ADC Therapeutics (ADCT), a commercial-stage biotechnology company specializing in oncology, is making waves in the development of antibody-drug conjugates (ADCs) for patients battling hematological malignancies and solid tumors. Their flagship product, Zynlonta (loncastuximab tesirine-Ipyl), a CD19-directed ADC armed with a pyrrolobenzodiazepine (PBD) payload, received accelerated FDA approval in January 2021 for adult patients with relapsed/refractory (r/r) large B-cell lymphoma (DLBCL) after two or more lines of systemic therapy.
However, Zynlonta has encountered a fierce competitive landscape. Despite reaching an annualized revenue run rate of approximately $80 million at its peak in the first quarter of 2023, it has struggled to gain significant market share. While the analyst expects Zynlonta’s peak revenue in the third-line treatment setting to reach $110 million in the U.S. by 2032, they believe the real potential lies in expanding its use to second-line DLBCL.
This optimistic outlook hinges on the assumption that Zynlonta will receive approval for second-line DLBCL treatment, backed by positive results from the LOTIS-5 and LOTIS-7 clinical trials. Preclinical data suggests that combining Zynlonta with rituximab, an anti-CD20 antibody, could enhance tumor control and extend treatment benefits.
Despite the competitive second-line DLBCL market, the analyst remains bullish on Zynlonta’s potential, citing its impressive efficacy: an 80% overall response rate and a 50% complete response rate. They estimate that Zynlonta could generate approximately $172 million in revenue from second-line DLBCL by 2032.
Adding to the excitement, ADCT boasts a diverse pipeline of ADCs targeting other solid tumor indications, presenting multiple growth opportunities beyond Zynlonta. The analyst at Stephens has initiated coverage on ADCT with an Overweight rating and a price target of $6, suggesting a potential 100% upside from current levels.
While navigating a crowded market, ADC Therapeutics remains focused on expanding Zynlonta’s applications and leveraging its diverse pipeline to establish itself as a major player in the oncology space. With promising efficacy and a robust development program, Zynlonta has the potential to make a significant impact on the treatment of hematological malignancies and solid tumors.
