On February 18, 2026, ADC Therapeutics amended its 2021 royalty-based funding agreement with entities managed by HealthCare Royalty Management, which have provided $300 million to the company. The amendment significantly revises the company’s change-of-control obligations, reducing the lump-sum payment due upon a takeover to $150 million if completed by the end of 2027 or $200 million thereafter, while allowing royalty obligations to continue unless bought out under a defined schedule.
Under the revised structure, ADC or a future acquirer may buy out remaining royalty obligations for $525 million if done by the end of 2029 or $750 million from 2030 onward, with prior royalties and any change-of-control payment credited against the buyout price. This reshaping of payment triggers alters the economics of a potential sale and could make the company a more flexible transaction partner, while preserving long-term royalty participation for the funding partner.
In connection with the amendment, ADC issued HealthCare Royalty warrants to purchase 9,834,776 common shares at an exercise price of $3.8130 per share, exercisable until December 31, 2030, with options for cash or cashless exercise and certain limits tied to the company’s treasury stock. The warrants include deemed exercise or assumption mechanics in the event of major corporate transactions and carry registration rights for the underlying shares, reinforcing HealthCare Royalty’s equity-linked exposure to ADC’s future performance.
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