Seres Therapeutics Inc (MCRB) 2021 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Seres Therapeutics Third Quarter Earnings Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded. (Operator Instructions)

I would now like to hand the conference over to your speaker today, Dr. Carlo Tanzi, Investor Relations. Please go ahead.

Thank you, and good morning. Our press release with the company's third quarter 2021 financial results and a business update became available at 7:00 a.m. Eastern Time this morning and can be found on the Investors & News section of the company's website. I'd like to remind you that we'll be making forward-looking statements relating to the timing, enrollment and results of our clinical studies, the anticipated safety profile of our products regulatory approval, the success of our agreement with health science, the anticipated market for SER-109 and the promise and potential impact of any of our microbiome therapeutics.

Actual results may differ materially. Additionally, these statements are subject to certain risks and uncertainties, which are discussed under the Risk Factors section of our recent SEC filings. Any forward-looking statements made on today's call represent our views as of today only. We may update these statements in the future, but we disclaim any obligation to do so.

On today's call with prepared remarks, I'm joined by our President and Chief Executive Officer, Eric Shaff; Dr. Lisa von Moltke, our Chief Medical Officer; David Arkowitz, our Chief Financial Officer; and Matthew Henn, our Chief Scientific Officer.

During the Q&A portion of the call, we will also be joined by Dr. Terri Young our Chief Commercial and Strategy Officer; and Dr. David Eg, our Chief Technology Officer. And with that, I'll pass the call to Eric.

Thank you, Carlo, and good morning, everyone. The last several months have been a productive period for Seres, where we have meaningfully advanced our microbiome therapeutic pipeline. Our key recent highlights include the completion of enrollment in our open-label SER-109 study. The continued advancement of this program towards a BLA filing for recurrent difficile infection and actions we have taken to prepare for a successful product launch. We believe that SER-109 has the potential to become the first ever FDA-approved microbiome therapeutic, an important milestone for this emerging class of medicines. We have also continued to perform microbiome data analysis following our SER-287 Phase IIb clinical results in ulcerative colitis announced earlier this summer. Our expectation is to communicate those results before the end of this year. To remind you of the development progress of SER-109, during the summer of 2020, we announced successful Phase III study results in patients with multiply recurrent C. difficile infection.

These efficacy data surpassed statistical thresholds that had been communicated to us by the FDA, and as a result, we expect the data of this study to provide the efficacy data in support of a BLA filing. The FDA had also communicated that our BLA filing should include a safety database of at least 300 subjects dosed at the Phase III dose and with a 24-week follow-up. Following the Phase III results, we enrolled an open-label study to gather the required safety data to support this filing. Notably, and following discussion with the FDA, our SER-109 open-label study also includes patients with a first recurrence of C. difficile infection, an expanded patient group compared to the Phase III study population, which included patients with multiple recurrent CDI. In September, we were pleased to have achieved target enrollment with our open-label study of SER-109 in patients with recurrent CDI. We were highly encouraged with the pace of that study's enrollment and believe that the accelerating rate of enrollment that we observed reflects an increasing level of interest about SER-109 within the physician community.

There is clearly demand for a new approach to treating our current CDI, and we believe that the physician community is eager to see SER-109 become commercially available. Recently, we initiated a SER-109 expanded access program at multiple sites across the United States. This important program is designed to enable adults with recurrent difficile infection to obtain access to SER-109 prior to a potential FDA product approval.

We continue to remain on track with our plan to begin the rolling submission of the BLA for SER-109 in the first half of next year and finalize the submission including the required 6-month data set from the ongoing safety study in mid-2022.

Looking forward, our top corporate priorities are to prepare for a high-quality SER-109 BLA filing and alongside Nestle Health Science, our commercial partner, we are working to ensure that we are well positioned for a successful SER-109 product launch. The approval and launch of SER-109 would represent a landmark event for the field our organization continues to prepare for all aspects of a successful commercial launch. We believe that SER-109 represents a substantial commercial opportunity for Seres. The cost of a patient with a recurrence of CDI has been estimated to result in approximately $34,000 in annual direct health care expenses.

The recurrent CDI population includes approximately 170,000 cases in the U.S., and we believe we have the opportunity to address this entire patient group. These patients do not have attractive treatment choices today. Some of these patients are currently being provided regimens and procedures that are not FDA approved, including fecal microbiota transplantation and extended courses of antibiotics. All of these approaches have important limitations. And based on our discussions with health care practitioners, there is an eagerness for new, safe, effective and FDA-approved treatment options. We believe that SER-109 could provide a transformational new therapeutic option for recurrent CDI, and we are working with urgency to bring our therapeutic forward to the market as quickly as possible. We recently announced the collaboration with Bacthera, a global leader in biopharmaceutical product manufacturing that further increases our longer-term commercial product supply.

Following this agreement, Bacthera is establishing a dedicated facility for commercial manufacturing in its new microbiome center of excellence, a manufacturing site dedicated to the production of live biotherapeutic products located in Switzerland. We look forward to partnering with Bacthera to expand upon our existing product production capacity to meet demand, growth beyond the initial phase of launch, and help ensure eligible patients can receive this potential new treatment option.

Following our SER-109 Phase III study results, one of our key initiatives has been to educate the medical community about our investigational therapeutic and our clinical data. I'd like to now pass the call to Lisa to review several important SER-109 data sets that we have presented at recent medical meetings. These data reinforce the remarkably strong SER-109 clinical profile and provide notable findings regarding the potential application of our microbiome therapeutics and new indications.

Thanks, Eric. Our SER-109 Phase III study was a data-rich trial. And since obtaining the initial top line results in July of 2020, we have presented various data sets at a number of prominent conferences that are well attended by leading infectious disease physicians and gastroenterologists. Last month, we presented at both IDWeek and at the American College of Gastroenterology Annual Meeting. In total, we presented 8 posters and 1 oral presentation.

In addition, at IDWeek, we sponsored a talk led by Dr. Paul (inaudible), a leading academic expert in the CDI field on the disease pathogenesis and the potential role for microbiome therapeutics.

At the meeting, we presented data from our lead SER-109 program as well as on our earlier-stage SER-155 program. I'd like to highlight some of the key results recently presented. Data from an exploratory analysis presented at the ACG meeting in a late-breaker poster session demonstrated that SER-109 reduced the risk of recurrent CDI compared to placebo including in patients with significant risk factors for Recurrent. This includes those taking acid-reducing medications such as proton pump inhibitors and H2 blockers, representing approximately 40% of our patients in our Phase III study.

Importantly, SER-109 showed broad efficacy in the Phase III study, including in these patients known to be at higher risk of recurrence. As expected, given the demographics of CDI, more than half of the study population in our Phase III study had at least one comorbidity, including diabetes, cardiac disease and malignancy. It was reassuring to see that SER-109 results in high levels of efficacy, including in these higher-risk patient groups. At IDWeek in a late-breaker oral presentation, we presented results showing that SER-109 reduces the abundance of antimicrobial resistance genes in the GI tract in patients with recurrent CDI. This is an important finding given the public health concerns regarding escalating rates of antimicrobial resistance and the associated negative outcomes for patients.

We were pleased to see the impact of our therapeutic approach on this component of the antibiotic resistance paradigm. We believe that our data support a potential role for microbiome therapeutics in the decolonization of bacteria that harbor antibiotic resistance genes. Our novel therapeutic modality has the potential to become an important approach to reduce the transmission of antimicrobial resistance.

We also presented an exploratory analysis derived from our Phase III data, which demonstrated that SER-109 administration was associated with an improved overall mental health score compared to baseline, regardless of clinical outcome.

In another poster, we have highlighted the rigor of our SER-109 manufacturing processes, including methods employed to reduce the risk of transmission of emerging and undetected infections. We believe that our approach has important potential safety advantages as compared to the use of untreated donor stool. Overall, the data we presented further validate the strength of our SER-109 product profile and we believe it provides further support for the potential of this investigational therapeutic to transform the management of patients with recurrent C. difficile infection.

In addition, our presentations have meaningfully increased the awareness of SER-109 among the medical community as well as in the potential utility of microbiome therapeutics as a new class of medicines.

I'll now pass the call to Matt to discuss our earlier stage pipeline programs.

Thank you, Lisa, and good morning. I'll begin with SER-155. SER-155 is an orally dosed, rationally designed, cultivated microbiome therapeutic candidate designed to decrease the incidence of gastrointestinal infections, bacteremia and graft-versus-host disease in immunocompromised patients, receiving allogenic hematic stem cell transplantation. SER-155 is designed to prevent both bacterial bloodstream infections, particularly those that harbor antibiotic-resistant genes as well as to modulate post immunity to reduce the onset of graft versus host disease.

Prior published studies by our collaborators at Memorial Sloan Kettering Cancer Center indicate that HSCT patients with a disrupted low diversity microbiome are at substantially increased risk for bacterial infections, including antibiotic-resistant infections and poor clinical outcomes. At the recent IDWeek conference in an oral presentation, we highlighted preclinical data showing that SER-155 can decolonize patient isolated antibiotic-resistant pathogens, including vancomycin-resistant entrocoxide and carbapenem-resistant enterobacteriaceae, such as enterococcus essensium and Klebsiella pneumoniae which are notable escape pathogens.

The continued emergence of antibiotic-resistant bacterial infection is a top global health priority identified as such by both the World Health Organization and Centers for Disease Control with significant clinical implications, particularly in immunocompromised patients.

Prior studies published by our collaborators at MSK indicate that HSCT patients with a disruptive low diversity microbiome at a substantially increased risk of bacterial infections, including antibiotic resistant infections and poor clinical outcomes.

Based on these observations in our clinical programs and our preclinical data supporting SER-155 mechanisms of action, we believe SER-155 has the potential to reduce the risk of infection in individuals with compromised immune systems. Our IND for SER-155 was cleared by the FDA, and we are in the late stages of prepping to dose our first patient in the SER-155 Phase Ib study in collaboration with MSK and the University of Chicago. The Phase Ib study is a 2-part trial, including an open-label and placebo-controlled portion, and the overall study is designed to enroll approximately 70 participants. A first part of the study aims to primarily assess safety and SER-155 in (inaudible), and the second part of the study will also evaluate the incidence of bloodstream infections, gastrointestinal infections and the incidence of acute graft versus host disease.

We look forward to providing further updates soon on the progress of this important study. Now moving on to our ulcerative colitis efforts. We continue to analyze data from our SER-287 Phase IIb study conducted in patients with mild to moderate ulcerative colitis. We're in the process of obtaining and analyzing microbiome results as well as metabolomic and other functional data from that study. We expect these data to provide us with a much deeper understanding of that study's unexpected clinical outcome, and these results will form our decisions regarding next steps for 28 and as well as any potential modifications to our ongoing SER-301 Phase Ib study. We intend to communicate an update on our initial assessment findings before the end of the year.

As a reminder, SER-301 is a next-generation orally dosed, rationally designed cultivated microbiome therapeutic candidate for the treatment of ulcerative colitis. The composition of SER-301 is designed to optimize drug species engraftment and the pharmacological properties that our clinical and nonclinical research have identified as potentially important drivers of a treatment effect. Research indicates that individuals with ulcerative colitis can have a gastrointestinal microbiome that differs from those of healthy individuals. And further, that bacteria found in the gastrointestinal microbiome and the metabolites they produce are associated with modulation of many of the immune pathways that have been associated with ulcerative colitis and IBD more broadly.

Unlike SER-287, a donor-derived product candidate SER-301 is comprised of a targeted set of bacteria selected to optimize the reduction of proinflammatory activity improve epithelial barrier integrity and modulate multiple UC relevant immune pathways to suppress inflammation. We continue to enroll our SER-301 Phase Ib study in adults with mild to moderate ulcerative colitis. As we had previously done several years ago with our SER-109 program, we are performing an in-depth rigorous scientific analysis of all available ulcerative colitis study results.

Based on the findings from our SER-287 assessment, we intend to make a thoughtful determination regarding next steps for our UC franchise, and we maintain the opportunity to modify the SER-301 study, if warranted.

With that, I'll now turn the call to David to provide an overview of our financials.

Thank you, Matt, and good morning. The details of our quarterly financials are included in this morning's press release, so I won't reiterate them here. Seres ended the third quarter of 2021 with approximately $353 million in cash, cash equivalents and marketable securities. That September 30, 2021 cash balance includes the upfront fee of $175 million that Seres received in July following the SER-109 co-commercialization agreement announced on July 1, 2021, in Nestle Health Science.

I would just remind you all of the deal terms in exchange for SER-109 co-commercialization rights in North America. Nestle Health Science provide Seres with an upfront payment of $175 million. Seres will also receive an additional $125 million upon FDA approval of SER-109 and a $10 million payment upon Canadian regulatory approval.

Furthermore, the agreement includes meaningful sales milestones which, if achieved, total up to $225 million. In summary, the aggregate value of the potential approval and sales milestones totaled $360 million. Upon commercialization of SER-109, Seres will be entitled to an amount equal to 50% of commercial profits. We're very pleased with the collaboration, which is financially attractive for Seres and provide Seres with both near-term value and substantial longer-term value. We continue to work very closely with Aimmune, the division within Nestle responsible for this effort in preparing for the launch of SER-109.

And as part of the agreement, Seres is funding all prelaunch commercialization and medical affairs expenses up until launch. As I've mentioned, once SER-109 is commercialized, the profits will be split 50-50. Aimmune has developed a highly effective pharmaceutical business including a sizable GI sales force and top-notch marketing team, and we believe that their commercial capabilities will help ensure a successful launch as well as provide meaningful efficiencies related to SER-109 commercialization.

I want to point out that our third quarter income statement reflects collaboration revenue of approximately $127 million, which is primarily from the accounting of the $175 million upfront fee from Nestle. As a result of this revenue recognition, Seres has generated a profit for the quarter. There are additional accounting implications related to the co-commercialization agreement included in our financial statements for the third quarter and these are further outlined in our 10-Q.

With respect to our operating expenses and efforts over the near term, we continue to be focused on a number of critical SER-109-related activities, which include filing the BLA submission, ramping up manufacturing operations for commercial supply and in conjunction with Aimmune accelerating our prelaunch commercialization efforts.

In addition, we continue to invest to advance and expand our pipeline and further build and enhance our platforms and capabilities. As a result of these high priority and value-generating activities we expect our expenses to increase in the coming quarters. In summary, we believe the company is well resourced to prepare for SER-109 commercialization, drive our ongoing development programs, while also deploying resources to continue to advance our research platforms where we believe we have differentiated proprietary and sustainable advantages.

With that, I will pass the call back to Eric.

Thanks, David. I will conclude our remarks by recapping the progress we have made across our microbiome therapeutic pipeline and key important milestones that we are looking forward to during the remainder of this year and into 2022. These include our achievement of over 300 subjects enrolled in our SER-109 open-label study in our preparations for a BLA filing in the middle of next year. Continued progress executing on SER-109 commercial readiness, working closely with Nestle, including expanded market education efforts. The initiation of a SER-109 expanded access program, the expansion of our longer-term commercial supply capabilities and capacity, including our recent collaboration with Bacthera completion of our SER-287 study data analysis and continued progress with our SER-155 and SER-301 earlier-stage programs.

Our organization continues to strengthen our microbiome research platform and preclinical efforts. In the coming year, we expect to advance our microbiome therapeutic candidates forward. We plan to focus on areas such as infectious disease, where we have clear clinical and mechanistic data demonstrating the utility of our approach. Seres is supported by a strong scientific foundation and solid balance sheet. We believe that our company is well positioned to continue to lead the microbiome therapeutic field and we look forward to executing our mission and seeking to improve the lives of patients. With that, operator, we'll now open the call up to questions.

(Operator Instructions) Your first question comes from the line of Joseph Thome of Cowen and Company.

Maybe the first one, in the commercial manufacturing agreement press release so this could be the first ever live biotherapeutic product commercially produced. I guess is there anything from an FDA perspective that they are pointing to specifically that you would need to clarify, given that this could be kind of groundbreaking here? And maybe how you're responding to them or getting data ready? And then second question, just on the potential for retreatment in patients that may be relapsed after SER-109 treatment, is it possible to go back in with another course mechanistically, would this make sense?

Yes, thanks for the 2 questions. On the first, from a manufacturing perspective, maybe I'll start, and I'll ask Dave to comment. As a reminder, Bacthera is not up or online yet. It will take some time to complete the facility and bring them online. We're taking into our commercial launch the same process that we took into our Phase III study. So we're continuing to work through the elements of the BLA. We feel good about where we are. But following the positive Phase III results in the summer of we pivoted pretty quickly to investing in and continuing to prepare both the capabilities and the capacity to launch the product. And in fact, that included in some sense, hiring Dave, who brings just exactly the right experience of being able to move quickly and bring a key product up to scale. So maybe I'll ask Dave to comment further and then we'll take your second question in terms of retreatment.

Sure. Thanks, Eric. And so Joe, you were asking about questions from the FDA. And so I'd emphasize that because of our breakthrough designation, we've been in ongoing almost continuous interaction with the FDA. So we have a really good dialogue with them and understanding what their expectations are and addressing those things as we prepare the BLA itself. And as Eric said, just to reemphasize the point that our current supply chain is our large supply chain. The new investment is not required for BLA filing or launch. So there's no change to that time line as it relates to manufacturing. The same supply chain that we had was used for Phase III, same scale, same facilities, same equipment and same staff. So that's what I could share with you this morning.

And Joe, maybe we can take your second question in terms of the potential for retreatment. And here, I'll ask Lisa to comment. But just to start, just a couple of comments. One is that I think the question on retreatment is an important one. We've gotten to know these patients incredibly well, right? And what I think hasn't come to light as much as it could. It's just the fear and emotional burden of the idea of a recurrence, right? Once you get hit by antibiotics, just not knowing whether you're likely to recur again or not. And one of the reasons that we were so gratified by our Phase II results was certainly the efficacy that we saw in that study. And there's medically no reason that we know of why you couldn't retreat, but one of the elements of the Phase II results was that there weren't that many patients in the active on that actually record, right? So maybe I can ask Lisa to comment further on that.

Yes. No, Eric is exactly right. There's no medical reason not to retreat. And in fact, we did have a few patients in the 012 study that did recur rolled over into the open label and received retreatment and did well. But as Eric said, we had so few people in the active arm recurring to begin with that is just not large numbers.

Your next question comes from the line of Ted Tenthoff of Piper Sandler.

And just with respect to preparation for the BLA. Since this is a new class, is there anything unique, kind of picking up on the last question but going beyond manufacturing, that would be required since it is a microbiome therapy.

Yes, Ted, thanks for the question. Look, I would say as Dave mentioned before, we think we have a pretty good sense of what the FDA is looking for. This is a new therapeutic, it is a new modality, but we're not starting fresh in terms of our discussions with the FDA, right? And we've been in discussions with the FDA around release specs, around our approach. Obviously, they had communicated to us the bar that they were looking for in terms of what would qualify from an efficacy perspective for one single pivotal study. Not only do we meet that, but we significantly surpassed that. We then had the discussion around safety and the idea that they were looking for these 300 patients on the Phase III dose, which we, of course, also executed as well. So it's a breakthrough designated program. We continue to be in contact with them. We think we have a pretty good sense of what they've asked for, and we're providing it. So that's the best that we could say at this point. We'll continue the dialogue with them and rest in line with the BLA.

And as you say, I mean, the quality and clear signals, both from safety and efficacy are really going to be helpful. Awesome. Looking forward to continued updates on the pipeline.

Your next question comes from the line of Chris Shibutani of Goldman Sachs.

This is CJ on for Chris this morning. Congratulations on the quarter. Can you help us think a little longer term about the potential competitive commercial landscape for therapeutic approaches to recurrent C. diff. In particular, I don't think we've discussed this as much previously, but Pfizer has a vaccine and where the Phase III data could come in the near term. How do you see therapeutics and the potential vaccine fitting into the overall clinical management arm momentary.

Yes. CJ, thanks for the question. Let me take the first part of it, and then maybe I can ask Terry to comment on more specifically vaccines or maybe alternate approaches. Look, we've been working in this disease for a long time, right? And what we know is what's needed in this space, which is something which is, we think, oral, highly efficacious GMP manufactured and incorporates the right safety dimensions that you look for. And that's what we think we have with SER-109. The idea of having a limited number of capsules, we think is highly attractive for patients.

We think that the safety dimension of not just relying on donor screening and hoping that you capture pathogens that might be transferred. We know that our CMC process is set up for additional steps that support patient safety. Most importantly, we think we have an efficacy profile, which is -- represents a step function increase in how you treat these patients with the 88%. So we feel very strongly about where we are and we're highly focused. We're certainly aware of the competitive landscape.

But where our focus really is, first and foremost, is just getting to the BLA and trying to get to the end of the regulatory finish line so we can get this drug to patients. But maybe I can ask Terry, our Head of Commercial, to comment further and maybe capture the vaccine question.

Sure, Eric. I mean I'll go straight to the vaccine and just point out a couple of facts about them. Number one, they are operating or aiming to operate quite far upstream from the market for recurrence if infections. So they're actually going for patients who are at risk of a primary C. diff infection. So for example, patients who are going in for surgery who are essentially going to be exposed to the health care system and may encounter editors and so on and so forth, in addition to administration of broad-spectrum antibiotics.

So far upstream from us. We haven't seen Phase III data from them yet. So we don't really have a feel for their efficacy levels. And I think for me the most, I think, relevant piece of information is really around uptake, what kind of uptake could you expect from a vaccine like this, given uptake levels that we're seeing for COVID vaccines that have probably the best advertising campaign known to man for a vaccine. And we're still not seeing, in many cases, broad uptake despite mandates and so on and so forth.

So that's what I would say about the vaccine. And with respect to competitors that may come along in the recurrent set of space, I would just close by echoing what Eric said, that we are very happy our drug's profile and the clear path to approval that we have with our Phase III data serving as a single pivotal due to surpassing the FDA's bar for efficacy and with clear direction on the necessary safety database, and we really look forward to bringing this product to patients as soon as we can.

Your next question comes from the line of Mark Breidenbach of Oppenheimer.

Just a couple for me. First, I'm wondering if we should be interpreting the agreement with Bacthera as an indication of any forward regulatory progress with the EMA and a step towards future European product launch. Or will Bacthera primarily be manufacturing drug product for the North American market. Also, I'm wondering if you can give us any numbers around manufacturing capacity with and without the addition of Bacthera in terms of drug supply per patient per year. And finally, one last one for me. Maybe you can give us a progress report on the enrollment of the SER-301 study and if we can reasonably expect to see any results from that trial in 2022.

Mark, thanks for the -- I think it's 3 questions. Let me take a stab at them, but the team can help me if I miss something. So on the first, I think we prefer not to kind of parse out signaling this or signaling that. I think (inaudible) for us is that we think this is going to be a major global drug, right? And because of that, we're looking to ensure that we've got the right the right commitment, the right capacity to supply this drug globally. That includes future regulatory work and includes future commercial work.

But ultimately, Bacthera with Lonza and Chr. Hansen, it's just the state-of-the-art operation, that we think industrializes our ability to fulfill our commitment to patients to get this drug to them as quickly and as robustly as possible. So I think that's the answer to the first. We haven't provided specificity in terms of numbers, except maybe I'll reiterate what Dave said earlier, which is we feel very good about where we are from a launch perspective. I think this is more forward-looking in terms of our ability to supply globally. And then on the last question, Mark, in terms of 301, I haven't provided guidance.

I can reiterate what I've said beforehand, which is that we've made progress, but at the same time, we're not so far along in this Ib study, where if there are learnings from our analysis that we could apply, we have the ability to do that. So I think on the last one, it's really more of a stay tuned.

Okay. Got it. Congrats on the progress.

Your next question comes from the line of John Newman of Canaccord.

Just curious if you could talk a little bit about what type of data you might be able to share from the microbiome analysis that you mentioned for later this year. Just kind of curious as to what you're hoping to learn from that analysis that can help inform future studies?

Yes, John, thanks for the question. And let me start with the status and then maybe Matt can comment a little bit more specifically on the types of analyses that will run. But as we've said, we're not finished with the analysis. It is in process. I think for us, it's important to not piecemeal data out, but rather get a sense of the total picture before providing our analysis conclusions and potentially next steps. So we've debated quite a bit about what we should and when. I think that we -- our intent is to share a more full picture when we have it. And I would say that we're certainly getting closer to that. Maybe, Matt, you can comment on the types of analyses and maybe some visibility as to how that informs our platform going forward.

Sure. Yes. So our 287 Phase II trial was designed to capture a rich data set around drug activity and pharmacology. And that was done, of course, understand what the drug is doing and also to enable our reverse translational discovery efforts more broadly. So we're generating metagenomic microbiome data, metabolomic data sets, transcriptional data sets, other functional data as well, which allow us to then look at specifically how the microbiome changed, what happened functionally did we or did we not elicit the the changes in the metabolic landscape that we would have expected based on our aggregate knowledge across both our preclinical work as well as our Phase Ib study, where we did see meaningful changes that were associated with both treatment and clinical outcome.

And of course, we're looking more broadly as well to say, we're IBD-relevant inflammatory pathways modulated as we might have expected them to be. And then also, we're trying to understand is there any evidence of patient subpopulations that might be more amenable to treatment versus not. So these are the kinds of things we're looking at and digging into -- And really, I'll just -- I'll close by saying that we've got a -- this is a large, rigorously collected interventional microbiome data set. And these kinds of data sets don't exist out there, generally speaking.

And so I think we've got a lot of work ahead of us, but there's much to learn here in terms of how we think about how microbes are interacting with each other, with these human cells and tissues in the GI. I think that has broad applicability across our portfolio.

Your next question comes from the line of Vernon Bernardino of H.C. Wainright.

Just have a question as far as the Bacthera agreement capabilities and so on. part of the announcement says that your leverage loans is capital encapsulation technology. Are there any considerations as far as what would need to be done regarding any differences between the capsules that are used now and perhaps stability testing for SER-109 once Bacthera's up in manufacturing SER-109.

Yes, Vernon, thanks for the question. Let me start, and I'll ask Dave to comment. So again, I don't think that I've taken the Bacthera question yet, but I'm thrilled with this relationship. They really do provide for us professional industrialization of manufacturing the drug going forward. And and we're thrilled that they kind of take the best of the 2 companies that really came together to form Bacthera. So there's aspects of what we're doing, which we think are best in our hands. There's aspects of what they're doing, which we think that they can provide and share unique value with us. And from that perspective, we think it's really a win-win in terms of a partnership. But maybe Dave can comment more specifically around your question in regards to the capsule.

Yes. Thanks, Eric. And Vernon for the question. Yes, I'll just briefly echo what Eric said, having worked for 20-some years in biopharmaceutical manufacturing and biologics and vaccines. I'm really really enthused about this partnership with Bacthera for meeting future expansion of supply. It's Lonza and Chr. Hansen have a long history in this site is top notch, as Eric said. Specifically to your question, this is being highlighted by Vector and Lonza for their own purposes to highlight it. We've actually used those capsules throughout. So Capsugel was acquired by Lonza at some point in time, but those particular capsules that we use have been part of the SER-109 program from early on, and we're indeed used in Phase III. So there's, in fact, no change with respect to that particular aspect.

Congrats on the progress.

There are no further audio questions at this time. I will now turn the call over to management for closing remarks.

So thank you, operator. I want to thank everybody for joining our call today and for your continued interest in Seres. We look forward to keeping you up-to-date on our progress. With that, we will conclude. Have a great day, and thanks, again.

This concludes today's conference call. Thank you for participating. You may now disconnect.