Delcath lifts 2026 outlook as HEPZATO revenue jumps 71%

By Grace Kim

Delcath Systems (NASDAQ: DCTH) reported record third-quarter revenue of $35.1 million, up 71% year over year, and raised its 2026 revenue outlook to $115 million to $117 million. The medical-technology company ended the quarter with $104.3 million in cash and investments and no debt, as increased HEPZATO KIT use across U.S. treatment centers drove results.

What drove the 71% revenue gain?

Chief Financial Officer Sandra Pennell said: “HEPZATO KIT revenue rose to $32.7 million from $19.3 million.” HEPZATO volume increased 19% from the second quarter and 72% year over year, while CHEMOSAT revenue rose to $2.4 million from $1.3 million.

Chief Executive Officer Gerard Michel said the quarter reflected “approximately 0.6 new patient starts per site per month,” meaning newly treated patients added at each site. Gross margin improved to 89% from 87%.

Net income rose to $7 million from $0.8 million, and adjusted EBITDA, a non-GAAP profitability measure, increased to $11.5 million from $5.3 million.

Research and development expenses climbed to $11 million from $8 million, mainly because of additional clinical staff and trial activity. Selling, general and administrative expenses rose to $13.1 million from $10.3 million as Delcath invested in commercial expansion.

Operating cash flow reached $8.2 million, up from $4.8 million a year earlier. Pennell cautioned that quarterly profitability could vary while the company invests in its treatment network and clinical development.

Takeaway: HEPZATO adoption drove both revenue growth and stronger cash generation, even as operating expenses increased.

What does the raised outlook imply for Q4?

Delcath’s $115 million to $117 million 2026 revenue guidance implies fourth-quarter revenue of $25.8 million to $27.8 million. That range is below the $35.1 million third-quarter result but approximately 25% to 34% higher than a year earlier.

Michel expects Delcath to lose close to two weeks of treatment scheduling because of holidays, accounting for most of the sequential decline. He also noted that new patient starts generally fall in the fourth quarter.

October results were included in the guidance, but Michel did not disclose the figures. Fourth-quarter new patient starts were approximately 0.3 to 0.35 per site per month last year; assuming a continued 0.6 rate would be aggressive, Michel said.

For the full year, Delcath expects 87% to 89% gross margin, positive adjusted EBITDA and HEPZATO KIT volume growth of at least 41% over 2025.

Takeaway: The raised annual forecast still points to a seasonally lower fourth quarter, with year-over-year growth intact.

How are treatment centers expanding?

Delcath had 33 active U.S. treatment centers, including newly added University of Nebraska and AdventHealth sites, and expects at least 36 centers by year-end. The company recorded its 1,000th commercial HEPZATO treatment in the United States during the third quarter.

Chief Commercial Officer Kevin Muir said new-patient growth was broad-based. Larger centers, including MD Anderson and Mass General, increased capacity and treatment activity.

Michel attributed third-quarter performance to more frequent HEPZATO use alongside or in sequence with systemic therapies, growing patient awareness, fewer headwinds from clinical trials and efforts to establish backup treatment teams at centers.

Two additional centers had patients scheduled for treatment in the coming weeks, Michel said. Scheduled procedures can be canceled, and center activation projections remain uncertain. Muir said integrated networks such as AdventHealth can help refer patients to treatment centers.

Takeaway: Center growth and referrals broaden the path to volume, but canceled procedures make activation counts less certain.

What milestones sit ahead for the pipeline?

Delcath’s phase 2 colorectal cancer trial, a mid-stage clinical study, is enrolling at a pace supporting an interim analysis, or planned mid-trial review, around mid-2027, Michel said. He said the company could provide an interim update in the second or third quarter of next year.

Enrollment in the breast cancer trial has been slower than initially anticipated, and the company has not set a timeline for an interim analysis. The first patient received a dose in July at the European Institute of Oncology in Milan, and multiple sites are recruiting in Europe and the U.S.

Delcath plans an investigational new drug submission, a regulatory filing, for cholangiocarcinoma in early 2027. The company also is developing an oxaliplatin-based hepatic delivery program and expects to complete preclinical development, or work before human studies, by mid-2027 to support a subsequent submission if the FDA agrees.

Takeaway: Treatment-center execution remains the near-term financial driver; formal pipeline submissions and analyses are concentrated in 2027.

What does Delcath sell?

Delcath develops and commercializes systems designed to deliver high concentrations of chemotherapy to the liver while limiting exposure to the rest of the body. Its primary U.S. product, the HEPZATO KIT, combines the company’s proprietary hepatic, or liver-directed, delivery system with melphalan hydrochloride for injection.

The FDA-approved treatment covers adult patients with metastatic uveal melanoma involving the liver that cannot be surgically removed, either with no disease outside the liver or with limited outside-liver disease that is not clinically significant. Outside the United States, Delcath markets the corresponding system under the CHEMOSAT brand.

Takeaway: HEPZATO KIT is the U.S. revenue driver, while CHEMOSAT serves markets outside the United States.