Delcath Systems, Inc.

Greetings and welcome to the DelCast Systems Business Update Call. At this time, all participants are in a listen-only mode. Question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, David Hoffman, General Counsel for DelCast Systems. Thank you. You may begin.

Thank you, and welcome to DelCast Systems Business Update Call. With me on the call are Gerard Michel, Chief Executive Officer, Sandra Pinnell, Chief Financial Officer, and Voyo Vukovic, DelCast Chief Medical Officer. In addition, we will share a prerecorded conversation between Dr. Vincent Timah, Assistant Professor and Medical Oncologist at the University of Wisconsin's Department of Medicine, and Dr. Vukovic. I'd like to begin the call by reading the safe harbor statement. This statement is made pursuant to the safe harbor for forward looking statements described in the private securities litigation reform act of 1995. All 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. The preliminary estimated financial results for the quarter ended September 30th of 2025 included in this call have not been reviewed by DELCAS independent auditors and may change as a result of the continued review. Such preliminary results are subject to the finalization of quarter end financial and accounting procedures. For a discussion of such risk 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 subsequently 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. Our press release with a summary of the Chopin trial results And our press release containing preliminary 2025 Q3 financial results are available on our website under the investor section. 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.

Thank you for joining us today to review the Chopin trial results and a summary of preliminary third quarter 2025 financial results. Yesterday, DelCast's chief medical officer, Boya Lukavich, had an opportunity to discuss the Chopin trial results with Dr. Vincent Ma, a current user of HepCytoKit for the treatment of metastatic uveal melanoma patients. Dr. Ma is an assistant professor, medical oncologist, and the immuno-oncology therapeutics director of the Phase I program at the University of Wisconsin Carbone Cancer Center. He is a clinical investigator and translational scientist with a research program dedicated to melanoma and advanced cutaneous malignancies. Recognized as an emerging national expert in using melanoma, he leads and collaborates on multiple grants, clinical trials, and scholarly publications focused on improving outcomes for patients with this disease. Delcoff retained Dr. Ma to review the Chopin trial results and provide his feedback. Dr. Ma's comments are his own and do not constitute medical advice. Let me first recap the trial results that were presented Saturday by principal investigator and lead author, Professor Ellen Capitan from Leiden University. The Chopin trial randomized 76 patients one-to-one to receive PHP alone at weeks one and seven or four cycles of ipilimumab and nivolumab every three weeks over approximately nine weeks with two PHP treatments at weeks one and seven. The trial protocol did not include additional PHP treatments beyond two treatments or nevalumab maintenance monotherapy. Once the nine-week treatment period was completed, patients were monitored without further treatment until progression. Key eligibility criteria included unresectable hepatic metastases with 50% or less unresectable disease and limited extra hepatic disease. The primary endpoint was one-year progression-free survival. Secondary influence included safety, best overall response rate, and overall survival, and hepatic progression-free survival. The primary endpoint was MEP, with one-year progression-free survival of 54.7% in the combination group versus 15.8% in the perfusion group. The combination also significantly improved overall survival, 23.1 versus 19.6 months, and best overall response rates, 76.3% versus 39.5%. All of these efficacy advantages were statistically significant. Grade 3 or higher treatment-related adverse events were more frequent in the combination group, 81.6% versus 40.5%, but most were manageable with standard care. Interestingly, this rate of adverse events in the combination arm were consistent with those seen in the FOCUS pivotal trial. To better explore the importance of the results, I will now share the prerecorded discussion between Dr. Vukovic and Dr. Ma. I will then discuss the implications of these results for DELCAP, as well as share preliminary third quarter 2025 financial results and full year guidance, and open the floor for questions.

So, Tamar, thank you for taking the time to speak to me today regarding the results from the Span trial.

Good to be here to discuss these important results. All right. So, Tamar, can you describe at the beginning right now, what's your political practice and your research interests and how they pertain to the Span trial?

Yeah, so just a little bit about myself. I'm a medical oncologist at the University of Wisconsin Carbone Cancer Center. I specialize particularly in melanoma and advanced cutaneous malignancy, but I'm also the immuno-oncology therapeutics lead in our early phase program. About 10% of my practice is actually caring for patients with uveal melanoma. You know, one particular research focus of mine is actually understanding the poor prognostic nature of liver mets, particularly in patients treated with immunotherapy. And so, you know, my group and I have sort of published several articles over the years and presented several studies on this topic, particularly in melanoma. And our group was actually instrumental in opening an early phase clinical trial at the University of Michigan where I did my training. looking at combining liver-directed radiotherapy with immunotherapy to actually help enhance immunotherapy efficacy.

That's really interesting. So this phenomenon, how well documented is the role of liver medicine reducing systemic epinephrine or other immune checkpoint inhibitor efficacy? And how large of a clinical problem is it?

Yeah, great question. So, you know, prior to me joining, you know, faculty at the University of Wisconsin, you know, I was actually involved in a variety of translational research at Michigan where we actually correlated liver metastases with worse immunotherapy outcomes. You know, the mechanisms that we propose is that liver mets actually siphons and actually leads activated CDA positive T cells from circulation, causing almost a systemic immune desert, sort of diminishing the effects of immune checkpoint inhibitors. And this hypothesis actually translates very well to uveal melanoma, which, you know, unlike cutaneous melanoma, is considered to be an immunologically cold tumor. And part of the explanation for this may be due to the disease and propensity to metastasize the liver. And so my team and I actually published previously a meta-analysis and found that liver mets across all tumors actually leads to worse survival outcomes, particularly when treated with immune checkpoint inhibitors. And it continues to be, at this point, an unmet need to identify better or optimal liver-directed

It's a real clinical problem. Now, would you mind describing your experience specifically with Hebzato? For example, how many patients have you treated and what type of treatment regimen protocol do you utilize in your clinical practice?

Yeah, absolutely. So at our institution, we actually treated our first patient with Hebzato or Melphalan PHP in March 2024. And really since then, our institution has done over 60 procedures on 15 patients. And I will admit, I was pleasantly surprised to see that nearly all our patients had some degree of liver tumor volume reduction and actually also with very minimal complications. Most patients actually recovered within a week after each PHP treatment and were able to continue to work and travel in between cycles. And so at our institution, you know, the typical path of getting patients evaluated is through medical oncology, such as myself. And every newly diagnosed metastatic uveal melanoma patient seen by medical oncology, really the intent here is for the consultation to review all local and systemic therapy options, including clinical trials. And so oftentimes I go through the eligibility, review the pros and cons of every treatment. And in some cases, we do a multidisciplinary tumor board discussion. After initial consultation, you know, if we determine the patient is fit enough for EBS-Auto, Patients are then referred to our interventional radiologist, Dr. Oran Ozkan, for the procedure. And really most unique about our institution is the ability to do real-time CT angiography on the day of PHP procedure. So we can actually assess with contrast the anticipated distribution of the melphalan and make minor adjustments with the catheter, location in particular, to optimize drug delivery to the whole liver and tumor. All right, that's really quite clear.

Now, with the release of the Chopin results, what do you think of the results? And in your opinion, how will the Chopin results impact your practice in the treatment of metastatic uveal melanoma patients?

Yeah, it was great to be at the conference yesterday to witness these results, this oral presentation. Yeah, I mean, the Phase 2 results of the SHO-PIN trial actually affirms the similar impressively high percentage objective response rate with combination ipinevo plus PHP as in their Phase 1b portion of study, which, I mean, is the highest objective response rate. It was 75% plus seen for any prospective Phase 2 trial for any new view of melanoma studies. And although the trial comparison and interpretation should always be taken, you know, with caution, you know, the cohorts are often dissimilar, you know, when we looked at the median progression-free survival of other studies, for example, so we see that, for example, for tabentaflas is 3.3 months, ipilimumab and nivolumab is anywhere from 2.7 to 5.5 months. But what we saw with the ipinivo-PHP, the median PFS was 12.8 months, so impressively numerically higher. And although PFS is an informative endpoint for treatment efficacy, overall survival is also an important patient-centered outcome to take into consideration. And fortunately, as a secondary endpoint, you know, overall survival seemed to also favor the combination approach where Dr. Capitan mentioned a median overall survival of 23.1 months compared to PHP alone, which was much shorter. Now I do think the results of the Chopin trial are practice changing and aligned with the scientific rationale for the combination therapy, which is what we had primarily done a lot of research on. In my opinion, the main challenge with adopting the use of combination ipinevo plus PHP is going to be the considerably high rates of grade 3 plus adverse events. But, you know, in the presentation, it was reported around 81.6%. But if we compare that to what we also saw in the FOCUS trial, the rates were actually similar at around 80% for patients who were just treated with PHP alone, albeit in the FOCUS trial, they received six cycles of therapy of PHP. Now, it seems that most of the adverse events were hematologic with the combination therapy per Dr. Capitan. which interestingly enough is not a common immune-mediated adverse event with immune checkpoint inhibitors. I think it would be important to see probably in a future published article what the non-hematologic and specifically the immune-mediated adverse events were in the combination. And so I think ongoing correlative studies right now are needed to just better understand the underlying immune versus cytotoxic mechanism. But nevertheless, I think based on the presented phase two Chopin trial results, I think the combined use of ipinevo and PHP should be at least considered and offered to patients who are eligible and certainly fit enough to receive combination therapy. But I think future consideration should be made to at least evaluate this role of combination regimen in uveal melanoma patients but both hepatic as well as extrahepatic disease that is not amendable for definitive therapy, which we can see in this patient population. Notably, I think Dr. mentioned in the Chopin trial that only about 20 to 30% of patients had known extrahepatic disease, but my suspicion is that they probably were presumably definitively treated at the time of trial enrollment.

All right, thank you for the extensive review of the highlights and results. Now, in the Chopin trial, per design, patients were treated with only two PHP treatment cycles. Do you think that the efficacy of the Chopin trial could have been improved if some additional PHP treatments were introduced? And I think the second question is also, nivolumab maintenance is often used after ipilimumab, nivolumab induction, and that nivolumab maintenance was not part of the chagrin trial. So what are your thoughts around the number of PHP treatment cycles and the nivolumab maintenance question?

Yeah, a great question and a good follow-up, especially, you know, after the presented results. So, you know, I would just kind of speak to our own institutional experience that, you know, we saw a correlation between the number of PHP treatments with liver tumor volume reduction. You know, we found that most patients can actually tolerate, you know, six doses or six cycles of PHP in some patients, and the maximal tumor volume reduction in liver was not seen until after the sixth treatment. So I actually do think that, you know, the efficacy could be better achieved with more PHP treatments But would, of course, we need to be balanced with the toxicity risk, particularly in this case of the hematologic side effects that were reported. Now, in the Chopin trial, the combination ICI plus PHP arm, you know, reported an 80% plus, you know, grade three plus adverse event rate with numerically higher rates of hematologic side effects compared to PHP alone. But from an institutional experience, you know, we see that these, hematologic or cytopenias, you know, recovery is often a bit, that's often slower with successive cycles of PHP. So that's a caution that we'd have to take into account of if we're thinking of incorporating more of those into a combined modality. Now, the question about the nivolumab maintenance, I think, should have probably been incorporated, you know, into the combined PHP plus ipinevo treatment schema. You know, I think just thinking about some good correlative studies to think about, you know, presented earlier this year in ASCO 2025, you know, the Dante trial did a comparison between one versus two years of anti-PD-1 based therapy and advanced stage melanoma subjects who were treated with two years. And what they actually found was that patients who were treated with two years had a numerically higher two-year progression-free survival than a one-year course of anti-PD-1 therapy. And so it makes sense that from an immunologic and a treatment perspective, more therapy seems to make more sense to provide better durability. But of course, barring any ICI-limiting toxicities, I think it's still, generally speaking, considered standard of care to continue nivolumab maintenance therapy after an initial induction of ipinevo.

All right. Thank you for these really interesting insights. Now, thinking about the potential of synergy between the PHP treatment and the immune checkpoint inhibitor treatment, we've seen really these great results in patients with mesothelioma or nono. Now, in your opinion, what are the implications for other cancers? Is this concept that you've seen in MUM, do you think it's feasible to evaluate and, you know, to test in other cancer types?

Yeah, absolutely. I mean, there's something to be said and some conclusions that can be drawn from the Chopin trial, which is that the, the studies suggest the importance of aggressive upfront management with a multimodality therapy. You know, we know a substantial percentage of patients with liver meds, you know, regardless of the origin responds poorly to ICI therapy. We publish this, uh, waiting for patients to progress with ICI before receiving liver directed therapy or even vice versa. you know, is potentially risky. And I will say this, time and time again, as a medical oncologist, you know, I see that the driver of morbidity and even mortality comes from liver med progression. You know, it is oftentimes frequently seen as the cause of things like weight loss, cachexia, altermentation, hypoalbuminemia that leads to edema, coagulopathy. And I think sequencing therapy separately poses a risk to patients of not being eligible for later line therapies due to declining performance status, whether it's due to disease progression or toxicity. And I think as ICI therapy is at this point FDA approved across multiple, if not nearly all, solid tumor types, I think understanding effective strategies to overcome ICI resistance from liver meds with earlier introduction of liver-directed therapy, such as PHP, is a definite ongoing unmet need.

Dr. Oman, thank you again for taking the time to speak with me today about the results from the CHIP-N trial and your insights. Again, thank you so much.

Thank you, Oyo, and the DELCAT team, certainly, for inviting me to participate in this milestone update call.

As we just heard, these results clearly demonstrate the benefits of treating early with a combination of systemic checkpoint inhibitors, ipilimumab and nivolumab, and PHP. The option of this 10-week induction regime may accelerate uptake, given some oncologists are uncomfortable postponing systemic treatment. Of equal importance are the potential longer-term implications, given the numerous indications, such as non-small cell lung cancer and cutaneous melanoma, where ICI therapy or immune checkpoint inhibitor therapy is a mainstay, and liver metastases are common. We have already scheduled advisory boards to discuss potential protocols in these and other patient populations. Now, turning to our financial results and revised guidance. For Q3, we are reporting preliminary unaudited revenue of $20.5 million, gross margins of 87%, net income of $0.8 million, operating cash flow of approximately $4.8 million, and positive adjusted EBITDA of $5.3 million. As of September 30, 2025, the company is preliminarily reporting $88.9 million of cash, cash equivalents, and short-term investments. In the third quarter, the effect of the 340B discounts associated with NDRA participation was an approximate 12% decrease in average revenue per HPSADO kit. We expect a similar average price level in the fourth quarter. While there was a slowdown in pace of site activations from June to August, we have returned to a more steady pace, activating four new sites in the past two months. We currently have 24 active sites, with Memorial Sloan Kettering joining most recently. Interests for major cancer centers remain strong, and we remain confident that it is a case of when, rather than if, they will become active. We still expect 40 centers to be operational by the end of next year. Historically, our sites have acquired new patients at a rate between 0.4 to 0.7 per month per treating center. In Q3, we observed a marked decrease in the number of new patient starts per site, driven at least partially by seasonality. The process for new patient starts can take two months, from initial visit to an oncologist and subsequent referrals and treatment. During the late summer, we saw this process disrupted due to scheduling issues. We have seen a rebound in new patient rates from the summer low, but the impact of these lost patients will continue through the fourth quarter as new patients drive subsequent retreatments. We are confident, however, that total new patient recruitment will steadily increase as additional sites come online. We are prioritizing working with centers to train additional healthcare professionals to administer Hepsado to avoid disruptions due to scheduling conflicts. Most importantly, we believe the Chopin data will change this dynamic since patients can quickly start ipinevo treatment. I want to stress that we do not believe the decline in revenue for both the quarter and the year reflects physician perspectives regarding the positive effects of treatment with Hepsado. The feedback from oncologists who use Hepsado consistently indicates Hepsado addresses a significant unmet need. We believe there's a meaningful untapped demand for Hepsado, and we remain focused on finding creative solutions to the distinct challenges that often arise with novel, innovative therapies. As a result of the change in the rate of new patient starts, we have decided to lower our guidance to $83 to $85 million for the total revenue for 2025. Forecast for 2025 gross margins are between 85% and 87%, with continued positive non-GAAP-adjusted EBITDA and positive cash flow for the rest of the year. The total Hepsado treatment volume in 2025 is projected to increase by approximately 150% versus 2024. That concludes our prepared remarks. I'd ask the operator to open the phone lines for Q&A, and please note we will be limiting our financial-related responses to only the information provided during this call and the preliminary financial-related release issued on October 18.

Thank you. If you'd like to ask the question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Marie Teibel with BTIG.

Please proceed with your question. Good morning, Gerard, and the rest of the team, and thank you so much for hosting this. And also, please pass on our thanks to Dr. Ma for his pre-recorded comments. Very interesting. I want to ask two quick questions here, one on the Chopin data and then one on the financials. First, on the Chopin data, I want to understand if we could see any sort of real-life impact to adoption of PHP, HEPATO-PHP, as a result of this. In my mind, it sort of points to, you know, there could be more interest in a combination therapy by tumor boards or considering a more, I guess, multimodal approach to some of these tumors. And so I wanted to understand if that's something we should come to expect or if there's more clinical work that needs to be done before doctors can be considering that.

Marie, as you might expect, you know, but my sampling so far of what docs think of this is, you know, maybe N equals seven to eight at this conference. Um, the majority of them believe they will adopt this lease in the U S believe they will adopt this regime. Um, and that now that's coming from docs who are already using it to be honest. Um, but I do think it will help across the board, uh, for two reasons. One, there are an awful lot of docs who just are plain uncomfortable, postponing systemics. They've been trained their whole lives that you go off to liver-directed therapy when there's really no other option, and you exhaust all lines of systemic therapy. So with those docs now, they can kind of, I don't know how to put it, have their cake needed too, and that we can get them started on systemics. They're getting the benefit of that, and they're also getting the liver-directed, which is the life-limiting organ for these patients. The second thing is that we definitely lose some patients due to scheduling hassles, especially if the patient is coming from a referral center, getting referred to another oncologist at a treating center, and sometimes the duration, they have to find an open slot in the IR suite, and sometimes we lose patients because of that. This will give a longer lead time, and I expect, although I don't know this, I expect some docs will work in an extra week or two if it's as necessary to fit in the PHP. So I think it will help from that angle as well. And then third, there's just simply a lot of docs are very interested in systemic immunotolerance that's known to occur with liver mets. And I think for those docs, this will be fascinating data and may move the needle with their practice patterns as well.

Okay. Seems like very practical data. Very interesting. Thanks, Gerard. My follow-up on financials, there was a mention in yesterday's press release or Saturday's press release about discounting under the drug rebate agreement. Wanted to understand how much of an impact that was in Q3 and what's sort of being assumed in Q4 now that we know that Some of the seasonality is behind you. What's being assumed in the discounting? And thanks for taking the questions.

Hi, Marie. This is Sandra. You know, it's consistent with what we mentioned, I believe, in our previous call in August, that the discounts are anywhere from 10% to 15% overall. That's a range we did see in Q3, and we expect to see in Q4 as well.

Yeah, so it's basically 50% of the sites of volume, basically, at 23%. And that's how we get to roughly a 12 percent discount on average per kit.

All right. Thank you.

Thank you. Our next question comes from the line of John Newman with Canaccord Genuity. Please proceed with your question.

Hi, guys. Good morning. Thanks for taking my question. First of all, congrats on really fantastic SHOPIN data. Very unexpected to see the magnitude of benefit there. I just had two questions this morning. The first one on SHOPIN, do you plan on submitting those data for compendia listing in the United States? And if so, what might be the timeline? The second question I have is a financial question. Would you say that the impact in the third quarter in terms of the sales decline had more to do with the effect of the 340B discount or the challenges that you noted with scheduling treatments? Thanks.

Yeah, the first question Voyo is sitting here with next to me. Yeah, Voyo is certainly going to be working with KOLs for guidelines. In terms of Compendia, generally the way that it works in the U.S. is if it's published in a certain set of journals, which I think this likely will be, it's automatically included in Compendia. It's kind of an automatic, as I understand it, effect. So guidelines, yes. Compendia, I think if it's in a decent journal, it will essentially be on Compendia. In terms of the revenue slowdown, you know, there were three compounding effects. You know, one is the decline in price, average revenue per kit, which we've discussed exhaustively. The second was the slowdown in, or frankly, the stoppage for about two months plus in new site activation, and that has ended and now we're back to a really good clip, kind of the average clip we were at in the past. And then the last thing was unexpected. It happened very quickly that we saw a very steep drop in new patient enrollment. Not the type of drop that you would think to see, hey, we're peaking in revenue. You have to keep in mind that we're talking about, you know, let's call it roughly 10 new patients in a month, okay? And, you know, 10 new patients is, you know, a $7 million revenue swing given our price point. you know, over a couple quarters. So, you know, if you get a drop in new patients all of a sudden, it's the law of small numbers. You have, given the high price, you have a wide swing in revenue. We do believe at least part of that, because we saw cancellations and we saw scheduling issues, we do believe part of it was frankly just summer vacations. We have to have three healthcare providers available for these treatments. There really are no backups trained. It's just an issue of REMS. Now, we're trying to get backup docs trained. It's not as simple as one would hope. But we're working hard to get that done. And also the referrals. If it's oncologist to oncologist to IR, again, there's somewhere in that longitudinal sequence. If someone's out, it's a lot easier just to put them on a systemic quickly or give them a taste. And those patients are gone. But again, I think as we get a wider base of activated centers, we attempt to train some backup teams. And importantly, Chopin, where they can start on a systemic, which really doesn't have any scheduling issues, I think we will be able to mitigate those effects.

Okay, great. Thank you.

Thank you. Thank you. Our next question comes from the line of Sudan Loganathan with Stevens Inc. Please proceed with your question.

Hey, good morning, DELCAT team. This is Kisav on behalf of Sudan. Congrats on the Chopin trial data. Got two quick questions on my end. So on the seasonality aspect, if you could just provide some more color there in its specific impact on patient starts. And then with your current cash and cash equivalence balance alongside the results from Chopin, has your long-term strategy in metastatic colorectal or breast cancer deviated? Thank you.

Yeah, again, our average new patient starts for this year up until the summer months was about 0.4 to 0.7, bouncing around there. So maybe an average of 0.6 new patient starts. And every new patient that starts, again, that's per site, every new patient that starts starts leads to about three more treatments down the road. So there's a tail effect to the new patient starts. We went from that range I mentioned a moment ago to about a third of that range all of a sudden for about two months. And now it's swung back up again. I cannot definitively say that was 100% due to seasonality. I can definitively say we know of quite a few new patient starts that were canceled due to conflicts. So a subset of them, we certainly saw a signal there. So that's about as much color as I can provide. I frankly shared everything that we've been able to discern from it. You know, our number one competitor is still clinical trials. Those are always wax and wane. I don't think that may be a component of it. Other trials, I think the Chopin data would help us there. But the most concrete thing I could see was scheduling issues. And that's our, you know, theory that at least part of this was due to seasonality. And the second question. Oh, yeah. Thank you, my colleague. It was whether your strategy has changed. No, the strategy hasn't changed at all in terms of the trials for COC and breast. We've got plenty of cash. We're cash flow positive. In a point of fact, we're very eager to have these advisory boards with the likes of non-smell cell lung cancer docs, cutaneous melanoma docs, and other places where ICI therapy is used to see if it makes sense to use this product earlier and in combination with checkpoint inhibitors.

Thank you.

Thank you. Our next question comes from the line of Chase Knickerbocker with Cary Callum Capital Group. Please proceed with your question.

Good morning. Thanks for taking the questions. Gerard, maybe just to start, can we get a little bit more detail on kind of the specifics as far as where you saw that impact on the average patients per month kind of enrolled into therapy? I mean, was it at some specific centers? Was it kind of across the board? Can you just give us a little bit more of a view?

It was across the board. And, you know, this isn't a crystal clear explanation. There are some sites such as I'll mention this one, MGH, that frankly didn't start new patients because they're full up. They're doing as many as they possibly can fit in with their slot at the IR suite and with the single team they have. So that one kind of cycles in and out as new patients start. Other centers just dropped all of a sudden. I don't want to mention names of specific centers, to be honest. But, yeah, quite a few of them all of a sudden just dropped. dropped in terms of new patient starts. You know, I've had the reps talk to the oncologists. And again, some of them were in the IRs and some of them were just simply scheduling issues. People were away. They couldn't fit them in. They put them on another therapy.

So that's about as clear as I can be because that's the limit of our understanding at this moment.

Do we have a hypothesis on maybe why a seasonal impact would be worse kind of this year relative to kind of, you know, we kind of didn't see the same kind of sequential utilization trends last year? I get much smaller numbers last year.

I think just, yeah, just the growth overwhelmed any signal. I think as simple as that. Can you share where those average monthly patient starts sits today? Have we seen a full recovery? I'd say we're about 80% there.

The only reason I can't go further than that is, frankly, our visibility in the new patient starts is all of about one to two weeks. These just pop up on the calendar. So we don't have a long lead time to understand this. But yeah, I think it's at least 80% back.

So maybe just confirm that, I guess, average kind of treatments per patient has been consistent as far as, you know, I guess, where does that sit? And then the second piece is if we've seen that recovery, can you kind of speak to your confidence on, you know, call it, you know, looking out a quarter or two as we look forward into, you know, kind of first half next year, kind of returning to utilization trends that, you know, we would expect, call it, you know, two plus per month. Because, again, I have a little bit of trouble kind of reconciling that Q4, Gerard, with that utilization.

I would say just stay tuned to our third quarter call, and we'll provide more details.

Got it. And then just one from Chopin. Sorry for all the questions, but can you just help me understand kind of how this will be treated for those physicians that do want to adopt some sort of sequencing with checkpoint? Can you kind of share how you would expect it to be treated by insurers? Would this kind of work within kind of existing guidelines as far as liver-directed therapy today, and then just a little bit more detail on the safety side, if you would, as far as how, you know, some of those, you know, a little bit more detail as far as how those AEs cleared up and if there was need for any, you know, meaningful treatment discontinuation, just a

Let me start with the second one. I'm going to hand that off to Voyo to talk through the safety profile, the 80 versus 40, roughly 40%. Sure, okay.

So at the ESMO conference, the presentation was quite limited. They didn't share the full extent of the safety data, and that's why my ability to really address things in detail would be also limited. We understand roughly that approximately half of the adverse events reported in the combination are hematological, which is attributed to the PHPT twin, and the other half is immunological, which is attributed to the ipinivo combination. We also understand that no new safety signals have emerged, meaning the frequency and the intensity of the adverse events is consistent with historical data. PHP produces roughly the similar hematological toxicity and ipinivo produces roughly similar immunological toxicity as reported in previous trials. Also important, there's no overlapping toxicity. So overall, the regimen is acceptably tolerable as stated by the investigator. And we also understand that in terms of discontinuation of treatment, more patients have discontinued because of ipinivo. than because of PHP, and that's something that, you know, is well-known. Epinivo induction treatment is not exactly a very user-friendly treatment. Many patients experience tolerability issues, and again, what we saw here is nothing unusual, nothing that would be different than historical data. So back to you, Gerard.

Yeah, and we expect a full publication to come out hopefully, you know, if not within weeks, you know, one or two months, uh, with all the data. Um, I think the first question was, um, our expectation in terms of how docs will incorporate this into their practice. Is that correct?

Yeah. Yeah.

The insurance covers the, um, so we have had doctors use this or a very similar treatment regime, um, in a number of centers across the country. and we know they're getting paid. So that's a positive. The second is I am confident this protocol, these results will be published in a very reputable journal. So that will impact CMS coverage and as well as commercial payer coverage because it will be a solid journal. So combined with the fact that we haven't seen any pushback to date, admittedly the end might be 10 or 20 patients, but we haven't seen any pushback to date. on this, plus the level of journal we expect the publication to come out in, I think we're on solid ground from a reimbursement perspective.

Got it. Thank you very much, Fred.

Thank you. Our next question comes from the line of Yale Jen with Laidlaw & Company. Please proceed with your question.

Good morning, and thanks for taking the question, and congrats on your outstanding outcomes. I just got two here, first about Japan and the second on the financial side. For the Japan study, do you guys have any reference to think about in terms of the IP plus NEVO compared to what you have learned from the combo study to suggest that the combo will be better than the two checkpoint inhibitors combined? And then I have a follow-up.

Sure. So on the ipinevo side, there is published data on ipinevo and uviolet. I'll let you chat about those kind of cross-study comparisons.

Yeah. So there are at least two perspectives. We designed and executed phase two trials with ipinevo in patients with unresectable metastatic uveal melanoma. In those two studies, which represents probably the strongest evidence, The response rate of ipinivo is in the range of 12 to 18% when it's given as a combination in this patient population. The progression-free survival is roughly three months, and the overall survival is typically around one year. So that's the historical reference. These are contemporary trials that were published in the last several years. So when you look at... the Chopin trial, even the control arm, PHP alone, achieves better efficacy. And then the combination arm clearly doubles that efficacy, practically speaking. So here we have a situation where the combination of PHP and ipinivo is one plus one equals three. And that's why the authors conclude they likely have observed the synergistic effect.

And I'll just add two things. One is the reason Professor Capitan at Leiden University made the control arm PHP is simply because she believes for liver-dominant disease, that should be standard of care, not epinevo, because the results for the epinevo today have been very weak. It doesn't really do a heck of a lot. The second thing is they just did two PHPs. I expect doctors, at least in the U.S. and others, will continue to treat. So theoretically, we should see even better better efficacy.

Okay, great. Maybe I just follow up on this point, which is that it should, I mean, I understand it's not a pure apple to apple comparison because of the patient population of those prior study versus the Japan. But nevertheless, would this message of that the two checkpoint inhibitor alone versus the checkpoint inhibitor plus is actually much better, would that be a strong push for physicians to really think about putting the combo as a frontline? At the beginning of the study, even they have a little bit time difference between which one to be administrated.

Yeah, so let me... I think we kind of have to segment the market to talk about which oncologists we're talking about. There's a set of oncologists who just say, hey, I want to start with systemic, period. And even though the data with ipinivo is pretty thin, or TEBI has very decent data, so whether it's like too positive or negative depends on the scenario, but there are a set that are just going to say, I'm starting with systemic. So Putting aside the HLA-2 positive for a moment and the HLA-2 negative, now they can start with the systemic and move them on to PHP. That helps a tremendous amount with that audience. With the TEBI, appropriate patients, HLA-2 positive, I think it's going to be a mix. Some docs are going to stick with TEBI first, and then this might become a second-line option. Other physicians I was just talking to some a few hours ago are going to stick postponed Tebby. It's a mix. I think probably Tebby will still win, you know, jump ball in first line for the time being. Hard to say. Time will tell. The other physician segment are docs who really like clinical trials. And I've said before that I think in the HLA-2 negative segment of the market, clinical trials are our largest competitors. I think this data is fairly compelling. I'm hopeful that we will lose less of that. The other, so that's one patient population. Invest in the physician population. An important patient population that we've lost out on a bit are patients with a fair amount of extra hepatic meds. So some docs, just the way the label was written, have said, hey, look, if there's any meaningful amount of extra hepatic meds, even though the patients almost never die from extrahepatic mets, they're generally manageable. They often say, well, it's not hepatic-only or hepatic-dominant, and they don't treat with Hepsado. This is valuable in that now they can do a systemic to treat the extrahepatic mets as well as deliver directed. So from that patient subpopulation amongst some docs, it'll be valuable as well. So this will be positive for us in a number of different dimensions.

Okay, great. That's very helpful, and again, congrats on the outstanding data.

Thank you.

Thank you. Our next question comes from the line of RK with HC Wainwright. Please proceed with your question.

Thank you. Thank you. Thanks, Zira, for taking my questions. I know a lot of my questions have been answered, but I'm just trying to triangulate, you know, I'm just trying to see how Chopin can help with, you know, some of the seasonality that we are talking about. I know you gave some color, but, you know, why? Do you think because of the data, the way it is now with Chopin, the wait periods, you know, during holidays could be handled, you know, by... whatever you lose on direct Hepsado could be somewhat neutralized by having patients put on the Chopin protocol? Is that how you're thinking about it?

Yeah, so RK, what we've witnessed in the past, like, is that patients who are already on the product, who are coming back for their second, their fourth, et cetera, treatment, they might see their treatment pushed around by a few weeks around, you know, schedules. But we don't lose them. It's the new patient starts, again, it was at least that was part of the issue. Again, we think part of this was scheduling in the summer months. And, yes, this should definitely help because they'll go on epinevo, and I think doctors will be comfortable if they need to prolong the epinevo, they might do so to get the PHP, but they're able to start them on something, which I think will be very helpful because, frankly, it's understandable. Patients and physicians, just given the logistical realities of this, sometimes don't want to wait. And now they have a reason, they have a tool to have some level of flexibility.

Perfect. Thank you. Thank you very much for taking my question.

Thank you. Our final question comes from the line of Bill Morgan with Clear Street. Please proceed with your question.

Hey, good morning. Thanks and congrats on the data. So as you talk about potentially having doctors do more Hepsado treatments or extend NEVO, is that something you expect to be sort of on a case-by-case basis and kind of spread by word of mouth? Or do you think it might be in your plans to formally study that at some point? And then my second question is, now that this systemic IO plus Hepsado paradigm has proof of concept, the breast and colorectal programs seem to be far more tangible. If and when those are successful, in order to accommodate the additional PAM, what does an updated commercial effort look like down the road in terms of site activations or additional treatment centers and trained doctors? Thank you.

Starting with that Second one, I think that it's probably premature to talk about expanding the commercial footprint for those opportunities. Those are phase two trials. They're down the road. If those phase two trials are read out and there's demand, organic demand, because it's not a label, we would probably expand the medical affairs because that's the appropriate way to do it for, you know, off-label usage. So we're in, you know, I think probably, I don't think there's a meaningful pop any time in the near future on that front.

Okay, and then on extending NEVO or having doctors use more?

Oh, yes, so in terms of that, Nevo, I'm pretty certain docs will do maintenance therapy, extend that, because that is pretty much standard of care in all the published regimes for both cutaneous and uveal melanoma. So we will continue to see Nevo. I also don't think docs are going to let patients progress in the liver and not retreat with Hepsado. And that was pretty much a very consistent set of input we've heard over the last few days. Now, with that said, if there is indeed more toxicity with the combination, and there seemed to be a signal there, although the combination seemed to be what we saw in the FOCUS trial. It was the single arm, the PHP only, that had a much lower AE rate. the docs can postpone the PHP until, um, the hematological markers bounce back. And that's kind of what a lot of docs do now. They'll just postpone and wait. So, um, she was trying to stick to, uh, protocol, which is often the case. And it stays, you know, so they stay very structured and that's, you know, compresses, they have less flexibility.

And if I can just add the comment to, to Gerard's points, um, A Chopin trial is a European trial, and European doctors tend to be somewhat less aggressive when choosing treatments, particularly in the first line of cancer patients. So we expect that U.S. doctors will, you know, take the learnings from the Chopin trial, and that is you can safely combine systemic immune checkpoint inhibitors with PHP, and they will probably, or quite likely, expand on that, add additional PHP cycles, to achieve better disease control. I mean, a number of patients had complete responses in the Chopin trial, which is very encouraging for patients and doctors. They will most certainly introduce the nevo maintenance. And because of the less reimbursement issues, they can retreat with PHP and checkpoint inhibitors if and when patients progress after remission, which was not done in the Chopin trial. So I think there's definitely lots of room for additional treatment, improving and optimizing both the safety and tolerability.

Got it. Thank you.

Thank you. Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Michel for any final comments.

I just want to say thank you all for listening and, most importantly, your continued commitment and belief in our mission. Everyone have a great day.

Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation. Thank you.