MCRB Stock Fell Over 50% Pre-Market: Why It Happened

By Amit Chowdhry ● July 22, 2021
  • The stock price of Seres Therapeutics Inc (NASDAQ: MCRB) fell by over 50% pre-market. This is why it happened.

The stock price of Seres Therapeutics Inc (NASDAQ: MCRB) – a leading microbiome therapeutics company-  fell by over 50% pre-market. Investors are responding negatively to Seres Therapeutics announcing topline results from the Phase 2b ECO-RESET study evaluating SER-287 in patients with mild-to-moderate ulcerative colitis (UC). This study did not meet its primary endpoint of improving clinical remission rates compared to placebo. And both dosing regimens of SER-287 were generally well tolerated. Given the lack of a clinical efficacy signal identified in ECO-RESET, the Company has decided to close the open-label and maintenance portions of the study.

The primary objective of the induction portion of the Phase 2b study was for evaluating the safety and efficacy of SER-287 after 10 weeks of induction dosing (following vancomycin pre-conditioning) in achieving clinical remission in participants with mild-to-moderate UC. And the trial was a randomized, placebo controlled, double blind, parallel group multicenter study — which enrolled 203 UC patients in 104 sites throughout the U.S. and Canada. 

The dosing was explored in two SER-287 cohorts (full induction dose and step-down induction dose) or placebo (randomized 1:1:1). And clinical remission was analyzed and defined by a 3-component modified Mayo Score. No meaningful clinical differences and no statistical significance were observed in absolute clinical remission rates among the 3 treatment arms (10.3% for the full induction dose, n=68 and 10.6% for the step-down induction dose, n=66 versus 11.6% for placebo, n=69). There were also no meaningful differences observed across the three treatment groups for endoscopic improvement, endoscopic remission or symptomatic remission.

Treatment-emergent adverse events (AEs) were observed in 67.6%, 46.2% and 50.7% of subjects in the induction dose, step-down dose (both of which included six days of oral vancomycin preconditioning) and placebo treatment arms, respectively. And the majority of observed AEs were mild or moderate in intensity. The most commonly observed AEs were worsening of UC, diarrhea, nausea and abdominal distension. Four participants on active treatment reported serious treatment-emergent adverse events (worsening ulcerative colitis, colonic dysplasia, congestive heart failure with decreased hemoglobin, and appendicitis), as did one on placebo (worsening ulcerative colitis).

The company is continuing to advance its SER-301 program currently in a Phase 1b study that is testing the hypothesis that engraftment of drug product species modulates microbe-associated metabolites to reduce intestinal inflammation and improve epithelial barrier integrity in adults with mild-to-moderate UC. And the Phase 1b is currently enrolling in Australia and New Zealand.

SER-287 and SER-301 are both consortia of bacteria found in the gastrointestinal tract of healthy individuals. But important compositional and potential therapeutic differences exist between the investigational drugs. And SER-287 is a donor-derived product candidate, whereas SER-301 utilizes Seres’ next-generation technology and is based on rationally designed, cultivated consortia of bacteria. 

The design of SER-301 has utilized the company’s reverse translation platforms and capabilities that can evaluate at high resolution how microbes in the gastrointestinal tract are interacting with one another and human cells and tissues to impact disease pathways. And the bacteria in SER-301 are targeted at, and specifically selected in, an effort to optimize the reduction of pro-inflammatory activity, improve epithelial barrier integrity and TNF-a driven inflammation in intestinal epithelial cells, and modulate UC-relevant anti-inflammatory, innate, and adaptive immune pathways.

And the results from the SER-287 ECO-RESET study — including additional efficacy and safety results as well as microbiome analyses — will be submitted for presentation at a future scientific meeting.

As of June 30, 2021, Seres had about $229 million in cash, cash equivalents, and marketable securities. And the June 30, 2021 cash balance does not include the upfront fee of $175 million that has been received by Seres following the SER-109 Co-Commercialization License Agreement announced on July 1, 2021 with Nestlé Health Science.

KEY QUOTE:

“While these outcomes were not what we, nor the UC community, were hoping for, we remain committed to leading the creation of a new class of medicines designed to impact how diseases like ulcerative colitis are treated. As with SER-109, we will again follow the science and the data, conduct a rigorous scientific analysis, and determine the optimal path forward for our UC franchise. We are well resourced and continue to prepare for SER-109 commercialization, in collaboration with Nestlé Health Science, and we are excited about advancing the development of our SER-301 and SER-155 investigational candidates as well as our earlier stage pipeline.”

— Eric Shaff, Chief Executive Officer at Seres

“While the efficacy results in this trial did not meet the pre-defined threshold, we believe this data-rich study, including microbiome analyses expected in the second half of 2021, will provide valuable insights to inform continued development of our pipeline, including SER-301, our next generation investigational candidate for UC. We are grateful for everyone who made this study possible, including the study investigators, and in particular, the patients and their families.”

— Lisa von Moltke, M.D., Chief Medical Officer at Seres

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