ADCT 10-K & 10-Q changes, risk factors and insider trading

•We or our partners may be unable to obtain, or experience delays in obtaining, regulatory approval for our product candidates. We or our partners may be unable to maintain regulatory approval for any approved products.

We have incurred substantial net losses since our inception and expect to continue to incur losses for the foreseeable future. As of December 31, 2024,2025, we had accumulated losses of $1,493$1,636 million. We expect to continue to incur net losses for the foreseeable future as we continue to devote substantial resources to research and development and marketing and commercialization efforts in both hematology and solid tumors, in particular to growcommercialize ZYNLONTA in the 3L+ DLBCL setting, continue to study and advance ZYNLONTA ininto earlier lines of therapy and in combinations to potentially expand ourits market opportunity and further develop our pipeline and our ADC platform.opportunity. We are unable to accurately predict whether and when we will achieve profitability. Even if we achieve profitability, we may not be able to sustain profitability in subsequent periods. This risk is heightened as we only have one approved product, ZYNLONTA, at the present time and thus are heavily dependent on its commercial performance and its continued research and development.

As a result, we will need to raise additional capital to fund our operations and execute our business plan. We do not have any committed external source of funds, and additional funds may not be available when we need them or on terms that are acceptable to us. Our ability to raise additional funds will depend on financial, economic and market conditions and other factors, over which we may have no or limited control. Further, as a Swiss company, we have less flexibility to raise capital, particularly in a quick and efficient manner, as compared to U.S. companies. See “—Risks Related to Our Common Shares—Our shareholders enjoy certain rights that may limit our flexibility to raise capital, issue dividends and otherwise manage ongoing capital needs.” The restrictions contained in our contractual agreements may also limit our ability to raise certain forms of capital. For example, subject to certain exceptions, the Loan Agreement restricts our ability to incur indebtedness and the HCR Agreement restricts our ability to sell, finance or loan any additional royalties on ZYNLONTA outside of China, Hong Kong, Macau, Taiwan, Singapore and South Korea or on Cami,Korea, and to incur indebtedness exceeding 20% of our market capitalization. If adequate funds are not available to us on a timely basis or on terms acceptable to us, we may be required to delay, limit, reduce or terminate our research and development, commercialization or growth efforts.

Under the HCR Agreement, we are obligated to pay to HCR royalties representing a percentage of net sales of ZYNLONTA in certain jurisdictions, and a percentage of any upfront or milestone payments we receive from licenses that we grant to commercialize ZYNLONTA in certain jurisdictions, and a percentage of any upfront or milestone payments (or on royalties) we receive from licenses that we grant to commercialize Cami.jurisdictions. See “Item 1. Business—Material Contracts.” As a result, our ability to generate from sales of, and licensing agreements involving, ZYNLONTA is reduced, which could adversely affect our financial condition.

In addition, upon the occurrence of a change in control event, we are obligated to pay HCR an$150 amountmillion equal to 2.50 times(if the amountchange paidof bycontrol HCRevent underoccurs on or before December 31, 2027) or $200 million (if the change of control event occurs on or after January 1, 2028). In addition, following such change of control event, royalty obligations will continue until the Royalty Cap (as defined in the HCR Agreement,Agreement), unless we (or atour 2.25successor timesin interest) buys out the amountremaining paidroyalty obligations by paying HCR under$525 million (if the agreementbuyout if HCR receives royalty payments exceeding a mid-nine-digit amountoccurs on or prior to MarchDecember 31, 2029,2029) or $750 million (if the buyout occurs on or after January 1, 2030), less anythe amountsamount weof royalties previously paid to HCR and the change of control payment previously paid to HCR. See “Item 1. Business—Material Contracts.” The foregoing provision may make us a less attractive acquisition target byand reducingreduces the benefit accruing to our shareholders in any change-of-control transaction.

The warrants that we have issued to Deerfield Partners, L.P. and Deerfield Private Design Fund IV, L.P. (the “Deerfield Warrants”) are presented in the audited consolidated balance sheets as a liability, which is remeasured to fair value at each reporting date. The fair value changes based on our share price and its expected volatility. Our obligation under the HCR Agreement is accounted for as a short-term and long-term debt obligation. To determine the accretion of the liability, we are required to estimate the total amount of future royalty payments and estimated timing of such payment to HCR based on our revenue projections as well as the achievement of certain milestones. Based on our periodic review, the amount and timing of repayment is likely to be different at each reporting period. To the extent the amount or timing of such payments is materially different than our initial estimates, we will record a cumulative catch-up adjustment. As a result, our Deerfield Warrants and obligations under the HCR Agreement could result in considerable non-cash charges to, and significant volatility in, our consolidated statements of operations.

As of December 31, 2024,2025, we reported $1,059$1,009 million and $19.3 million in tax loss carryforwards for Swiss and U.S. corporate income tax purposes.purposes, respectively. Such tax loss carryforwards and tax credits could, with certain limitations, be used to offset future taxable income. Swiss tax loss carryforwards generally expire seven years after the tax year in which they were incurred;incurred, whereas, U.S. tax loss carryforwards whereas U.S. tax loss carryforwards do not expire but may be subject to annual utilization limitations. U.S. federal and state tax credits generally expire after 20 years, although some state tax credits expire as quickly as seven years after the tax year in which they were incurred, and others do not expire. There can be no assurance that we will be able to generate sufficient income that allows us to use such tax loss carryforwards or tax credits before their expiration. We recognizehave not recognized any deferred tax asset related to U.S. federal and state tax credits inas ourof consolidatedDecember financial31, statements2025, because we do not believe it is more likely than not that such credits will be realized based on our assessmentcurrent projections of thefuture valuetaxable that we will be able to realizeincome; however, such assessments are based on our projections of our future taxable income, which are subject to uncertainty and change based on numerous factors, including those described in this “Item 1A. Risk Factors” section. In addition, relevant tax authorities may not accept our claims of tax loss carryforwards or tax credits. Furthermore, changes in tax law, as well as interpretation of such tax laws, could reduce, eliminate, or otherwise impair our ability to use our tax loss carryforwards and U.S. federal and state tax credits.

We believecannot assure you that we werewill not be a passive foreign investment companyCompany (a “PFIC”) for U.S. federal income tax purposes for the 2023any taxable year, which could result in adverse U.S. federal income tax consequences to certain U.S. investors.

Under the Internal Revenue Code of 1986, as amended (the “Code”), we will be a passive foreign investment company (“PFIC”), for any taxable year in which, after the application of certain look-through rules with respect to subsidiaries, either (i) 75% or more of our gross income consists of “passive income” or (ii) 50% or more of the average quarterly value of our assets consists of assets that produce, or are held for the production of, “passive incomeincome.” (includingFor cash).purposes of the above calculations, we will be treated as if we hold our proportionate share of the assets of, and receive directly our proportionate share of the income of, any other corporation in which we directly or indirectly own at least 25%, by value, of the shares of such corporation. Passive income generally includes interest, dividends, certain non-active rents and royalties, and capital gains. Cash is generally characterized as a passive asset for these purposes. Goodwill and other intangibles are generally characterized as a non-passive or passive asset based on the nature of the income produced in the activity to which the goodwill or other intangibles are attributable.

If we are a PFIC for any taxable year during which a U.S. Holder holds our common shares, we generally will continue to be treated as a PFIC with respect to that U.S. Holder for all succeeding years during which the U.S. Holder holds our common shares, even if we cease to meet the threshold requirements for PFIC status. Such a U.S. Holder may be subject to adverse U.S. federal income tax consequences, including (i) the treatment of all or a portion of any gain on disposition as ordinary income; (ii) the application of a deferred interest charge on such gain and the receipt of certain dividends; and (iii) compliance with certain reporting requirements. A “qualified electing fund” (“QEF”) election or, if our common shares are regularly traded on a qualified exchange, a “mark-to-market” election may be available that will alter the consequences of PFIC status.

BecauseIf we believe we were a PFIC for the 2023any taxable year, we haveintend providedto provide information necessary for our U.S. Holders to make a QEF election with respect to us for the 2023such taxable year and expect to provide such information for any subsequent year if we believe we are a PFIC,year, but there is no assurance that we will timely provide this information. There is also no assurance that we will have timely knowledge of our status as a PFIC in the future or of the information that a U.S. Holder would need in order to make a valid election. Any such information will be provided on our website.

•competition from alternative clinical trials in a similar space or new treatments in similar indications which may limit orour ability to recruit and enroll new subjects;

Drug research and clinical trials are inherently uncertain. There can be no assurance regarding the outcome of any ongoing or planned clinical trials, including whether such trials will meet their respective endpoints, whether severe adverse events will occur during the trials and whether the final results will ultimately be sufficient to support or maintain regulatory approval. For example, we are conducting a confirmatory Phase 3 trial of ZYNLONTA in combination with rituximab for the treatment of relapsed or refractory DLBCL.DLBCL after one or more lines of systemic therapy (LOTIS-5). As previously disclosed, we submitted a protocol amendment to FDA in 2024 to increase enrollment in LOTIS-5 to address unexpectedly high rates of early censoring which FDA noted could impact the interpretability and reliability of the data. We subsequently implemented several actions to mitigate such early censoring in the newly enrolled patients. Enrollment was completed in 2024. It is unknown if the high rate of early censoring seen in the trial will impact the study results. Despite ZYNLONTA having received accelerated approval from the FDA and conditional approval from the EMAEMA, UK MHRA and UKHealth MHRA,Canada, ZYNLONTA may fail to achieve its primary endpoint in LOTIS-5, or the reliability and interpretability of the data from LOTIS-5 may be impacted by factors such as, but not limited to, the high rates of early censoring or possible inconsistent results across subgroups. Even if LOTIS 5 achieves its primary endpoint, the secondary endpoints in thisthe study, including overall survival, or the safety profile, may not be favorable such that the FDA concludes that the clinical trial,benefit whichdoes not justify the risks associated with the treatment. Any of the above factors, or other variables impacting the study, could result in oura inabilitydetermination by regulatory authorities that the data are insufficient for full approval, or to maintain regulatoryaccelerated approval.approval, Resultsand fromthat earlier-stagean additional clinical trialstrial areis even more unpredictable due to the limited size of the clinical trials and number of unknown factors at such early stages.required.

Results from preclinical studies and early-stage clinical trials of a product candidate may not be predictive of results from late-stage clinical trials of that product candidate or of any other product or product candidate.candidate due to the limited size of the clinical trials and a number of unknown factors at such early stages. In the past, despite promising results from preclinical studies and early-stage clinical trials, we have discontinued development of product candidates due to the results from late-stage clinical trials. In addition, positive and promising results from preclinical studies and clinical trials of a product or product candidate in one indication may not be predictive of results from clinical trials of that product or product candidate in other indications or in combination with other agents. There may be significant differences between clinical trials, including differences in inclusion and exclusion criteria, efficacy endpoints, dosing regimen and statistical design. For example, results from the pivotal Phase 2 clinical trial of ZYNLONTA for the treatment of relapsed or refractory DLBCL,DLBCL after two or more lines of systemic therapy, or any other clinical trial of ZYNLONTA, may not be predictive of results from other clinical trials of ZYNLONTA, such as the confirmatory Phase 3 clinical trial, particularlyLOTIS-5, those in which ZYNLONTA is used in combination with other agentsagents, and those involving different patient populations, such as the Phase 11b LOTIS-7 trial. If the results of our confirmatory trial for ZYNLONTA or the additional trials for ZYNLONTA in other indications do not meet their primary endpoints, then we may be unable to maintain regulatory approval for ZYNLONTA or obtain regulatory approval for expanded or new indications for ZYNLONTA. Failure to maintain or obtain regulatory approval for ZYNLONTA could have an adverse impact on our ability to continue to generate and grow our revenue in the future.

In our clinical trials, we have observed certain class toxicities associated with our warheads, including elevated liver enzymes, skin rash, and effusions and edema. The prescribing information for ZYNLONTA contains warnings and precautions for effusion and edema, including capillary leak syndrome, myelosuppression, infections, hepatotoxicity, including drug-induced liver injury, cutaneous reactions and embryo-fetal toxicity.

We are also developing ZYNLONTA and certain of our product candidates in combination with other therapies, such as rituximab and bispecific antibodies. Combining therapies may cause additional, different or more severe side effects or adverse events than when a drug is used as a monotherapy. In addition, therapies used in combination may have common toxicities. When used in combination, the severity and frequency of such undesirable side effects or adverse events may be greater than the cumulative severity and frequency of such side effects or adverse events when the therapies are used as monotherapies.

We may not be successful in our efforts to expand the market opportunity of ZYNLONTA, develop additional product candidates or build up our research pipeline.ZYNLONTA.

ZYNLONTA is currently approved for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy, including DLBCL not otherwise specified, DLBCL arising from low-grade lymphoma, and also high-grade B-cell lymphoma. We are undertaking clinical trials to potentially expand ZYNLONTA into other indications and into earlier lines of therapy. However, clinical development and regulatory review is inherently unpredictable and are subject to numerous risks and uncertainties described in this “Item 1A. Risk Factors” section. Failure to expand the indication(s) for ZYNLONTA could limit the market opportunity for ZYNLONTA and our potential future revenue which could have an adverse effect on our business and operations.operations and our ability to achieve our potential peak revenue for ZYNLONTA. There can be no assurance that we will succeed in expanding the market opportunity of ZYNLONTA.

We do not control the conduct of current or any potential future investigator-initiated clinical trials, and the data from such trials isare not subject to our review or quality control.

We have provided and may continue to providepublicly present clinical data from anIITs. investigator-initiatedFor example, initial clinical trialsdata (“IIT”).from two IITs at the University of Miami in which ZYNLONTA is being studied as a single agent in the treatment of MZL or in combination with rituximab for the treatment of FL has been presented. We do not control the design or administration of such trials, nor the submission, approval or maintenance of any regulatory and institutional filings required to conduct such trials. Furthermore, we have limited or no rights to audit, review or apply quality control procedures to the clinical data generated from such trials. As a result, we have no control over the conduct of such trials and the timing of any data releases from such trials and we cannot be certain that such trials are or will be conducted in accordance with applicable regulatory requirements or that the clinical data provided to us by the investigators of such trials are accurate, reliable or complete. There can be no assurance regarding the outcome or timing of any IITs, including whether such trials will meet their respective endpointendpoints and whether severe adverse events will occur during the trials. Nevertheless, any new side effects or adverse events observed in these trials may require a change in our current approved labeling, affect our ongoing trials, or affect our ability to maintain marketing authorization for any approved product. In addition, positive preliminary results in any ongoing IIT may not be predictive of results in the completed trial.

We or our partners may be unable to obtain, or experience delays in obtaining, regulatory approval for our product candidates.

Our product candidates must be approved by the FDA in the United States, by the EMA in the European Union and by comparable regulatory authorities in other jurisdictions prior to commercialization. In order to obtain regulatory approval for the commercial sale of any product candidates, we or our partners must demonstrate through extensive preclinical studies and clinical trials that the product candidate is safe and effective for use in each target indication and that manufacturing of the product candidate is safe, robust and reproducible. The time and resources required to obtain regulatory approval is unpredictable, typically takes many years and significant investment following the commencement of clinical trials and depends upon numerous factors.

Regulatory authorities have substantial discretion in the approval process. They may refuse to accept any application or may decide that our data are insufficient for approval and require additional clinical trials or other studies. In this Annual Report and elsewhere in our public communications, we designate certain of our clinical trials as “pivotal” if we believe that these clinical trials, if successful, will support BLA submissions; however, thereThere can be no assurance that any clinical trial or data that we designateor asour “pivotal”partners believe will support regulatory approval will be viewed as sufficient by the FDA, the EMA and other comparable regulatory authorities in other jurisdictions to support regulatory approval. Additionally, the FDA may convene an Oncologic Drugs Advisory Committee (ODAC) meeting during the review of our application to market our product which may influence the approval of the application. While the FDA is not bound by recommendations of an ODAC, it generally follows such recommendations when making decisions on approval. If we or our partners are required to conduct additional clinical trials or other testing of any of our products and product candidates beyond those that are contemplated, we or our partners may incur significant additional costs and regulatory approval may be delayed or prevented.

Furthermore, the process and time required to obtain regulatory approval differ by jurisdiction. Approval by one regulatory authority does not ensure approval by regulatory authorities in other jurisdictions. In particular, prior to regulatory approval, regulatory authorities may require additional clinical trials to be conducted with a local population. Moreover, in many countries outside the United States, a drug must be approved for reimbursement before it can be approved for sale in that country, which can take considerable time and be heavily impacted by the robustness of the clinical data as well as political, economic and regulatory developments.

In addition, the approval policies or regulations of the FDA, the EMA or comparable regulatory authorities in other jurisdictions may change in a manner rendering our clinical data insufficient for approval. For example, the accelerated approval pathway has come under scrutiny within the FDA and by Congress. The FDA has put increased focus on ensuring that confirmatory studies are conducted with diligence and, ultimately, that such studies confirm the benefit. The Food and Drug Omnibus Reform Act (“FDORA”) included provisions related to the accelerated approval pathway and authorized the FDA to require a post-approval study to be underway prior to approval or within a specified time period following approval. Furthermore, the Oncology Center of Excellence within the FDA is advancing Project Optimus, which is an initiative to reform the dose optimization and dose selection paradigm in oncology drug development to emphasize selection of an optimal dose, which is a dose or doses that maximizes not only the efficacy of a drug but the safety and tolerability as well. This shift from the prior approach, which generally determined the maximum tolerated dose, may require sponsors to spend additional time and resources to further explore a product candidate’s dose-response relationship to facilitate optimum dose selection in a target population. TheseThe andFDA otheralso policiesrecently issued draft guidance on recommendations for assessing overall survival in randomized oncology trials where it expressed a preference for overall survival as a primary endpoint. It is unknown how this guidance may impact FDA’s risk-benefit assessment of studies already in progress or what postmarketing obligations FDA may require for such studies. For example, the primary endpoint of the FDA,LOTIS-5 trial is progression free survival with overall survival as a secondary endpoint. It is unknown how FDA may view these endpoints in light of the EMArecent ordraft comparable regulatory authorities in other jurisdictions may increase the time and costs associated with regulatory approval.guidance. Other recent Oncology Center of Excellence initiatives have included Project FrontRunner, a new initiative with a goal of developing a framework for identifying candidate drugs for initial clinical development in the earlier advanced setting rather than for treatment of patients who have received numerous prior lines of therapies or have exhausted available treatment options, and Project Equity, which is an initiative to ensure that the data submitted to the FDA for approval of oncology medical products adequately reflects the demographic representation of patients for whom the medical products are intended. More recently, as part of FDORA, sponsors will be required to submit Diversity Action Plans (“DAPs”) for Phase 3 studies or other pivotal studies of new drugs. DAPs must include the sponsor’s goals for enrollment for such studies, disaggregated by age group, sex, and racial and ethnic demographic characteristics of clinically relevant study populations; the sponsor’s rationale for such goals; and an explanation of how the sponsor intends to meet such goals. FDA is scheduled to issue final guidance on DAPs by late June 2025, and these requirements are scheduled to be implemented in late 2025.options. However, there remains significant uncertainty regarding the final details of these requirements and their impact on development programs. These and other policies of the FDA, the EMA or comparable regulatory authorities in other jurisdictions may increase the time and costs associated with regulatory approval.

We or our partners may be unable to maintain regulatory approval for any approved products.

As part of regulatory approval, we or our partners may be subject to a number of post-marketing requirements and commitments, such as post-marketing studies or clinical trials, surveillance to monitor the safety or efficacy of any approved product and risk evaluation and mitigation strategies. For example, our post-marketing obligations with respect to ZYNLONTA include a confirmatory trial to verify and describe the clinical benefit of ZYNLONTA, a deferred pediatric trial and a trial in patients with hepatic impairment. For ZYNLONTA and for any other products for which we receive accelerated approval from the FDA or conditional approval from the EMA or comparable regulatory authorities in other jurisdictions, we are required to complete confirmatory clinical trials.trials and these other post-marketing commitments, on specified timelines. We are currently conducting the LOTIS-5 study as our confirmatory trial for ZYNLONTA. The FDA may withdraw approval of our products approved under the accelerated approval pathway if, for example, the clinical trial(s) required to verify the predicted clinical benefit of a product fails to verify such benefit or does not demonstrate sufficient clinical benefit to justify the risks associated with the product for any reason, including if the high rate of censoring of patients,patients impacts the reliability of the results, if other evidence demonstrates that a productZYNLONTA is not shown to be safe or effective under the conditions of use, we or our partners fail to conduct any required post-marketing confirmatory clinical trial with due diligence and within specified timelines or we or our partners disseminate false or misleading promotional materials relating to the relevant product. There can be no assurance that we will receive full approval or maintain the current accelerated approval for ZYNLONTA for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy or that we will receive full approval for ZYNLONTA in other indications or for any of our product candidates for which we receive accelerated approval.indications. In addition, any products for which we or our partners receive regulatory approval in a particular jurisdiction and the activities associated with their commercialization, including testing, manufacture, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, will be subject to comprehensive regulation by the FDA, the EMA or comparable regulatory authorities in other jurisdictions. These requirements include, without limitation, submissions of safety and other post-marketing information and reports, registration and listing requirements, the FDA’s cGMP requirements or comparable requirements in foreign jurisdictions, requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, including periodic inspections by the FDA, the EMA or comparable regulatory authorities in other jurisdictions, requirements regarding the distribution of samples to physicians, tracking and reporting of payments to physicians and other healthcare providers and recordkeeping. If we or our partners are unable to complete the required confirmatory or post-marketing studies, if such studies fail to meet their safety and efficacy endpoints or if we otherwise fail to timely comply with post-marketing requirements and regulations, we or our partners may be unable to maintain regulatory approval for any approved products. If we are unable to maintain accelerated approval for ZYNLONTA, we may not be able to continue to generate revenue which will have a material adverse impact on the Company.

The policies of the FDA, the EMA and comparable regulatory authorities in other jurisdictions may change and additional regulations may be enacted. If we or our partners are slow or unable to adapt to changes in existing requirements or to the adoption of new requirements, or not able to maintain regulatory compliance, we may lose any regulatory approval that may have been obtained. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad, as the regulatory environment changes rapidly.

We may pursue orphan drug designation for one or more of our other product candidates. However, obtaining an orphan drug designation can be difficult, and we may not be successful in doing so. Even if we obtain orphan drug designation, we may not be able to maintain such designation. For example, in the process of seeking marketing authorization in the European Union, the Committee for Orphan Medicinal Products recommended to not uphold ZYNLONTA’s previously granted orphan drug designation. Orphan drug designation neither shortens the development time or regulatory review time of a product candidate nor gives the product candidate any advantage in the regulatory review or approval process. Even if we obtain orphan drug designation for our product candidates in specific conditions, we may not be the first to obtain regulatory approval of these product candidates for the orphan-designated condition and therefore we may not be eligible for orphan drug exclusivity in the U.S.United States. In addition, exclusive marketing rights in the United States may not be awarded if we seek approval for an indication broader than the orphan-designated condition or, if awarded, may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition. Furthermore, even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different ADCs with different monoclonal antibody elements or functional elements of the conjugated molecule can be approved for the same condition. Even after an orphan product is approved, the FDA can subsequently approve the same ADC with the same monoclonal antibody element and functional element of the conjugated molecule for the same condition if the FDA concludes that the later ADC is safer, more effective or makes a major contribution to patient care. Our inability to obtain orphan drug designation for any product candidates for the treatment of rare cancers and/or our inability to maintain that designation for the duration of the applicable exclusivity period, could reduce our ability to make sufficient sales of the applicable product candidate to balance our expenses incurred to develop it.

Even if ZYNLONTA does receive its 12 years of exclusivity, the value of RPE is limited. As data exclusivity, RPE would not preclude subsequent licensure of a similar or related product unless the application sought to rely on the FDA’s findings of safety, purity, and potency for ZYNLONTA in a biosimilar application filed pursuant to Section 351(k) of the PHS Act. Accordingly, the FDA could approve an identical loncastuximab tesirine productproduct, or any other loncastuximab product, with full studies demonstrating safety, purity, and potency submitted under section 351(a) of the PHS Act. The FDA could also approve loncastuximab tesirine for a different indication or with a different route of administration or formulation despite any RPE for ZYNLONTA.

The FDA, the EMA and comparable regulatory authorities in other jurisdictions strictly regulate the promotional claims that may be made about prescription drug products, such as our products. While physicians, in the practice of medicine, may prescribe approved drugs for unapproved indications, a product may not be promoted for uses that are not approved by the applicable regulatory authority as reflected in the product’s approved labeling or for uses inconsistent with the product’s approved labeling. For example, despite ZYNLONTA being approved for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy, including DLBCL not otherwise specified, DLBCL arising from low grade lymphoma and high-grade B-cell lymphoma, if our promotional materials and related activities are not consistent with the approved labeling or if physicians, in their professional medical judgment, nevertheless prescribe the drug product to their patients in a manner that is inconsistent with the approved labeling, we may be subject to claims that we promoted off-label use or otherwise violated applicable regulations. In addition, although we believe our warhead may provide for superior efficacy as compared to marketed ADCs, without head-to-head data, we will be unable to make comparative claims for our products. If we are found to have promoted such off-label use or made suchany unsubstantiated comparative claims, we may become subject to significant liability under the Federal Food, Drug, and Cosmetic Act (the “FDCA”) and other statutory authorities, such as laws prohibiting false claims for reimbursement.

We receive, generate and store significant and increasing volumes of sensitive information, such as employee and patient data. In addition, we actively seek access to medical information, including patient data, through research and development collaborations or otherwise. We and any potential collaborators may be subject to federal, state, local and foreign laws and regulations that apply to the collection, use, retention, protection, disclosure, transfer and other processing of personal data, including the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (“HITECH”), the Regulation 2016/679, known as the General Data Protection Regulation (the “GDPR”), as well as European Union memberMember stateState implementing legislations, the UK General Data Protection Regulation (“UK GDPR”) and the Swiss Federal Act on Data Protection. In addition, many state laws govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, and often are not pre-empted by HIPAA. For example, the California Consumer Privacy Act of 2018 (“CCPA”), as amended by the California Privacy Rights Act of 2020 (“CPRA”) onrequires January 1, 2023, imposes obligations on businessesbusiness to which it applies, including, but not limited to, providingprovide specific disclosures in privacy notices, affordingaffords California residents certain rights related to their personal data, although it exempts some data processed in the context of clinical trials, expandingand expands consumers’ rights with respect to certain sensitive personal information, and creating a new state agency that is vested with authority to implement and enforce the CCPA and CPRA.information; Virginia’s Consumer Data Protection Act, which took effect on January 1, 2023,Act requires businesses subject to the legislation to conduct data protection assessments in certain circumstances and requires opt-in consent from consumers to acquire and process their sensitive personal information, which includes information revealing a consumer’s physical and mental health diagnosis and genetic and biometric information that can identify a consumer. In addition, Colorado enacted the Colorado Privacy Act,consumer; and Connecticut enacted the Connecticut Data Privacy Act, each of which took effect on July 1, 2023, and Utah enacted the Consumer Privacy Act, which became effective on December 31, 2023, and each of these laws may increase the complexity, variation in requirements, restrictions and potential legal risks, and could require increased compliance costs and changes in business practices and policies. Otherother states have also enacted, proposed,proposed orand are considering proposing, data privacy laws, which could further complicate compliance efforts, increase our potential liability and adversely affect our business. These laws and regulations are complex and change frequently, at times due to changes in political climate, and existing laws and regulations are subject to different and conflicting interpretations, which adds to the complexity of processing personal data from these jurisdictions. Compliance with U.S. and international data protection laws and regulations could require us to take on more onerous obligations in our contracts, restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate in certain jurisdictions. Failure to comply with these laws and regulations could result in government enforcement actions, which could include civil, criminal and administrative penalties, private litigation, and adverse publicity and could negatively affect our operating results and business. Moreover, clinical trial subjects, employees and other individuals about whom we or our potential collaborators obtain personal information, as well as the providers who share this information with us, may limit our ability to collect, use and disclose the information. Claims that we have violated individuals’ privacy rights, failed to comply with data protection laws, or breached our contractual obligations, even if we are not found liable, could be expensive and time-consuming to defend and could result in adverse publicity that could harm our business.

•HIPAA, which, among other things, imposes criminal liability for executing or attempting to execute a scheme to defraud any healthcare benefit program, including private third-party payors, knowingly and willfully embezzling or stealing from a healthcare benefit program, or willfully obstructing a criminal investigation of a healthcare offense, and creates federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement or representation, or making or using any false writing or document knowing the same to contain any materially false, fictitious or fraudulent statement or entry in connection with the delivery of or payment for healthcare benefits, items or services.

These initiatives culminated in the enactment of the Inflation Reduction Act (“IRA”), which, among other things, allows the U.S. Department of Health and Human Services (“HHS”) to directly negotiate the selling price of a statutorily specified number of drugs and biologics each year that the Centers for Medicare & Medicaid Services (“CMS”) reimburses under Medicare Part B and Part D. The negotiated price may not exceed a statutory ceiling price. Only high-expenditure single-source biologics that have been approved for at least 11 years (7 years for single-source drugs) can be selected by CMS for negotiations, with the negotiated price taking effect two years after the selection year. For 2026, the first year in which negotiated prices become effective, CMS selected 10 high-cost Medicare Part D products in 2023, negotiations began in 2024, and the negotiated maximum fair price for each product has been announced. CMS has selected 15 additional Medicare Part D drugs for negotiated maximum fair pricing in 2027. For 2028, an additional 15 drugs, which may be covered under either Medicare Part B or Part D, will be selected, and for 2029 and subsequent years, 20 Part B or Part D drugs will be selected. A drug or biological product that has an orphan drug designation for only one rare disease or condition will be excluded from the IRA’s price negotiations requirements, but loses that exclusion if it has designations for more than one rare disease or condition, or if is approved for an indication that is not within that single designated rare disease or condition, unless such additional designation or such disqualifying approvals are withdrawn by the time CMS evaluates the drug for selection for negotiation. The IRA also penalizes drug manufacturers that increase prices of Medicare Part B and Part D drugs at a rate greater than the rate of inflation, and in November 2024, CMS finalized regulations for these Medicare Part B and Part D inflation rebates. In addition, the IRA requires manufacturers that wish for their drugs to be covered by Medicare Part D to provide statutorily defined discounts to Part D enrollees. The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. Manufacturers that fail to comply with the IRA may be subject to various penalties, some significant, including civil monetary penalties. The IRA also extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025. These provisions began taking effect progressively in 2023, although they may be subject to legal challenges. Thus, while it is unclear how some provisions of the IRA will be implemented, we are liable for Part B inflation rebates for ZYNLONTA under the IRA, which has and will continue to negatively impact our gross-to-net adjustment for ZYNLONTA sales.

Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

We expect that additional state and federalother healthcare reform measures willthat may be adopted in the future.future Anymay adoptedresult healthcarein reformmore measurerigorous couldcoverage reducecriteria theand ultimatein demandadditional for our products or putdownward pressure on the price that we receive for any approved product. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our productproducts, pricing.if approved. It is likely that federal and state legislatures within the United States and foreign governments will continue to consider changes to existing healthcare legislation. We cannot predict the reform initiatives that may be adopted in the future or whether initiatives that have been adopted will be repealed or modified.

We or our foreign commercialization partners may not be able to successfully commercialize our products.

To successfully commercialize our products, we must attract and retain qualified selling and marketing personnel and attain significant market acceptance of our products. We face significant competition for qualified personnel. See “—We face substantial competition, which may result in others discovering, developing or commercializing products, treatment methods or technologies before or more successfully than we do.” Establishing market acceptance of our products among physicians, patients, patient advocacy groups, third-party payors and the medical community is complex and resource intensive. The risk of our inability to establish market acceptance may be heightened as our products represent novel treatment methods and may be influenced by factors beyond our control, including perceptions of ADC products generally or those of our competitors and coverage and reimbursement for our products. Further, changes to our commercialization strategy may result in disruptions to and adverse impacts on our commercialization efforts. If we do not successfully commercialize our products, we may not generate significant product revenues and may not receive a satisfactory return on our investment into the research and development of those products.

Alternatively, we have established collaborations with third parties to commercialize our product.product in certain jurisdictions. See “Item 1. Business—Material Contracts.” In such collaborations, we depend on the performance of the contractual counterparty, over which we have limited control. Therefore, such collaborations may generate lower product revenues or profit than if we were to commercialize our products ourselves. We may wish to establish additional collaborations with third parties to commercialize our product. We may not be successful in entering into such marketing and distribution arrangements with third parties or in entering in such marketing and distribution arrangements with third parties on favorable terms. Moreover, such arrangements are complex and time-consuming to negotiate, document and implement and they may require substantial resources to maintain.

In both domestic and foreign markets, sales of our products will depend substantially on the extent to which the costs of our products will be covered by third-party payors, such as government health programs, commercial insurance and managed healthcare organizations. These third-party payors decide which products will be covered and establish reimbursement levels for those products. If coverage and adequate reimbursement are not available, or are available only to limited levels, or if access to or funding for government health programs, commercial insurance and managed healthcare organizations is restricted or otherwise unavailable, we may not be able to successfully commercialize our products.

Obtaining coverage approval and reimbursement from a government or other third-party payor is a time-consuming and costly process that could require us to provide supporting scientific, clinical and cost-effectiveness data for the use of our products to the payor, which we may be unable to provide. In particular, there is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, there is no uniform policy for coverage and reimbursement and, as a result, coverage and reimbursement can differ significantly from payor to payor. The principal decisions about reimbursement for new medicines are typically made by the CMS, which decides whether and to what extent a new medicine will be covered and reimbursed under Medicare. Private payors often, but not always, follow the CMS’s decisions regarding coverage and reimbursement. Further, coverage policies and third-party payor reimbursement rates may change at any time. ItCoverage and reimbursement is difficultlargely todependent on the clinical profile of a product/regimen, we cannot predict what third-party payors will decide with respect to coverage and reimbursement forwithout fundamentallyhaving noveltrials products such as ours, as there is no body of established practicescompleted and precedentsregulatory approval for thesea new products.product/regimen. Further, one payor’s determination to provide coverage and adequate reimbursement for a product does not assure that other payors will also provide coverage and adequate reimbursement for that product. In Europe, pricing and reimbursement schemes may be more restrictive than those in the United States and vary widely from country to country and may require additional clinical trials and additional cost-effectiveness assessments. Many foreign jurisdictions provide nationalized healthcare which may impact the ability to obtain coverage or the amount of reimbursement. In addition, countries may restrict the price of products through the use of nationalized tender processes, controls on the profitability of drug companies, guidance to physicians to limit prescriptions, reference pricing and parallel distribution. Furthermore, many countries have increased the amount of discounts required on pharmaceutical products. This risk may be heightened by our collaboration with Sobi, pursuant to which we do not control the commercialization of, including obtaining coverage and reimbursement for, ZYNLONTA. The downward pressure on healthcare costs in general, and prescription products in particular, has become increasingly intense.

Furthermore, the containment of healthcare costs has become a priority of governments and private third-party payors. Governments and private third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. We also expect to experience pricing pressures due to the trend towards managed healthcare, the increasing influence of health maintenance organizationshealthcare and additional legislative changes. In particular, we contract with group purchasing organizations, which increases our gross-to-net deductions. These and other cost-control initiatives could cause us to decrease the price we might establish for products, which could result in lower-than-anticipated product revenues. In addition, the publication of discounts by third-party payors or authorities may lead to further pressure on the prices or reimbursement levels within the country of publication and other countries. If pricing is set at unsatisfactory levels or if coverage and adequate reimbursement of our products is unavailable or limited in scope or amount, our revenues and the potential profitability of our products in those countries would be negatively affected.

The market opportunities for our products and product candidates may be smaller than we estimate and any approval that we obtain may be based on a narrower definition of the patient population.population than we anticipated.

InADC Therapeutics is a commercial-stage global pioneer in the field of antibody drug conjugates (“ADCs”), transforming treatment for patients through our hematologyfocused program,portfolio ourwith flagshipZYNLONTA product,(loncastuximab ZYNLONTA,tesirine-lpyl), a CD19-directed ADC,ADC. ZYNLONTA received accelerated approval from the U.S. Food and Drug Administration (“FDA”) and conditional approval from the European CommissionCommission, China National Medical Products Administration (“NMPA”) and conditionalHealth approval from the NMPACanada for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy. We are seekingpursuing toexpansion continue expandingof ZYNLONTA internationally, and into earlier lines of diffuse large B-cell lymphoma (“DLBCL”) through our LOTIS-5 confirmatory Phase 3 clinical trial (rituximab combination) and LOTIS-7 Phase 1b clinical trial (bispecific combination) as well as into indolent lymphomas, including marginal zone lymphoma (“MZL”) and follicular lymphoma (”FL”), as a single agent and in combination through our LOTIS-5 confirmatory Phase 3 clinical trial and LOTIS-7 Phase 1b clinical trial as well as through investigator-initiated trials (“IITs”) at leading institutions. In addition, we are investigating a CD-22 targeted compound, ADCT-602, in collaboration with the MD Anderson Cancer Center in a Phase 1/2 IIT in relapsed or refractory B-cell acute lymphoblastic leukemia.

We generate product revenue through the sale of ZYNLONTA in the United States. Revenue is recognized when control is transferred to the customer at the net selling price, which includes reductions for gross-to-net (“GTN”) sales adjustments such as government rebates, chargebacks, distributor service fees, other rebates and administrative fees, sales returns and allowances and sales discounts. In the long term, we expect that our product revenue will increase as we execute our business strategy, although ourOur product revenue may fluctuate from period to period based on a number of factors, including patient demand, as well as the timing, dose and duration,duration of patient therapy and customers’ buyingordering patternspatterns, pricing and GTN deductions. We expect a relatively consistent level of GTN sales adjustments as a percentage of gross sales, but may also experience variability in GTN sales adjustments due to additional information and actual experience such as actual rebate and return rates.

Product revenues, net, were $73.6 million for the year ended December 31, 2025 as compared to $69.3 million for the year ended December 31, 2024 as compared to $69.1 million for the year ended December 31, 2023,2024, an increase of $0.2$4.3 million, or 0.3%.6.2%. The increase is primarilyprincipally attributable to a higher sellingsales priceprice, andwith favorabilityconsistent insales priorvolume on a period GTNover salesperiod adjustments, partially offset by lower sales volume.basis.

We generate license revenue and royalties from our strategic agreements for the development and commercialization of ZYNLONTA and other product candidates outside of the United States. Under these agreements, we receive upfront payments and are eligible for certain milestone payments and royalties. See “Item 1. Business—Material Contracts.” We are unable to predict the timing and amounts of license revenue and royalties as meeting milestones is subject to many factors outside of our control and we have limited control over our partners’ commercialization efforts.

License revenues and royalties were $7.8 million for the year ended December 31, 2025 as compared to $1.6 million for the year ended December 31, 2024 as compared to $0.5 million for the year ended December 31, 2023,2024, an increase of $1.1$6.2 million. The increase wasmillion attributable to increased royalty revenue from our exclusive license agreement with SOBISobi to develop and commercialize ZYNLONTA in all territories other than the United States, greater China, Singapore and Japan. In March 2025, the Company recognized $5.0 million in license revenue in connection with a milestone due upon ZYNLONTA’s conditional approval by Health Canada for the treatment of relapsed or refractory DLBCL after two or more lines of systemic therapy, which was paid to us by Sobi in the second quarter of 2025. The increase was also attributable to increased royalty revenue from Sobi.

Cost of product sales primarily includes direct and indirect costs relating to the third-party manufacture and distribution of ZYNLONTA, royalties payable to a collaboration partner based on net product sales of ZYNLONTA and inventory write-downs. We expect that cost of product sales will increase over time as we sell through pre-approval inventory that was previously expensed prior to commercialization under U.S. GAAP. Factors such as inflationinflation, tariffs and other external factors may also increase our cost of product sales as a percentage of product revenue if we are not able to increase the price at which we sell ZYNLONTA to offset such increases in our cost of product sales.

Share-based(1) Excludes share-based compensation expense.

(1)Excludes share-based compensation expense (reversal).expense.

Selling and marketing expenses were $43.4 million for the year ended December 31, 2025 as compared to $44.0 million for the year ended December 31, 2024 as compared to $57.5 million for the year ended December 31, 2023,2024, a decrease of $13.4$0.6 million, or 23.4%.1.5%. The net decrease in external costs and overhead was primarily attributable to a reduction of $12.0$2.0 million in lower spend on marketing and advertising expenses as a result of costreduced cuttingspending initiatives.initiatives within the U.S. The decreaseincrease in employee expenses was primarily due to loweran increase in wages and benefits of $2.3 million primarily due to decreased headcount, as well as lower recruitment costs of $0.2$0.3 million. The increase in share-based compensation expense of $0.6$1.0 million was primarily duedriven toby the forfeitures of awards in connection with employee terminations in the prior year employee terminations.year.

General and administrative expenses were $36.6 million for the year ended December 31, 2025 as compared to $41.9 million for the year ended December 31, 2024 as compared to $48.4 million for the year ended December 31, 2023,2024, an overall decrease of $6.5$5.3 million, or 13.5%.12.7%. The decrease in external costs and overhead of $2.9 million was primarily related to lower professional fees of $1.5$2.1 million primarily as a result of lower legal and accounting expenses, VAT recoveries of $0.5 million, lower insurance costs of $0.7 million and lower insurancetravel and IT costs of $1.3$0.5 million. The increasedecrease in employee expenses of $0.6 million was primarily due to higherlower wages and benefits of $0.4 million and higherlower recruitment costs.costs of $0.4 million, partially offset by $0.2 million in higher temporary project help. The decrease in share-based compensation expense of $1.0 million was primarily due to fluctuationsthe intiming our share price as well asof forfeitures of awards in connection with employee terminations.

Interest income was $8.8 million for the year ended December 31, 2025 as compared to $12.3 million for the year ended December 31, 20242024, asa compared to $10.5 million for the year ended December 31, 2023, an increasedecrease of $1.7$3.5 million, or 16.4%.28.2%. The increasedecrease was primarily due to higherlower yields received on our cash deposits.deposits and cash equivalents and lower average balances.

Interest expense is primarily related to the accretion of our deferred royalty obligation withto HCR and the senior secured term loan facility. Interest expense was $51.6 million for the year ended December 31, 2025 as compared to $50.2 million for the year ended December 31, 2024 as compared to $46.3 million for the year ended December 31, 2023,2024, an increase of $3.9$1.4 million, or 8.4%.2.8%. The increaseThis was relateddue to higher accretion of our deferred royalty obligation with HCR of $5.7$1.7 million as a result of thehigher $73.1total million,revenue, net of transaction costs, received in June 2023 upon the first commercial sale of ZYNLONTA in the United Kingdom or any European Union country, which increased the liability. This wasnet, partially offset by lower interest on our senior secured term loan facility of $1.8$0.3 million as a result of a lower effective interest rate.

Other, net consists primarily of cumulative catch-up adjustments related to our deferred royalty obligation, changes in the fair value (gains or losses) of the Deerfield warrant obligation and the R&D tax credit from our UK operations. Other, net as of December 31, 2025 and 2024 included the following:

We are subject to corporate income taxation in Switzerland.Switzerland We are also subject to taxationand in other jurisdictions in which we operate, in particular,including the United States and the United Kingdom, where our two wholly-owned subsidiaries are incorporated. WeUnder Swiss law, we are entitled under Swiss lawspermitted to carry forward anynet operating losses incurred for aup period ofto seven years, which couldmay be used to offset future taxable income. We are also entitled underUnder U.S. tax lawlaw, toresearch carryand forward R&Ddevelopment tax credits may generally be carried forward for a period of up to 20 years,years which could beand used to offset future taxabletax income.liabilities, subject to statutory requirements.

We recorded an income tax expense of $1.0 million for the year ended December 31, 2025 as compared to $0.2 million for the year ended December 31, 2024 as compared to $39.1 million for the year ended December 31, 2023,2024, primarily driven by our U.S. and U.K. operations and the full valuation allowance recognized on our deferred tax assets.

We recorded our proportionate share of Overland ADCT BioPharma’s net loss of $1.5 million and $5.5 million for the years ended December 31, 2024 and 2023, respectively. For the year ended December 31, 2024,2024. weWe recorded our share of Overland ADCT BioPharma’s net loss up until the point at which our share of losses exceeded our interest in Overland ADCT BioPharma. Losses were not recognized in excess of our total investment, as we have not incurred legal or constructive obligations or committed to additional funding on behalf of the joint venture. As a result, we did not record losses for the year ended December 31, 2025.

We plan to continue to fund our operating needs through our existing cash and cash equivalents, revenues from sales of ZYNLONTA, potential milestone and royalty payments under our licensing agreements and additional equity financings, debt financings and/or other forms of financing, as well as potential funds provided by collaborations. We are continuously exploring strategic collaborations, business combinations, licensing opportunities or similar strategies for our early-stage research pipeline and for clinical development and commercialization of ZYNLONTA and/or our productPSMA-targeting candidates.ADC. However, we may be unable to obtain such future financing, licensing and collaboration arrangements on favorable terms, if at all, and if so we may need to prioritize our portfolio and reduce our investment in early stage research and development activities.all.

Our primary uses of capital are, and we expect will continue to be, research and development expenses, selling and marketing expenses, compensation and related expenses, interest and principal payments on debt obligations and other operating expenses. We expect to incur substantial expenses as we continue to devote substantial resources to research and development and marketing and commercialization efforts, in particular to grow ZYNLONTA in the 3L+ DLBCL setting, continue to study and advance ZYNLONTA in earlier lines of therapy and in combinations to potentially expand our market opportunity and further develop our pipeline and our ADC platform.opportunity. Cash used to fund operating expenses is impacted by the timing of when we pay expenses, as reflected in the change in our outstanding accounts payable and accrued expenses, as well as the timing of collecting receivables from the sale of ZYNLONTA and paying royalties related to our deferred royalty obligation.

For information relating to our non-cancelable obligations under third party manufacturing agreements see Note 14, “Commitments and contingenciescontingencies,”, included in the Notes to our audited consolidated financial statements.

The Company has entered into variouscertain collaborations with development partners, including in-licensing and manufacturing agreements. These agreements provide for the Company to makeinclude potential future milestone and royalty payments that arebecome conditionalpayable ononly success,upon andthe that are spread over various stagesachievement of developmentspecified anddevelopment, commercialization, including filing an IND application, commencingregulatory, or completing multiple clinical development stages, obtaining regulatory approval in multiple countries, and achieving various levels of commercial sales.events. Due to the nature of these arrangements, the future potential payments related to the attainment of the specified milestones are inherently uncertain, and accordingly, no amounts have been recorded for these future potential payments in the Company’s consolidated balance sheets asAs of December 31, 20242025, and 2023.2024 we have not incurred any obligations under these arrangements, and we do not expect any material payments to become due unless and until such events occur. The aggregate amount of such potential milestone payments (excluding royalty payments), under all such collaboration agreements, was $212.2$59.6 million, including approximately $79.3$29.2 million contingent on the achievement of various research, development and regulatory approval milestones and approximately $132.9$30.4 million in sales-based milestones.

Net Cash Usedprovided by (used in) Investing Activities

ThereBelow havewe beenare noproviding, materialin changessupplemental form, an addition to theour risk factors as previously disclosed in our Annual Report.Report on Form 10-K for the year ended December 31, 2025.

Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025

The following table summarizes our results of operations for the three months ended MarchJune 31,30, 2026 and 2025:

Product revenues, net, were $20.0$18.6 million for the three months ended MarchJune 31,30, 2026 as compared to $17.4$18.1 million for the three months ended MarchJune 31,30, 2025, an increase of $2.6$0.5 million, or 15.1%.3.0%. The increase is primarily attributable to higher sales volume and a higher price. Sales volume was consistent on a period over period basis.

We generate license revenue and royalties from our strategic agreements for the development and commercialization of ZYNLONTA outside of the United States. Under these agreements, we receive upfront payments and are eligible for certain milestone payments and royalties. See “Item 1. Business—Material Contracts” in our Annual Report on Form 10-K. We are unable to predict the timing and amounts of license revenue and royalties as meeting milestones is subject to many factors outside of our control and we have limited control over our partners’ commercialization efforts.

Cost of product sales were $3.6$2.3 million for the three months ended MarchJune 31,30, 2026 as compared to cost of product sales of $2.1$0.8 million for the three months ended MarchJune 31,30, 2025, an increase of $1.6$1.5 million, or 75.4%.181.0%. The increase in cost of product sales was primarily attributable to a $1.2$1.1 million increase in certain personnel costs, reflecting a change in focus of these personnel from research and development clinical supply activities to commercial manufacturing activities. Cost of product sales was also higher due to $0.2 million in higher shippingstability and storage charges for the three months ended MarchJune 31,30, 2026. Additionally, both periods included charges of $1.4 million and $1.2 million, respectively, related to the manufacturing of batches that did not meet our specifications.

The following table summarizes our research and development expenses for the three months ended MarchJune 31,30, 2026 and 2025:

Our R&D expenses were $19.9$17.4 million for the three months ended MarchJune 31,30, 2026 as compared to $28.9$30.1 million for the three months ended MarchJune 31,30, 2025, a decrease of $9.1$12.7 million, or 31.3%.42.3%.

The decrease in external costs and overhead of $6.1$10.2 million was driven primarily by discontinued programs and our preclinical product candidates and research pipeline as a result of the 2025 Restructuring andRestructuring, completion of IND-enabling activities for our PSMA-targeting ADC.ADC, Theseas decreaseswell wereas partiallya offset by an increasedecrease in ZYNLONTA spend due to the timing and enrollment of our ZYNLONTA clinical trials and related costs incurred in connection with the LOTIS-5 and LOTIS-7 trials.

The decreasechanges in employee and share-based compensation expenses were primarily driven by lower wages and benefits of $2.8 million resulting from the 2025 Restructuring, partially offset by higher temporary project help of $0.6 million. Additionally, we had a $2.1$1.7 million shift in certain personnel costs (including $0.4 million in share-based compensation expense) to cost of product sales ($1.2$1.1 million), inventory capitalization ($0.6$0.5 million) and selling and marketing expense ($0.3$0.1 million), reflecting a change in focus of these personnel from research and development activities to commercial manufacturing and fulfillment activities. TheThese decreasedecreases was also attributable to lower wages and benefits of $2.3 million due to the 2025 Restructuring,were partially offset by higher temporaryshare-based projectcompensation helpexpense due to the timing of $1.3forfeitures million.of awards in connection with employee terminations and higher grant date fair values of RSU awards issued during the year, driven by both an increased number of awards and stock price appreciation at the time of grant.

The following table summarizes our selling and marketing expenses for the three months ended MarchJune 31,30, 2026 and 2025:

Selling and marketing expenses were $12.7$12.6 million for the three months ended MarchJune 31,30, 2026 as compared to $10.6$10.1 million for the three months ended MarchJune 31,30, 2025, an increase of $2.2$2.4 million, or 20.4%.23.9%. The increase in external costs and overhead of $0.7$1.7 million was primarily attributable to higher spend on marketing and advertising expenses, training initiatives and related travel costs.expenses. The increase in employee and share-based compensation expenses were primarily due to an increase in wages and benefits of $0.8 million and a $0.3$0.1 million increase in certain personnel costs, reflecting an increase in commercial fulfillment activities. The increase in share-based compensation expense was also driven by higher grant date fair values of RSU awards issued during the period,year, driven by both an increased number of awards and stock price appreciation at the time of grant.

The following table summarizes our general and administrative expenses for the three months ended MarchJune 31,30, 2026 and 2025:

General and administrative expenses were $9.9$9.7 million for the three months ended MarchJune 31,30, 2026 as compared to $10.0$8.8 million for the three months ended MarchJune 31,30, 2025, an decreaseincrease of $0.1$0.9 million, or 0.6%.10.0%. The increase in external costs and overhead of $0.5$0.9 million was primarily related to higher legal expenses of $0.5 million and higher IT expenses of $0.4 million, as well as a one-time VAT recovery of $0.3 million recognized in the prior year, partially offset by $0.2 million in lower legal expenses.million. The decrease in employee expenses of $0.8$0.9 million was primarily due to lower wages and benefits. The increase in share-based compensation expense of $0.3$0.9 million was primarily due to higher grant date fair values of RSU awards issued during the period,year, driven by both an increased number of awards and stock price appreciation at the time of grant.

Interest income was $2.0$1.8 million for the three months ended MarchJune 31,30, 2026 as compared to $2.1$1.9 million for the three months ended MarchJune 31,30, 2025, a decrease of $0.1 million, or 2.9%.5.9%. The decrease was primarily due to lower yields received on our cash deposits.deposits and lower average cash balances.

Interest expense is primarily related to the accretion of our deferred royalty obligation with HCR and the senior secured term loan facility. Interest expense was $12.3$13.5 million for the three months ended MarchJune 31,30, 2026 as compared to $12.2$13.0 million for the three months ended MarchJune 31,30, 2025, an increase of $0.1$0.5 million, or 1.0%.3.9%. The increase was primarily related to higher accretion of our deferred royalty obligation with HCR of $0.3 million as a result of higher total revenue, net, as well as a higher effective interest rate as a result of the HCR Amendment, partially offset by lower interest on our senior secured term loan facility of $0.2 million as a result of a lower effective interest rate.Amendment.

Other, net consists primarily of the change in the fair value of the HCR warrant obligation, cumulative catch-up adjustments related to our deferred royalty obligation and the R&D tax credit from our UK operations. Other, net as of MarchJune 31,30, 2026 and 2025 included the following:

On February 18, 2026, we entered into an amendment (the “HCR Amendment”) to the Purchase and Sale Agreement, dated August 25, 2021 (the “Original HCR Agreement” and, as amended by the HCR Amendment, the “Amended HCR Agreement”). In connection with the HCR Amendment, the Company issued to HCR warrants to purchase 9,834,776 common shares. The HCR warrant obligation has been recorded at its initial fair value at the time the agreement was entered into on February 18, 2026 and is remeasured to fair value at the end of each reporting period. The fair value of the warrant obligation as of MarchJune 31,30, 2026 was $18.5$4.2 million. The income of $2.2$14.4 million for the three months ended MarchJune 31,30, 2026 was primarily due to the decrease in fair value of the underlying shares during the respective period.

We are subject to corporate income taxation in Switzerland and in other jurisdictions in which we operate, including the United States and the United Kingdom, where our two wholly-owned subsidiaries are incorporated. Under Swiss law, we are permitted to carry forward net operating losses for up to seven years, which may be used to offset future taxable income. Under U.S. tax law, research and development tax credits may generally be carried forward for up to 20 years and used to offset future tax liabilities, subject to statutory requirements. We recorded an income tax expense of nil for the three months ended MarchJune 31,30, 2026 as compared to $0.2$1.3 million for the three months ended MarchJune 31,30, 2025.2025, primarily driven by a tax adjustment in our UK operations recorded in the comparable prior period as a result of the 2025 Restructuring.