ADC Therapeutics SA (NYSE: ADCT) today reported financial results
for the third quarter 2023 and provided business updates.
“During the third quarter, we fully rolled out
the new commercial strategy, advanced our prioritized pipeline
programs and continued to drive operating efficiencies,” said Ameet
Mallik, Chief Executive Officer of ADC Therapeutics. “We are
confident that restructuring the commercial model and the resulting
disruptions that continued into the third quarter were necessary to
fully capture the potential longer-term value of ZYNLONTA® and we
expect to see growth in the coming quarters in an increasingly
competitive environment. We have a clear roadmap in place as we
approach several potential value-generating catalysts in 2024,
including data readouts for the LOTIS-7 trial of ZYNLONTA in
combination with bispecifics, ADCT-601 targeting AXL, ADCT-901
targeting KAAG1 and ADCT-602 targeting CD22.”
Recent Highlights and
Developments
ZYNLONTA®
(loncastuximab tesirine-lpyl)
- ZYNLONTA generated net sales of
$14.3 million in the third quarter of 2023, representing a 33.1%
decrease over the third quarter of 2022. The decline was
attributable to an extended period of disruption following the
restructuring of the commercial model, increased competition and
higher gross-to-net sales deductions. This was partially offset by
a slight increase in price.
- At the Eleventh Annual Meeting of
the Society of Hematologic Oncology (SOHO 2023) in September,
updated safety run-in results from the confirmatory LOTIS-5 Phase 3
trial in combination with rituximab were presented and demonstrated
an 80% overall response rate, a 50% complete response rate and
median duration of response of 8.0 months with no new safety
signals.
- The LOTIS-7 trial of ZYNLONTA in
combination with bispecifics glofitamab or mosunetuzumab for the
treatment of patients with diffuse large B-cell lymphoma (DLBCL),
follicular lymphoma (FL) and marginal zone lymphoma (MZL) is
actively enrolling patients.
- The Company’s partner Mitsubishi
Tanabe Pharma Corporation (MTPC) joined the confirmatory Phase 3
LOTIS-5 study of ZYNLONTA in combination with rituximab in
second-line or later, transplant ineligible DLBCL patients in
Japan.
- An American Society of Hematology
(ASH) abstract from the University of Miami investigator-initiated
trial exploring ZYNLONTA in combination with rituximab in high-risk
relapsed or refractory follicular lymphoma indicated that the
combination was well tolerated with a 95% overall response rate at
week 12 and at week 21, an 86% metabolic complete response
rate.
Pipeline
- ADCT-601 (targeting
AXL): Dose escalation in patients with non-small cell lung
cancer (NSCLC) and sarcoma is proceeding. The maximum tolerated
dose has not yet been reached, and the immunohistochemistry (IHC)
assay is under final validation. Based on preclinical data, a
pancreatic cancer cohort is being added with an enriched patient
population.
- ADCT-901 (targeting
KAAG1): Dose escalation is proceeding, and the IHC assay
is under final validation.
- ADCT-602 (targeting
CD22): Dose escalation and expansion in the Phase 1 trial
in collaboration with MD Anderson Cancer is progressing and
additional clinical trial sites are being added to accelerate
enrollment.
GuidanceThe Company maintains
the following guidance based on its current business plan:
- Continued decrease in total
operating expenses expected in full year 2023 and 2024 as compared
to 2022
- Expected cash runway into the
middle of 2025
Upcoming Expected
Milestones
ZYNLONTA
- Complete enrollment of the Phase 3
LOTIS-5 study in 2024
- Initial safety and efficacy data
from the LOTIS-7 study in 1H 2024
Pipeline
ADCT-601 (targeting AXL)
- Initial data from Phase 1 study in
1H 2024
ADCT-901 (targeting KAAG1)
- Initial data from Phase 1 study in
1H 2024
ADCT-602 (targeting CD22)
- Additional data from Phase 1 study
in 1H 2024
Third Quarter 2023 Financial
Results
Cash and Cash Equivalents
Cash and cash equivalents were $310.4 million as
of September 30, 2023, compared to $326.4 million as of December
31, 2022. The Company continues to expect its cash runway to extend
into the middle of 2025.
Product Revenues
Net product revenues were $14.3 million for the quarter ended
September 30, 2023, compared to $21.3 million for the same quarter
in 2022. Net product revenues are for U.S. sales of ZYNLONTA. The
decrease of $7.1 million for the quarter was primarily due to lower
sales volume, which was impacted by the extended period of
disruption following restructuring of the commercial organization,
increased competition, as well as higher gross-to-net deductions,
partially offset by a slightly higher price.
License Revenues and
Royalties
License revenues and royalties were $0.2 million for the quarter
ended September 30, 2023, compared to $55.0 million for the same
quarter in 2022. During July 2022, the Company entered into an
exclusive license agreement with Sobi for the development and
commercialization of ZYNLONTA for all hematologic and solid tumor
indications outside of the U.S., greater China, Singapore and
Japan. Under the terms of the agreement, the Company received an
upfront payment of $55.0 million during the quarter ended September
30, 2022.
Research and Development (R&D)
Expenses
R&D expenses were $28.4 million for the
quarter ended September 30, 2023, compared to $41.7 million for the
same quarter in 2022. R&D expenses decreased due to less
investment in camidanlumab tesirine (Cami), as well as productivity
initiatives and focused investment toward prioritized development
programs. The decrease in R&D expenses related to Cami was
primarily due to completion of the Phase 2 study in 2022 and the
Company’s decision to pause the program while it evaluated FDA
feedback, while continuing to assess a potential regulatory pathway
and seeking a partner to continue developing this program.
R&D expenses in the third quarter of 2023
also decreased due to lower share-based compensation expense as a
result of fluctuations in the share price and award forfeitures in
connection with voluntary terminations.Selling and
Marketing (S&M) Expenses
S&M expenses were $13.7 million for the
quarter ended September 30, 2023, compared to $16.8 million for the
same quarter in 2022. The decrease in S&M expenses for the
quarter was primarily due to lower share-based compensation expense
resulting from fluctuations in the share price and award
forfeitures in connection with voluntary terminations as well as
lower wages and benefits.
General & Administrative
Expenses
G&A expenses were $9.4 million for the
quarter ended September 30, 2023, compared to $19.6 million for the
same quarter in 2022. G&A expenses decreased during the third
quarter of 2023 primarily due to lower share-based compensation
expense due to fluctuations in the share price and award
forfeitures in connection with voluntary terminations, as well as
lower wages and benefits.
Net Loss and Adjusted Net
Loss
Net loss was $47.8 million, or a net loss of
$0.58 per basic and diluted share, for the quarter ended September
30, 2023. This compares to a net loss of $50.6 million, or a net
loss of $0.65 per basic and diluted share, for the same quarter in
2022. The decrease in net loss for the quarter ended September 30,
2023, as compared to the same quarter in 2022, was attributable to
a non-cash loss related to the extinguishment of our convertible
loans and derivatives during the third quarter of 2022 in
connection with restructuring of existing loans, as well as lower
operating expenses during the third quarter of 2023 which included
lower non-cash charges related to share-based compensation. The
decrease in net loss was partially offset by lower revenues during
the third quarter of 2023.
Adjusted net loss was $33.8 million, or an
adjusted net loss of $0.41 per basic and diluted share, for the
quarter ended September 30, 2023. This compares to adjusted net
income of $10.3 million, or adjusted net income of $0.13 per basic
and diluted share, for the same quarter in 2022. The increase in
adjusted net loss is primarily driven by lower revenues during the
third quarter of 2023, partially offset by lower operating
expenses.
Conference Call Details
ADC Therapeutics management will host a
conference call and live audio webcast to discuss third quarter
2023 financial results and provide a company update today at 8:30
a.m. Eastern Time. To access the conference call, please register
here. Registrants will receive the dial-in number and unique PIN.
It is recommended that you join 10 minutes before the event, though
you may pre-register at any time. A live webcast of the call will
be available under “Events & Presentations” in the Investors
section of the ADC Therapeutics website at ir.adctherapeutics.com.
The archived webcast will be available for 30 days following the
call.
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, remaining less visible to
DNA repair mechanisms. This ultimately results in cell cycle arrest
and tumor cell death.
The U.S. Food and Drug Administration (FDA) and
the European Medicines Agency (EMA) have 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 and in the European Union under conditional 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. Please see full prescribing
information including important safety information about ZYNLONTA
at www.ZYNLONTA.com.
ZYNLONTA is also being evaluated as a
therapeutic option in combination studies in other B-cell
malignancies and earlier lines of therapy.
About ADC Therapeutics
ADC Therapeutics (NYSE: ADCT) is a
commercial-stage global leader and pioneer in the field of antibody
drug conjugates (ADCs). The Company is advancing its proprietary
ADC technology to transform the treatment paradigm for patients
with hematologic malignancies and solid tumors.
ADC Therapeutics’ CD19-directed ADC ZYNLONTA
(loncastuximab tesirine-lpyl) received accelerated approval by the
FDA and conditional approval from the European Commission for the
treatment of relapsed or refractory diffuse large B-cell lymphoma
after two or more lines of systemic therapy. ZYNLONTA is also in
development in combination with other agents and in earlier lines
of therapy. In addition to ZYNLONTA, ADC Therapeutics has multiple
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
LinkedIn.
ZYNLONTA® is a registered trademark of ADC Therapeutics SA.
Use of Non-IFRS Financial
Measures
In addition to financial information prepared in
accordance with IFRS, this document also contains certain non-IFRS
financial measures based on management’s view of performance
including:
- Adjusted total operating
expenses
- Adjusted net loss
- Adjusted net loss per share
Management uses such measures internally when
monitoring and evaluating our operational performance, generating
future operating plans and making strategic decisions regarding the
allocation of capital. We believe that these adjusted financial
measures provide useful information to investors and others in
understanding and evaluating our operating results in the same
manner as our management and facilitate operating performance
comparability across both past and future reporting periods. 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.
When preparing these supplemental non-IFRS measures, management
typically excludes certain IFRS items that management does not
believe are indicative of our ongoing operating performance.
Furthermore, management does not consider these IFRS items to be
normal, recurring cash operating expenses; however, these items may
not meet the IFRS definition of unusual or non-recurring items.
Since non-IFRS financial measures do not have standardized
definitions and meanings, they may differ from the non-IFRS
financial measures used by other companies, which reduces their
usefulness as comparative financial measures. Because of these
limitations, you should consider these adjusted financial measures
alongside other IFRS financial measures.
The following items are excluded from adjusted
net loss and adjusted net loss per share:
Shared-Based Compensation Expense: We exclude
share-based compensation expense from our adjusted financial
measures because share-based compensation expense, which is
non-cash, fluctuates from period to period based on factors that
are not within our control, such as our stock price on the dates
share-based grants are issued. Share-based compensation expense has
been, and will continue to be for the foreseeable future, a
recurring expense in our business and an important part of our
compensation strategy.
Certain Other Items: We exclude certain other
significant items that we believe do not represent the performance
of our business, from our adjusted financial measures. Such items
are evaluated by management on an individual basis based on both
quantitative and qualitative aspects of their nature. While not
all-inclusive, examples of certain other significant items excluded
from our adjusted financial measures would be: changes in the fair
value of derivatives and warrant obligations and the effective
interest expense associated with the Facility Agreement with
Deerfield and the senior secured term loan facility and the
effective interest expense and cumulative catch-up adjustments
associated with the deferred royalty obligation under the royalty
purchase agreement with HealthCare Royalty Partners.
See the attached Reconciliation of IFRS Measures
to Non-IFRS Measures for explanations of the amounts excluded and
included to arrive at the non-IFRS financial measures.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. In some cases you
can identify forward-looking statements by terminology such as
“may”, “will”, “should”, “would”, “expect”, “intend”, “plan”,
“anticipate”, “believe”, “estimate”, “predict”, “potential”,
“seem”, “seek”, “future”, “continue”, or “appear” or the negative
of these terms or similar expressions, although not all
forward-looking statements contain these identifying words.
Forward-looking statements are subject to certain risks and
uncertainties that can cause actual results to differ materially
from those described. Factors that may cause such differences
include, but are not limited to: the ability of the Company to cure
the deficiency and regain compliance with NYSE listing standards
and for the Company’s common shares to remain listed on the NYSE;
the success of the Company’s updated corporate strategy including
operating efficiencies, capital deployment and portfolio
prioritization; the Company’s ability to achieve the decrease in
total operating expenses for 2023 and 2024, the expected cash
runway into the middle of 2025, the effectiveness of the new
commercial go-to-market strategy, competition from new
technologies, the Company’s ability to grow ZYNLONTA® revenue in
the United States; Swedish Orphan Biovitrum AB (Sobi®) ability to
successfully commercialize ZYNLONTA® in the European Economic Area
and market acceptance, adequate reimbursement coverage, and future
revenue from the same; approval by the NMPA of the BLA for
ZYNLONTA® in China submitted by Overland ADCT BioPharma and future
revenue from the same, our strategic partners’, including
Mitsubishi Tanabe Pharma Corporation, ability to obtain regulatory
approval for ZYNLONTA® in foreign jurisdictions, and the timing and
amount of future revenue and payments to us from such partnerships;
the Company’s ability to market its products in compliance with
applicable laws and regulations; the Company’s expectations
regarding the impact of the Infrastructure Investment and Jobs Act;
the timing and results of the Company’s or its partners’ research
projects or clinical trials including LOTIS 5 and 7, ADCT 901, 601
and 602, the impact, if any, from discontinuation of the LOTIS-9
study, actions by the FDA or foreign regulatory authorities with
respect to the Company’s products or product candidates, the timing
and outcome of regulatory submissions for the Company’s products or
product candidates; the ability to complete clinical trials on
expected timelines, if at all and the results of the same;
projected revenue and expenses; the Company’s indebtedness,
including Healthcare Royalty Management and Blue Owl and Oaktree
facilities, and the restrictions imposed on the Company’s
activities by such indebtedness, the ability to repay such
indebtedness and the significant cash required to service such
indebtedness; and the Company’s ability to obtain financial and
other resources for its research, development, clinical, and
commercial activities. Additional information concerning these and
other factors that may cause actual results to differ materially
from those anticipated in the forward-looking statements is
contained in the “Risk Factors” section of the Company's Annual
Report on Form 20-F and in the Company's other periodic reports and
filings with the Securities and Exchange Commission. These
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results, performance, achievements or
prospects to be materially different from any future results,
performance, achievements or prospects expressed in or implied by
such forward-looking statements. The Company cautions investors not
to place undue reliance on the forward-looking statements contained
in this document. The Company undertakes no obligation to revise or
update these forward-looking statements to reflect events or
circumstances after the date of this press release, except as
required by law.
ADC Therapeutics
SACondensed Consolidated Interim Statement of
Operations (Unaudited)(in KUSD except for per
share data)
|
|
For the Three Months Ended September
30, |
|
For the Nine Months Ended September
30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Product
revenues, net |
|
14,267 |
|
21,321 |
|
52,417 |
|
55,110 |
License revenues
and royalties |
|
226 |
|
55,000 |
|
351 |
|
85,000 |
Total
revenue |
|
14,493 |
|
76,321 |
|
52,768 |
|
140,110 |
|
|
|
|
|
|
|
|
|
Operating
expense |
|
|
|
|
|
|
|
|
Cost of product sales |
|
(366) |
|
(1,295) |
|
(2,275) |
|
(4,090) |
Research and development expenses |
|
(28,440) |
|
(41,676) |
|
(99,864) |
|
(139,165) |
Selling and marketing expenses |
|
(13,730) |
|
(16,847) |
|
(43,537) |
|
(52,876) |
General and administrative expenses |
|
(9,361) |
|
(19,617) |
|
(35,857) |
|
(56,868) |
Total operating
expense |
|
(51,897) |
|
(79,435) |
|
(181,533) |
|
(252,999) |
Loss
from operations |
|
(37,404) |
|
(3,114) |
|
(128,765) |
|
(112,889) |
|
|
|
|
|
|
|
|
|
Other income
(expense) |
|
|
|
|
|
|
|
|
Financial income |
|
3,140 |
|
273 |
|
7,250 |
|
18,597 |
Financial expense |
|
(12,942) |
|
(11,356) |
|
(38,650) |
|
(29,374) |
Non-operating expense |
|
(687) |
|
(37,122) |
|
(1,143) |
|
(10,805) |
Total other
expense |
|
(10,489) |
|
(48,205) |
|
(32,543) |
|
(21,582) |
Loss
before taxes |
|
(47,893) |
|
(51,319) |
|
(161,308) |
|
(134,471) |
Income tax benefit |
|
86 |
|
711 |
|
6,958 |
|
2,828 |
Net
loss |
|
(47,807) |
|
(50,608) |
|
(154,350) |
|
(131,643) |
|
|
|
|
|
|
|
|
|
Net loss
attributable to: |
|
|
|
|
|
|
|
|
Owners of the parent |
|
(47,807) |
|
(50,608) |
|
(154,350) |
|
(131,643) |
|
|
|
|
|
|
|
|
|
Net loss per
share, basic and diluted |
|
(0.58) |
|
(0.65) |
|
(1.89) |
|
(1.70) |
ADC Therapeutics
SACondensed Consolidated Interim Balance Sheet
(Unaudited)(in KUSD)
|
|
September 30,2023 |
|
December 31,2022 |
ASSETS |
|
|
|
|
Current
assets |
|
|
|
|
Cash and cash equivalents |
|
310,407 |
|
326,441 |
Accounts receivable, net |
|
21,180 |
|
72,971 |
Inventory |
|
22,728 |
|
18,564 |
Other current assets |
|
21,283 |
|
28,039 |
Total current assets |
|
375,598 |
|
446,015 |
Non-current assets |
|
|
|
|
Property, plant and equipment |
|
5,260 |
|
3,261 |
Right-of-use assets |
|
10,272 |
|
6,720 |
Intangible assets |
|
12,358 |
|
14,360 |
Interest in joint venture |
|
26,989 |
|
31,152 |
Deferred tax asset |
|
35,400 |
|
26,757 |
Other long-term assets |
|
1,023 |
|
903 |
Total non-current assets |
|
91,302 |
|
83,153 |
|
|
|
|
|
Total
assets |
|
466,900 |
|
529,168 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
Current
liabilities |
|
|
|
|
Accounts payable |
|
8,977 |
|
12,351 |
Other current liabilities |
|
53,483 |
|
73,035 |
Lease liabilities, short-term |
|
1,417 |
|
1,097 |
Senior secured term loans, short-term |
|
14,329 |
|
12,474 |
Total current liabilities |
|
78,206 |
|
98,957 |
Non-current liabilities |
|
|
|
|
Senior secured term loans, long-term |
|
97,707 |
|
97,240 |
Warrant obligations |
|
96 |
|
1,788 |
Deferred royalty obligation, long-term |
|
305,266 |
|
212,353 |
Deferred gain of joint venture |
|
23,539 |
|
23,539 |
Lease liabilities, long-term |
|
10,076 |
|
6,564 |
Other long-term liabilities |
|
6,191 |
|
— |
Total non-current liabilities |
|
442,875 |
|
341,484 |
|
|
|
|
|
Total
liabilities |
|
521,081 |
|
440,441 |
|
|
|
|
|
Equity
attributable to owners of the parent |
|
|
|
|
Share capital |
|
7,312 |
|
7,312 |
Share premium |
|
1,008,088 |
|
1,007,452 |
Treasury shares |
|
(541) |
|
(679) |
Other reserves |
|
166,334 |
|
155,683 |
Cumulative translation adjustments |
|
(339) |
|
(356) |
Accumulated losses |
|
(1,235,035) |
|
(1,080,685) |
Total equity attributable to owners of the
parent |
|
(54,181) |
|
88,727 |
|
|
|
|
|
Total
liabilities and equity |
|
466,900 |
|
529,168 |
ADC Therapeutics
SAReconciliation of IFRS Measures to Non-IFRS
Measures (Unaudited)(in KUSD except for share and
per share data)
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
in
KUSD |
2023 |
|
2022 |
|
Change |
|
% Change |
|
2023 |
|
2022 |
|
Change |
|
% Change |
Total
operating expense |
(51,897) |
|
(79,435) |
|
27,538 |
|
(35)% |
|
(181,533) |
|
(252,999) |
|
71,466 |
|
(28)% |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation expense (i) |
2,083 |
|
14,565 |
|
(12,482) |
|
(86)% |
|
11,275 |
|
42,293 |
|
(31,018) |
|
(73)% |
Adjusted
total operating expenses |
(49,814) |
|
(64,870) |
|
15,056 |
|
(23)% |
|
(170,258) |
|
(210,706) |
|
40,448 |
|
(19)% |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
in KUSD
(except for share and per share data) |
2023 |
|
2022 |
|
2023 |
|
2022 |
Net
loss |
(47,807) |
|
(50,608) |
|
(154,350) |
|
(131,643) |
Adjustments: |
|
|
|
|
|
|
|
Share-based
compensation expense (i) |
2,083 |
|
14,565 |
|
11,275 |
|
42,293 |
Convertible
loans, derivatives, change in fair value expense (income) (ii) |
— |
|
4,660 |
|
— |
|
(25,650) |
Loss on
extinguishment (iii) |
— |
|
42,114 |
|
— |
|
42,114 |
Senior secured
term loans, warrants, change in fair value income (ii) |
(299) |
|
(2,543) |
|
(916) |
|
(2,543) |
Effective
interest expense on convertible loans (iv) |
— |
|
1,536 |
|
— |
|
7,684 |
Deerfield
warrants obligation, change in fair value income (ii) |
(140) |
|
(9,418) |
|
(776) |
|
(9,418) |
Senior secured
term loan facility, warrants, transaction costs (v) |
— |
|
245 |
|
— |
|
245 |
Effective
interest expense on senior secured term loan facility (iv) |
4,728 |
|
1,933 |
|
13,748 |
|
1,933 |
Deferred royalty
obligation interest expense (vi) |
8,087 |
|
5,669 |
|
19,662 |
|
17,356 |
Deferred royalty
obligation cumulative catch-up adjustment (income) expense
(vi) |
(437) |
|
2,175 |
|
4,851 |
|
(16,113) |
Adjusted
net (loss) income |
(33,785) |
|
10,328 |
|
(106,506) |
|
(73,742) |
|
|
|
|
|
|
|
|
Net loss per
share, basic and diluted |
(0.58) |
|
(0.65) |
|
(1.89) |
|
(1.70) |
Adjustment to net
loss per share, basic and diluted |
0.17 |
|
0.78 |
|
0.58 |
|
0.75 |
Adjusted net
(loss) income per share, basic and diluted |
(0.41) |
|
0.13 |
|
(1.31) |
|
(0.95) |
Weighted average
shares outstanding, basic and diluted |
82,256,847 |
|
78,372,680 |
|
81,516,563 |
|
77,374,388 |
(i) Share-based compensation
expense represents the cost of equity awards issued to our
directors, management and employees. The fair value of awards is
computed at the time the award is granted, including any market and
other performance conditions, and is recognized over the vesting
period of the award by a charge to the income statement and a
corresponding increase in other reserves within equity. These
accounting entries have no cash impact.
(ii) Change in the fair value
of the convertible loan derivatives, senior secured term loan
facility warrants and the Deerfield warrant obligation results from
the valuation at the end of each accounting period. There are
several inputs to these valuations, but those most likely to result
in significant changes to the valuations are changes in the value
of the underlying instrument (i.e., changes in the price of our
common shares) and changes in expected volatility in that price.
These accounting entries have no cash impact.
(iii) As a result of the
exchange agreement entered into on August 15, 2022, the Company
recognized a loss on extinguishment which primarily consists of the
difference between the aggregate principal amount and carrying
amount of the convertible loans and exit fee as well as the unpaid
interest payments through the maturity date.
(iv) Effective interest
expense on convertible loans and senior secured term loans relates
to the increase in the value of our loans in accordance with the
amortized cost method.
(v) The transaction costs
allocated to the senior secured term loan facility warrant
obligation represent actual costs. We do not believe that these
costs reflect the performance of our ongoing business.
(vi) Deferred royalty
obligation interest expense relates to the accretion expense on our
deferred royalty obligation pursuant to the royalty purchase
agreement with HCR and cumulative catch-up adjustment (income)
expense relates to changes in the expected payments to HCR based on
a periodic assessment of our underlying revenue
projections.CONTACTS:
InvestorsEugenia LitzADC
TherapeuticsEugenia.Litz@adctherapeutics.com+44 7879 627205+1
908-723-2350
MediaNicole RileyADC
TherapeuticsNicole.Riley@adctherapeutics.com+1 862-926-9040
(1) loncastuximab tesirine-lpyl; (2) on a non-IFRS basis or 35%
on an IFRS basis including stock-based compensation expense. See
reconciliation of IFRS measures to non-IFRS measures in
accompanying financial tables
ADC Therapeutics (NYSE:ADCT)
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ADC Therapeutics (NYSE:ADCT)
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