NEW
YORK, March 27, 2023 /PRNewswire/ -- Delcath
Systems, Inc. (Nasdaq: DCTH), an interventional oncology company
focused on the treatment of primary and metastatic cancers of the
liver, today reported business highlights and financial results for
the fourth quarter and full year ended December 31, 2022.
Recent Business Highlights
During and since the fourth quarter, Delcath Systems, Inc.
(Delcath or the Company):
- Received an acceptance of the NDA resubmission from the U.S.
Food and Drug Administration (FDA) for Hepzato Kit®
(melphalan hydrochloride for injection/Hepatic Delivery System)
with a Prescription Drug User Fee Act (PDUFA) target action date of
August 14, 2023,
- Priced a financing that is expected to provide an initial
upfront funding of $25 million, with
up to an additional $60 million tied
to satisfaction of milestones, in gross proceeds to Delcath through
a private placement. The financing was led by Vivo Capital with
participation from Logos Capital, BVF Partners LP, Stonepine
Capital Management, LLC, Serrado Capital LLC and existing investor,
Rosalind Advisors,
- Completed in December a private placement with existing
investors priced at market for a total of $11.2 million funds raised in 2022,
- Announced the rotation of its Board of Directors with
John R. Sylvester appointed as
Chairman, and
- Reached terms of settlement to end its dispute with medac, its
former distributor in Europe.
In addition, during and since the fourth quarter, independent
investigators published:
- Updated results from the CHOPIN phase 1B trial in which seven patients with advanced
uveal melanoma treated with CHEMOSAT and ipilimumab plus nivolumab
show a median PFS of 29.1 months at a median follow-up of 29.1
months, and
- Results of a Single Center Study in the treatment of
Cholangiocarcinoma (CCA) in which the authors concluded that
percutaneous hepatic perfusion (PHP) with CHEMOSAT is an effective
and safe treatment option for patients with advanced CCA and has
the potential to prolong life in patients with inoperable,
treatment-refractory liver metastases. The authors highlighted the
increasing importance of locoregional forms of therapy in the
treatment of CCA and that the new edition of the German S3 cancer
guideline "Diagnostics and Therapy of Hepatocellular Carcinoma and
Biliary Carcinomas" now includes PHP with melphalan for the
treatment of inoperable iCCA or eCCA liver metastases.
"With the FDA setting an August 14,
2023, PDUFA date we have crossed a significant milestone for
the Company." said Gerard
Michel, Chief Executive Officer of Delcath. Mr. Michel
added, "We are gratified with the support from both our existing
investors and our new investors, all of whom are highly regarded
healthcare-focused funds. Their support, potentially totaling up to
$85 million, subject to satisfaction of milestones, we believe
validates the clinical relevance of and the commercial opportunity
for Hepzato in metastatic ocular melanoma. Further, it
positions Delcath to execute on HEPZATO commercialization plans
upon potential FDA approval. Finally, we eagerly await the
publication of interim results from the phase II portion of the
CHOPIN study which should provide critical additional information
about the potential utility of CHEMOSAT used in sequence with
immune checkpoint inhibitors."
Income Statement Highlights.
Fourth Quarter 2022 Results
Product revenue for the three months ended December 31, 2022 was approximately $0.6 million, compared to $0.2
million for the prior year period, from our sales of CHEMOSAT
in Europe. This increase in product revenue is primarily due
to direct product sales for the fourth quarter of 2022 compared to
the revenue share arrangement with our distribution partner in
Europe during the fourth quarter
of 2021. Other income for the three months ended December 31, 2022 was $1.9
million due to the acceleration of deferred revenue caused
by the termination of the medac license agreement.
Research and development expenses for the three months ended
December 31, 2022 were $4.4 million, compared to $3.6 million in the prior year quarter. The
growth in R&D expense is primarily due to increased activity
related to the expenses incurred for the preparation of our NDA
resubmission which occurred on February
14, 2023. Selling, general and administrative expenses
for the three months ended December 31,
2022 were approximately $3.8
million, compared to $3.0
million in the prior year quarter. The increase in general
and administrative expenses was primarily due to higher headcount
related costs such as higher share-based compensation expense.
The Company recorded a net loss for the three months ended
December 31, 2022 of $8.5 million, $0.86
per share (basic and diluted), compared to a net loss of
$5.3 million, $0.69 per share (basic and diluted), for the same
period in 2021.
Full Year 2022 Results
Product revenue for the year ended December 31, 2022 was
approximately $2.5 million, compared to $1.3
million for the prior year from sales of CHEMOSAT
in Europe. Other income for the year ended December 31,
2022 was $0.2 million compared to $2.3
million in the prior year primarily due to the termination of
the medac license agreement in December last year.
Research and development expenses for the year
ended December 31, 2022 were $18.6 million compared
to $13.8 million in the prior year with the increase due
to preparation for the pre-NDA meeting in April 2022 and expenses related to the NDA
resubmission. Selling, general and administrative expenses for the
year ended December 31, 2022 were approximately $17.3
million compared to $13.6 million in the prior year
with the increase primarily due to the pending launch of HEPZATO in
the United States and the accrual
for the settlement of the medac litigation.
The Company recorded a net loss for the year ended December
31, 2022, of $36.5 million, $4.12 per share (basic and diluted), compared to
a net loss of $25.6 million $3.59 per share (basic and
diluted) for the year ended December 31, 2021.
Balance Sheet Highlights
On December 31, 2022, the Company
had cash, cash equivalents and restricted cash totaling
$11.8 million, as compared to cash,
cash equivalents and restricted cash totaling $26.9 million on December
31, 2021. During the years ended December 31, 2022, and December 31, 2021, the Company used $25.0 million and $22.6
million, respectively, of cash in our operating activities.
The use of cash in operating activities was partially offset by two
private placements during 2022 resulting in net proceeds of
$10.9 million. On March 15, 2023, the Company returned to Avenue
Venture Opportunity Fund L.P. the $4.0 million held in the restricted cash to
paydown a portion of the outstanding loan balance.
On December 13, 2022, the Company
closed a private placement for the issuance and sale of 1,448,889
shares of common stock and 692,042 pre-funded warrants to purchase
common stock to certain investors. Each share of common stock was
sold at a price per share of $2.90
and the pre-funded warrants were sold at a price of $2.89 per pre-funded warrant. The pre-funded
warrants have an exercise price of $0.01 per share of common stock and are
immediately exercisable. The Company received gross proceeds from
the private placement of approximately $6.2
million before deducting offering expenses.
Conference Call Information
Delcath will host a conference call today, on March 27, 2023, at 4:30 PM
Eastern Time to discuss results for its fourth quarter and
full year ended December 31, 2022 and
provide a business update.
To participate in this event, dial approximately 5 to 10 minutes
before the beginning of the call.
Event Date: Monday March 27,
2023
Time: 4:30 PM Eastern Time
Participant Numbers: Toll Free: 1-833-630-1960
International: 1-412-317-1841
Webcast: https://app.webinar.net/RQwvVK8NyzM
CONFERENCE REPLAY
US Toll Free: 1-877-344-7529
International Toll: 1-412-317-0088
Replay Access Code: 7305121
End Date: April 03,
2023
About Delcath Systems, Inc.
Delcath Systems, Inc. is an interventional oncology company
focused on the treatment of primary and metastatic liver cancers.
The Company's proprietary products, HEPZATO Kit (melphalan
hydrochloride for Injection/Hepatic Delivery System) and
CHEMOSAT® Hepatic Delivery System for Melphalan percutaneous
hepatic perfusion (PHP) are designed to administer high-dose
chemotherapy to the liver while controlling systemic exposure and
associated side effects during a PHP procedure.
In the United States,
HEPZATO Kit is considered an investigational drug/device
combination product regulated as a drug by the United States
Food and Drug Administration (FDA). HEPZATO Kit is comprised
of the chemotherapeutic drug melphalan and Delcath's proprietary
Hepatic Delivery System (HDS). The HDS is used to surgically
isolate the liver while simultaneously filtrating hepatic venous
blood during melphalan infusion and washout. The use of the HDS
results in loco-regional delivery of a relatively high melphalan
dose, which can potentially induce a clinically meaningful tumor
response with minimal hepatotoxicity and reduce systemic exposure.
In the US, HEPZATO Kit was the subject of a February 14,
2023 new drug application resubmission to FDA for the
treatment of patients with unresectable hepatic-dominant metastatic
ocular melanoma (mOM), also known as metastatic uveal melanoma
(mUM). The FDA has established an August 14,
2023 PDUFA target action date for the resubmission. In
Europe, the device-only
configuration of the HDS is regulated as a Class III medical device
and is approved for sale under the trade name CHEMOSAT Hepatic
Delivery System for Melphalan, or CHEMOSAT, where it has been used
in the conduct of percutaneous hepatic perfusion procedures at
major medical centers to treat a wide range of cancers of the
liver.
Safe Harbor / Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for forward-looking statements made by the Company or
on its behalf. This news release contains forward-looking
statements, which are subject to certain risks and uncertainties
that can cause actual results to differ materially from those
described in particular, the statements regarding our private
placement and expected gross proceeds and the expected uses of the
proceeds from the private placement. Factors that may cause such
differences include, but are not limited to, uncertainties relating
to: achievement of milestones, the likelihood and timing of the
FDA's potential approval of the NDA for HEPZATO by the FDA by the
PDUFA date of August 14, 2023, the
Company's ability to commercialize HEPZATO, the receipt of
stockholder approval to allow for the conversion of the Series F
Preferred Stock into shares of the Company's common stock; the
Company's ability to generate revenue from HEPZATO, clinical
adoption, use and resulting sales, if any, for the CHEMOSAT system
to deliver and filter melphalan in; the Company's ability to
successfully commercialize the HEPZATO KIT/CHEMOSAT system and the
potential of the HEPZATO KIT/CHEMOSAT system as a treatment for
patients with primary and metastatic disease in the liver; approval
of the current or future HEPZATO KIT/CHEMOSAT system for delivery
and filtration of melphalan or other chemotherapeutic agents for
various indications in the U.S. and/or in foreign markets; actions
by the FDA or foreign regulatory agencies; uncertainties relating
to the timing and results of research and development projects; and
uncertainties regarding the Company's ability to obtain financial
and other resources for any research, development, clinical trials
and commercialization activities. These factors, and others, are
discussed from time to time in our filings with the SEC. You should
not place undue reliance on these forward-looking statements, which
speak only as of the date they are made. We undertake no obligation
to publicly update or revise these forward-looking statements to
reflect events or circumstances after the date they are made.
Investor Relations Contact:
Ben Shamsian
Lytham Partners
646-829-9701
shamsian@lythampartners.com
DELCATH SYSTEMS,
INC.
|
Condensed
Consolidated Balance Sheets
|
(in thousands,
except share and per share data)
|
|
|
|
|
|
|
|
December
31,
|
|
December
31,
|
|
|
2022
|
|
2021
|
Assets
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
7,671
|
|
$
22,802
|
Restricted
cash
|
|
4,151
|
|
4,151
|
Accounts receivable,
net
|
|
366
|
|
44
|
Inventories
|
|
1,998
|
|
1,412
|
Prepaid expenses and
other current assets
|
|
1,969
|
|
2,743
|
Total current
assets
|
|
16,155
|
|
31,152
|
Property, plant and
equipment, net
|
|
1,422
|
|
1,348
|
Right-of-use
assets
|
|
285
|
|
624
|
Total assets
|
|
$
17,862
|
|
$
33,124
|
|
|
|
|
|
Liabilities and
Stockholders' Equity (Deficit)
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Accounts
payable
|
|
$
2,018
|
|
$
638
|
Accrued
expenses
|
|
4,685
|
|
4,109
|
Deferred
revenue
|
|
—
|
|
170
|
Lease liabilities,
current
|
|
186
|
|
416
|
Loan payable,
current
|
|
7,846
|
|
621
|
Total current
liabilities
|
|
14,735
|
|
5,954
|
Other liabilities,
non-current
|
|
1,144
|
|
207
|
Loan payable,
non-current
|
|
3,070
|
|
10,372
|
Convertible notes
payable, non-current
|
|
4,772
|
|
4,639
|
Total
liabilities
|
|
23,721
|
|
21,172
|
|
|
|
|
|
Commitments and
contingencies
|
|
—
|
|
—
|
|
|
|
|
|
Stockholders' equity
(deficit)
|
|
|
|
|
Preferred stock, $.01
par value; 10,000,000 shares authorized; 11,357 shares
issued and outstanding at December 31, 2022 and
2021
|
|
—
|
|
—
|
Common stock, $.01 par
value; 40,000,000 shares authorized; 10,046,571 shares and
7,906,728 shares issued and outstanding at December 31, 2022 and
2021, respectively
|
|
100
|
|
79
|
Additional paid-in
capital
|
|
451,608
|
|
432,831
|
Accumulated
deficit
|
|
(457,484)
|
|
(420,976)
|
Accumulated other
comprehensive (loss) income
|
|
(83)
|
|
18
|
Total stockholders'
equity (deficit)
|
|
(5,859)
|
|
11,952
|
Total liabilities and
stockholders' equity (deficit)
|
|
$
17,862
|
|
$
33,124
|
DELCATH SYSTEMS,
INC.
|
Condensed
Consolidated Statements of Operations and Comprehensive
Loss
|
(Unaudited)
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
Year ended December
31,
|
|
2022
|
2021
|
2022
|
|
2021
|
Product
revenue
|
$
639
|
$
246
|
$
2,548
|
|
$
1,300
|
Other
revenue
|
—
|
1,862
|
171
|
|
2,255
|
Total
revenues
|
639
|
2,108
|
2,719
|
|
3,555
|
Cost of goods
sold
|
(237)
|
(130)
|
(686)
|
|
(671)
|
Gross profit
|
402
|
1,978
|
2,033
|
|
2,884
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Research and
development expenses
|
4,431
|
3,619
|
18,583
|
|
13,778
|
Selling, general and
administrative expenses
|
3,826
|
3,017
|
17,303
|
|
13,637
|
Total operating
expenses
|
8,257
|
6,636
|
35,886
|
|
27,415
|
Operating
loss
|
(7,855)
|
(4,658)
|
(33,853)
|
|
(24,531)
|
|
|
|
|
|
|
Interest expense,
net
|
(646)
|
(683)
|
(2,685)
|
|
(1,186)
|
Other
income
|
29
|
(6)
|
30
|
|
68
|
Net loss
|
(8,472)
|
(5,347)
|
(36,508)
|
|
(25,649)
|
|
|
|
|
|
|
Other comprehensive
(loss) income:
|
|
|
|
|
|
Foreign currency
translation adjustments
|
(27)
|
45
|
101
|
|
122
|
Total other
comprehensive loss
|
$ (8,499)
|
$
(5,302)
|
$ (36,407)
|
|
$
(25,527)
|
|
|
|
|
|
|
Common share
data:
|
|
|
|
|
|
Basic and diluted loss
per common share
|
$
(0.86)
|
$
(0.69)
|
$
(4.12)
|
|
$
(3.59)
|
|
|
|
|
|
|
Weighted average number
of basic and diluted shares outstanding
|
9,871,669
|
7,797,357
|
8,864,615
|
|
7,145,754
|
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SOURCE Delcath Systems, Inc.