Delcath Systems (NASDAQ:DCTH) reported second-quarter financial results on Thursday. The transcript from the company’s second-quarter earnings call has been provided below.
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Summary
Delcath Systems reported a 21% increase in Hepzato Kit revenue to $27.2 million in Q2 2026, with total revenue up to $29.1 million, reflecting a 30% volume growth versus 2025.
The company activated 2 new treatment centers, bringing the total to 31, and plans to reach 37 by year-end, focusing on prominent cancer centers.
Delcath raised its full-year revenue guidance to $104-108 million, driven by strong first-half performance and new patient starts.
Gross margin improved to 90% in Q2 from 86% a year ago, with a full-year guidance of 86% to 89% due to better overhead absorption and increased volume.
Ongoing clinical trials in liver-dominant cancers show promise, with recruitment improvements in colorectal and breast cancer studies.
Management highlighted strategic efforts to mitigate seasonal treatment capacity constraints by training backup teams at high-volume centers.
Full Transcript
OPERATOR (Operator)
Good morning, ladies and gentlemen, and welcome to the Delcath Systems second quarter 2026 earnings conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, August 6, 2026. I would now like to turn the conference over to Mr. David Hoffman, Delcath General Counsel. Please go ahead, sir.
David Hoffman, General Counsel
Thank you, and welcome to Delcath Systems’ second quarter 2026 earnings call. With me on the call are Gerard Michel, Chief Executive Officer; Sandra Brooks Pennell, Chief Financial Officer; Kevin Muir, Chief Commercial Officer; Vojo Vukovic, Chief Medical Officer; and Martha Rook, Chief Operating Officer. This statement is made pursuant to the safe harbor for forward-looking statements described in the Private Securities Litigation Reform Act of 1995.
Statements made on this call, with the exception of historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the Company believes that expectations and assumptions reflected in these forward-looking statements are reasonable, it makes no assurance that such expectations will prove to have been correct. Actual results may differ in a material manner from those expressed or implied in forward-looking statements due to various risks and uncertainties.
For a discussion of such risks and uncertainties which could cause actual results to differ from those expressed or implied in the forward-looking statements, please see risk factors detailed in the Company’s Annual Report on Form 10-K, those contained in filed quarterly reports on Form 10-Q, as well as in other reports that the Company files from time to time with the Securities and Exchange Commission. Any forward-looking statements included in this call are made only as of the date of this call.
We do not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent knowledge, events, or circumstances. A press release with our second quarter 2026 results is available on our website under the Investors section and includes additional details. Our website also has our latest SEC filings, which we encourage you to review. A recording of today’s call will be available on our website. Now I would like to turn the call over to Gerard Michel.
Gerard, please proceed.
Gerard Michel, Chief Executive Officer
Thank you for joining us today. Now well into our third year of commercial launch, we continue to deliver revenue growth and operate as a profitable business, supported by a platform with the potential to address larger patient populations well beyond metastatic uveal melanoma. We delivered a strong second quarter driven by $27.2 million in Hepzato Kit revenue, up 21% over the second quarter of 2025, a significant achievement given the introduction of 340B pricing.
In July of 2026, we activated 2 new treatment centers, bringing our total to 31, and sustained a healthy flow of new patients into our existing sites. Our commercial execution in metastatic uveal melanoma is now self-funding the investment needed to extend our liver-directed platform into other cancers where the liver is a dominant site of disease. We remain on track to activate approximately six additional centers by year end, which would bring us to 37 active centers.
We are not simply opening more centers; we are opening the right centers. Most of our targets are part of one of two overlapping groups of institutions. The first is National Comprehensive Cancer Network member institutions, or NCCN, an alliance of 30 leading cancer centers that help define oncology standards of care. The second is the National Cancer Institute’s comprehensive cancer centers, 58 institutions federally designated for excellence in cancer research, clinical trials, and multidisciplinary patient care.
Today, approximately 80% of our active treatment centers hold NCI Comprehensive designation. Nationally, we are now represented at 41% of the 58 NCI comprehensive cancer centers and approximately half of the 34 NCCN member institutions. Our 2026 activations continued that pattern. This year we added MD Anderson, UT Southwestern, Mayo Clinic Scottsdale, the Knight Cancer Institute at OHSU, and the Herbert Irving Comprehensive Cancer Center at Columbia, all NCI Comprehensive Cancer Centers, with MD Anderson, UT Southwestern, and Mayo Clinic also NCCN member institutions.
These are among the nation’s leading referral destinations for complex oncology care and liver-directed therapy. By adding institutions with this level of academic influence and referral reach, we are building a network that supports both near-term growth and long-term leadership in metastatic uveal melanoma and in the additional indications we intend to pursue. Beyond activating new centers, we are focused on increasing physician awareness and consideration of PHP for appropriate patients through targeted medical education, peer-to-peer engagement, and continued evidence generation.
New patient starts remain solid in the second quarter, averaging approximately 0.5 new patients per site per month. Because patients typically receive a series of Hepzato treatments over up to three quarters, second quarter starts generate volume that flows into the back half of the year and support our full-year revenue outlook. The data from the CHOPIN trial, a randomized Phase 2 study published in The Lancet Oncology earlier this year, continues to accelerate broader adoption of combination approaches at leading centers.
And at ASCO this year, investigators from MAPA Cancer Center presented a Trials in Progress abstract describing an ongoing Phase 2 study of Hepzato followed by tebentafusp in HLA-A2–positive patients with metastatic uveal melanoma. We believe this and future planned combination therapy trials will be critical to moving Hepzato more consistently to a co–first-line setting. Turning to clinical development beyond metastatic uveal melanoma, we remain confident in Hepzato Kit’s potential in other liver-dominant cancers, and we continue to work with investigators to generate supporting data.
At ESMO Breast Cancer in May 2026, independent investigators presented a retrospective analysis of 15 heavily pretreated patients with liver-dominant metastatic breast cancer treated with percutaneous hepatic perfusion. Nine of the 15 patients showed a hepatic partial response, supporting further evaluation of this approach in that setting. Turning to our sponsored trials: In our sponsored Phase 2 trial in metastatic colorectal cancer, we now have 13 centers actively screening.
Consistent with the acceleration we anticipated on our last call, recruitment has improved as we have added sites and applied specialized training and streamlined onboarding. We estimate that approximately 6,000 to 10,000 U.S. patients annually have liver-dominant disease in the third-line setting. In HER2-negative metastatic breast cancer, we recently dosed the first patient at the European Institute of Oncology in Milan. Six sites are activated and screening, with additional sites in the activation process.
We estimate a similar-size addressable population in this indication. Beyond these two programs, we continue to evaluate additional liver-dominant indications through our scientific advisory board and physician feedback, and we are preparing for pre-IND meetings with the FDA later this year to discuss new potential indications. Based on our first-half results and trends early in the third quarter, we are raising our full-year revenue guidance. Sandra will take you through the numbers and our updated outlook.
Sandra Brooks Pennell, Chief Financial Officer
Thank you, Gerard. Total revenue in the second quarter of 2026 was $29.1 million, compared with $24.2 million in the second quarter of 2025. This includes $27.1 million of Hepzato Kit revenue and $2 million of ChemoSat revenue. This represents 17% sequential Hepzato volume growth over the first quarter and 30% volume growth versus the same period in 2025. Now turning to 2026 guidance, we are increasing our full-year revenue guidance to a range from $104 million to $108 million, which reflects at least a 28% growth in Hepzato Kit volume over 2025.
Our decision to raise guidance is driven primarily by first-half performance, particularly the pace of new patient starts. We’ve also modestly reduced the seasonal step-down we had assumed for the third and fourth quarters. A part of last year’s seasonality came from centers operating with a single REMS-certified treatment team, where staff absences translated directly into lost treatment capacity. We have since worked with centers to train backup teams, including some of our highest-volume sites, which should ease that constraint.
In addition, enrollment in ongoing clinical trials during 2025 reduced the number of patients available for our treatment. Gross margin for the quarter was 90% compared to 86% in the second quarter of 2025. We are guiding to full-year 2026 gross margin between 86% to 89%, and we also expect to report positive adjusted EBITDA for the full year. Research and development expense in the second quarter was $10.4 million compared to $6.9 million in the prior-year quarter, driven primarily by continued investment in our clinical organization and ongoing Phase 2 trials.
Selling, general, and administrative expense in the second quarter was $13.4 million compared to $11.4 million in the prior-year quarter, reflecting our investment into continued commercial expansion and increasing marketing activities. Net income for the second quarter in both 2026 and 2025 was $2.7 million. On a non-GAAP basis, adjusted EBITDA for the quarter was $7.6 million compared to $9.8 million in the second quarter of 2025. We ended the quarter with cash and investments of $95.9 million.
Cash provided by operations was $5.7 million in the quarter, and we purchased a small amount of common shares in the second quarter under the Company’s approved $25 million share buyback program. To date, we have purchased approximately $9 million worth of common shares. I want to thank you all for participating today, and I’ll ask the operator to open the lines for Q&A. Thank you.
OPERATOR (Operator)
Thank you, ladies and gentlemen. We will now begin the question-and-answer session. If you’d like to ask a question, please press star followed by the number one on your telephone keypad. If your question has been answered and you would like to withdraw from the queue, please press star followed by the number two. And if you’re using a speakerphone, please lift your handset before pressing any keys. One moment, please, while we compile the roster.
Your first question comes from Marie Thibault with BTIG. Please go ahead.
Marie Thibault, Analyst at BTIG
Hi. Thank you for taking the questions. I wanted to ask a question here just sort of on the referral pathway and some of the efforts I know that you’ve been making on the commercial side. So, you know, wanted to understand how the referral network efforts have been progressing. I know you’ve been working on it for a few quarters. Are there ways to sort of describe the outreach that you’ve been making to the medical oncologists that is translating into incremental new patient starts?
And then second, I’ll just ask my follow-up here. I wanted to follow up, I think there was an effort to try to mitigate summer seasonality, get, you know, second treatment teams trained at various centers. Just an update on how that has been progressing as well. Thanks for taking the questions.
Gerard Michel, Chief Executive Officer
Sure. Marie, good to hear from you. In terms of the referral network, I would say about a third of the referral network is a static network, and that is within the institutions we are currently part of. Any oncology networks that are, you know, are part of that. So there, you know, we know who the oncologists are. They have, you know, a meaningful number of patients. Meaningful could be two, three, four, but on a relatively consistent basis. The other part of the referral network, and probably should be kind of called a just-in-time referral, are the many, many doctors who just get one patient.
Now, most of those patients eventually make their way to one of our treating sites or one of our targeted sites that will open in the next one month to two years as we continue to expand. But many of those are not. And what we have to do is find them in real time if we want to get them first line. If we don’t want to lose patients who progress too quickly, our efforts there right now are multifaceted. What’s—hearing me? Can everyone hear me?
Marie Thibault, Analyst at BTIG
We lost you for a while, Gerard. We lost you for a minute.
Gerard Michel, Chief Executive Officer
Okay. All right. So where did I—where did you lose me? The perils of cell phones.
Marie Thibault, Analyst at BTIG
We were just past kind of talking about those folks that only see one patient. We got a little bit past that.
Gerard Michel, Chief Executive Officer
Right. So what we need to do is get a just-in-time network is kind of the term I’m using internally with the team now. Right now we’re using claims data that lags, but we generally know patients who’ve been recently diagnosed—recently could be anywhere from a month to six months given claims lags. And we try to get in front of those doctors a number of different ways. We’d like to do better than that. We’re investigating the use of other forms of data that are refreshed more frequently.
That’s not in place yet, but we will get it in place. We recognize that we have a higher hill to climb in terms of execution than something like an Immunocore, in that community oncologists can’t use our product, but we have a definitive plan. We are definitely working that right now. So we are actively finding patients who’ve had a recent biopsy and stuff, and we’re working to improve that over time. It is and will be a core part of our strategy.
Now, your second question was about training additional docs and centers. We’ve had several centers that I think our efforts led to backup teams. And, you know, at least one or more of those are very high-volume centers that it was critical to do that in. I wouldn’t say that we have backup teams everywhere we would like to, but a meaningful percentage of our volume now is covered by centers with backup teams.
Marie Thibault, Analyst at BTIG
Thank you so much.
OPERATOR (Operator)
Thank you. Your next question comes from John Newman with Canaccord Genuity. Please go ahead.
John Newman, Analyst at Canaccord Genuity
Hey guys, thanks for taking my question. Really nice execution on the quarter. Had a couple of questions here. So I’m curious as to how much of the increased guidance for the year could be related to better uptake—excuse me—due to the CHOPIN data. Also wondering if you can discuss your enrollment expectations for both colorectal and the breast cancer studies. And I’m wondering with those two studies if you’re able to utilize overlap between existing centers that are already using Hepzato for liver mets due to uveal melanoma.
Gerard Michel, Chief Executive Officer
Thank you. All right, so first part of your question in terms of how much of the increase is from CHOPIN, you know, it’s all anecdotal. The data, the claims data, is rather thin for some reason. Our claims data comes in very slow relative to other treatments. But our anecdotal experience is that more and more of these patients are getting combination therapy, and that’s undoubtedly a result of the CHOPIN data. In terms of site recruitment, which I think was your third question, we’re not going to give guidance on that.
I think the only guidance we’re going to give is that we expect an interim readout for colorectal sometime late next year. And we’re not providing guidance on breast, but we are encouraged by both—an uptick of both trials in terms of site activation and enrollment. And there was a second question there. Embarrassed to say I lost it. Could you remind me, John, what it was?
John Newman, Analyst at Canaccord Genuity
Sure. Just curious if you’re able to utilize existing centers that are using Hepzato in terms of also signing them up for enrollment with breast and colorectal cancer.
Gerard Michel, Chief Executive Officer
Yeah, I would say the majority of centers in the U.S. already were, you know, already REMS-activated for mUM. In Europe it’s a lower percentage. We’re actually activating some new centers. Can you guys hear me? I got another message that audio dropped.
OPERATOR (Operator)
We can hear you.
Gerard Michel, Chief Executive Officer
Okay. All right. We also have a number of—in Europe, it’s a smaller percentage of centers that were mUM centers. I’d say, you know, maybe 60/40 existing centers and new centers in the trial.
John Newman, Analyst at Canaccord Genuity
Okay, great. Thank you.
OPERATOR (Operator)
Thank you. Your next question comes from Chase Knickerbocker with Craig-Hallum. Please go ahead.
Chase Knickerbocker, Analyst at Craig-Hallum
Good morning. Congrats on a really nice quarter and thanks for taking the questions. Just wanted to dig in a little bit more on kind of the implied kind of second half in your guidance. And so if we kind of look at that, you know, it assumes a pretty meaningful kind of slowdown still. You know, with that in mind, can you just maybe kind of talk through exactly when you started seeing that softness in kind of new patient starts last year, and then kind of what you’ve seen so far, you know, through July, early August.
You know, have you seen any green shoots from some of the programs that you put in place to try to train additional treatment teams, et cetera?
Gerard Michel, Chief Executive Officer
Without going into specific numbers, I will say, Chase, that the bulk of our increase in guidance is due to an impressive first half of the year. We have tempered the downturn we expect in the second half partly due to, frankly, less demand from clinical trials. And the second part is really just a two-week lead. We only have a two- to three-week vision idea of what’s going to happen going forward and it looks reasonably strong. So we’ve tempered the overall seasonality as well.
But I would say the bulk of our increase in guidance is based on our performance in the first half of the year. And as you well know, new patient starts drive business, you know, over two to three more quarters.
Chase Knickerbocker, Analyst at Craig-Hallum
And so fair to say that we haven’t seen, you know, to date, you know, the same kind of, you know, softness in new patient starts, you know, at least yet? And then just kind of second follow-up would just be kind of the visibility that you have to kind of center adds in the back half of the year here, you know, kind of, and how you’re thinking about that year-end target.
Gerard Michel, Chief Executive Officer
Yeah. I’ll ask Kevin in a moment to comment on how we feel about the additional six centers. In terms of—it’s fair to say we haven’t seen the softness yet. This is about when we saw it last year. Kind of two-week look forward at this point, it dropped dramatically. No, we haven’t seen that yet. But again I think I want to caution listeners that we don’t have a very long, you know, forward-looking visibility into these things. It’s about two to three weeks.
This time last year we saw some softness in that two- to three-week period. We’re not seeing that quite yet, but, you know, that’s only two to three weeks. Kevin?
Kevin Muir, VP, General Manager Interventional Oncology
Yes, thanks Gerard, and thanks for the question, Chase. We are looking kind of strong for the number of new sites we’re bringing on. It’s—we kind of get them in fits and starts when training is completed. So we have a number of sites that are in the queue to get our preceptorship and proctorship, and it’s just a matter of time until they open for the remainder of the year. So I feel very strong that we can obtain to our goal of 37—yeah, our goal of 37, my friend.
I also say I think we have at least one patient scheduled, maybe two right now, and then one more looking for patients. Now these can—you know, patients can get scheduled—that one I mentioned. But these are on the cusp, and what we found is the on-the-cusp ones can go in weeks, they can go in months. But there’s a healthy, healthy on-deck circle here. It’s not—the 37 is well within our reach. You know, fingers crossed a bit. As we know it’s episodic but it’s—
Chase Knickerbocker, Analyst at Craig-Hallum
—not a soft pipe. Helpful color, guys. Thank you.
OPERATOR (Operator)
Thank you. Your next question comes from Sam Pankula, Ram Kanth with H.C. Wainwright.
Please go ahead.
RK, Analyst at H.C. Wainwright
Thank you. This is RK from H.C. Wainwright. Good morning Gerard and Sandra. A couple of quick questions here. I’m trying to bridge the gap between the 30% Hepzato volume growth and the 20-some percent revenue growth. So how much of that gap is from 340B or Medicaid or just the site mix? And the second question is on the gross margin. You know you exited last quarter with 90% but your guidance asks for a little bit lower than that for the full year. So is that basically coming from the top line or is there something else that’s going on?
Sandra Brooks Pennell, Chief Financial Officer
Yes, I can answer both questions with regard to the Q2 volume as well as the revenue from prior year. So reminder that 340B pricing, which reduced our effective ASP from about $185,000 down to about $170,000–$173,000 per kit this year versus what we recognized last year. So even though revenue is only up 21%, it’s actually representative of 30% volume. So 100% of that difference between those two figures is due to 340B. With regards to gross margin, yes, we had a great quarter in Q2 recognizing 90%, which is up from 86% a year ago and is above our original guidance of 85% to 87% for the full year.
Now, the Q2 improvement reflects better overhead absorption, favorable manufacturing performance, and obviously increased Hepzato volume. As we go into the remainder of the year we do have to be a bit conservative around additional manufacturing costs. So the full year is 86% to 89%. You know, we may see a quarter that dips a little bit below that 90% and, you know, one that hits 90% again. But that’s our current guide.
RK, Analyst at H.C. Wainwright
Thank you. Thank you Sandra for taking the question.
Sandra Brooks Pennell, Chief Financial Officer
Thank you.
OPERATOR (Operator)
Thank you. Your next question comes from Yael Jin with Lelo and Company. Please go ahead.
Yael Jin, Analyst
Good morning and thanks for taking questions and congrats on a good quarter performance. Just—we have two here. The first one is that I noticed your recent deck in terms of the type of cancer that metastatic to the liver. You have about eight of them and just curious initially why you choose the breast cancer and BRC given they are not necessarily the highest volume or other factors. Any thoughts of that when you made that decision and then I’ll follow up.
Kevin Muir, VP, General Manager Interventional Oncology
Yeah, that’s a great question. And you know, we started the conversations as to for those two trials probably a good two years ago. And you know, for CRC there is a fair amount of—there’s a large amount of liver-dominant cancer. It’s one of the largest. It’s probably the largest outside of primary. The setting we chose, third line, is not the largest. It’s actually quite a bit cut down from the overall population of patients with liver-dominant cancer and CRC patients.
But the reason we chose that, frankly, was when oncologists, and to a lesser extent IRs who are fairly unfamiliar with our therapy, when we were having conversations about where to start, that’s where we got traction. And so it was largely driven by docs’ willingness to participate. Now I don’t want people to think, well, that’s a big negative. It is a very novel procedure. Oncologists generally prefer systemics. But I think the data as we generate it will bear out and oncologists will change their perception first in terms of trials they want to participate in and then eventually, obviously, actual commercial clinical usage.
In terms of breast cancer, that one is a bit less, admittedly, but there was real interest in oncologists in terms of participating in that trial. Yes, we have. It’s been slow to enroll and get started, but there were a couple of key KOLs who thought there was a real need here. Breast cancer—various types of breast cancer tumors—generally react well to chemotherapy. So that was one reason a number of docs were excited. But these were the starting sets where we get traction with oncologists being interested.
Who knows, if we started now with the level of understanding we have out there, would it be a different set? Yes, but we had to start somewhere. I think these are meaningful markets for us and there’s a real unmet need in these settings. And we’ll add more, some orphan-type indications and some much larger indications going forward.
Yael Jin, Analyst
Okay, great. That’s very helpful. Maybe just tackle that—one of the similar themes, which is with the current patient enrollment of those two trials, are they within your expectation, or you have different sort of hope in terms of the pace and other factors? And thanks.
Kevin Muir, VP, General Manager Interventional Oncology
Definitely lower than our expectations. There are a number of reasons for that. I think one not-so-obvious reason is that just as we had to get sites REMS-certified and up and running, we had that issue with new centers. We also had to educate the clinical trial teams, and we found that getting the IR teams, which are less set up for clinical trials, to work with the oncology teams, which are very familiar with trials but they’re not familiar with this type of therapy—getting those teams to work together with a new patient flow, the type of data we need to gather in the IR suite—it was very new to them, quite frankly.
A number of centers that we thought would quickly activate, enroll—when we got the disparate teams together, it became an issue. So there was a dimension of change in training we did not anticipate would be a problem in the clinical trial setting. So just as in the commercial setting, there was a hill to climb that we kind of understood we’d have to do when we started—it was a bigger hill than we thought—we found the same thing in the clinical trial.
Getting the clinical trial teams to work together in this type of trial was a problem. We lost some centers because, undoubtedly. And the bigger issue was just centers taking a while to get up and running. So again, interesting product, different type of product, but we’re working through the issues just as we have commercially. We’re going to work through the issues on the clinical side as well.
Yael Jin, Analyst
Okay, great. This is very helpful and certainly congrats on all the progress, and best of luck to you guys.
OPERATOR (Operator)
Thank you. There are no further questions on the phone line. I will turn the call back to Mr. Mitchell for some closing remarks.
Gerard Michel, Chief Executive Officer
Okay. Just want to thank everyone for their support, both the investors as well as the internal team here at Delcath Systems. We’re getting a lot done, and it wouldn’t be if it wasn’t for the employees of the company who are very dedicated to move things forward for patients and to, you know, earn the trust of the investors. Thank you very much for your time, and have a great day.
OPERATOR (Operator)
Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines. Have a great day.
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