This was all before FDA, in February 2011, issued a refuse-to-file letter citing unanswered questions about ChemoSat's safety. ChemoSat is already approved in Europe but only as a medical device; FDA considers it a drug and therefore holds approval to a stricter regulatory standard.

Delcath finally resubmitted ChemoSat to FDA on Aug. 15. It took 18 months to refile -- a really long time. Delcath says all the patient records have been updated with the safety data that FDA requested but the company has not told us any details about these data or whether the data will be sufficient to assuage FDA's concerns. This is a risk.

The ChemoSat resubmission also seeks approval of the device replacing the old Generation 1 filter with a new Generation 2 filter. These filters remove melphalan from a patient's blood as the toxic chemotherapy exits the liver before it can enter the bloodstream and cause harm.

These filters play a very important safety function so it's concerning that Delcath is seeking ChemoSat's approval without any Gen 2 filter efficacy or safety data from clinical trials. All of the ChemoSat studies to date have used the Gen 1 filter. That's potentially a big risk.

Delcath CEO Eamonn Hobbs claims FDA deemed it "acceptable" to re-file ChemoSat with the untested Gen 2 filter. The hairs on the back of my neck stand straight up whenever I hear a bio-pharma CEO speak for FDA. Place full trust in Hobbs' assurance about the Gen 2 filter at your peril.

If you're a trader interested in Delcath and any possible stock run-up, watch for FDA's acceptance of the ChemoSat resubmission, which should be announced at the end of September or mid-October at the latest. If FDA decides to review ChemoSat and grants priority review, the approval decision date will be mid-February 2013. A standard review will extend the approval decision date to June 2013.

Alfred Y. asks, "Since your last article on Peregrine Pharmaceuticals ( PPHM), it has been on fire. What is behind the shoot up in the price?"

Stock promotion. Speculation. Momentum trading. Hype. Short-covering. Low-volume summer trading. Take your pick. What hasn't changed about Peregrine since my July 20 Mailbag is the company's fundamental outlook. It's still poor. That's what I focus on, not short-term movements in the stock price in either direction.

Peregrine is presenting updated overall survival data from bavituxmab's phase II study in second-line non-small cell lung cancer on Sept. 7. At best, we'll likely see a non-statistically significant trend in survival favoring bavituximab. I won't be surprised or impressed considering the mediocre data released from this study already, combined with the outright failure of bavituximab in the first-line lung cancer trial.

Remember what I've said about paying more attention to what biotech executives do rather than what they say. Peregrine sold 3 million shares of stock through its At-The-Market (ATM) financing vehicle between April and June at an average price of 49 cents per share. Peregrine sold this stock in the dark while telling investors publicly how excited it was about the bavituximab lung cancer data and boasting about all the interest the company was receiving from potential partners.

--Written by Adam Feuerstein in Boston.

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Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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