Delcath Systems, Inc. (OTCMKTS:DCTH) Provides a Europe Progress Update

Delcath Systems, Inc. (OTCMKTS:DCTH) Provides a Europe Progress Update


Delcath Systems, Inc. (OTCMKTS:DCTH) is a stock we warned against vehemently back in October when we said the company was “sprinting down the wrong path”. Now, after the reverse split impact, the stock is down in split-adjusted terms from $13/share to $0.03/share. It’s time to revisit the story and see what’s next.

In terms of new catalysts, the company just announced that physicians in Europe have performed the 500th PHP Therapy treatment using the company’s Hepatic CHEMOSAT Delivery System (CHEMOSAT). According to the release, “CHEMOSAT was launched in select European markets in 2012, and physicians there have used it to treat a wide variety of cancers of the liver.”

Delcath Systems, Inc. (OTCMKTS:DCTH) frames itself as a specialty pharmaceutical and medical device company focused on oncology.

DCTH focuses on the treatment of primary and metastatic liver cancers. The company is developing melphalan hydrochloride for Injection for use with the Delcath hepatic delivery system to administer high-dose chemotherapy to the liver. It offers melphalan hydrochloride under the Delcath Hepatic CHEMOSAT Delivery System for Melphalan name in Europe.

The company was founded in 1988 and is headquartered in New York, New York.

According to company materials, “Delcath Systems, Inc. is an interventional oncology Company focused on the treatment of primary and metastatic liver cancers. Our investigational product – Melphalan Hydrochloride for Injection for use with the Delcath Hepatic Delivery System (Melphalan/HDS) – is designed to administer high-dose chemotherapy to the liver while controlling systemic exposure and associated side effects. We have commenced a global Phase 3 FOCUS clinical trial for Patients with Hepatic Dominant Ocular Melanoma (OM), and plans to initiate a Registration trial for intrahepatic cholangiocarcinoma (ICC) by the end of 2017 contingent on effecting the reverse stock split as outlined in the Company’s consent proposal. Melphalan/HDS has not been approved by the U.S. Food & Drug Administration (FDA) for sale in the U.S.  In Europe, our system has been commercially available since 2012 under the trade name Delcath Hepatic CHEMOSAT® Delivery System for Melphalan (CHEMOSAT), where it has been used at major medical centers to treat a wide range of cancers of the liver.”

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Jennifer K. Simpson, Ph.D., President and CEO of Delcath Systems, said, “this is a meaningful milestone for Delcath, one that speaks to the belief physicians in Europe have developed in our product and this therapy for certain types of liver cancers. Our commercialization efforts in Europe have established a considerable body of published and presented research data that demonstrates the safety and efficacy of this therapy in appropriate patients. Further, Dutch Health Authorities recently included CHEMOSAT treatment in their published guidelines for ocular melanoma liver metastases, a step toward potential reimbursement coverage of CHEMOSAT in the Dutch market.  We continue to leverage this experience to validate the safety and efficacy of the melphalan/Hepatic Delivery System (CHEMOSAT) in our clinical trials.”

According to materials from the company, Percutaneous Hepatic Perfusion (PHP) Therapy with Melphalan/HDS was developed by Delcath Systems as “a targeted, whole organ therapy for the liver.” It is apparently available as a device in Europe on a commercial basis, where it sells under the CHEMOSAT designation. The U.S. Food and Drug Administration actually has not yet approved the system, and Phase 3 clinical testing is now underway in the U.S.

The chart shows 33% tacked on to share pricing for the name in the past week, but this action is running counter to the larger trend in the name. That said, DCTH has a track record that includes a number of dramatic bounces. Moreover, the company has registered increased average transaction volume recently, with the past month seeing just under 250% over what the stock has registered over the longer term.

Now commanding a market cap of $329k, DCTH has a significant war chest ($10.9M) of cash on the books, which is balanced by about $10.2M in total current liabilities. DCTH is pulling in trailing 12-month revenues of $2.7M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 57.2%. We will update the story again soon as further details emerge. Sign-up for continuing coverage on shares of $DCTH stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in $DCTH, either long or short, and we have not been compensated for this article.

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