Seres Therapeutics Inc Stock

Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Seres Therapeutics webcast to discuss recent clinical studies results. [Operator Instructions] It is now my pleasure to turn the call over to Carlo Tanzi, Kendall's Investor Relations. Please go ahead.

Thank you, operator. Earlier today, Seres announced promising results from the investigator-sponsored trial, or IST, of SER-155 in immune checkpoint inhibitor-related enterocolitis or irEC, conducted at Memorial Sloan Kettering Cancer Center, or MSK.

We have posted slides to the Investors section of the Seres website, which we'll review on today's call. As noted, we will be making forward-looking statements on today's call, including regarding our pipeline, potential applications for our drug candidates, clinical development plans, potential partnerships and financing strategies and other matters, which are subject to risks and uncertainties as described in the company's SEC filings and as noted on this slide.

Seres undertakes no obligation to update forward-looking statements, except as required by law. Speaking on today's call are Richard Kender, Executive Chairman and Interim CEO; Dr. Matthew Henn, Seres President and CSO; and Kelly Brady, EVP and COO. Dr. Jonathan Peled, a bone marrow transplant specialist and cellular therapist at MSK will also join the call. Marella Thorell, EVP and CFO; and Dennis Walling, SVP, Clinical Development, will be available for Q&A. I'll now pass the call over to Rich.

Good morning. Thank you for joining us. We are excited to report promising new clinical data that we believe expands the opportunity for Seres Live Biotherapeutics as a fundamental component of cancer care.

Memorial Sloan Kettering Cancer Center, one of the world's leading institutions devoted to cancer treatment has worked in collaboration with Seres for over a decade. And this partnership has advanced our understanding of the importance of gut microbes to human health and importantly, has helped translate these learnings into improved outcomes for oncology patients.

I want to thank the patients and the investigators involved in this study for aiding in these efforts. We believe the results of this IST support the potential of SER-155 to provide a differentiated non-immunosuppressive approach to treat irEC and importantly, to allow cancer patients to remain on their life-saving immune checkpoint inhibitor, which is often discontinued as a result of irEC.

With that, I'll turn the call over to Kelly to describe the ICI patient journey and share the study results. Kelly?

Thank you, Rich. Starting on Slide 3, immune checkpoint inhibitors, commonly known as ICIs are a widely and increasingly used class of cancer therapy because they are effective in a range of solid tumors. ICIs work by interacting with the immune system.

The immune system has built-in breaks that prevent immune cells from overreacting. Cancer tumor cells exploit these breaks by expressing various proteins to hide from the immune system. ICIs unmask the cancer cells so that the immune system is activated and amplified and can recognize and attack cancer tumors. Unfortunately, the immune system activated by ICIs can often also attack healthy tissue, including in the gut, leading to a serious side effect called immune checkpoint inhibitor-related enterocolitis, or irEC, also referred to as immune-mediated colitis.

For the patient, irEC typically results in diarrhea, abdominal pain, colitis or inflammation of the intestine and blood and stool and can significantly affect quality of life and in some cases, progress to costly patient hospitalizations and serious or life-threatening consequences. irEC incidence rates vary by ICI type and regimen.

Moderate to severe irEC classified as Grades 2 to 3 occurs in approximately 25% of all ICI recipients, which in the U.S. alone equates to an estimated 75,000 patients or 1/4 of the 300,000 patients estimated to be on ICIs in 2026.

And the use of ICIs is growing as the types and stages of cancer, which are eligible for treatments with ICIs is also expanding. Devastatingly, while ICIs work well, guidelines stipulate that patients who are afflicted with moderate to severe irEC must halt their ICI therapy and initiate immunosuppressive corticosteroids.

Moving to Slide 4. This is where SER-155 could potentially fill a significant gap for patients and clinicians in need. There are numerous clinically meaningful toxicities associated with current standard of care immunosuppressive, including systemic immunosuppression, increased infection risk and metabolic complications.

Additionally, the immunosuppression may negatively impact the anticancer effect of the ICI therapy and put cancer outcomes at risk for patients. Approximately 40% of these patients do not respond to systemic steroids and require escalation to biologics treatment, which may also be immunosuppressive.

This is why clinicians are seeking safe non-immunosuppressive solutions to treat irEC and get their patients back on the drugs to fight their cancer as quickly as possible. SER-155 is an oral treatment designed to repair the mucosal epithelial barrier and reduce the gastrointestinal inflammation, which underpins irEC and which Matt will discuss later and to do so without any negative interference with the immune system. Now that you have the context of the large unmet patient need, on Slide 5, we've summarized key results of the study.

First, we saw an impressive 80% immunosuppressive-free clinical response rate with 12 of the 15 participants treated with SER-155 achieving at least a 1 grade response in diarrhea, a common measure of irEC severity by day 15. As expected, based on our prior clinical study experience, SER-155 was generally well tolerated with no serious drug-related adverse events.

Importantly, we also observed pharmacology results that support the clinical outcomes, notably improved mucosal epithelial barrier function and reduced gut inflammation in a second indication, the first being in the strong study results from our Phase Ib of SER-155 in allo-HCT patients, which you may have previously seen.

The design of this study is described on Slide 6. It was an open-label Phase Ib trial conducted by MSK evaluating SER-155 in 15 participants with Grade 2 or Grade 3 irEC. As a reminder, that is moderate to severe, who had not yet received immunosuppressive therapy for their irEC. MSK is an institution with substantial expertise in managing immune-related gastrointestinal toxicities associated with checkpoint inhibitors.

The study's main clinical efficacy assessment was immunosuppressive-free clinical response at day 15, defined as at least a 1 grade improvement in diarrhea symptoms without corticosteroid or biologic immunosuppressive therapy. Safety and tolerability were also evaluated. Dosing of SER-155 was a convenient 2 capsules once a day for 12 consecutive days.

As noted on Slide 7, the enrolled population reflected a clinically representative irEC population and included participants with a range of underlying cancers and most at later stages 3 and 4. A wide range of prior ICI treatment regimens, including PD-1 inhibitors such as KEYTRUDA, Opdivo, Zynz, PD-L1 inhibitors such as Imfinzi, BAVENCIO, CTLA-4 inhibitors such as Yervoy, Imjudo and LAG-3 inhibitors such as Opdualag were represented in this study.

Notably, 60% of participants entered the study with debilitating Grade 3 diarrhea, reflecting a severe form of irEC. There was strong compliance with the SER-155 dosing regimen. We will speak about ICI therapy interruption next. As you can see on Slide 8, irEC diarrhea grades range from low Grade 1 to moderate to severe Grades 2 to 3 to progression to Grades 4 to 5, resulting in life-threatening complications or death, respectively.

While Grade 1 is managed with only symptomatic care, importantly, as noted previously, the treatment guidelines for Grade 2 or higher dictate halting the patient's ICI therapy. This practice was borne out in the ISP as we noted that 14 of 15 study participants or 93% had their ICI therapy interrupted prior to study entry as a result of their irEC.

Additionally, a post-hoc observation in the study found that a portion of participants returned to their ICI therapy through day 43 of the study, and Seres expects to analyze ICI administration in a future study. Grades 2 through 4 irEC also require medical intervention with the current standard of care, which is immunosuppressive therapy such as corticosteroids or biologics.

Patients with more severe forms of irEC can require hospitalization, and this can certainly have a significant impact on the patient's quality of life. Digging a bit deeper into the results on Slide 9. As noted earlier, at day 15, the primary endpoint, 80% or 12 of the 15 participants achieved immunosuppressive-free clinical response following SER-155 dosing.

Further, 33% or 5 of the 15 participants, which represents 42% of the 12 responders achieved immunosuppressive-free complete clinical remission, defined as full resolution of diarrhea symptoms down to Grade 0 without immunosuppressive therapy. A few more details worth noting are the speed of response, 11 of 12 responders showed improvement by day 8 and the magnitude of response, 8 of 12 responders improved by 2 or more grades by day 15.

Slide 10 shows the day 43 clinical results. Importantly, all 12 responders at day 15 remained at the same diarrhea grade or better as of day 43. 5 of 15 participants maintained immunosuppressive-free response, 2 of whom remained in clinical remission, which is a Grade 0 and 3 of whom remained a Grade 1.

We believe these results are highly encouraging because they suggest that SER-155 improves irEC symptoms without requiring immunosuppression over a period of time. The 7 of 15 remaining day 15 responders maintained their clinical response at day 43. These patients received nonsystemically acting gastrointestinal targeted immunosuppressive for mild residual or moderate recurrent symptoms.

Importantly, these data suggest that SER-155 has potential to help patients avoid the use of high-dose systemic corticosteroids and address the unmet medical need in irEC. Turning briefly to safety on Slide 11, SER-155 was well tolerated through day 43. There were no serious adverse events assessed as related to SER-155 and no bloodstream infections were reported.

Two participants experienced nonserious adverse events assessed as possibly related to vancomycin and SER-155, and those events were moderate in severity and resolved. In summary, taken together, we believe these clinical and safety results support the potential of SER-155 as a differentiated nonimmunosuppressive therapeutic approach in irEC, which could allow patients to remain on their ICI cancer drugs and potentially benefit to a greater degree from the immune therapy. With that, I'll hand the call over to Matt. Matt?

Thank you, Kelly. Moving to Slide 12. In addition to the clinical observations, we were also pleased with the pharmacology and translational results from the study, which provide important biological support for the observed clinical activity of SER-155. I'll start by explaining more about the functional properties that SER-155 was optimized to target and how the clinical pharmacology results support that it's working as intended.

Notably, in cancer patients, different stressors, for example, chemotherapy or as in the case of immune checkpoint inhibitor therapy, the activation and amplification of T cells and macrophages can damage the cells that create the mucosal epithelial barrier in the gastrointestinal tract, and this damage leads to gastrointestinal inflammation and the further exacerbation as such by various inflammatory cellular products and potentially harmful bacteria present in the gut.

In addition, in certain high-risk patient populations, mucosal epithelial barrier compromise can lead to infections. SER-155 is a live biotherapeutic that was designed to prevent the translocation of gastrointestinal pathogens and resulting bloodstream infections in allogeneic hematopoietic stem cell transplant or allo-HSCT patients.

Mechanistically, to achieve this, the SER-155 bacterial consortia was optimized to include bacteria that Seres has identified to be potent producers of metabolites that promote mucosal epithelial barrier integrity and that can modulate immune responses without immunosuppression and in addition, include bacteria that can prevent the colonization of harmful bacterial pathogens in the gut.

Importantly, the targets of Seres biotherapeutics are key upstream drivers of inflammatory and immune diseases that existing drugs do not target. In Seres' previous Phase Ib study of SER-155 for the prevention of bloodstream infections in allo-HSCT patients, biomarker data demonstrated clinical translation on all of the above-noted mechanisms of action, including protection and repair of the mucosal epithelial barrier and immune modulation linked to anti-inflammatory outcomes.

In that study, these pharmacology data supported the observed clinical results, a strong 77% relative risk reduction in bloodstream infections for those participants who received SER-155, results that led to the FDA granting breakthrough therapy designation to SER-155 and also the acceptance of these study results for publication in Nature Medicine in a coming future issue.

MSK was a collaborator on our SER-155 Phase Ib allo-HSCT study and the results from this study, along with the significant unmet medical need for a new solution in treating irEC motivated the irEC investigator-sponsored study. Turning to the irEC study pharmacology results on Slide 13. Consistent with prior SER-155 studies, the majority of SER-155 strains colonized and took root in the gut, i.e., engrafted across all patients.

The engraftment profile was consistent with what we have previously observed in the allo-HCT setting. These data support and reinforce the robustness and reproducibility of SER-155 pharmacokinetics. Turning to the drug's pharmacodynamics. SER-155 could be a highly differentiated therapeutic option for irEC that addresses current standard of care limitations. The translational analysis from this study support that rationale.

At baseline, participants showed evidence of epithelial barrier disruption and severe gastrointestinal inflammation as evidenced in the biomarkers fecal albumin and fecal calprotectin, respectively. Fecal albumin is a biomarker that indicates protein leakage from the bloodstream into the gut lumen and provides direct evidence of mucosal epithelial barrier compromise. Fecal calprotectin is a well-established clinical biomarker of immune activation that indicates the presence of activated neutrophils in the intestinal mucosa.

At study entry, participants had elevated fecal albumin and calprotectin levels that are characteristic of individuals with colitis. Following SER-155 treatment, both albumin and calprotectin biomarkers showed early, durable and concordant reductions over time with significant reductions in both measures achieved by day 43, reflecting consistent improvement across 2 mechanistically linked dimensions of irEC disease.

These biomarker improvements were directionally consistent with the clinical observations and provide additional support for SER-155's potential biological activity in this disease setting. Importantly, the pharmacological and translational results suggest that SER-155 may act on core disease-relevant biology rather than simply produce a symptomatic effect.

As noted on Slide 14, Seres has pioneered a new drug modality to access the vast therapeutic potential of microbes. We have a track record of success with achieving FDA licensure of VOWST and are advancing innovative technologies as supported by multiple breakthrough therapy designations. More importantly, we view the irEC study results as supporting the potential of SER-155 and Seres live biotherapeutic technology across diseases characterized by microbiome functional disruption and resulting mucosal epithelial barrier dysfunction and inflammatory dysregulation.

We are focused currently as a company on addressing unmet medical needs in oncology and inflammatory and immune diseases, where we think our drugs are uniquely positioned. As noted on Slide 15, mucosal epithelial barrier disruption is increasingly recognized as an important driver across multiple inflammatory, immune, infectious and oncology-related conditions. By therapeutically modulating the gastrointestinal microenvironment, supporting mucosal healing and reducing inflammatory responses of immune cells, in other words, inducing immune homeostasis, rationally designed live biotherapeutics may address clinically meaningful disease biology in ways that are distinct from conventional immunosuppressive therapies.

Over time, this biology could have relevance beyond irEC, including in other oncology settings, inflammatory bowel disease, the focus of SER-603 program, infection-associated complications and additional inflammatory and immune disorders. In closing, as noted on Slide 16, we believe the results of the investigator-sponsored trial reviewed today are an important milestone for Seres that represent a potentially meaningful opportunity for patients undergoing cancer therapies.

Immune checkpoint inhibitor drugs have revolutionized cancer treatment and are sizable, valued at over $50 billion globally in 2025 and growing drug class. Estimates of the annual growth rate of ICIs range from mid- to high double digits over the next 5 to 10 years, driven by broadening eligibility for ICI therapy across multiple cancer types, earlier intervention and use of ICIs in combination with other cancer therapies and increasing global cancer rates.

Unfortunately, many patients develop debilitating immune-related ulcerative colitis, which the current standard of care does not meet the medical needs and can lead to disruption of life-extending cancer treatment. SER-155 could offer a unique solution to irEC with a demonstrated potential to broadly achieve immunosuppressive-free treatment and prevent the halting of life-saving cancer therapies. With that, I'll turn the call back to Rich.

Thank you, Matt. As we evaluate next steps in the development of SER-155 for irEC and in our Phase II ready program for allo-HCT, we believe this study data will strengthen our ongoing engagement with potential strategic counterparties and financial partners, including those interested in finding solutions to both improve outcomes for oncology patients and enhance the use of ICIs as well as those who want to address broader inflammatory and immune diseases.

Before we open the line for questions, I would like to introduce Dr. Jonathan Peled from Memorial Sloan Kettering and express my appreciation for the great work he and his colleagues are doing to advance cancer care and improve patient outcomes. Dr. Peled, I know I speak for everyone at Seres and appreciation for you taking the time to join this call.

Thank you very much, Rich. Happy to be here.

Thank you. Dr. Peled, I'd like to ask you to comment on MSK's experience with ICIs and irEC and given your experience working with Seres on clinical studies to share your thoughts on the potential for SER-155 in irEC and beyond.

Sure thing. We've been -- as was mentioned, we've been collaborating for many years working on this. And the gut barrier is really where the microbiome and the immune system meet one another with just a single cell layer between them.

And this is a really critically important part of the body for human health in cancer treatment and infectious disease and in many other inflammatory diseases. But it's really largely inaccessible to many drugs and the drugs that are used often have a lot of side effects. I think that SER-155 as a ligand therapeutic is really novel and its ability and unique in its ability to target and modulate the gut community of bacteria and the biology that's happening in the intestine.

And there are really 2 clinical settings where we've seen that we can already make an impact. As your colleagues mentioned, in the prior study that we collaborated on, which was placebo-controlled, we showed that we could reduce the risk of bloodstream infections during bone marrow transplantation. And in the current study, we now have this really promising signal about attenuating the inflammation, the colitis and the diarrhea that can complicate cancer immunotherapy. This was briefly mentioned earlier, but I just want to underline the point that the current standard approach to this complication of the cancer therapy, which is steroids are really an inadequate answer for our patients mostly because of the immunosuppression [indiscernible] can cause and the risk of infection, but also because of the treatment interruptions.

So the cancer patients are not only feeling miserable from their diarrhea, but they have to pause their life-saving treatment for their underlying cancer.

So the idea that we could administer an optimally designed consortium of bacterial strains that can produce the right blend of metabolites, promote the barrier function of the gut, outcompete pathogens and potentially reset homeostasis in the gut is really exciting because this can potentially allow our patients to stay on their life-saving cancer treatment and deal with this very serious side effect while avoiding the side effects and the immunosuppression of the steroids. I'll just mention one other thing, which is that I think there are a lot of other clinical settings where if we could improve gut barrier function, it could really be transformative even outside of the very specific clinical settings that we've currently studied this drug in together, inflammatory bowel disease, patients in the intensive care unit, the neutropenia that accompanies conventional cancer treatment with chemotherapy and cellular therapy to name just a few. So I think there's enormous potential here.

Thank you, Dr. Peled. We appreciate your thoughts. Operator, we can now open the line for questions.

[Operator Instructions] Our first question comes from the line of John Newman with Canaccord Genuity.

Congrats on really, really interesting data here. It could be a start of a new treatment paradigm to manage this issue. You may have mentioned this on the call, but I'm just curious, in your study, were there any patients that were actually able to resume their immune checkpoint inhibitor therapy during the study?

John, thank you for the question. Yes, as a reminder, and we did mention it that of the 15 patients who enrolled on this study, 14 of 15 participants had their immune checkpoint inhibitor interrupted at study entry. Though it was a post-hoc observation, we did observe that a portion of participants were able to return to their immune checkpoint inhibitor through day 43.

And we did not observe that the immune checkpoint inhibitor had an impact on the diarrhea response at either day 15 or day 43. And we will absolutely look at ICI administration and analysis as part of our future study planning. Thanks, John.

Sure. I just had one additional question. Just curious as to what the next steps are here for the program. And in particular, I'm curious in the future, might you consider a study where you start the administration of SER-155 in conjunction with the checkpoint inhibitors rather than here where it seems like you have treated only the patients that have irEC.

Great question, John. I will start, and then I will ask some of my colleagues, potentially Marella and Matt to jump in. So first of all, based on the promising Phase Ib data that we talked about today and as we consider the clinical development path and life cycle management for SER-155, we would strongly consider studying 155 as a prophylactic medication to prevent irEC with the goal of allowing patients to stay on ICI without toxicity.

As we think about the immediate next studies, we are aware, though, of course, that prevention trials sometimes are larger. So as we think about the immediate next steps, which are supported by the robust efficacy we saw at day 15, the strong safety, the strong PK/PD, we have anticipated a modestly sized Phase II trial of approximately 100 to 150 patients that would look at treatment of irEC with SER-155 utilizing similarly timed endpoints for a timely readout and in collaboration with our strong cancer centers like MSK and other relationships that we have.

And so we feel confident that we have the regulatory efficiency as in the FDA relationship, the background of our breakthrough designation for SER-155 in allo-HCT. Now we have the experience of a second derisked indication for SER-155, and we have manufacturing efficiency as well with the work we've done for allo-HCT.

So we think this sets us up for a well-powered Phase II for treatment of irEC, but we will absolutely be considering opportunities to expand this in the future to prophylactic approach, which would be a huge asset for this cancer population.

And John, let me add one quick point here, too. So keep in mind, as we've noted, our technology really works on the upstream causes of inflammation and barrier compromise. And so when you start to think about that potential, not just as a treatment paradigm, but in the context of prevention, it becomes very, very powerful because we're upstream of where a lot of different drugs operate. And maybe I'll ask Dr. Peled as well to comment on the clinical value from thinking about future prevention opportunities.

Thank you, Matt. I would say that I think a preventative approach would be very welcome in our field, especially with something that is well tolerated. There's also another opportunity baked in with that idea. There are a lot of studies coming out lately that correlate microbiome features in the gut with the response of tumors to the checkpoint drugs in the first place.

So if something like SER-155 would be deployed with an intention to prevent colitis, there could be opportunities to study effects on tumor responses at the same time if patients would be getting this kind of microbiome modulation the entire time they're getting checkpoint blockade. So it's a tremendous opportunity, and I think it could be very interesting.

And your next question comes from the line of Matthew Keller with H.C. Wainwright.

Congrats on the data. So I have to do particularly with the durability. I was wondering maybe you guys could provide a little more color or what your thoughts are on why some patients may have experienced a more durable response than others? And then a follow-up to that is, how do you think the biomarker data that you guys collected fit into that observation as well?

Yes. Thanks so much for the question, Matt. I will start off with some comments, and then I will turn it over to Matt to speak to the biomarker results. So first, again, I want to emphasize that we are encouraged with the robust response we saw at day 15, especially in absence of immunosuppressant and the magnitude of that response as well in that majority of patients had 2 grade response, and it was occurring early.

We also see that 1/3 of participants remained in immunosuppressive-free response weeks after completing SER-155. And as we noted as we went through the slides, a portion of those participants that achieved immunosuppressive-free response at day 15, when they received an immunosuppressive, the immunosuppressives they received after day 15 were only nonsystemically GI-targeted immunosuppressives.

And that was for either mild residual Grade 1 or some moderate recurrence. It was well managed and then those patients got back to their responses at day 43. So this suggests a trend that 155 may support a reduction of reliance on these high-dose systemic immunosuppressives.

And as with any Phase I study, as you may imagine, we are digging into each and every patient's clinical journey, looking at their engraftment, their symptoms, their immune checkpoint inhibitor return, if it did occur, the biomarkers to inform dosing for the next study as well as the efficacy endpoints after SER-155 administration.

So we remain encouraged and have some work to do to continue to analyze these patients. Matt, do you want to speak to the PK/PD results and the biomarker results in context of Matt's question?

Yes. Thanks, Kelly. Matt, and thanks for your question. Seres has always invested and done the work to build a translationally rich clinical studies. And the biomarker data, I think, is particularly important generally and specifically for your question. So as I noted on the call, we really saw highly elevated levels, particularly of fecal calprotectin at study entry. And as I said, we see the reduction in that over time. What I think is interesting is that we saw those reductions in the fecal calprotectin, a well-established marker of inflammation very, very rapidly and quickly soon after dosing.

And importantly, even in the patients that required immunosuppressive treatment later by the nonsystemic corticosteroids, as Kelly had mentioned, we didn't see further improvement in their calprotectin scores put on those immunosuppressants. So in other words, it looks like SER-155 already got them down to levels of fecal calprotectin that would be considered at the level of actually mucosal healing based on clinical precedents.

So we're really encouraged by the calprotectin results from the study, and we think they strongly support the clinical observations.

And with that, I will now turn the call back over to management for closing remarks.

Thank you very much. We hope everyone has a great day.

Thank you again for joining us today. This does conclude today's conference call. You may now disconnect.

Thank you for standing by. At this time, I would like to welcome everyone to the Seres Therapeutics Corporate Update Conference Call. [Operator Instructions]

I would now like to turn the conference over to Dr. Carlo Tanzi of Investor Relations. You may begin.

Thank you, and good morning.

Before we begin, I'd like to remind everyone that we will be making forward-looking statements, including statements regarding the impact of our recent management transitions and appointments, our strategy, clinical development plans, anticipated data readouts, regulatory interactions, efforts to secure funding and/or partnerships, operating plans, our drug candidates and their potential impacts and outcomes and our expected cash runway. These statements are subject to risks and uncertainties described in our SEC filings. Actual results may differ materially. We undertake no obligation to update these statements, except as required by law.

On today's call, prepared remarks will be made by Richard Kender, Executive Chair and Interim Chief Executive Officer; Dr. Matthew Henn, President and Chief Scientific Officer; Kelly Brady, Chief Operating Officer; and Marella Thorell, Chief Financial Officer. Additional members of the management team will be available for Q&A.

With that, I'll turn the call over to Rich.

Thank you, Carlo, and good morning, everyone. I am very pleased to be leading Seres at this important time. As a long time Board member serving more than 11 years, I've had the opportunity to closely observe the evolution of the company's live biotherapeutic platform and pipeline and witnessed the difference our drugs and drug candidates have made for patients and see the scientific rigor of our underlying programs. I know the Seres leadership team well. I understand the strong capabilities of the organization, and I am confident in the numerous opportunities to leverage our platform to deliver significant impact and in some cases, life-saving therapies to patients.

I accepted this role because I believe and the company has differentiated science with the potential to address important unmet medical needs in a fundamentally novel way. My 35 years in biopharma, including a career at Merck and a role spanning M&A, licensing, financial evaluation and analysis and global competitive intelligence as well as my experience in navigating complexities and biotechs both numerous public and private company boards, which have positioned me well to lead Seres on our mission.

I am pleased to work closely with the Seres executive team, including Matt Henn in his new role as President and CSO; Kelly Brady, newly appointed COO; and Tom and Marella, who have provided strong leadership to Seres through the strategic shift, along with the rest of the Seres leadership team.

Since the company's founding 15 years ago by flagship pioneering, Seres has built a differentiated, field-leading and proven scientific foundation on which to advance drugs that harness the therapeutic potential of microbiomes. The development, FDA approval and the launch of VOWST, the first-ever oral micro biotherapeutic validated the platform and demonstrated both the company and team's ability to navigate the complex regulatory pathway required for novel therapeutic modality.

Kelly, Matt and our current leaders in manufacturing, quality, regulatory, medical affairs and R&D were instrumental in getting VOWST from the concept to the market. So we will benefit from their experiences, establishing Seres core live biotherapeutic technology and navigating the approval pathway to the novel mortality as we advance our early-stage programs.

Our strategy is focused and disciplined, centered on advancing live biotherapeutic programs supported by strong scientific rationale and clear commercial potential. A key priority continues to be securing funding for our programs, including potential collaborations with organizations aligned with our vision to advance these programs efficiently and to drive long-term value for shareholders.

As we move forward, we will focus on our promising live biotherapeutic programs in inflammatory and immune disease. In the near-term, we are supporting the upcoming readout of the ongoing fully enrolled investigator-sponsored SER-155 study with Memorial Sloan Kettering Cancer Center, evaluating patients with immune checkpoint inhibitor-related enterocolitis or irEC. We look forward to these clinical data in the second quarter of this year. This indication is among the most frequent and severe immune-related adverse events observed in recipients of immune checkpoint inhibitor or ICI therapy and could represent an important therapeutic and commercial opportunity for Seres.

Immunotherapeutics are commonly used across tumor types, representing a landmark innovation in cancer treatment. The best-selling drug in this space, Merck's KEYTRUDA alone reached $32 billion in global sales in 2025, highlighting the magnitude of ICIs and therefore, the potential scope of the need for irEC therapies.

Turning to our SER-603 program. In a moment, Matt will share more about the potential of this asset in IBD and potential collaboration opportunities. Given the chronic nature of IBD, the size of the market and the continued unmet need for safe, durable non-immunosuppressive treatment options, we believe SER-603 has the potential to address a substantial commercial opportunity.

Over the past year, as Kelly will further elaborate on, Seres has made excellent progress with Phase II readiness activities to support the further development of SER-155 to prevent bloodstream infections in patients undergoing allo-HSC (sic) [ allo-HSCT ] treatment. With strong Phase Ib data underscoring the clinical rationale and supportive from KOLs as to the need to address inadequate options for preventing bloodstream infections in patients receiving transplants to treat blood cancers, we continue to work to secure funding to initiate that study.

With that, I'll turn it over to Matt.

Thank you, Rich. In connection with our strategic focus, I'm pleased to assume the role of President alongside my responsibilities as Chief Scientific Officers and collaborate with Rich and the rest of the executive team to successfully advance getting our innovative drug technology to patients with significant unmet medical needs. Our early-stage pipeline programs are focused on inflammatory and immune diseases, or I&I, with a primary focus to date on inflammatory bowel disease, or IBD, and immune-related enterocolitis or irEC. Kelly will speak about our investigator-sponsored trial in irEC at Memorial Sloan Kettering Cancer Center in just a moment.

A key element of our pipeline strategy is advancing SER-603, a preclinical stage biotherapeutic product or LBP candidate, optimized to address disruptions in the GI microbiome and improve mucosal barrier integrity, key drivers of inflammation in IBD patients that are not currently targeted by existing therapeutics.

SER-603 is designed to inhibit inflammatory bacteria and their associated metabolites to promote epithelial barrier integrity to reduce the translocation of inflammatory molecules and barrier inflammation and to promote immune homeostasis by inducing non-immunosuppressive T regulatory cell responses. Many IBD patients experienced an efficacy ceiling due to nonresponse or poor durability of response to existing therapies. And further, most approved therapies target downstream inflammatory and immune responses.

In addition, the majority of these approaches are immunosuppressive, leading to toxicities and limitations of use in combination therapy. We believe that SER-603 has the potential to serve as a non-immunosuppressive treatment option for I&I diseases linked to colitis. We believe the therapeutic opportunity could be substantial with the ability to target causes of inflammation that are not currently addressed with existing therapies, utilizing both mono and combination therapy strategies without the potential added risk of increased toxicity.

Our research to date on SER-603 has been primarily supported through a partnership with the Crohn's and Colitis Foundation, and we continue to explore additional opportunities for collaborations with other entities, particularly those with an established franchise in IBD. We are currently conducting IND-enabling activities for SER-603 as we plan for further development of this program.

I'd also like to note that Seres continues to have a highly productive, long-standing collaboration with the combating antibiotic-resistant bacteria accelerator, also known as CARB-X. With their support, we are progressing the development of an oral liquid formulation of an LBP based on SER-155 strains for patients unable to take capsules, including ICU patients and other medically vulnerable populations at high risk of antimicrobial-resistant infections. Progressing liquid formulation technologies could have broad applicability with benefits not just in infection, but also in the context of the treatment of pediatric and I&I patients.

I'll now turn the call over to Kelly to provide an update on our clinical activities.

Thanks, Matt. In terms of current clinical activities, we have an ongoing investigator-sponsored trial of SER-155 in patients with irEC being conducted in collaboration with Memorial Sloan Kettering or MSK Cancer Center. We have been collaborating with MSK for over a decade on the impact of the gastrointestinal microbiome on immune-related diseases and cancer, and we are very pleased to leverage their expertise in this study.

The SER-155 irEC study is now fully enrolled with 15 participants and clinical data are on track for release in Q2. The readout is expected to include initial safety, efficacy, pharmacology and exploratory biomarker data. We also expect to prepare a historical reference cohort with MSK to contextualize the data readout. These data have the potential to clarify the opportunity for SER-155 in both irEC as well as more broadly in other applications.

irEC is a major clinical problem faced by many cancer patients and is among the most frequent and severe immune-related adverse events seen in recipients of ICI therapy. This complication is observed in up to 50% of ICI patients with rates varying based on cancer drug and treatment regimen. Current treatment approaches for irEC include immunosuppressive steroids, which have significant limitations, including toxicity and the potential reduction of antitumor efficacy as patients come off their checkpoint inhibitor therapy.

SER-155 is designed to allow patients to remain on or reintroduce ICI therapy while avoiding systemic immunosuppression. Links between the microbiome and response to ICI therapy as well as incidence of colitis have been established in the literature and live biotherapeutics targeting the microbiome such as SER-155 may uniquely address gut epithelial barrier integrity, offering a novel solution.

I am also pleased to report progress on our SER-155 allo-HCT Phase II preparation efforts. Our interest in advancing SER-155 in this setting is grounded in the prior clinical results demonstrating a 77% relative risk reduction in bloodstream infections, accompanied by consistent biomarker findings and a well-tolerated safety profile. Based on these positive data and the significant unmet need, SER-155 has received breakthrough therapy designation, which has facilitated our subsequent interactions with the FDA.

Over the past year, our team has made meaningful progress on Phase II preparatory activities. This includes achieving key milestones such as submitting the final study protocol to the FDA, along with selecting our CRO, engaging with and evaluating potential clinical study sites globally and manufacturing drug substance for the study. Importantly, while we have paused further investment at this time in these start-up activities, we have paused the program at a point that preserves value and the ability to efficiently advance the study in the future.

Based on our progress, we believe that pending receipt of funding support, we are well prepared to resume the work required to initiate the planned Phase II study. Following study initiation, we believe we can obtain the interim clinical results from the Phase II study within 12 months of first patient. Positive results from this study, if achieved, could enable timely engagement with the FDA and advancement into a single Phase III trial to support registration.

I will now pass the call to Marella.

Thanks, Kelly. We plan to report our fourth quarter and full year 2025 financial results via press release next week, so I won't discuss those details today. However, I do want to provide an update on our cash position and runway. As of December 31, 2025, Seres had approximately $45.8 million in cash and cash equivalents, which includes net proceeds of approximately $12.2 million raised in the fourth quarter of 2025 through the company's at-the-market equity offering program.

As recently announced, we have taken action to decrease our operating costs, including a reduction in our workforce. Based on the current cash position and future operating plans, we expect to fund operations through the third quarter of this year. We continue to evaluate additional opportunities to extend our cash runway.

I'll now return the call to Rich.

Thank you, Marella. As you have heard from Matt, Kelly and Marella, Seres is executing a focused strategy across our live biotherapeutic platform and managing our financial resources and team efforts in line with the strategy. We remain committed to advancing our inflammatory and immune programs while preparing for the upcoming irEC clinical data expected in 2Q this year.

Our immediate priority is to establish a collaboration that supports the continued advancement of our pipeline towards meaningful development milestones with the goal of delivering differentiated medicines and creating durable shareholder value.

Operator, please open the line for questions.

[Operator Instructions] There are no questions at this time. I will turn the call back over to the management for closing remarks.

Thank you for joining the call today. Have a good day.

That concludes today's call. Thank you all for joining, and you may now disconnect.

Good day, everyone, and thank you for standing by. My name is RG, and I will be your conference operator today. At this time, I would like to welcome everyone to the Q3 2025 Seres Therapeutics Results and Business Updates. [Operator Instructions]

Thank you. I would now like to turn the call over to Dr. Carlo Tanzi of Investor Relations. Please go ahead.

Thank you, and good morning. Today, before market opened, we issued a press release with our third quarter 2025 financial results and business updates available on the Investors and News section of our website. We've also posted an updated corporate presentation.

Before we begin, I'd like to remind everyone that we will be making forward-looking statements, including statements around the results of our current or planned clinical trials, studies and data readouts, our product candidates and their potential benefits, development plans and potential commercial opportunities, interactions with and feedback from the FDA, our ability to secure an R&D or other partnership and/or generate or obtain additional capital, financing or other resources, our planned strategic focus and operating plans, cost reduction actions and anticipated benefits and cash runway, the timing of any of the foregoing and other statements which are not historical facts.

Actual results may differ materially due to various risks and uncertainties and other important factors described under Risk Factors in our recent SEC filings. We undertake no obligation to update these statements, except as required by law.

On today's call with prepared remarks are Marella Thorell, our Co-Chief Executive Officer and Chief Financial Officer; and Dr. Matthew Henn, our Chief Scientific Officer. Additional members of the management team, including Tom DesRosier, Co-CEO and Chief Legal Officer; Terri Young, Chief Commercial and Strategy Officer; and Dr. Dennis Walling, SVP of Clinical Development, will be available during the Q&A portion of the call.

And with that, I'll turn the call over to Marella.

Thank you, Carlo, and good morning, everyone. We made good progress during the quarter. Our immediate priority remains advancing SER-155, our lead investigational, oral, live biotherapeutic for the prevention of bloodstream infections, or BSIs, in adults undergoing allo-HSCT into a Phase II study. We believe that results in this study, if positive, could represent a very meaningful value creation event for the company.

SER-155 represents a first-in-class mechanistically differentiated approach to address infections, including bloodstream and antimicrobial resistant infections, which are among the causes of mortality in medically compromised patients.

In the Phase Ib study, treatment with SER-155 led to an impressive 77% relative risk reduction in bacterial bloodstream infections, along with decreased antibiotic exposure and febrile neutropenia. The therapy is designed to decolonize gastrointestinal pathogens, improve epithelial barrier integrity and restore immune balance, addressing root causes to prevent BSIs and therefore, reduce antibiotic use, antimicrobial resistance and often severe or fatal outcomes.

Based on our analysis of the commercial opportunity, we believe that SER-155 could transform how allo-HSCT patients are managed and result in meaningfully improved patient outcomes.

In September, we obtained further constructive feedback from the FDA on the SER-155 allo-HSCT program, which has received Breakthrough Therapy designation Phase II protocol. Based on the feedback received, we are pleased to have alignment on multiple key study parameters, including study size, dosing regimen, primary efficacy endpoint and the interim analysis plan. We do not believe there are any gating items to commencing the study from a protocol standpoint and are incorporating FDA feedback into the protocol.

Notably, given the planned study design and our experience in this therapeutic area, we expect to be able to efficiently generate Phase II data in allo-HSCT patients, and we estimate that we will obtain meaningful placebo-controlled clinical results from a planned interim analysis within 12 months of study initiation with commencement being funding dependent.

Beyond the initial allo-HSCT indication, we see significant expansion potential across other medically vulnerable populations, including autologous-HSCT patients, cancer patients with neutropenia, CAR-T therapy recipients and other medically compromised patients such as those in the ICU who face similar infection risks and unmet needs.

Collectively, these represent a multibillion-dollar commercial opportunity in patients facing high unmet need and where there has been limited therapeutic innovation.

As Matt will discuss, we also have an ongoing investigator-sponsored study at Memorial Sloan Kettering Cancer Center, evaluating SER-155 in an indication beyond infection that is of high interest, and we look forward to obtaining initial clinical results in early 2026 that may highlight the potential of SER-155 in immune-related negative clinical outcomes.

While we advance SER-155 Phase II study start-up activities, we continue our efforts to seek capital in order to initiate the study and support our broader portfolio of product candidates with applications in inflammatory diseases. Advancing SER-155 is our top priority, and we continue to strive to obtain the resources needed to move the program forward.

During the quarter, we also implemented targeted cost reduction measures, including a workforce reduction of approximately 25% to extend our cash runway and focus resources on core development priorities. We believe that the cost reduction actions, the resultant operating runway extension will provide us with additional opportunities to advance our strategic priorities.

With that, I'll turn it over to Matt.

Thank you, Marella. Seres continues to execute its R&D strategy with efficiency and discipline with a focus on expanding the reach of SER-155 and building on key clinical insights to advance our broader biotherapeutic pipeline.

Our recent successes in clinical translation and leveraging external collaborations as well as securing non-dilutive funding allows us to evaluate important new opportunities for SER-155 in additional patient populations.

We are thrilled to have recently announced that Seres has received a non-dilutive award from the Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator or CARB-X, of up to $3.6 million. This award represents the second CARB-X grant to Seres and will support the development of an oral liquid formulation of SER-155, which is intended to expand future access to this biotherapeutic in medically vulnerable patients who cannot easily swallow capsules, including patients in intensive care units and some pediatric and elderly patients.

Furthermore, we believe that this CARB-X award underscores the global recognition of the potential of our biotherapeutic approach to address antimicrobial resistance, a major global public health issue and a top strategic priority for CARB-X.

Additionally, at the recent IDWeek conference, Seres presented new post-hoc analyses from our SER-155 Phase Ib study in allo-HSCT, which provided deeper insights into bloodstream infection patterns, antimicrobial resistance and clinical outcomes across treatment groups. These data further support SER-155's differentiated mechanism and its potential to reduce serious infections in patients with limited therapeutic options.

Also notably, our collaboration with Memorial Sloan Kettering Cancer Center on an investigator-sponsored trial initiated by a clinician evaluating SER-155 in patients with immune checkpoint inhibitor-related enterocolitis, or irEC, continues to progress, and the study is currently enrolling subjects.

irEC is among the most frequent and severe immune-related adverse events in recipients of immune checkpoint inhibitor therapy and can be observed in up to 50% of patients with rates varying based on cancer drug and treatment regimen.

Immune checkpoint inhibitors can cause a wide range of immune-related adverse events with links to T cell biology and epithelial barrier inflammation, biological functions shown in our preclinical studies and clinical pharmacology data to be positively impacted by SER-155.

irEC can be a serious condition characterized by diarrhea, abdominal pain, cramping, dehydration and blood in the stool and may progress to more serious complications such as bowel perforation, toxic megacolon or death. Management of irEC includes corticosteroids and other immune-suppressive drugs and can require withholding immune checkpoint treatment. We expect data will be available from this study early next year.

We also continue to explore potential R&D partnerships to advance the development of our investigational live biotherapeutics in inflammatory and immune diseases, including ulcerative colitis and Crohn's disease. These represent large patient populations with a continued need for new mechanisms of action, in particular, therapies that can target epithelial barrier-driven inflammation and that are not immunosuppressive.

Clinical and preclinical data generated through support from the Crohn's & Colitis Foundation support the potential use of our biotherapeutics to address these unmet medical needs and provide a new approach to treat these conditions, either as a monotherapy or combination therapy.

We continue to advance our novel biotherapeutics using highly focused data-driven approach and look forward to continuing collaboration with our clinical and academic partners to bring important new therapies to patients in need.

Thank you, Matt. I'll now turn to the third quarter financial results. As a reminder, Seres has classified all historical operating results for the VOWST business within discontinued operations in the consolidated statement of operations for the comparative periods presented, and there was no ongoing activity in this quarter related to the discontinued operations.

Seres reported net income from continuing operations of $8.2 million in Q3 2025 as compared to a net loss from continuing operations of $51 million in the third quarter of 2024. The results this quarter are comprised of a $22.5 million loss from operations, offset by a $27.2 million gain on the sale of VOWST, resulting primarily from the $25 million installment payment received as expected from Nestlé during the third quarter.

R&D expenses for this quarter were $12.6 million compared to $16.5 million in the third quarter of 2024, reflecting lower personnel and related costs, a decrease in platform investments and a reduction in clinical expenses resulting from the completion of the SER-155 Phase Ib study.

G&A expenses were $9.5 million in the quarter compared to $12.7 million in Q3 2024, driven primarily by lower personnel and related expenses, including IT-related expenses.

As of September 30, 2025, Seres had $47.6 million in cash and cash equivalents. Based on the company's current cash position, remaining VOWST transaction-related obligations and current operating plans, we expect to fund operations through the second quarter of 2026.

To summarize, we are disciplined in managing our expenses and continue to work towards securing additional capital to support development activities. In early 2026, we expect to obtain additional SER-155 clinical results, which could highlight therapeutic opportunities in a new patient population.

We have also made progress advancing SER-155 preparation activities to conduct a robust Phase II study, commencement of which is funding dependent. Based on the design of the Phase II study and the scope of the opportunity, we believe that positive study results, if achieved, could lead to tremendous value creation.

Operator, you may now open the call for questions. Thank you.

[Operator Instructions] Your first question comes from the line of John Newman of Canaccord.

You have some really interesting commentary on this IST at Sloan Kettering for immune checkpoint-related enterocolitis. I wonder if you could just talk to us a little bit more about anything you can tell us regarding the study design and also how you view the commercial opportunity there?

Sure. John, thank you for the question. We're very excited about the study as well. MSK initiated this study, and we're pleased to be looking at one of what could be potentially many different applications for SER-155.

As you know, there is a significant unmet need in this patient population, and so we're eager for the results as well. To elaborate a little bit more on the design of the study, I'd like to turn it over to Dennis, and he can share a little bit about the significant impact to patients who are on ICI of the irEC side effect. Dennis?

Yes. Thank you, Marella. irEC is one of the most frequent and severe immune-related adverse events that patients experience in immune checkpoint inhibitor therapy. Up to 60% of patients with rates varying depending on the cancer treatment and regimen used can experience irEC. irEC can be a very serious condition, as Matt previously described, characterized by symptoms, including diarrhea and abdominal pain, cramping, dehydration, blood in the stool and can progress to more serious complications such as bowel perforation, toxic megacolon or even death.

And the patients who experience irEC are treated with corticosteroids and other immunosuppressive drugs and also have to withhold their immune checkpoint inhibitor therapy. So the impact of this condition is significant and affects a significant number of patients undergoing this type of treatment. So this is the importance of why the study was originally designed and set up by the collaborator at MSK.

The study is a small Phase I open-label study. The readout from this study is expected to occur in early 2026 and will be comprised primarily of safety data, drug pharmacology data and diarrhea symptom response data, following these patients through approximately 6 weeks on the study for those who have received SER-155 for irEC.

Our hope is that we could see an impact on the diarrhea symptoms. And certainly, patients who would have improvement in the diarrhea symptoms without needing additional immunosuppressive therapy medications would be a very meaningful finding.

So that type of a clinical outcome paired with the safety data and the drug pharmacology mechanistic data would be extraordinarily useful for us to help us plan and inform for any future development -- clinical development opportunities in this new indication.

John, I just want to spend a minute to ask Terri to comment on the second aspect of your question regarding the commercial opportunity.

Thanks, Marella. John, thanks again for the question. As Dennis outlined, and this is a very common side effect of a very commonly used class of medications across many tumor types in oncology, perhaps best evidenced by KEYTRUDA net sales last year of almost $30 billion and growing at 18% versus 2023. So these are highly used agents growing, will continue to grow, particularly as biosimilars become available in the class.

In terms of the patient impact, just double-clicking a little bit on what Dennis said, it's not uncommon for patients to have to either pause or discontinue their cancer treatment altogether to go down this detour of addressing the enterocolitis. It frequently drives them into the hospital.

It's also a key limitation on physicians' choice of using combination therapies, which may be highly effective for treating the different tumors they're trying to address. But there's this nervousness or anxiety about using combination therapy or even increasing the dose to address the cancer. So we feel like we have a big problem here and a very nice solution to address it. We're very eager to get the data.

Your next question comes from the line of Joseph Thome of TD Cowen.

Maybe just a couple on the potential partnership deals. Can you talk a little bit about how much capital you would need to get to that initial SER-155 data within the 12 months of study initiation?

And then I guess, secondly, anything that you can do to kind of convey confidence that you'll be able to achieve something within the next 6 months within your targeted cash runway?

And then maybe last, if you're able to comment, there obviously was a report during the quarter that Nestlé made a takeout offer. Are you able to comment on if that was authentic and maybe why that wasn't an appropriate choice at that time?

Great. Joe, thank you for the question. So first of all, just to talk a little bit about the design of the Phase II study. Importantly, that interim analysis 12 months after the study start will allow us a capital-efficient and timely recovery of data, and we are pleased to get feedback from the FDA that they were in alignment with that approach.

As to the specific capital needs, we haven't guided on that other than to say that the timing of that and the way that we've designed the study, we do feel that we'll get meaningful safety and efficacy data given the patient count in this study at that IA point.

We continue to make obtaining a partnership or another source of capital as our highest priority for SER-155, our lead candidate. So we are continuing to have interactions and looking at a variety of different sources from which that capital could be obtained. So while we can't comment on any specifics as to status, it remains our most important priority.

With respect to your last question, we just make it a practice not to comment on rumors, Joe, so I can't comment specifically on that.

That ends our Q&A session, and we appreciate your participation. I will now turn the call back over to the management for closing remarks. Please go ahead.

Thank you. Thanks, everyone, for joining us this morning, and have a great day.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.