ADC Therapeutics Announces Amended HealthCare Royalty Financing Agreement

Rhea-AI Summary

ADC Therapeutics (NYSE: ADCT) amended its royalty purchase agreement with HealthCare Royalty to increase strategic flexibility for ZYNLONTA®. Key changes: the change-of-control payment is reduced to $150M through Dec 31, 2027 and $200M thereafter; HealthCare Royalty received warrants for ~9.8M common shares at $3.81 exercisable through Dec 31, 2030. Royalties continue to be payable to an acquirer until the original royalty cap, and buyout options of $525M (pre-2029 deadline) or $750M (post-2029) remain in place.

Positive

• Change-of-control payment cut to $150M through 2027, $200M thereafter
• HealthCare Royalty granted warrants for ~9.8M shares at $3.81
• Company projects potential US peak revenue of $600M–$1B assuming approvals and compendia inclusion
• HealthCare Royalty previously provided $300M of funding

Negative

• Royalty payments continue to an acquirer until the original royalty cap is reached
• Buyout obligation can still be up to $525M (pre-2029) or $750M (post-2029) less royalties paid
• Warrants could lead to issuance of ~9.8M common shares if exercised

Key Figures

Change-of-control fee (old): $750 million Change-of-control fee (to 2027): $150 million Change-of-control fee (after 2028): $200 million +5 more

8 metrics

Change-of-control fee (old) $750 million Prior change-of-control payment obligation to HealthCare Royalty

Change-of-control fee (to 2027) $150 million New payment if change of control occurs on or before Dec 31, 2027

Change-of-control fee (after 2028) $200 million New payment if change of control occurs on or after Jan 1, 2028

Royalty buyout (to 2029) $525 million Optional buyout amount if completed on or before Dec 31, 2029

Royalty buyout (2030+) $750 million Optional buyout amount if completed on or after Jan 1, 2030

Funding previously provided $300 million Initial funding under original HealthCare Royalty agreement

Warrant shares ≈9.8 million shares Common shares underlying new warrants granted to HealthCare Royalty

Warrant exercise price $3.81 per share Exercise price for warrants expiring Dec 31, 2030

Market Reality Check

Price: $4.10 Vol: Volume 616,318 is below t...

normal vol

$4.10 Last Close

Volume Volume 616,318 is below the 20-day average of 795,108, suggesting no outsized positioning ahead of this news. normal

Technical Shares at $4.10 are trading above the 200-day MA $3.45, indicating a recovery from prior lows.

Peers on Argus

Among key biotech peers, only AUTL appeared on the momentum scanner, moving mode...

1 Up

Among key biotech peers, only AUTL appeared on the momentum scanner, moving modestly higher, while others showed mixed, smaller moves. With no clear direction for ADCT specified, this looks more company-specific than sector-driven.

Historical Context

5 past events · Latest: Feb 02 (Neutral)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Feb 02	Employee equity grants	Neutral	+0.0%	Inducement plan share options granted to seven new employees.
Jan 08	Prelim 2025 results	Positive	-2.2%	Preliminary 2025 ZYNLONTA revenue, cash runway to 2028, and strong LOTIS data.
Jan 08	Prelim 2025 results	Positive	-2.2%	Duplicate record of preliminary 2025 revenue and program update release.
Jan 08	Conference participation	Neutral	-2.2%	Announcement of CEO presentation at J.P. Morgan Healthcare Conference.
Jan 08	Conference participation	Neutral	-2.2%	Duplicate record of conference participation announcement.

Pattern Detected

Recent news has included operational and investor-relations updates, with at least one fundamentally positive update coinciding with a modest share-price decline.

Recent Company History

In the last few months, ADC Therapeutics issued several updates. On Jan 8, 2026, it provided preliminary 2025 revenue and cash data, highlighting ZYNLONTA net product revenue of $73M for 2025 and strong LOTIS-7 efficacy metrics, yet the stock fell about 2.19%. The same day, it announced participation in the 44th Annual J.P. Morgan Healthcare Conference. On Feb 2, 2026, inducement equity grants to new employees had no price impact. Today’s royalty and warrant amendment fits into this pattern of balance-sheet and strategic updates around ZYNLONTA.

Regulatory & Risk Context

Active S-3 Shelf · $71,341.46

Shelf Active

Active S-3 Shelf Registration 2025-12-09

$71,341.46 registered capacity

An active S-3/A shelf dated Dec 9, 2025 remains in place. The latest amendment added a new auditor consent and estimated total offering-related expenses of $71,341.46, without changing the underlying prospectus terms or disclosing overall capacity.

Market Pulse Summary

This announcement restructures ADC Therapeutics’ royalty financing with HealthCare Royalty by cuttin...

Analysis

This announcement restructures ADC Therapeutics’ royalty financing with HealthCare Royalty by cutting the change-of-control payment from $750 million to $150–200 million while adding optional buyout terms of $525–750 million. In exchange, HealthCare Royalty receives warrants for about 9.8 million shares at $3.81. Management highlights ZYNLONTA’s long-term potential and sizeable peak-revenue range, but investors must weigh this against added warrant dilution and substantial future payment obligations.

Key Terms

change of control, warrants, exercise price, diffuse large B-cell lymphoma

4 terms

change of control financial

"The new agreement reduces the change of control payment from $750 million"

A change of control occurs when the ownership or management of a company shifts significantly, such as through a sale, merger, or acquisition, resulting in new leadership or ownership structure. This change can impact the company's direction and decision-making, which is important for investors because it may affect the company's stability, strategy, and future prospects.

warrants financial

"HealthCare Royalty has been granted warrants to purchase approximately 9.8 million"

Warrants are special documents that give you the right to buy a company's stock at a set price before a certain date. They are often used as a way for companies to attract investors or raise money, and their value can increase if the company's stock price goes up.

exercise price financial

"shares, with an exercise price of $3.81 per share. These warrants are"

The exercise price is the fixed amount at which you can buy or sell an asset, like a stock, when using an options contract. It matters because it helps determine whether exercising the option will be profitable or not, depending on the current market price. Think of it as the set price you agree on today to buy or sell later.

diffuse large B-cell lymphoma medical

"data in diffuse large B-cell lymphoma and other indolent lymphomas has"

A fast-growing form of blood cancer that starts in white blood cells within the lymphatic system and can spread quickly to other organs. Investors watch it because the need for effective treatments, the size of the patient population, and results from clinical trials or regulatory approvals can significantly affect pharmaceutical and biotech company revenues—think of it like a large, urgent market for new medicines where trial results or approvals can move stock prices.

AI-generated analysis. Not financial advice.

LAUSANNE, Switzerland, Feb. 23, 2026 /PRNewswire/ -- ADC Therapeutics SA (NYSE: ADCT), a commercial-stage global leader and pioneer in the field of antibody drug conjugates (ADCs), today announced that it has entered into an amendment to its royalty purchase agreement with entities managed by HealthCare Royalty.

Based on confidence in the long-term outlook for ZYNLONTA^®, ADC Therapeutics negotiated mutually beneficial updated terms with HealthCare Royalty, offering greater strategic flexibility to the Company. The new agreement reduces the change of control payment from $750 million to $150 million through the end of 2027, and to $200 million thereafter. In the event of a change of control, HealthCare Royalty will continue to receive royalties on sales by the acquirer until the original royalty cap is reached. In return, HealthCare Royalty has been granted warrants to purchase approximately 9.8 million common shares, with an exercise price of $3.81 per share. These warrants are exercisable until December 31, 2030, and are subject to a lock-up through the end of 2027.

"We are pleased by this meaningful amendment to the terms of our partnership with HealthCare Royalty, based on our shared conviction in ZYNLONTA's potential, as it enables greater strategic flexibility for our Company," said Ameet Mallik, Chief Executive Officer of ADC Therapeutics. "With a robust and growing body of evidence, including multiple expected data readouts this year across our clinical programs supporting the best-in-class potential of ZYNLONTA, we anticipate meaningful growth beginning in 2027. Assuming compendia inclusion and regulatory approval, potential peak revenue in the US could reach $600 million to $1 billion annually."

"This updated agreement is a result of our belief in the long-term upside of ZYNLONTA," said Clarke Futch, Chairman and Chief Executive Officer of HealthCare Royalty. "The combination of existing and upcoming ZYNLONTA data in diffuse large B-cell lymphoma and other indolent lymphomas has enhanced our confidence in the Company's focused portfolio, which we believe will unlock significant value."

HealthCare Royalty had previously provided $300 million of funding under the original agreement and, conditional upon the occurrence of a change of control event, ADC Therapeutics was obligated to buy out the remaining royalty obligations for $750 million (or $675 million if HealthCare Royalty receives specified minimum royalty payments before March 31, 2029), less the amount of royalties previously paid to HealthCare Royalty.

Under the amendment:

1. 1. Upon the occurrence of a change of control event, ADC Therapeutics is obligated to pay HealthCare Royalty $150 million (if the change of control event occurs on or before December 31, 2027) or $200 million (if the change of control event occurs on or after January 1, 2028), which amount is not reduced by the amount of royalties previously paid to HealthCare Royalty.
   2. Following any such change of control, the royalty obligations under the royalty purchase agreement will continue to be paid up to the original royalty cap, unless ADC Therapeutics (or its successor in interest) buys out the remaining royalty obligations by paying HealthCare Royalty $525 million (if the buyout occurs on or prior to December 31, 2029) or $750 million (if the buyout occurs on or after January 1, 2030), less the amount of royalties previously paid to HealthCare Royalty and the change of control payment described above.

About ZYNLONTA^® 

ZYNLONTA^® is a CD19-directed antibody drug conjugate (ADC). Once bound to a CD19-expressing cell, ZYNLONTA is internalized by the cell, where enzymes release a pyrrolobenzodiazepine (PBD) payload. The potent payload binds to DNA minor groove with little distortion, remaining less visible to DNA repair mechanisms. This ultimately results in cell cycle arrest and tumor cell death.

The U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) have approved ZYNLONTA (loncastuximab tesirine-lpyl) for the treatment of adult patients with relapsed or refractory (r/r) large B-cell lymphoma after two or more lines of systemic therapy, including diffuse large B-cell lymphoma (DLBCL) not otherwise specified (NOS), DLBCL arising from low-grade lymphoma and also high-grade B-cell lymphoma. The trial included a broad spectrum of heavily pre-treated patients (median three prior lines of therapy) with difficult-to-treat disease, including patients who did not respond to first-line therapy, patients refractory to all prior lines of therapy, patients with double/triple hit genetics and patients who had stem cell transplant and CAR-T therapy prior to their treatment with ZYNLONTA. This indication is approved by the FDA under accelerated approval and in the European Union under conditional approval based on overall response rate and continued approval for this indication may be contingent upon verification and description of clinical benefit in a confirmatory trial. Please see full prescribing information including important safety information about ZYNLONTA at www.ZYNLONTA.com.

About ADC Therapeutics
ADC Therapeutics (NYSE: ADCT) is a commercial-stage global leader and pioneer in the field of antibody drug conjugates (ADCs), transforming treatment for patients through our focused portfolio with ZYNLONTA (loncastuximab tesirine-lpyl).

ADC Therapeutics' CD19-directed ADC ZYNLONTA received accelerated approval by the FDA and conditional approval from the European Commission for the treatment of relapsed or refractory diffuse large B-cell lymphoma after two or more lines of systemic therapy. ZYNLONTA is also in development in combination with other agents and in earlier lines of therapy.

Headquartered in Lausanne (Biopôle), Switzerland, with operations in New Jersey, ADC Therapeutics is focused on driving innovation in ADC development with specialized capabilities from clinical to manufacturing and commercialization. Learn more at adctherapeutics.com and follow us on LinkedIn.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In some cases you can identify forward-looking statements by terminology such as "may", "will", "should", "would", "expect", "intend", "plan", "anticipate", "believe", "estimate", "predict", "potential", "seem", "seek", "future", "continue", or "appear" or the negative of these terms or similar expressions, although not all forward-looking statements contain these identifying words. Forward-looking statements are subject to certain risks and uncertainties that can cause actual results to differ materially from those described. Factors that may cause such differences include, but are not limited to: whether future LOTIS-7 clinical trial results will be consistent with or different from the LOTIS-7 data presented by the Company on December 3, 2025, the timing, publication and outcome of the full LOTIS-7 trial, compendia inclusion and regulatory strategy and the commercial opportunity; the timing of the PFS events and topline data release for LOTIS-5 and the results of the trial, the timing for the sBLA submission and full FDA approval; the Company's ability to grow ZYNLONTA^® revenue in the United States and potential peak revenue; the ability of our partners to commercialize ZYNLONTA^® in foreign markets, the timing and amount of future revenue and payments to us from such partnerships and their ability to obtain regulatory approval for ZYNLONTA^® in foreign jurisdictions; the timing and results of the Company's clinical trials; the timing, publication and results of investigator-initiated trials including those studying FL and MZL and the potential regulatory and/or compendia strategy and the future opportunity; the timing and outcome of regulatory submissions for the Company's products or product candidates; actions by the FDA or foreign regulatory authorities; projected revenue and expenses; the Company's indebtedness, including HealthCare Royalty Management and Blue Owl and Oaktree facilities, and the restrictions imposed on the Company's activities by such indebtedness, the ability to comply with the terms of the various agreements and repay such indebtedness and the significant cash required to service such indebtedness; and the Company's ability to obtain financial and other resources for its research, development, clinical, and commercial activities; and the uncertainties of international trade policies, including tariffs, sanctions, trade barriers and most favored nation drug pricing and the potential impact they may have on our business, financial condition, and results of operations. Additional information concerning these and other factors that may cause actual results to differ materially from those anticipated in the forward-looking statements is contained in the "Risk Factors" section of the Company's Annual Report on Form 10-K and in the Company's other periodic and current reports and filings with the U.S. Securities and Exchange Commission. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance, achievements or prospects to be materially different from any future results, performance, achievements or prospects expressed in or implied by such forward-looking statements. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document.

CONTACTS:
Investors and Media
Nicole Riley
ADC Therapeutics
Nicole.Riley@adctherapeutics.com
+1 862-926-9040

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SOURCE ADC Therapeutics SA

FAQ

What did ADC Therapeutics (ADCT) change in the HealthCare Royalty agreement on Feb 23, 2026?

They reduced the change-of-control payment to $150M through 2027 and $200M thereafter. According to the company, HealthCare Royalty also received warrants for ~9.8M shares at $3.81, exercisable until Dec 31, 2030.

How do the amended terms affect ADC Therapeutics' obligation at a change of control event?

ADC Therapeutics would pay $150M if a change of control occurs on or before Dec 31, 2027, or $200M after. According to the company, royalties still continue to be paid to the acquirer until the original royalty cap is reached.

What are the warrant details HealthCare Royalty received in the ADCT amendment?

HealthCare Royalty received warrants to purchase approximately 9.8 million common shares at an exercise price of $3.81 per share. According to the company, the warrants are exercisable until Dec 31, 2030 and locked up through end of 2027.

Could ADC Therapeutics still buy out the royalty after a change of control and for how much?

Yes. According to the company, a buyout of remaining royalty obligations would cost $525M if on or before Dec 31, 2029, or $750M if on or after Jan 1, 2030, less royalties already paid and the change-of-control payment.

How much prior funding did HealthCare Royalty provide to ADC Therapeutics under the original agreement?

HealthCare Royalty previously provided $300M of funding to ADC Therapeutics. According to the company, that amount remains part of the prior payments referenced in the amended terms.

What revenue outlook did ADC Therapeutics give for ZYNLONTA in the amendment announcement?

ADC Therapeutics indicated potential US peak revenue of $600M to $1B assuming compendia inclusion and regulatory approval. According to the company, this outlook depends on upcoming data readouts and regulatory steps.