ADC Therapeutics SA

Welcome to the ADC Therapeutics First Quarter 2023 Financial Results Conference Call. My name is Antoine Alexander, and I will be your operator for today's call. At this time, our participants are in listen-only mode. Later, we will conduct a Q&A session. During the Q&A session, if you would like to ask a question, please press star 1-1 on your touchtone phone. I would now like to hand the call over to Amanda Lashbaugh, Investor Relations Manager, Amanda, you may begin.

Thank you, Operator. This morning, we issued a press release announcing our first quarter 2023 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, I meet Malik, Chief Executive Officer. Kristen Harrington-Smith, Chief Commercial Officer, Mohamed Zaki, Chief Medical Officer, and Pepe Carmona, Chief Financial Officer, will discuss recent business highlights and review our first quarter 2023 financial results before opening the call for 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. Examples of forward-looking statements include those related to our future financial and operating results, the impact of our updated strategic path forward, including our commercial field strategy, portfolio prioritization, and capital allocation and restructuring plan, our ability to achieve our guidance for 2023's in long-term revenue and operating expenses, as well as our future cash requirement projections, future revenue growth, prescription volume, product launches, and market share for our products, either alone or through our foreign partners, timing and results of ongoing and future development programs and clinical trials for our products, either alone or in combination with our partner products, FDA and foreign regulatory authorities' actions and potential regulatory approval for our products, either alone or in combination with our strategic partner products, future strategic partnerships, and business development efforts, and our ability to repay our outstanding debt obligations. These forward-looking statements are subject to certain risks and uncertainties, and actual results could differ materially. They are identified and described in today's press release, in the accompanying slide presentation on slide two, and in the company's filings with the SEC on Form 20-F, and as updated in ADCP's recent periodic filings on Form 6-K. ADCP is providing this information as of the date of today's conference call 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 after the date hereof, except as required by law or otherwise. The company fashions investors not to place undue reliance on these forward-looking statements. Today's presentation also includes non-IFRS financial measures. These non-IFRS measures have limitations to 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 first quarter earnings release for definitional information and reconciliations of historical non-IFRS measures to the comparable IFRS financial measures. It is now my pleasure to pass the call over to our CEO, Amit Malik. Amit?

Thanks, Amanda, and thank you all for joining us. We will provide you with details regarding our progress during the first quarter, but I want to spend most of my time today focusing on some important changes to our corporate and capital allocation strategy. These changes follow a comprehensive assessment of the business by the executive team and take into account our current status, the evolving DLBCL treatment landscape, and the reality of the current capital markets environment. By successfully executing our updated strategy, we believe we can optimize our operations and maximize value for all of our stakeholders. There are three main components to our updated strategy. One, we are implementing a new go-to-market model to help drive growth in both academic and community centers. Two, we are prioritizing our pipeline on nearer term clinical programs, which we believe have the greatest potential to drive value over the next 12 to 15 months. And three, we are increasing efficiencies across the organization to reduce operating expenses. Now I'd like to expand on each of these three elements, starting with the commercial organization supporting Symanta, which delivered net sales of $19 million in the first quarter, up 15% year over year, and a slight decline versus prior quarter. We remain confident in the uniquely differentiated product profiles in Manta, but we know that we can do better communicating this to physicians, particularly those in the community setting. Since Kristen joined as Chief Commercial Officer last November, she has had the opportunity to carefully assess the existing go-to-market model from every angle to figure out areas of improvement. As a result, we have decided to change our model to better align with how prescribers make treatment decisions and how healthcare is delivered locally. We know that in local geographies, academic centers are expanding into the community, community centers are consolidating, and the influence across the two is growing. Our new model has aligned local teams with the right skills to address these shifts in the marketplace. I worked with Kristen for over a decade, and I've seen her successfully lead her teams to maximize the value of product launches. I'm confident in her ability, along with the commercial team, to take on this new phase of growth for Zonlanta. Turning to the pipeline, we've decided to focus our resources on our more advanced programs, which we believe have the highest potential to drive value in a reasonable timeframe. These include the Zonlanta Lifecycle Management Program, as well as our clinical programs targeting Axel, TAG1, and CD22. We are encouraged by the progress of these programs to date, and after a thorough review of the protocols, and plans of action, we have agreed with Mohamed to increase investments to either expand and or accelerate the pace of patient enrollment for these programs. At this time, as part of our prioritization exercise, we are halting investments in our preclinical programs targeting PSMA and DLK1. Mohamed will elaborate on this a little later. Finally, after a comprehensive business assessment conducted by the executive team, we are streamlining the organization and optimizing efficiencies. As Pette will discuss later, the cost reduction is derived primarily from the prioritization of our R&D activities, a 17% reduction in the workforce, and greater operating efficiencies across the company. With these savings, we are redeploying capital to fund the prioritized programs. Taken together, the key elements of our updated corporate strategy will better position us to maximize the tremendous commercial and patient opportunities in Atlanta and to progress our most advanced pipeline programs all while being fully funded through mid-2025. With that, I'd like to turn the call over to Kristen for a commercial update. Kristen?