Delcath Systems Announces CMS Approval for NTAP for HEPZATO KIT™

Rhea-AI Summary

Delcath Systems (Nasdaq: DCTH) has announced that the Centers for Medicare & Medicaid Services (CMS) has granted New Technology Add-on Payment (NTAP) status for its HEPZATO KIT™. This approval, effective from October 1, 2024, will support the adoption of this innovative liver-directed therapy under the CMS Inpatient Prospective Payment System.

The NTAP designation will help cover costs associated with HEPZATO KIT for eligible Medicare inpatients, ensuring broader access to this treatment. The HEPZATO KIT is a combination product that delivers high-dose chemotherapy directly to the liver while minimizing systemic exposure, indicated for treating adult patients with unresectable hepatic-dominant metastatic uveal melanoma.

Positive

• CMS approval of NTAP status for HEPZATO KIT™
• Additional payment to cover costs for eligible Medicare inpatients
• Potential for broader patient access to HEPZATO KIT™
• Recognition of HEPZATO KIT™ as an innovative medical technology

Negative

• None.

Insights

Healthcare Policy Analyst

The CMS approval for NTAP status for Delcath's HEPZATO KIT™ is a significant development for both the company and patients. This decision will enhance Medicare reimbursement for the treatment in inpatient settings, potentially increasing adoption and accessibility.

The NTAP designation, effective from October 1, 2024, signifies that CMS recognizes HEPZATO KIT™ as an innovative technology offering substantial clinical improvement. This could lead to increased utilization in hospitals, as the additional payment helps offset costs.

However, it's important to note that HEPZATO KIT™ is primarily used in outpatient settings, which may limit the immediate financial impact. The long-term implications for Delcath will depend on how effectively they can leverage this approval to expand market penetration and potentially secure similar reimbursement enhancements for outpatient use.

Oncology Specialist

The NTAP approval for HEPZATO KIT™ is a positive development for patients with unresectable hepatic-dominant metastatic uveal melanoma. This rare and challenging condition has treatment options and HEPZATO KIT™ offers a targeted approach that could significantly improve outcomes.

The Hepatic Delivery System's ability to isolate the liver during chemotherapy infusion is a key innovation. It allows for high-dose treatment while minimizing systemic exposure, potentially improving efficacy and reducing side effects. This could lead to better quality of life for patients undergoing treatment.

However, it's important to note that while this approval enhances accessibility, the clinical effectiveness and long-term outcomes of HEPZATO KIT™ will need ongoing evaluation. The oncology community will be closely monitoring real-world data to fully understand its impact on patient care.

Financial Analyst

The NTAP approval for HEPZATO KIT™ is a positive catalyst for Delcath Systems (NASDAQ: DCTH). This designation could potentially accelerate revenue growth by facilitating broader adoption in inpatient settings. However, investors should note that the financial impact may be initially, given the product's primary use in outpatient scenarios.

The approval's effective date of October 1, 2024, means that any significant financial benefits won't materialize until FY2025. This gives Delcath time to prepare for potential increased demand and optimize their market strategy. The company's ability to leverage this approval for broader market penetration and potential expansion into outpatient reimbursement will be important for long-term growth.

Investors should monitor Delcath's sales trajectory, adoption rates and any updates on efforts to secure similar reimbursement enhancements for outpatient use. While positive, this news alone may not dramatically alter the company's near-term financial outlook.

QUEENSBURY, N.Y.--(BUSINESS WIRE)-- Delcath Systems, Inc. (Nasdaq: DCTH), an interventional oncology company focused on the treatment of primary and metastatic liver cancers, announced today that the Centers for Medicare & Medicaid Services (CMS) has granted New Technology Add-on Payment (NTAP) status for its HEPZATO KIT™ (melphalan/Hepatic Delivery System). This approval will be effective for the fiscal year starting October 1, 2024.

The NTAP designation under the CMS Inpatient Prospective Payment System (IPPS) is designed to support the adoption of innovative medical technologies that provide substantial clinical improvement over existing treatments. HEPZATO KIT™ is used primarily in the outpatient setting, however there are instances where it is used in the inpatient setting. This additional payment will help to cover the costs associated with the HEPZATO KIT for eligible Medicare inpatients, ensuring that more patients can benefit from this advanced liver-directed therapy.

"The NTAP approval for HEPZATO KIT is a significant milestone that underscores the clinical value of our therapy. This will facilitate broader access to HEPZATO KIT for eligible patients and support the oncology community in delivering this important treatment," stated Gerard Michel, CEO of Delcath Systems.

The HEPZATO KIT is a combination product that delivers melphalan, a chemotherapeutic agent, directly to the liver using Delcath’s proprietary Hepatic Delivery System (HDS). This system isolates the liver during the infusion process, allowing for high-dose chemotherapy administration while minimizing systemic exposure. The HEPZATO KIT is indicated for the treatment of adult patients with unresectable hepatic-dominant metastatic uveal melanoma.

About Delcath Systems, Inc., HEPZATO KIT and CHEMOSAT

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™ (Hepzato (melphalan) 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 a combination drug and device product and is regulated and approved for sale as a drug by the 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. HEPZATO KIT is approved in the United States as a liver-directed treatment for adult patients with metastatic uveal melanoma (mUM) with unresectable hepatic metastases affecting less than 50% of the liver and no extrahepatic disease, or extrahepatic disease limited to the bone, lymph nodes, subcutaneous tissues, or lung that is amenable to resection or radiation. Please see the full Prescribing Information, including BOXED WARNING for the HEPZATO KIT.

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 press release contains forward-looking statements, which are subject to certain risks and uncertainties, that can cause actual results to differ materially from those described. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Factors that may cause such differences include, but are not limited to, uncertainties relating to: the Company's commercialization plans and its ability to successfully commercialize the HEPZATO KIT; the Company's successful management of the HEPZATO KIT supply chain, including securing adequate supply of critical components necessary to manufacture and assemble the HEPZATO KIT; successful FDA inspections of the facilities of the Company and those of its third-party suppliers/manufacturers; the Company's successful implementation and management of the HEPZATO KIT Risk Evaluation and Mitigation Strategy; the potential benefits of the HEPZATO KIT as a treatment for patients with primary and metastatic disease in the liver; the Company's ability to obtain reimbursement for the HEPZATO KIT; and the Company's ability to successfully enter into any necessary purchase and sale agreements with users of the HEPZATO KIT. For additional information about these factors, and others that may impact the Company, please see the Company's filings with the Securities and Exchange Commission, including those on Forms 10-K, 10-Q, and 8-K. However, new risk factors and uncertainties may emerge from time to time, and it is not possible to predict all risk factors and uncertainties. Accordingly, 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240805478333/en/

Investor Relations:

ICR Westwicke

investorrelations@delcath.com

Source: Delcath Systems, Inc.

FAQ

When will the NTAP status for Delcath's HEPZATO KIT become effective?

The NTAP status for Delcath's HEPZATO KIT will become effective on October 1, 2024, for the fiscal year starting from that date.

What is HEPZATO KIT used to treat?

HEPZATO KIT is indicated for the treatment of adult patients with unresectable hepatic-dominant metastatic uveal melanoma.

How does the HEPZATO KIT work?

HEPZATO KIT delivers melphalan, a chemotherapeutic agent, directly to the liver using Delcath's proprietary Hepatic Delivery System (HDS), which isolates the liver during infusion to allow high-dose chemotherapy while minimizing systemic exposure.

What is the significance of the NTAP approval for Delcath Systems (DCTH)?

The NTAP approval underscores the clinical value of HEPZATO KIT and will facilitate broader access to the treatment for eligible patients, potentially supporting adoption and sales of the product.