Delcath Systems, Inc. (NASDAQ:DCTH) has announced that it has entered into a material definitive agreement, with one of its institutional investors. As per the details of the agreement, the investor would provide a total of $35 million, in return for senior convertible notes. Moreover, the notes also carry an 8% original issue discount, leaving DCTH with $32.2 million.
The company has stated that it would be using the funds to further its commercial activities and ongoing clinical programs. Delcath particularly pointed out two clinical trials, the phase-3 Melphalan/HDS trial and the phase-2 trials of the same drug. The first trial focuses on using the drug for hepatic dominant ocular melanoma, while the second is concerned with hepatocellular carcinoma. Furthermore, DCTH also disclosed that a total of $3 million, from the proceeds would be freely available, for use by DCTH and its subsidiary companies. However, the remainder would be held in control accounts and would be subject to cash covenants.
Jennifer K. Simpson, the CEO of Delcath, stated that the financing would provide the company with resources to continue its operations, through the FY2017. She also hinted that the proceeds would be used in the commercialization of company products in the EU. The CEO also stated that once the trials are successful, they can proceed with obtaining the FDA approval, in order to generate long term share holder value.
Furthermore, Delcath had also recently announced that the Sanchinarro team, at the HM Sanchinarro University Hospital, had successfully used the company’s Melphalan Hydrochloride injection. The team is using the company’s proprietary CHEMOSAT procedure, for peripheral cholangiocarcinoma. HM Sanchinarro is also the second hospital in the country to employ the procedure. DCTH’s CEO stated that the hospital is one of the leading cancer treatment centers in the country and it was an honor to have them use the procedure.
Delcath Systems, Inc. (NASDAQ:DCTH) closed trading at a share price of $0.263, after recording a surge of 0.77% in terms of its share value, at the end of the June 8 trading session.