Delcath Systems, Inc. (NASDAQ: DCTH) has announced robust financial results for the third quarter of 2024, driven by strong sales of its HEPZATO kit. The company reported a total revenue of $11.2 million, with HEPZATO sales reaching $10 million, triggering a $25 million financing from warrant exercises. This performance underscores the increasing adoption of HEPZATO and its potential to address unmet needs in liver-dominant cancers.
Delcath ended the quarter with $14 million in cash and no outstanding debt, positioning it close to cash flow break-even. The company anticipates further growth with plans to increase its treatment centers and initiate new clinical trials for liver-dominant metastatic colorectal and breast cancers.
Commercial Performance and Expansion
The key drivers of Delcath's revenue ramp in the US are center activation and the average number of treatments per center. The company finished the quarter with 11 active centers, with an additional center becoming active in October, bringing the total to 12 active centers. "We should exit the year with at least 15 treating centers and sometime in the first quarter have 20 treating centers. Our 2025 goal is 30 centers by the end of the year," stated Gerard Michel, Chief Executive Officer of Delcath Systems.
Average treatment rate post activation averaged just under two treatments per month in the third quarter. The company expects this rate to remain stable as new centers are added, with a potential decrease in Q4 due to holiday scheduling.
CHEMOSAT sales in Europe grew over 100% year-on-year, although revenue remained flat compared to the previous quarter. Delcath plans to expand its presence in Europe by identifying and opening commercial and trial centers in France, Italy, and Spain.
Clinical Developments and Research
Delcath continues to support research efforts to expand the evidence base for percutaneous hepatic perfusion (PHP) using its hepatic delivery system. A subgroup analysis from the FOCUS trial presented at ESMO 2024 demonstrated similar outcomes in overall survival, overall response rate, and progression-free survival between patients with and without extrahepatic lesions or based on prior therapy. A 30-patient study published in the Annals of Surgical Oncology reported that HEPZATO used in first- or second-line therapy for Metastatic Uveal Melanoma provided better disease control in the liver and improved progression-free survival compared to both immunotherapy and other liver-directed therapies.
Delcath is planning to initiate two phase II randomized clinical trials to compare the safety and efficacy of HEPZATO plus standard of care versus standard of care alone in liver-dominant metastatic colorectal cancer and metastatic breast cancer. The metastatic colorectal clinical trial is designed to enroll approximately 90 patients and will be conducted at more than 20 study sites in the US and Europe. Patient enrollment and treatment are expected to begin in the second half of 2025. The Phase II trial in patients with liver-dominant metastatic breast cancer will start somewhat later, likely in the fourth quarter of 2025.
Financial Position
Delcath's third-quarter operating cash burn was $3.6 million, and the company is approaching cash flow break-even. As of today, the company has no outstanding debt obligations. All Tranche B warrants from the March 29, 2023 pipe were exercised by the November 6, 2024 expiration date, resulting in approximately $25 million in proceeds.
Future Outlook
Delcath Systems is strategically expanding its treatment center network and initiating clinical trials to explore new indications for HEPZATO. The company's strong financial position supports its ability to fund these initiatives and drive future growth. The CHOPIN trial, which is fully enrolled with 76 patients, is anticipated to have an analysis of the primary endpoint progression-free survival at one year to occur in mid-2025. The company expects presentation of the results in the second half of 2025. Positive data from the CHOPIN trial could establish HEPZATO as a new standard of care and increase patient uptake.
