Release Date: August 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Seres Therapeutics Inc (MCRB, Financial) announced the sale of VOWST assets to Nestle Health Science, providing a substantial immediate and future financial consideration.
- The VOWST asset sale will provide Seres Therapeutics Inc (MCRB) with $155 million in cash, strengthening their balance sheet and enabling debt retirement.
- Seres Therapeutics Inc (MCRB) has developed VOWST, the first FDA-approved oral live microbiome therapy, transforming the lives of patients with recurrent C. difficile infections.
- The company is advancing its pipeline with promising programs like SER-155 and SER-147, targeting significant unmet medical needs in vulnerable patient populations.
- Seres Therapeutics Inc (MCRB) reported a 43% growth in VOWST net sales for the second quarter, reflecting strong market potential and execution.
Negative Points
- Seres Therapeutics Inc (MCRB) reported a net loss of $32.9 million for the second quarter of 2024, compared to net income of $46.6 million for the same period in 2023.
- The company will not recognize VOWST net sales in its financial statements, sharing equally the product's commercial profits and losses with Nestle.
- Research and development expenses for the second quarter were $17.9 million, indicating ongoing high costs despite a decrease from the previous year.
- General and administrative expenses for the second quarter were $16.1 million, reflecting significant operational costs.
- The company's future cash runway is dependent on the successful completion of the VOWST asset sale and subsequent capital infusion.
Q & A Highlights
Q: What signals are you specifically looking for in Cohort 2 for SER-155 around key secondary endpoints? Can you provide a framework for a potential pivotal study if Cohort 2 is successful?
A: We are looking for meaningful decrements in neutropenia and fever rates, bloodstream infections, and GI infections. Consistency across these endpoints and pathogen abundance data will be crucial. For a pivotal study, we would build on our VOWST experience, aiming for an efficiently sized trial with a safety database requirement of about 300 patients. β Eric Shaff, President & CEO, and Lisa von Moltke, Chief Medical Officer
Q: Could SER-155 be applicable in CAR T therapy to address challenges like CRS and GvHD?
A: Yes, SER-155 could be applicable in CAR T therapy for both infectious complications and immunologic issues. Recent studies show infections are a significant cause of mortality in CAR T patients, highlighting the need for solutions like SER-155. β Lisa von Moltke, Chief Medical Officer, and Matthew Henn, Chief Scientific Officer
Q: Could you discuss the global data sets for pathogen domination and any differences in pathogens globally?
A: Global data on pathogen abundance is consistent, supported by a New England Journal of Medicine article. We use the MSK reference cohort for its high-quality data, but global trends are similar. β Matthew Henn, Chief Scientific Officer
Q: What are the next steps with the FDA if the Phase 1b Cohort 2 data is positive?
A: We would discuss the data and next study design with the FDA, seeking designations like orphan drug and breakthrough therapy. The process will depend on the data, but we are prepared based on our experience with VOWST. β Lisa von Moltke, Chief Medical Officer
Q: How do you prioritize pipeline programs post-VOWST sale, and why was SER-147 selected as the next program?
A: We prioritize based on unmet need, technological advantage, and commercial opportunity. SER-147 was chosen due to its potential in chronic liver disease, supported by strong scientific and clinical data. β Eric Shaff, President & CEO, and Matthew Henn, Chief Scientific Officer
Q: Will the 50-50 profit/loss sharing for VOWST continue post-deal closing, and was the profit this quarter due to any one-time events?
A: Post-deal, the profit on inventory transfer will no longer be recognized. Future results will reflect the product profit and loss. The proxy will include estimates for collaboration profit or loss. β Marella Thorell, Chief Financial Officer
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
