Delcath Systems Receives Permanent J-Code (J9248) for HEPZATO™ (melphalan/Hepatic Delivery System) Effective April 1, 2024
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Insights
The assignment of a permanent J-code for Delcath Systems' HEPZATO by CMS represents a pivotal moment for the company, with potential for material financial implications. This coding facilitates a more streamlined reimbursement process for Medicare Part B drugs, which could lead to increased adoption and usage of HEPZATO. From an economic standpoint, the ease of billing and reimbursement is a significant factor in the uptake of new medical treatments, as it reduces administrative barriers for healthcare providers and ensures a predictable revenue stream from Medicare reimbursements.
Moreover, with the U.S. population aging, the incidence of diseases such as metastatic uveal melanoma (mUM) could see an increase, potentially expanding the market for treatments like HEPZATO. It's important to note that Medicare coverage can significantly influence market dynamics, as it often paves the way for adoption by private insurers. The long-term financial outlook for Delcath could be positively impacted if other insurers follow CMS's lead in recognizing the treatment, thereby widening the patient base eligible for HEPZATO.
The approval of a product-specific J-code for HEPZATO by CMS is a critical development for clinicians and patients dealing with metastatic uveal melanoma. This liver-directed treatment represents a specialized approach for a subset of cancer patients with limited treatment options. The specificity of the J-code acknowledges the unique administration and dosage requirements of HEPZATO compared to other forms of melphalan, underlining its distinct clinical use and value.
From a medical perspective, the establishment of the J-code could lead to broader clinical adoption and potentially improve patient outcomes by providing more accessible treatment options. The clinical community often faces challenges with the adoption of innovative treatments due to reimbursement complexities; thus, this decision by CMS is a significant enabler for change.
Delcath's announcement about CMS's establishment of a permanent J-code for HEPZATO can be seen as a strategic milestone, likely to influence the company's market positioning and competitive edge. This development not only enhances the product's visibility within the healthcare system but also signals to investors and stakeholders the potential for increased market penetration and revenue growth.
It is essential to consider the competitive landscape of oncology treatments, particularly for rare conditions like metastatic uveal melanoma. The adoption of a permanent J-code may provide Delcath with a competitive advantage in securing formulary placements and favorable reimbursement tiers. Additionally, this could attract partnership opportunities or even make Delcath a more attractive acquisition target for larger pharmaceutical companies looking to expand their oncology portfolios.
J-codes are a form of Healthcare Common Procedure Coding System Level II identifiers used by payors to streamline the billing of Medicare Part B drugs. In its summary of Delcath's application for the J-code, CMS stated that "[e]xistng melphalan hydrochloride is FDA approved at 0.25 mg/kg via intravenous infusion for patients with multiple myeloma and is not substitutable for the melphalan hydrochloride in the HEPZATO KIT which is approved at 3.0 mg/kg via intraarterial delivery for patients with metastatic ocular melanoma."
The HEPZATO KIT is a liver-directed treatment for adult patients with metastatic uveal melanoma (mUM) with unresectable hepatic metastases affecting less than
"We believe that the establishment of the permanent J-code for HEPZATO will facilitate patient access to this important treatment," said Gerard Michel, Delcath's Chief Executive Officer. "This is a significant step towards accurate and efficient reimbursement of the HEPZATO KIT, facilitating access for patients."
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.
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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.
Contact:
Investor Relations Contact:
Ben Shamsian
Lytham Partners
646-829-9701
shamsian@lythampartners.com
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SOURCE Delcath Systems, Inc.
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