ADC Therapeutics (ADC Therapeutics (ADCT)) is having a rough Thursday. The biotech's stock plunged nearly 50% in premarket trading after the company released data from its Phase 3 LOTIS-5 trial that, while hitting its main goal, came with some serious safety baggage.

The study tested ZYNLONTA (loncastuximab tesirine) in combination with rituximab against a standard chemo-immunotherapy regimen (R-GemOx) in patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL). And on the efficacy front, the numbers look pretty good. The combination met its primary endpoint of progression-free survival (PFS), with patients on the ZYNLONTA combo living a median of 6.1 months without their cancer getting worse, versus 4.7 months for the control group. That's a meaningful improvement.

But here's where things get complicated. The safety data showed a higher rate of serious adverse events, treatment discontinuations due to side effects, and even Grade 5 events—meaning deaths—in the ZYNLONTA arm. Most of those Grade 5 events occurred in patients aged 75 or older, which is a population that's already more vulnerable. The company also noted that infections, liver toxicity, and edema or effusion were more common in the test group.

ADC Therapeutics is being upfront about it. The company said it will discuss the benefit-risk profile with the FDA, and it's planning a pre-sBLA meeting in August, with a potential sBLA submission in the fourth quarter of 2026. "Based on these topline results from LOTIS-5, we look forward to discussing next steps for this combination of ZYNLONTA plus rituximab with the U.S. FDA," said Mohamed Zaki, Chief Medical Officer of ADC Therapeutics. "We intend to conduct a pre-sBLA meeting in August and are preparing for a planned sBLA submission in the fourth quarter of 2026."

The efficacy data, though, is worth a closer look. The overall response rate was 58.1% with the ZYNLONTA combo versus 45.2% for R-GemOx. Complete response rates were 39.5% versus 26.7%. And the responses lasted longer: median duration of response was 9.2 months versus 7.7 months, and median duration of complete response was 16.8 months versus 12.3 months. Perhaps most striking, among patients who achieved a complete response, 48.5% were still in complete remission at 24 months on the ZYNLONTA arm, compared with just 16.7% on the control arm. That's a big difference.

Overall survival data didn't show a detrimental effect, but the company noted that the analysis was muddied by the fact that more patients in the control group switched to newer anti-lymphoma treatments earlier. That's a common issue in oncology trials when the control arm gets access to effective therapies after progression.

ADC Therapeutics also said it will continue to evaluate value-maximizing alternatives—corporate-speak for "we're keeping our options open."

For context, this isn't the only recent DLBCL trial with mixed results. In January, Genmab (Genmab (GMAB)) released data from its Phase 3 EPCORE DLBCL-1 trial of epcoritamab, which showed an overall survival hazard ratio of 0.96—a result that did not reach statistical significance. So the bar for new treatments in this space remains high.

For now, ADC Therapeutics investors are focused on the safety signal. The stock was down 49.68% at $1.55 in premarket trading. The company has a lot of work to do to convince the FDA—and the market—that the benefits of ZYNLONTA plus rituximab outweigh the risks.