumor
activity.
Cami is being evaluated in a pivotal Phase 2 clinical trial in
patients with relapsed or refractory Hodgkin lymphoma and a Phase
1b clinical trial as monotherapy and in combination with
pembrolizumab in solid tumors.
About ADC Therapeutics
ADC Therapeutics (NYSE: ADCT) is a commercial-stage
biotechnology company improving the lives of cancer patients with
its next-generation, targeted antibody drug conjugates (ADCs). The
Company is advancing its proprietary PBD-based ADC technology to
transform the treatment paradigm for patients with hematologic
malignancies and solid tumors.
ADC Therapeutics’ CD19-directed ADC ZYNLONTA™ (loncastuximab
tesirine-lpyl) is approved by the FDA for the treatment of relapsed
or refractory diffuse large B-cell lymphoma after two or more lines
of systemic therapy. ZYNLONTA is also in late-stage clinical trials
in combination with other agents. Cami (camidanlumab tesirine) is
being evaluated in a late-stage clinical trial for relapsed or
refractory Hodgkin lymphoma and in a Phase 1b clinical trial for
various advanced solid tumors. In addition to ZYNLONTA and Cami,
the Company has multiple PBD-based ADCs in ongoing clinical and
preclinical development.
ADC Therapeutics is based in Lausanne (Biopôle), Switzerland and
has operations in London, the San Francisco Bay Area and New
Jersey. For more information, please visit
https://adctherapeutics.com/ and follow the Company on Twitter and
LinkedIn.
ZYNLONTA™ is a trademark of ADC Therapeutics SA.
About HealthCare Royalty
HealthCare Royalty purchases royalties and uses debt-like
structures to invest in commercial or near-commercial stage life
science assets. HealthCare Royalty has $5.8 billion in cumulative
capital commitments with offices in Stamford (CT), San Francisco,
Boston and London. For more information, visit
www.healthcareroyalty.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20210826005211/en/
Investors Eugenia Litz ADC Therapeutics
Eugenia.Litz@adctherapeutics.com +44 7879 627205
Amanda Hamilton ADC Therapeutics
amanda.hamilton@adctherapeutics.com +1 917-288-7023
USA Media Mary Ann Ondish ADC Therapeutics
maryann.ondish@adctherapeutics.com Tel.: +1 914-552-4625
EU Media Alexandre Müller Dynamics Group amu@dynamicsgroup.ch
+41 (0) 43 268 3231
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