Delcath Systems’ Earnings Call Highlights Growth and Challenges

Delcath Systems, Inc. ((DCTH)) has held its Q1 earnings call. Read on for the main highlights of the call.

Delcath Systems’ recent earnings call painted a generally positive picture for the company, underscored by robust revenue growth and an increase in active treatment centers. The financial metrics were favorable, highlighting a successful quarter. However, the overall sentiment was slightly tempered by challenges related to European reimbursement and rising expenses.

Strong Revenue Growth

Delcath Systems reported a combined revenue of $19.8 million for HEPZATO and CHEMOSAT in Q1 2025. HEPZATO alone contributed $18 million, while CHEMOSAT added $1.8 million. This marks a significant increase compared to the previous year, showcasing the company’s strong market performance.

Increased Active Centers

The company ended the first quarter of 2025 with 19 active treatment centers in the U.S., up from 17. Additionally, there are 10 more centers pending activation, indicating a strategic expansion in their operational capacity.

Positive Financial Metrics

Delcath Systems reported positive cash from operations amounting to $2.2 million, a net income of $1.1 million, and an adjusted EBITDA of $7.6 million for the first quarter of 2025. The company also maintained a strong financial position with no debt and $59 million in cash and investments.

European Market Growth

Despite facing reimbursement challenges, the European market for CHEMOSAT grew by 29% over the previous quarter, reaching $1.8 million. This growth highlights the potential of the European market despite existing hurdles.

Pipeline Expansion

The company received FDA clearance for Phase II trials in metastatic colorectal and breast cancer, with plans to commence by the end of 2025. This expansion is part of Delcath’s strategy to broaden the applications of its liver treatment platform.

Reimbursement Challenges in Europe

While the European market showed growth, significant reimbursement and pricing challenges remain. These issues are expected to limit the market’s contribution to revenue in the short to medium term.

Increase in Operating Expenses

Research and development expenses rose to $5 million from $3.7 million, and selling, general, and administrative expenses increased to $11.3 million from $8.8 million compared to the same period in 2024. This rise in expenses is a notable aspect of the company’s financial performance.

Forward-Looking Guidance

Looking ahead, Delcath Systems aims to have 30 active centers by the end of the year and is expanding its sales territories from four to six. The company is also advancing clinical trials for liver-dominant metastatic colorectal and breast cancer, with patient enrollment expected to begin later in 2025. These initiatives are part of Delcath’s broader strategy to enhance its liver treatment platform.

In summary, Delcath Systems’ earnings call reflected a positive outlook with strong revenue growth and an increase in active treatment centers. Despite facing challenges in the European market and rising expenses, the company remains in a strong financial position and is focused on expanding its reach and clinical trials. These efforts underscore Delcath’s commitment to advancing its liver treatment platform and achieving long-term growth.