Healthcare Industry News: neuroendocrine tumor
News Release - October 4, 2007
Delcath Systems Issues CEO Letter to ShareholdersNEW YORK--(HSMN NewsFeed)--Delcath Systems, Inc. (Nasdaq: DCTH ), a developer of percutaneous perfusion technology for organ or region-specific delivery of therapeutic and chemotherapeutic agents, today announced that President and Chief Executive Officer, Richard L. Taney, has released the following letter to shareholders:
It is with great pleasure that I write you this Third Quarter update, as Delcath has made significant progress on several important fronts since my last formal communication during the second quarter.
- Phase III patient enrollment has increased to 19; seven patients have crossed over from the control arm to now receive the Delcath treatment.
- Phase II patient enrollment has increased to 41; published data from this trial showed complete or partial responses in 77% of the Delcath treated patients with survival benefits of 14 to 42 months for patients with liver cancer.
- Delcath raised $14.2 million, and is now in its strongest financial position in history.
In May, the National Cancer Institute (NCI) presented interim results from the neuroendocrine arm of the ongoing Phase II trial using the Delcath System. This data was presented at the World Conference on Interventional Oncology in a session entitled, "Percutaneous Liver Perfusion for Patients with Metastatic neuroendocrine tumors." The presentation revealed that objective tumor responses, which include partial and complete responses, were observed in 77% of patients treated using the Delcath System to deliver the drug melphalan. Remarkably, the remaining 23% of patients were classified with stable disease, showing no tumor progression post-treatment. Furthermore, the study's Principal Investigator reported that a "significant and durable tumor response was observed in patients with large inoperable hepatic (liver) metastases." Moreover, in these patients the physician reported duration of response and survival data within a range of 14 to 42 months. Notwithstanding the preliminary nature and small test population, these results compare favorably to other treatments, either approved or in development. Following the release of this data, we have been approached by a number of leading regional cancer oncologists, and are in discussion with them regarding the Delcath System's potential. Some of these doctors are prospective investigators in an anticipated expanded phase II or phase III trial which could start next year.
The Phase II trial enrollment also continues to progress, with 41 patients enrolled to date. In June, we announced the addition of a fourth arm to this Phase II multi-histology trial, and are now including patients previously treated with either the Delcath System or the invasive surgical hepatic perfusion procedure. To date, we have enrolled 3 patients in this new arm of the study. The results from this arm of the Phase II study will be useful in demonstrating the repeatability of the procedure and the potential to extend survival even further in some previously treated patients.
During the past months, we have strengthened our management team with the addition of Jason Rifkin, an intellectual property attorney with a Masters degree in biotechnology, and the return of Jonathan Foltz, a medical device executive with diverse financial experience. We have also enhanced our Board of Directors with the addition of Laura A. Philips, Ph.D., MBA and Jonathan J. Lewis, MD, PhD, both bringing significant medical industry experience to the company.
The company has also expanded its intellectual property focus group to include other disciplines which will enhance the expertise of the group in reviewing improvements to the system, evaluating the ways it is used and investigating how improvements can bolster our already strong patent and trade secret position. As we recently reported, our patent portfolio now numbers 18 approvals, with twelve patents issued overseas. Delcath still maintains 100% of its worldwide intellectual property rights and additional applications will be filed to support this base and secure future directions for the technology.
We continue to expand our research activities evaluating newer blood filtration technologies. In addition to working with our current supplier to further tailor filter design to Delcath needs, we have established relationships with two other companies developing state of the art blood filters. We expect these activities will result in broader applications for our technology by providing filters that can better remove conventional chemotherapeutic agents as well as remove agents not always cleared by traditional filtration, such as larger protein-based drugs and drug targeting agents.
We continue our efforts to increase awareness of the Delcath technology. Most recently, Delcath presented at the 12th Annual Drug Delivery Technologies and Deal Making Conference. The presentation titled, "Isolated High Dose Drug Delivery for the Treatment of Cancer and Hepatitis," is the first time Delcath presented to a conference audience of major medical device and pharmaceutical manufacturers. As the company moves toward commercialization, we are in a better position to introduce our technology to larger companies that previously saw the Delcath System as too early in the clinical phase. In addition, we will be presenting before audiences of medical device and pharmaceutical companies next week when we present at the BioPartnering and BioTechnica - Europe conferences in London and Germany. Our negotiating position with potential partners has been strengthened by our cash balance of nearly $20 million, as it demonstrates that we have the financial resources to follow through with envisioned research projects either on our own or in collaboration.
Our investor and corporate outreach has started to attract media attention, as evidenced by the recent article appearing in New Scientist magazine. Each mention of Delcath increases the reach of our technology and the potential recruitment into our trials. We continue to strive to inform the medical community and patient populations both in the U.S. and overseas about the applications and opportunities presented by the Delcath System.
We held numerous meetings with institutional investors across the country during the past 6 months. While investors were very receptive to our technology and regulatory strategy, there continued to be concern over our cash balances. I am proud to report that Delcath has just completed the most significant fundraising in our history totaling $14.2 million which brings our cash position to approximately $20 million. Delcath is now in a position to support the financial commitments to the medical institutions joining the Phase III clinical trial and aggressively pursue FDA approval in the U.S.
This financing brought more to the company than needed cash. It essentially doubled the institutional ownership of our stock. Three institutional investors accounted for 53% of this financing round. They were selected based on their history of long term holdings in companies like Delcath and we feel the market for our stock is strengthened by their involvement. The quality of the banks that placed this round and the reputations of the investors who participated speak to our success.
With the financing completed, the quiet period restrictions on communications with shareholders has ended allowing for this shareholder letter and more frequent communications. We are now also in the position to devote resources to development projects the company has talked about for years without the caveat "as funds become available." We have already initiated discussions with experts in areas outside of cancer and outside of the liver, and are evaluating opportunities overseas. While these are long-term projects that must go through further discussion, as well as pre-clinical and clinical testing, we are laying the groundwork to create additional value from our unique technical base.
We welcome our new stockholders and appreciate their confidence in our science and leadership. We also thank our long-term loyal stockholders with the recognition that your strong support has enabled this progress. We look forward to our next update and to continuing to communicate with all of our shareholders -- new and old -- as we continue to drive our company forward.
President and Chief Executive Officer
About Delcath Systems, Inc.
Delcath Systems is the developer of percutaneous perfusion technology for organ- or region-specific delivery of therapeutic and chemotherapeutic agents. The Delcath System is currently being tested with the drug Melphalan in a Phase III trial of patients with metastatic ocular and cutaneous melanoma in the liver, and a Phase II trial of patients with primary liver cancers and metastatic tumors in the liver from neuroendocrine cancers and adenocarcinomas, as well as patients with melanoma who previously received isolated perfusion. The Company's intellectual property portfolio currently consists of 18 patents on a worldwide basis including the U.S., Europe, Asia and Canada. For more information, please visit the Company's website www.delcath.com.
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. Factors that may cause such differences include, but are not limited to, uncertainties relating to our ability to successfully complete Phase III clinical trials and secure regulatory approval of our current or future drug-delivery system and uncertainties regarding our ability to obtain financial and other resources for any research, development and commercialization activities. These factors, and others, are discussed from time to time in our filings with the Securities and Exchange Commission. 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.
Source: Delcath Systems
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