Last fall, ADC Therapeutics (ADCT) concluded the time just wasn’t right for an IPO. Six months later, with its lead drug in a pivotal test and plans being drawn up for a regulatory submission and potential commercialization, the cancer drug developer has determined it needs cash now.
ADCT refiled its IPO plans late Friday. The Epalinges, Switzerland-based company set a preliminary $100 million goal for its public market debut. According to ADCT’s filing, an application for a New York Stock Exchange listing under the stock symbol “ADCT” has already been approved.
The Swiss company is developing antibody drug conjugates, cancer drugs that link a tumor-targeting antibody to a cancer-killing chemical compound. Such drugs are intended to provide a direct hit to tumors that spares healthy tissue. The company’s drug candidates use pyrrolobenzodiazepines (PBDs), a class of compounds among those used in antibody drug conjugates, as the cancer-killing payloads.
In its filing, ADCT says its PBDs are different than other drugs used in antibody drug conjugates because they don’t disrupt the DNA of cancer cells, which in turn avoids the DNA repair mechanisms that could thwart a therapy’s cancer-killing effects. ADCT says that it has improved upon the first generation of PBDs, with drugs that that are easier to link to antibodies. The company adds that its PBDs showed in preclinical tests that they are 100 times more powerful than the cancer-killing compounds used in the antibody drug conjugates now on the market.
ADCT’s lead drug candidate, loncastuximab tesirine, or “Lonca,” targets CD-19, a protein on the surface of tumor cells. The drug, which is given as an intravenous infusion, is currently in a pivotal Phase 2 clinical trial testing it in relapsed or difficult to treat diffuse large B-cell lymphoma (DLBCL). As of last October, the company says that 45.5 percent of the 145 patients enrolled in the study showed a partial or complete response to the drug. Patients in the Phase 2 study had been treated, on average, with three previous lines of cancer therapy.
As of April 21, the overall response rate was 76.9 percent at the dose that will be used in the pivotal portion of the Phase 2 study, according to the filing. The percentage of patients showing a complete response to that dose was 61.5 percent.
Final Phase 2 data for Lonca are expected by the end of this quarter. The company plans to submit the drug for FDA review in the second half of 2020. At the same time, the company says it will run a confirmatory study testing the drug in combination with Roche drug rituximab (Rituxan), which the company hopes will support an application for use of the drug as a second line of treatment in relapsed or difficult to treat DLBCL.
Lonca is also being developed for follicular lymphoma, as well as both DLBCL and mantle cell lymphoma in combination with ibrutinib (Imbruvica), a drug marketed by AbbVie (NYSE: ABBV) for B-cell cancers. A pivotal Phase 2 study in follicular lymphoma is expected to start in the fourth quarter of this year, according to ADCT’s filing.
The second cancer drug in ADCT’s pipeline is camidanlumab tesirine, or “Cami.” The drug, which uses an antibody from Genmab (NASDAQ: GMAB) to target the CD-25 cancer protein, is being developed for relapsed or difficult to treat Hodgkin lymphoma, non-Hodgkin lymphoma, and solid tumors. Cami is being developed in partnership with Genmab, which has opportunity to negotiate for full rights option of the drug.
A Phase 2 test of Cami in Hodgkin lymphoma is currently under a partial clinical hold, which stops the study from enrolling new patients. According to the prospectus, the partial hold came after the company told the FDA that two patients were diagnosed with Guillain-Barré syndrome, a rare disorder in which the immune system attacks the nerves. As of April 17, one of those patients is recovering at home and the other one is on a ventilator in a hospital.
It’s not the first time the ADCT drug has run into this problem. In 2017, just days before the company announced the close of $200 million in financing, the FDA put a partial hold on a Phase 1 test of Cami. That setback came after two Hodgkin lymphoma patients were diagnosed with Guillain-Barré, according to the filing. ADCT amended the clinical trial plans and the regulator lifted the partial hold in 2018. In its filing, the company says preliminary Phase 2 data in Hodgkin lymphoma are now expected in the first half of 2021, though the biotech cautions that the timeline will be affected by how the FDA handles the latest partial clinical hold.
ADCT was founded in 2011, spun off of Spirogen, a UK-based company specializing in developing antibody drug conjugates for cancer. In 2013, AstraZeneca (NYSE: AZN) acquired Spirogen for $200 million up front and $240 million in potential milestone payments. In addition, AstraZeneca also invested $20 million in ADCT. That investment was matched by Auven Therapeutics, the majority shareholder of both Spirogen and ADCT. According to ADCT’s IPO filing, Auven and AstraZeneca both own more than 5 percent of the company, though their precise stakes in the biotech were not disclosed. Since its founding, ADCT says it has raised $558.6 million, according to the IPO filing.
In addition to its Switzerland headquarters, ADCT has locations in London, San Mateo, CA, and Murray Hill, NJ, which has the company’s clinical development and commercialization teams. Of ADCT’s 138 employees, 83 are based in the US.
When ADCT initially filed its IPO plans last September, the IPO market, particularly for life science companies, remained strong. Nonetheless, the company opted to withdraw its proposal in October. The global economic crash in the wake of the COVID-19 pandemic has since clamped down on the number of companies going public, though a handful of biotech companies are still managing to successfully complete IPOs.
As of the end of 2019, ADCT reported having $115.6 million in cash. The company says the IPO proceeds will support continued clinical development of Lonca and Cami. ADCT also plans to apply some of the new capital toward earlier-stage clinical development of ADCT-602 in relapsed or difficult to treat acute lymphoblastic leukemia, as well as ADCT-601 in solid tumors.