This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk02: Welcome to the AGC Therapeutics Second Quarter 2022 Financial Results Conference Call. My name is Gigi, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. During the question-and-answer session, if you have a question, please press star, then 1-1 on your touchtone phone. I will now turn the call over to Amanda Hamilton, Investor Relations Manager. Amanda, you may begin.
spk00: Thank you, operator. This morning, we issued a press release announcing our second quarter 2022 financial results and business updates. This release is available on the ADCT website at ir.adctherapeutics.com under the press releases section. On today's call, Amit Malik, Chief Executive Officer, Jennifer Herron, Chief Commercial Officer, Joe Camardo, Chief Medical Officer, and Jen Creel, Chief Financial Officer, will discuss recent business highlights and review our second quarter 2022 financial results before opening the call for questions. As a reminder, this conference call may contain forward-looking statements. Such statements are subject to risks and uncertainties. For additional information concerning forward-looking statements and factors that could cause actual results to differ materially from those expressed or implied in these statements, we refer you to the section titled Cautionary Statement Regarding Forward-Looking Statements in Exhibit 99.2 of our report on Form 6-K filed with the U.S. Securities and Exchange Commission earlier today. Such statements speak only as of the date of this conference call, and we expressly disclaim any obligation or undertaking to update these forward-looking statements unless required to do so by applicable law. Today's presentation also includes non-IFRS financial measures. 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. You should refer to the information contained in the company's second quarter earnings release for definitional information and reconciliation of historical non-IFRS measures to the comparable IFRS financial measures. It is now my pleasure to pass the call over to Amit Malik. Amit?
spk05: Thanks, Amanda, and thank you for joining us today. Before we get into the details of the quarter, now that I've been in the role of CEO for three months, I would like to take this opportunity to share my observations and thoughts on the company and its business plan looking forward. I've spent the last three months on a listening tour, speaking with physicians and investors and meeting with employees across all sites and levels. My intent was to take a deep dive into all aspects of the business and determine how to best capitalize on our unique science and tremendous talent to maximize the impact we deliver for our stakeholders. First and foremost, and one of the main reasons why I joined the company, is that ADCs have emerged as a promising and exciting class of therapies that have the potential to benefit a broad set of patients for years to come. ADC Therapeutics is both a pioneer and leader in the field of ADCs. We are a fully integrated company with a strong value chain that we built from the ground up, starting with our innovative ADC platform and the expertise and capabilities extending from research and clinical development to CMC and commercial. The seamless integration of our agile and experienced team has been validated by the approval and launch of Zynlanta for third-line DLBCL, as well as our advancing pipeline of promising hematology and solid tumor programs. So how do we plan to deliver to patients and maximize the potential of our platform and portfolio? We think about value creation in three time horizons, the near, mid, and long-term. Starting with the near-term horizon and the hematology program, we will continue to execute on our plan to maximize the potential of Zynlanta in the third-line plus DLBCL market. We delivered 17.3 million in Q2 net sales, representing 5% growth over Q1. We have increased awareness and advocacy for Zinlanta and will continue to amplify our messaging. We have fine-tuned our approach to increase breadth and depth in both the academic setting and in the community. With Zinlanta's differentiated product profile, we believe tremendous opportunity remains, and we are confident in our ability to steadily capture this growth. We are also working to move Xenlanta into earlier lines and in combination therapies. In Q2, we continued to enroll our confirmatory phase 3 LOTUS 5 trial in combination with rituximab. We also initiated the LOTUS 7 trial in novel combinations and the LOTUS 9 trial in frail and unfit first-line patients. The combinations of Xenlanta and rituximab offers a sizable expansion opportunity. The LOTUS 5 trial doubles the current addressable patient population for Xenlata, and LOTUS 9 serves an additional population with a clear unmet medical need in the frontline setting. Beyond the U.S., we now have three strong strategic partners to expand the reach of Xenlata globally. In Asia, we have our collaborations with Overland ADCT in Greater China and Mitsubishi Tanabe in Japan. We also recently signed an agreement with SOBE, an experienced and committed partner for the development and commercialization of Zenlanta in Europe and all other open territories worldwide, which will allow us to focus even more on executing commercially in the U.S. while making Zenlanta more widely available to patients in need. Our second heme program, CAMI for Hodgkin's lymphoma, is based on the same validated PBD-based ADC platform. We released top line data from the Phase II pivotal trial in Hodgkin's lymphoma in an oral presentation at EHA in June. Our pre-BLA meeting with the FDA has been scheduled for September, and based on the results of that meeting, we plan to complete our regulatory submission in the second half of next year, given the time we need for manufacturing stability data to mature. Moving to the midterm horizon, where we are leveraging our expertise in ADC development To advance our solid tumor pipeline, we have five programs, three in the clinic and two heading towards IND filing. These include a mix of clinically validated and novel targets, all of which are supported by strong scientific rationale and promising preclinical data. The long-term horizon provides the opportunity to build upon our proprietary technology toolbox in new and different directions. We are working on next-generation assets incorporating new antibiotic constructs and payloads as well as broader partnering approaches to expand the toolbox and realize the full value of our ADC platform. With the signing of the SOBE agreement, we are pleased to now have a cash runway extending into early 2025. This will allow us the time to execute on our strategy and deliver on our objectives. We will take a disciplined approach to capital allocation based on science, unmet medical need, and commercial opportunity. We aim to identify and accelerate promising programs and terminate those that are not supported by strong data, which will ultimately accelerate the growth of the company and value creation for all stakeholders. Finally, after having the privilege to visit and meet employees at all of our sites, I'm struck by the capabilities of our team. I'm impressed by the talent, common purpose, and drive to help cancer patients, and we are energized about the many opportunities ahead. We look forward to keeping you updated on our progress. I would now like to turn the call over to Jennifer to report on the Zenlanta launch. Jennifer?
spk08: Thank you, Amit, and good morning, everyone. I am pleased to share an update on the Zenlanta launch in Q2. Zenlanta Q2 net sales were $17.3 million, representing 5% growth versus Q1. We saw steady month-over-month growth in demand as we progressed through the quarter. Just a little over a year into the launch, We have made solid progress in a challenging environment. However, there are many more opportunities for growth in the Third Line Plus DLBCL market. We have a focused plan in place to capture that opportunity, and we remain confident that with the launch's differentiated product profile, we will drive steady growth in the coming quarters. Since the launch, we have focused the majority of our efforts on the academic centers. We have built advocacy with team-on specialists and thought leaders at these institutions for our influencers across the entire market. Although there are more DLBCL patients in the community setting on average, academic-based clinicians see two to three times the number of third-line plus DLBCL patients as compared to their respective community counterparts. We have made good progress engaging and educating key lymphoma doctors across the country with approximately 60% of our volume coming from academic accounts. With this solid foundation in place, we see good opportunity for growth as we continue to convert awareness to advocacy and building increased breadth and depth in academic accounts. While it made strategic sense to focus on academic centers during the initial launch period, the broader opportunity is in the community setting, where the majority of the third-line-plus DLBCL patient population is treated. With the permanent J-code now in place, we are intensifying our efforts to increase awareness and adoption in these centers. We are confident that the versatility of Zinlanza's differentiated product profile will resonate well with physicians and patients in the community. Factors such as significant single agent efficacy, rapid time to response, manageable side effect profile, and importantly, our practice and patient-friendly administration schedule. For the second half of this year, we have a focused plan to capture the significant opportunities that remain in the market. We plan to drive Delonta awareness, experience, and advocacy, and we have identified three areas for execution. First, on the healthcare provider level, we are optimizing the execution of all of our customer-facing teams, as in-person opportunities are increasing, including at local and regional congresses. This will help us capture a broader and deeper market share in both academic centers and the community setting. We are encouraged with the increasing access to healthcare providers that we have seen expand through Q2, with approximately 75% of our total interactions being face-to-face as we exited the quarter. This is an important trend. As we know, it often takes several visits for new products, such as Enlanta, to be embedded into practice. Next, we are partnering with key community oncology networks. We are broadening our educational efforts within the network to make sure physicians understand the differentiated profile of Zinlanta. We also want to ensure the proper positioning of Zinlanta in the DLBCL treatment paradigm so that every patient who may benefit from Zinlanta has that opportunity. Finally, on the patient level, we recognize the active role patients and their caregivers can play in discussing and choosing treatment options with their physicians. We are intensifying regional and local marketing efforts to build grassroots product advocacy at the patient level, as well as mobilizing the DLBCL community through a newly launched campaign to educate about our patient-friendly profile. A little over a year into the launch, Our cross-functional Zinlanta team has established a good foundation for us to build on. Now we will work to expand into untapped areas. We have a focused plan in place to continue to grow Zinlanta sales over the coming quarter. And remain confident we will establish Zinlanta as a third-line standard of care. And over time, we see Zinlanta as a cornerstone of earlier lines of DLBCL treatments. Now I'll turn the call over to Joe to provide an update on our pipeline.
spk06: Joe? Thank you, Jennifer. I'm happy to provide an update on our clinical trials. During the quarter, we made good progress on our Zinlanta development programs with a focus to explore novel combinations and the potential to move into earlier lines of treatment. We initiated the Lotus 7 trial, the Phase 1B clinical trial of Zinlanta in combination with other newer lymphoma drugs, starting with bolifuzumab. This combination has shown enhanced activity in our preclinical studies. Other novel combinations will be added to the study, and we will keep you updated as this occurs. In July, we enrolled the first patient into LOTUS9, the Phase II trial to evaluate Synlanta in combination with rituximab in first-line DLBCL patients who are unfit or frail. I am particularly excited about this study as it will investigate the potential of Synlanta with rituximab to address a significant unmet need in frontline patients who are unable to tolerate the RCHOP regimen, even at the reduced doses. These patients are often excluded from clinical trials, and so they lag behind advances in treatment open to younger and more fit patients. We've received positive feedback and a high degree of interest from physicians on this initiative, and we've activated several sites in the United States. To execute on our targeted strategy, we have decided to terminate the LOTUS 6 trial of synlanta and relapse the refractory follicular lymphoma due to the comparator idelalicid being removed from the U.S. market. While we have discontinued the monotherapy program, we will continue to explore opportunities for novel combinations with synlanta for follicular lymphoma. Finally, we continue to enroll patients in the randomized part of LOTUS 5. the Phase III registration study of Zonata in combination with rituximab in second-line DLBCL patients who are not eligible for stem cell transplant. Expansion into the randomized part of the trial was supported by the safety run-in, which was completed in the first quarter. And we look forward to sharing these results at an upcoming major medical meeting. To give you an update on our XUS activities and partnerships, we are on track to receive a regulatory decision from the EMA by the first quarter of 2023. In partnership with Mitsubishi Kanabe, we are moving forward with a development plan for registration in Japan. In China, Overland ADCT BioPharma completed enrollment of their single agent bridging study ahead of schedule, and the joint venture has also dosed the first patient in China in the Lotus 5 confirmatory phase three global clinical trial. We are focused on the successful execution of this in launch of trials, and we look forward to keeping you updated on our progress. Turning now to CAMI in Hodgkin's lymphoma, the one-year follow-up data from the Phase 2 study was released at an oral presentation at the EHA Congress in June. This presentation showed an overall response rate of 70%, a complete response rate of 33%, and a duration of response of 13.7 months for all responders in patients with a median of six prior lines of treatment. Our advisors have told us these data represent a significant benefit to the patients that were included in this study. Recall these patients had progressive disease despite the use of both pentuximab and pembrolizumab, as well as other treatments, and over half progressed after stem cell transplant. We have a pre-BLA meeting scheduled with the FDA in September, and we will complete a regulatory submission in the second half of 2023. The timing is driven by the availability and maturity of the manufacturing stability data. Before we move on from hematology, I would like to provide an update on ADCT602. You may recall ADCT602 is an antibody drug conjugate targeting CD22. This is being evaluated in a Phase I-II clinical trial in patients with relapsed or refractory reacutement for blasted leukemia. We see early signs of activity and continue to work with MD Anderson to optimize the dose and schedule. We will update you in the future. Now, moving on to our solid tumor portfolio. First, we have the ongoing CAMI phase 1B safety and efficacy dose escalation trial in combination with Pembrolizumab. When we complete the escalation and the optimum dose has been determined, the study will enter a dose expansion stage. From a timing perspective, we expect to have data on the safety and tolerability of the combination, as well as any signal of anti-tumor activity next year. We are proceeding. with the Phase 1 trial of ADCT901 targeting CAG1. We continue to dose escalate and expect to have an indication of the safety and tolerability, as well as early signals of anti-tumor activity in 2023. Moving on to ADCT601 targeting Axel, the first patient has now been enrolled and dosed in the Phase 1b trial. The study includes a monotherapy arm in patients with axial gene amplification, and a combination arm with gemcitabine in patients with sarcoma. Finally, we are completing IND enabling work for two advanced preclinical solid tumor programs. ADCT701 targets the DLK1 in neuroendocrine malignancies. This is a project in collaboration with the National Cancer Institute. ADCT212 is our optimized second-generation PBD-based antibody drug conjugate targeting PSMA, a validated target in metastatic prostate cancer. We plan to take both of these assets into the clinic next year. With that, I will turn the call over to Jen to give a financial update.
spk09: Thank you, Joe, and good morning, everyone. As of June 30th, we had cash and cash equivalents of $377 million. as compared to $431 million as of March 31, 2022. The cash balance does not include the upfront payment of $55 million we received from SoBe in July of this year. Based on our business plan and expected milestones from SoBe and healthcare royalty partners, we now have a cash runway that extends into early 2025. Potential near-term milestone payments from these agreements include the $50 million due from SOBI upon European regulatory approval of Zinlanta and third-line DLBCL, and the potential $75 million milestone from our Healthcare Royalty Partners Agreement for the first EU commercial sale. Turning to the P&L, as we reported in the press release issued earlier today, Zinlanta net sales were $17.3 million for the second quarter 2022. Cost of product sales was 2.3 million for the quarter compared to 0.1 million for the same quarter in 2021. The increase was primarily associated with impairment charges related to the manufacturing of antibodies that were not within the company's specifications. In addition, cost of product sales increased due to a full second quarter of sales activity in 2022 as compared to the same period in 2021 due to the commencement of Zinlanza sales in May 2021. R&D expenses were $49 million for the second quarter 2022 compared to $40 million for the same quarter 2021. R&D expense increased for the quarter due to the reversal of previously recorded impairment charges of $6.8 million during the second quarter 2021. based upon the FDA approval of Zenlanta during that quarter. In addition, we continue to invest in Zenlanta trials in earlier lines of treatment and our broad portfolio. Selling and marketing expenses were $18 million for the second quarter 2022 compared to $15 million for the same quarter 2021. The increase in selling and marketing for the quarter reflects the expenses for the Zenlanta launch and ongoing commercial efforts. T&A expenses were $18 million for the quarter compared to $19 million for the same quarter 2021. T&A expenses decreased for the second quarter 2022 as compared to the same quarter in 2021 primarily due to lower share-based compensation expense. Net loss was $64 million for the second quarter compared to a net loss of $73 million for the same quarter 2021. Our diluted net loss per share was 84 cents in the second quarter, compared to a net loss of 95 cents for the same quarter 2021. The decrease in net loss for the quarter ended June 30, 2022, as compared to the same period in 2021, was primarily due to higher product revenue, partially offset by the increase in cost of product sales, R&D, and selling and marketing expenses. In addition, Net loss decreased for the second quarter of 2022 as a result of income arising from changes in the fair value of derivatives associated with our Deerfield facility agreement. Partially offset by higher interest expense associated with the deferred obligation with healthcare royalty partners. Adjusted net loss, a measure that excludes certain items as described in the press release issued earlier today, was 56 million for the second quarter compared to an adjusted net loss of 54 million in the same quarter 2021. Adjusted net loss per share was 73 cents for the second quarter compared to an adjusted net loss per share of 70 cents in the same quarter 2021. With that, I will turn the call back to Amit for closing remarks. Amit?
spk05: Thank you, Jennifer, Joe, and Jen. To conclude, we remain focused on executing on all areas of the business, and we are well positioned to achieve our key objectives going forward. This includes driving the Zenlata launch, working to develop Zenlata in earlier lines of therapy, advancing our pipeline of differentiated hematological and solid tumor programs, and expanding our ADC platform. Now the team will be available for questions. Operator?
spk02: Thank you. We will now begin the question and answer session. If you have a question, please press star one one on your touchtone phone. If you are using a speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press star one one on your touchtone phone. Our first question comes from the line of Kelly Shih from Jefferies.
spk01: Oh, taking my questions. So for targeted BLI submission of CAMI in the second half of next year, you mentioned the manufacturing stability data need to mature. I'm also curious if the clinical data package is in good shape for submission and for GBS toxicity in the hospital-informed patients, would you anticipate adcom requested by FDA? Thank you. I also have a follow-up.
spk05: Yeah, thank you for your question. I'm going to pass this on to Joe to answer. Sure.
spk06: Yes, the clinical data package is in very good condition. I mentioned the response rates and the duration, and that's all very positive from the efficacy side. On the safety side, you mentioned the Guillain-Barre syndrome. We have been able to develop some very straightforward interventions to make sure GBS is diagnosed early and treated. We only have eight cases in the package of Lotus 2. We don't have any, I'm sorry, of the Phase 2 study for CAMI. We don't have any late cases. And so, our advisors and we believe that the balance of efficacy and safety now is very positive and the benefit is clear and the safety can be addressed. The last question was, The last part of that was about an adcom. It's impossible to predict FDA activity, but we are not thinking that there will be an adcom. If there is, we will be prepared for it.
spk01: Great. Thanks. And I also have a question. Thank you. Thank you. And I also have a question on Zalampas-Dales. So the CAR T extended to second line in former patients and Yaskata showed a strong revenue increase in the second quarter. And also ADCP now has a J code effective since April 1st. I'm curious how those factors are going to start impacting long-term sales. And understood no sales guidance to be offered for 2022. But could we think the Q3 and the Q4 sales number could be, we could get some clue from the first half reported sales to signal the ramp up for the whole year. Thanks.
spk05: Yeah, thanks, Kelly. And before I turn it over to Jennifer, one more thing I want to address from your previous question, which is you'd also asked about the manufacturing stability. So Joe had said that the clinical package is moving in good shape, and we have a meeting planned with the FDA in September. The manufacturing stability, just to be clear, is just a matter of time. So when the manufacturing batches were produced, we're just waiting for that stability data to mature, and that's what's going to drive the timing for the planned completion of the filing in the second half of next year. But now I'll turn it over on the Zolante question to Jennifer.
spk08: Yeah, Kelly, thanks for your question. So your specific question with regard to CAR T, we have seen increased utilization in CAR T in the second line setting. We have been seeing a lot of post-CAR T use for Zinlanza. There are tremendous opportunities ahead of us in the second half of this year. And we're encouraged because as we moved through Q2, we did see month-over-month growth in demand and an increasing face-to-face access. As we exited the quarter, about three quarters of our engagements with physicians was in person, which we think is really important to portray the differentiated product profile of Zynlanta. And if we think specifically about the growth opportunities, we started out this year really focusing on the academic centers and developing national and regional level thought leadership and influence across the marketplace. We've had really good awareness in the academic centers, and as I've mentioned, 60% of our volume is coming from academia. We still have opportunity in the academic centers, not only for depth of prescribing, so converting those trialists to true advocates and embedding Zolanta in their treatment paradigm, but also, more importantly, in the community. And you mentioned the J-code. The permanent J-code that we got in April definitely takes away a barrier to prescribing And now we are doubling down on our awareness initiatives and partnering with community oncology to realize that opportunity.
spk01: Great.
spk02: Thank you. Thank you. Our next question comes from the line of Gregory Renza from RBC.
spk07: Hey, good morning, team. Congrats on the progress and thanks for taking time. My question is maybe just one for you, just more higher level. It's helpful to hear the feedback from your listening tour over the past few minutes and just laying out the near, medium, and longer-term goals. I'm just curious if there's anything in particular that's jumping out at you. Certainly helpful to hear about all the positive, any particular challenges that you face. you think are unique with respect to what ADC is facing, and even in this environment, and just how you're thinking about allocating your time across those different time horizons?
spk05: Yeah, no, it's a great question, and thanks so much for asking it. Yeah, look, I think, you know, one challenge that was pretty clear to me, and I've spent a lot of time, you know, with Jennifer and Joe's team, particularly in the field and with a lot of customers, because I always think You get the best insights when you meet with employees on the ground, you meet with customers, and you meet with investors, and you get a lot of insights. And that's how I spent a lot of my time our first few months. So one thing I would say is with Zinlanta, you know, this launch was in a pretty challenging environment because during this COVID period where institutions were relatively shut down, awareness of the product, particularly unaided awareness in the community, is still relatively low. And you know, while that's a challenge, I think it equally provides a big opportunity because, you know, as Jennifer mentioned, now that we have the J code established, which removes a key barrier for prescribing and access is really, we really saw it improve in Q2. So when I look at the indicators of activity and not only the activity, we're getting a lot of initial calls to customers that we hadn't had in the first part of launch. So to me, as much as it's been a challenge, I see it as an opportunity now going forward. And at least, you know, good early indicators of those sort of things in Q2. You know, when it comes to the midterm and our pipeline in general, what I would say is just, you know, for me the key is we have a lot of things in our pipeline and a lot of activity going on. And what I want to make sure is that we're really disciplined in terms of our portfolio prioritization and portfolio management. So, you know, we've implemented – we're in the process, I'd say, of implementing a really robust set of – process in terms of how we're going to manage our portfolio at the research stage, the gaining decisions to move into IND and clinical stages, and the gaining decisions to move into later stage clinical development. Because these, I judge, is all key investment decisions. And I think there's more we can do in terms of the robustness of that criterion. So you see with decisions, you know, I've always told the team, if the data doesn't bear up, the opportunity is not there from a business standpoint, we will stop things because we don't want to just keep putting money after things because we started things. So that's an area I'd say, again, for opportunity where we can do even more. And that's going to be a big focus for me. And then finally, on the third horizon, you know, we've been very PVD focused in terms of our payloads. And, you know, I think PVDs are really, really strong payloads that for a number of targets, particularly the ones that we picked in our pipeline, they really fit well. But as we want to expand the number of strong payloads that for a number of targets, particularly the ones that we picked in our pipeline, they really fit well. But as we want to expand the number of biological targets that we can go after, we want to expand the toolbox and open up the possibilities. We've done a number of different technology deals in the past, particularly around linker technology, some antibody constructs and conjugation chemistry. We've been a little bit more limited on payloads, but there are things that we've done, and there's more to come, I would say, on that front. Because to continue to lead in the ADC space, I think we have to open up our lens in terms of, you know, in terms of our technology toolbox. So those are just my initial thoughts of, you know, where there's still areas for opportunity and where we're focusing on to take the company going forward.
spk07: That's really helpful. Thank you so much. And maybe just one quick follow-up in case I missed it. If you could just comment on the inventory impact from 2Q on, on Volanta and also just now that the launch is over a year now, do we have a better sense of that predictability of, um, And what the quarters, how are you thinking about the quarters when it comes to inventory and build there? Thanks again.
spk08: Yeah, I'll take that question. So in terms of inventory for Q2, we believe that the net sales of $17.3 million reflects real-time patient demand. And we're not aware of any significant inventory build at this time. And I can't really comment on a future trend there.
spk07: Got it. Thanks again. Yeah, thank you very much.
spk02: Thank you. Our next question comes in the line of Boris Beeger from Cowen.
spk03: My first question is, speaking with the Zoloft discussion, can you maybe give us kind of a rough patient characteristic of these initial Zoloft adapters?
spk08: Certainly, Boris, and thanks for the question. So, you know, as we started off our launch by design and strategy, we developed our national and regional thought leaders, and many times they reside in the academic centers. And so in the academic centers, we've seen utilization of Zenlanta across the entire spectrum of the indication. I think the prioritized business opportunities as we see it in this fairly dynamic marketplace are in the post-CAR-T setting. And we've heard very strong support from our thought leaders in the post-CAR-T setting. And then for those patients that are unsuitable for CAR-T, there are a variety of reasons why a patient would not be eligible or not choose to pursue CAR-T treatment. And with our differentiated product profile, we believe that physicians and patients have a lot to benefit from both the efficacy, including a rapid time to response, the manageable side effect profile, and the very convenient administration.
spk03: And on that topic, we talked about CAR T's as moving to early lines of therapy, and obviously that's well known and it's helping those patients, but there are several competing drugs in second and third line DLBCL outside of CAR T. Can you comment how that competitive landscape is shaping up and where do you see Zoloft fitting in there more specifically?
spk08: Yeah, you know, Boris, I don't think that our positioning, our outlook for the positioning at Zinlanta has changed versus our launch positioning. So, you know, it really comes down to the differentiated product profile of Zinlanta, the robustness of the Lotus 2 trial, and the fact that in the real-world setting, physicians are seeing a Lotus 2 type of experience. with a rapid time to response and half those patients getting into a response. You know, recall these were heavily pre-treated patients. And so I think that, you know, Zynlonda continues to compete well from a product profile standpoint where we're putting a little bit more effort is really optimizing the execution of all of our customer facing teams because we have that unique opportunity with access really opening up. And so as Amit mentioned, we have still a bit of opportunity ahead of us, both in the academic centers and in the community, and that's where we're putting our focus.
spk03: Great. Thank you very much for taking my question.
spk02: Thank you. Our next question comes from the line of Matthew Harrison from Morgan Stanley.
spk04: This is Chris Yu speaking for Matthew. So we have two questions. The first question is regarding Zelanta. Just wondering whether you are getting any patients in the community setting in Q2?
spk08: Yes, we are getting patients in the community setting. As I mentioned, the permit J code came through in the beginning of April, and while that takes away a barrier to prescribing, I think we still have some work to do to really raise the level of awareness in the community that we've achieved in the academic centers. About 60% of our volume is coming from the academic centers, and so conversely, 40% of the volume is coming from the community. I think the real opportunity for us moving forward is not only the full execution of the J-code, but also partnering with the community oncology networks.
spk05: Yeah, and I would just add to what Jennifer said, that the adoption typically in a field like this, later lines, the LBCL, you tend to have slower adoption in the community than the academic. partly because community doctors on average see just far fewer patients than Jennifer had mentioned during the earnings call. And so you have slower adoption in general of all new therapies. I think as our profile gets more known, more understood by physicians, I think we have a real opportunity for many of the reasons that Jennifer mentioned. The fact that we have a really strong efficacy profile, fast time to response, the fact that it's a manageable safety side effect profile, the fact that it's single agent, the fact that You know, the molecule also is very easy to administer, one 30-minute infusion every three weeks. So it's really easy to administer. So I think there's a lot of reasons why it's going to fit well. And as I think Jennifer and her team have predicted, you'll get later adoption, and it takes longer to get the adoption in the community. But we believe we start to see that happening now in Q2.
spk04: That's very helpful. And my second question is regarding the long-term infarcular lymphoma. You mentioned that the Lotus 6 is terminated. And do you get any feedback from the FDA? And what's your path forward with long-term in focula lymphoma?
spk05: Yes, so Joe, do you want to take that?
spk06: Sure. Yes, thanks for the question. We did not get specific information from FDA. But it was very clear from the recent advisory boards and some of their public statements that FDA is much more interested in earlier treatments for follicular lymphoma where the chance of a long-term remission remains an option, you know, a possibility. You know, the late-line single agents sort of as a rescue don't look like the future, and FDA has actually said that. So, we took that into consideration and changed the focus of our program to look at some combination data for earlier lines. And so, it's going to take some time for us to get that data, but we're doing that. And that looks like a much more promising and I would say modern and future way of dealing with follicular lymphoma.
spk04: Thank you. You're welcome.
spk02: Thank you. Our next question comes from the line of Tazine Omar from BOFA.
spk10: Thank you for taking my questions. Just wanted to get your sense of what you think the data catalysts will be over the next 12 months. With the upcoming oncology conferences in the second half of the year, should we expect any presentations from any of your ongoing programs? And then lastly, on the The slope of the launch for Alonka, if you had to ask doctors what they would need to feel comfortable prescribing it today, is it simply just a matter of awareness? Or as you said, for community-based doctors, it's a limited patient pool. I'm just trying to understand how well doctors today, in your view, might appreciate the benefits of the drug. Thanks.
spk05: Yeah, so maybe I'll take the question on upcoming milestones, and I'm going to turn it over to Jennifer to answer the question around Zinlanta adoption. So I'd say I just highlight a few different milestones, let's say, over the next, let's call it 12 to 18 months. With Zinlanta, from Lotus 5, we're going to be presenting the safety lead-in data from the combination study with rituximab at an upcoming medical meeting. So we haven't announced which one, but it will be this year and the second half of the year. We also expect to get a regulatory decision around our European approval from EMA by the Q1 of next year. With CAMI, we have an upcoming meeting that we think is going to be really important, a pre-VLA meeting in September of this year, which will give us clarity on the path forward. And then, as we mentioned, given the timing for the stability data to mature, we plan to complete the submission of that in the second half of next year. With CAMI and with CAG1, we expect to have initial signs of safety and efficacy data for both programs in 2023. We're not being more specific because we're still in the process of dose escalation, but we expect to have some initial results from both of those programs next year. So those are, I'd say, the key milestones that I would highlight over the next 12 to 18 months. And I'll turn it, Jennifer, to you to talk about Samantha.
spk08: Yeah. So, Gene, thanks for the question. This past year has been pretty challenging with a lot less face-to-face interactions or educational opportunities that's really needed for a new product introduction. We are encouraged, though, as we move through Q2 that it's really opening up and hopefully for good. And we're seeing a lot more face-to-face interactions. Our team is doing quite well with face-to-face interactions, even versus the competitors and industry norms at this time. We do have quite a few opportunities, as I mentioned earlier, and the academic centers where we have done a fairly good job with regard to awareness and initial trial, we need to convert those trialists really to product advocates and embed in the treatment paradigm there. In the community, which represents over half of all third-line plus DLBCL patients, so a significant opportunity, I think they're, with the permanent J-code now, well in place. we have the opportunity to raise awareness, to get that initial positive experience with Zinlanta, and really embed Zinlanta in the community as a third-line standard of care. So I think that the access has been a challenge for this first year of launch, but I'm very encouraged from what I'm seeing, and the receptivity to the profile continues to be strong.
spk05: Yeah, and Tazine, just to add on to what Jennifer said, I mean, the – The community tends to adopt new products in oncology or hematology slower anyways than academic physicians. I think in this case it was probably heightened by two things. One is the lack of access, so just a lack of knowledge about many new therapies, I'd say, in the community, particularly ours, which is just a year into launch. And then the second thing is just the diffuse nature of the patients, where a community doctor may be seeing a patient every three to four months. So that frequency also drives the urgency to learn about new therapies, especially when you're not getting access. But I think that remains the big untapped opportunity, and I think our profile fits particularly well in that setting. So for some physicians right now, we're in the early launch phase right now in the community in terms of the number of interactions they've had, the knowledge of the product. And I think if that picks up, given the access that Jennifer spoke about, I think that's the much bigger opportunity for growth in the near and midterm.
spk10: Okay, thanks for that, Keller. I'm sorry if I might have missed this if you've already said it. What is your split between community docs and academics right now?
spk08: Yeah, so in terms of volume, we still have about 60% of our volume coming from academia. In terms of ordering accounts, it's a 50-50 split, but we do see that in terms of ordering, there's a lot more account acquisition opportunity in the community to come. But that, as Amit mentioned, is going to take time. It will fuel our steady growth in the future.
spk10: Okay. And you don't have any constraints on supply right now, do you?
spk08: There are no issues with regard to commercial supply that I'm aware of.
spk10: Okay, great.
spk02: Thank you. Thank you. I would now like to turn the conference back over to Amit Malik for closing remarks.
spk05: No, thank you. And thank you to all of you very much for joining our call today. Thanks for your continued support of ADC Therapeutics. We look forward to keeping you updated on our progress, and I hope that you have a nice day. Thank you.
spk02: This conference calls. Thanks for participating. Thanks for participating. You may now disconnect. The conference will begin shortly. To raise your hand during Q&A, you can dial star 1-1.
Disclaimer