On November 5, 2019 Seres Therapeutics, Inc. (Nasdaq: MCRB) reported financial results for the three months ended September 30, 2019 and provided a business update (Press release, Seres Therapeutics, NOV 5, 2019, View Source [SID1234550360]).

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"Seres continues to advance our microbiome programs, and the Company is well resourced to reach important corporate milestones in 2020, including two late-stage clinical readouts: SER-287 Phase 2b study in mild-to-moderate ulcerative colitis and SER-109 Phase 3 study in recurrent C. difficile infection," said Eric D. Shaff, President and Chief Executive Officer at Seres. "We are very pleased that our SER-109 ECOSPOR III study is now approaching target enrollment. SER-109 could provide patients with a meaningful new treatment option and also provide definitive clinical validation for our microbiome therapeutic approach. We are eagerly looking forward to top-line results from both of these important programs."

Program Updates and Corporate Highlights

SER-287 Phase 2b ECO-RESET study in ulcerative colitis: SER-287 is an orally-administered, biologically-derived, live microbiome therapeutic candidate designed to modulate the gastrointestinal microbiome of individuals with ulcerative colitis. Seres continues to enroll the SER-287 Phase 2b ECO-RESET induction study in patients with active mild-to-moderate ulcerative colitis. The SER-287 Phase 2b ECO-RESET study is expected to enroll approximately 201 patients. Based on U.S. Food and Drug Administration feedback, Seres expects that with positive Phase 2b study results, the study could serve as one of two pivotal trials to enable a SER-287 Biologics License Application submission. Seres expects Phase 2b ECO-RESET study top-line results in the second half of 2020.
SER-109 Phase 3 ECOSPOR III study in recurrent C. difficile infection: SER-109 is an orally-administered, biologically-derived, live microbiome therapeutic candidate designed to restore the depleted, or dysbiotic, gastrointestinal microbiome of patients with recurrent C. difficile infection. The Company continues to enroll the ECOSPOR III trial, which is evaluating efficacy and safety in 188 patients with recurrent C. difficile infection. All patients enrolled in ECOSPOR III are required to test positive for C. difficile cytotoxin to ensure enrollment of only patients with an active C. difficile infection. As of October 31, ECOSPOR III was more than 85% enrolled, and top-line study results are expected in mid-2020.
SER-301 preclinical candidate for ulcerative colitis: The Company has nominated the lead candidate for SER-301, a rationally-designed, live microbiome therapeutic for ulcerative colitis. Next-generation, rationally-designed microbiome therapeutics may provide important benefits that include the optimization of pharmacological properties for target diseases and streamlined manufacturing. The consortia of bacteria in SER-301 are designed to modify the microbiome and microbe-associated metabolites in the gastrointestinal tract to modulate ulcerative colitis-relevant anti-inflammatory and immune pathways and to improve epithelial barrier integrity. SER-301 incorporates species associated with clinical efficacy in prior Seres human studies. Further, bacterial species selected for inclusion in SER-301 have been confirmed to engraft across human subjects. The consortia has demonstrated the capacity to modulate disease-relevant cellular mechanisms in human cell-based screening assays and in vivo models. Seres is entitled to a $10 million milestone payment associated with the SER-301 Phase 1 clinical study from its ongoing collaboration with Nestlé Health Science. Seres expects to initiate clinical development in early 2020.
SER-401 Phase 1b in metastatic melanoma: SER-401 is an orally-administered, biologically-derived, live microbiome therapeutic candidate comprising bacteria that reflect the bacterial signature in the gastrointestinal microbiome associated with response to checkpoint inhibitor immunotherapy. The ongoing Phase 1b study, supported by the Parker Institute for Cancer Immunotherapy and The University of Texas MD Anderson Cancer Center, will evaluate the potential for SER-401 to improve clinical response to nivolumab, an approved anti-PD-1 checkpoint inhibitor therapy, and will evaluate tumor biopsies and various biomarkers. Seres expects to obtain SER-401 Phase 1b preliminary study results in the second half of 2020.
New debt financing: Seres entered into a debt financing agreement with Hercules Capital in October 2019 that provides the Company with up to $50 million in additional capital. The Company received a first tranche of approximately $25 million following the agreement closing. Two subsequent tranches of $12.5 million each would become available to the Company upon the achievement of certain milestones.
Financial Results
Seres reported a net loss of $16.4 million for the third quarter of 2019, as compared to a net loss of $21.9 million for the same period in 2018. The third quarter net loss was driven primarily by clinical and development expenses, personnel expenses and ongoing development of the Company’s microbiome therapeutics platform. The third quarter net loss figure was inclusive of $7.0 million in recognized revenue associated primarily with the Company’s collaborations with Nestlé Health Science and AstraZeneca.

Research and development expenses for the third quarter of 2019 were $18.3 million, as compared to $23.7 million for the same period in 2018. The research and development expense was primarily related to Seres’ late stage SER-109 and SER-287 clinical development programs.

General and administrative expenses for the third quarter of 2019 were $5.9 million, as compared to $7.6 million for the same period in 2018. General and administrative expenses were primarily due to headcount, professional fees and facility costs.

Seres ended the third quarter with approximately $83.8 million in cash, cash equivalents and investments. This amount does not include the $25 million in debt capital obtained in October 2019.

Cash resources are expected to fund operating expenses and capital expenditure requirements, excluding net cash flows from future business development activities or potential incoming milestone payments, into the second quarter of 2021.

Conference Call Information
Seres’ management will host a conference call today, Nov. 5, 2019 at 8:30 a.m. ET. To access the conference call, please dial 844-277-9450 (domestic) or 336-525-7139 (international) and reference the conference ID number 3577505. To join the live webcast, please visit the "Investors and Media" section of the Seres website at www.serestherapeutics.com.

A webcast replay will be available on the Seres website beginning approximately two hours after the event and will be archived for at least 21 days.