ADC Therapeutics: US$325m for ADC royalties

The Lausanne-based biotechnology company has entered into a US$325m financing agreement with healthcare investment firm HealthCare Royalty Partners. Under the terms of the agreement, ADC Therapeutics will receive US$225m upon closing, and is eligible to receive an additional US$75m upon the first commercial sale of Zynlonta (loncastuximab tesirine) in Europe and an additional US$25m 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).

“We are delighted to partner with HealthCare Royalty, a leading healthcare investment firm, to continue the development and commercialisation of ZYNLONTA in combination with other drugs, in earlier lines of therapy and in new histologies, as well as to continue our development and commercialisation plans for Cami,” said Chris Martin, Chief Executive Officer of ADC Therapeutics. The Swiss company will use the proceeds for the continued development and commercialisation of the two candidates.

Zynlonta is a CD19-directed antibody drug conjugate (ADC). Once bound to a CD19-expressing cell, Zynlonta is internalised 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 tumour cell death. Zynlonta 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. The compound is also in late-stage clinical trials in combination with other agents.

Camidanlumab tesirine (formerly ADCT-301)  is an ADC composed of a monoclonal antibody that binds to CD25, conjugated to a PBD-dimer toxin. Once bound to a CD25-expressing cell, camidanlumab tesirine is internalised into the cell where enzymes release the PBD-based warhead. In addition to CD25-expressing tumour cells, camidanlumab tesirine depletes CD25-positive Tregs in the local tumour environment, which enhances immune-mediated anti-tumour activity.