Seres Therapeutics Inc (MCRB) 2022 Q2 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Q2 2022 Seres Therapeutics, Inc. Earnings Conference Call. I will now turn the conference over to Dr. Carlo Tanzi, Investor Relations.

Thank you, and good morning. Our press release for the company's second quarter 2022 financial results and a business update became available at 7:00 a.m. Eastern Time this morning and can be found on the Investors and News section of the company's website. I'd like to remind you that we'll be making forward-looking statements including the potential approval of SER-109 and its status as a first-in-class therapeutic, the timing of a BLA filing and potential product launch, the market for SER-109, the ultimate safety and efficacy data for our products, the use of cash to fund operations and other statements which are not historical facts. 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 Eric Shaff, Seres President and CEO; David Arkowitz, CFO; Dr. Lisa von Moltke, Chief Medical Officer; and Dr. Matthew Henn, Chief Scientific Officer. Additional members of our management team will also be available during the Q&A. And with that I'll pass the call over to Eric.

Thank you Carlo, and good morning everyone. We have continued to make meaningful progress across all areas of the business including our clinical development efforts, commercial readiness, manufacturing and in strengthening the company's balance sheet. Our top priority is SER-109 our lead microbiome therapeutic candidate for recurrence difficile infection. We have now observed remarkable results from a Phase III program that includes 2 robust clinical studies. This program is progressing to FDA regulatory review and an anticipated product launch. If approved by the FDA, SER-109 could represent an important new option for those suffering from our current CDI. Furthermore, the approval of SER-109 could represent the first in a new class of microbiome therapeutics that we believe has tremendous potential to treat many serious diseases.

Based on well over a decade of research, Seres has established a strong leadership position in the development of microbiome therapeutics and we are well positioned to continue discovering and developing novel medicines. Earlier this summer, we were delighted to report confirmatory results from ECOSPOR IV, our SER-109 clinical study that has provided highly supportive safety and efficacy data in patients with recurrent CDI. The overall safety profile observed in ECOSPOR IV was consistent with a favorable profile observed in the ECOSPOR III study and we believe completes the FDA's predefined safety database requirements to support a BLA filing. Furthermore, these study data also provides strong additional evidence confirming the remarkable efficacy profile observed in ECOSPOR III.

These data further build upon ECOSPOR III by evaluating a broad patient population including patients with a first recurrence of CDI. Together, these data deepen our conviction in the potential of SER-109 if approved to transform how recurrent CDI is managed as well as the substantial commercial opportunity that we see in this therapeutic. As we have previously discussed, our Phase III SER-109 ECOSPOR III data surpassed statistical thresholds that were communicated to us by the FDA allowing that single clinical study to fulfill efficacy requirements for BLA.

Earlier this summer, we initiated the rolling submission process to file the SER-109 BLA and we are pleased to report that we remain on track to complete the submission in the coming weeks. SER-109 has obtained a breakthrough therapy designation from the FDA and we expect to receive priority review. Priority review should provide an expedited timeline including a 2-month BLA acceptance period followed by a 6-month review period. Therefore, we are anticipating the commercial launch of SER-109 pending FDA approval in the first half of 2023. We believe the opportunity for SER-109 is clear with approximately 170,000 cases of recurrent CDI in the U.S. per year. This is a disease where patients do not have adequate treatment options available today and result in over 20,000 deaths per year.

Today, some recurrent CDI patients are being treated with regimens and procedures that are not FDA approved which may be associated with significant risk. Also, patients may be treated with extended courses of antibiotics that we know may fuel the public health threat of antibiotic resistance. In collaboration with Nestle Health Science we continue to prepare for a successful commercial launch. Leading up to the anticipated launch, we will continue to prioritize our commercial preparedness activities including market education and payer engagements.

The external feedback we have received from the medical community related to the SER-109 profile has been highly encouraging and we are enthusiastic about the opportunity to help these patients in need. In addition, we continue to expand our commercial scale production of SER-109 to prepare for anticipated market demand. In addition to Seres internal manufacturing capabilities, we continue to work closely with our external manufacturing partners to both ensure patient needs are met at launch and increase longer-term SER-109 product supply to fulfill anticipated worldwide demand both in the U.S. and potentially other markets as well. Importantly, we also recently strengthened Seres balance sheet with approximately $100 million in new capital. This capital provides significant support for the company as we enter a critical period preparing for the approval of SER-109 and a successful commercial launch. I'd like to now pass the call over to Lisa to discuss our clinical initiatives in more detail.

Thanks, Eric. I'll begin by providing additional detail about our ECOSPOR IV study results that we initially reported in June. ECOSPOR IV was a 24-week study that included 263 enrolled subjects with recurrent CDI. ECOSPOR IV was designed to address the FDA's feedback regarding the required safety database to support the SER-109 BLA filing.

In designing ECOSPOR IV we also took the opportunity to obtain additional efficacy data including in an expanded patient population. Along with the SER-109 dosed patients in the ECOSPOR III study this study provides a safety database of at least 300 patients as requested by the FDA. With a total of 326 subjects who received SER-109 completing 24 weeks of follow-up. Based on prior discussion with the FDA the study also included 77 patients or 29% that have had only 1 recurrence of CDI. We were very pleased to observe a high level of efficacy in this patient group. These first recurrence patients reflect a group that was not included in our prior ECOSPOR III study and are of interest to health care providers treating this disease. In ECOSPOR IV, we also included patients diagnosed at entry with either PCR or toxin ELISA assays reflecting the variations in current medical practice across the U.S.

Overall, the safety profile through 24 weeks of follow-up indicated that SER-109 was well tolerated, consistent with the favorable data obtained from the prior ECOSPOR III study. In ECOSPOR IV, the most common treatment-emergent adverse events were diarrhea, flatulence, nausea, abdominal pain, abdominal distension, urinary tract infections and fatigue. And these are all issues common to the CDI population. Approximately 12.5% of patients in ECOSPOR IV experienced a severe adverse event as may be expected in this older patient population with frequent comorbidities. Importantly none of these SAEs were deemed related or possibly related to the study drug by the study investigator.

From an efficacy perspective, we observed a sustained clinical response as measured at up to week 8 in approximately 91% subjects which was remarkably similar to the 88% rate observed in ECOSPOR III. Response rates did not differ between those treated with vancomycin or fidaxomicin. And they were also similar regardless of the diagnostic method used for the qualifying episode of recurrent CDI. We were very pleased to see the level of clinical activity observed in this study which is substantially different from the 60% sustained clinical response rate in the placebo arm of ECOSPOR III.

We were also very happy to see a similar recurrence rate across the study population regardless of the number of prior episodes. This includes first recurrence patients where we observed a sustained clinical response rate of 93.5%. Our clinical results in this first recurrence population are consistent with the underlying pathophysiology of the disease which is believed to be similar across recurrent CDI patients regardless of a number of prior episodes. So to summarize, the results of ECOSPOR IV provide robust additional support for the well-tolerated SER-109 safety profile.

Also, the results reaffirm and extend the SER-109 ECOSPOR III efficacy results. The results provide compelling additional evidence of efficacy suggesting a marked benefit in sustained clinical response rates. Moreover, our data suggests similar activity in patients with a first recurrence in CDI. Based on the clinical profile we have observed to date we believe that SER-109 if approved could benefit patients across the entire recurrent CDI population. However, the utilization of SER-109 would of course, be based on the product label pending FDA approval. I will now pass the call to Matt to discuss SER-155 and additional R&D efforts.

Thanks, Lisa. Beyond SER-109, our most advanced program is SER-155 which we are developing for individuals receiving allogeneic stem cell transplants. SER-155 along with SER-109 is part of our infection protection pipeline franchise. The allogeneic stem cell transplant patients targeted by SER-155 are at very high risk for serious infections as well as graft versus host disease and we believe that SER-155 has the potential to address both issues.

We are continuing to enroll a Phase Ib trial to assess the safety, microbiome engraftment and efficacy of SER-155 alongside our partners at a number of leading cancer centers in the U.S. The subjects in this study will be undergoing treatment for hematologic malignancies such as leukemia. Based on historical data, we expect that over half of these subjects will experience infection or graft versus host disease. SER-155 is able to reduce the incidence of either of these conditions. We believe we would meaningfully improve health outcomes for these patients. The study is designed to evaluate safety and drug pharmacology including the engraftment of SER-155 bacteria in patients gastrointestinal tract.

In addition, data are being collected to evaluate clinical outcomes including rates of bloodstream infection and acute graft versus host disease. Observing either the decolonization of target antibiotic resistant bacteria or significantly reduced incidence of bloodstream infections or reduced occurrence of acute graft versus host disease associated with SER-155 administration would be clinically compelling. The study will help inform future clinical efforts which outcomes to prioritize with future studies.

Furthermore, this is a translationally rich trial that will produce immunological biomarker data that will not only support assessments of graft versus host disease but also will inform additional therapeutic opportunity priorities in the company's immune modulation portfolio more broadly. Looking ahead to pipeline expansion we have a strong R&D team in place. And as we highlighted in detail during an investor event earlier this year, we believe that both our clinical and preclinical data provides strong evidence supporting the potential for microbiome therapeutics and preventing infection in patients that are at high risk of blood stream infections. Particularly in large patient populations that are immunocompromised, such as cancer neutropenia, cirrhosis and solid organ transplant.

Importantly, we believe our technology can provide a novel approach to tackle the continued and increasing threat of antimicrobial resistant infections for which therapeutic options are limited. We see the potential to reduce the abundance of targeted pathogens to decrease the potential for pathogen transmission, strengthen epithelia barriers to further reduce the frequency of bloodstream infections and to modulate immune responses to tackle medical complications such as graft versus host disease. Seres has developed an integrated reverse translational MVTX platform that has enabled the discovery and development of novel therapeutic candidate. This platform leverages both clinical and human data sets and data from a broad range of preclinical assays and models customized for the development of microbiome therapeutics.

We are building on the success of SER-109 clinical data with SER-155 and we are advancing additional preclinical programs targeting infection and combining the slow pandemic of antimicrobial-resistant infections more broadly. We anticipate additional clinical programs into the clinic over the next 3 years starting next year. With that, I'll now turn the call to David to provide an overview of our financials.

Thanks, Matt. The details of our second quarter financials are included in the press release issued this morning, so I won't reiterate all the figures here. Seres ended the second quarter of 2022 with approximately $196 million in cash, cash equivalents and marketable securities. Subsequent to the end of the second quarter in July we announced a registered direct equity offering resulting in gross proceeds of $100 million. We intend to use the proceeds from this offering to further support commercial readiness and manufacture SER-109 for the U.S. market including expanding longer-term commercial manufacturing capacity as well as advancing the clinical development of SER-109 for the EU market and other general corporate and working capital purposes. This capital meaningfully strengthens our balance sheet and enables the company to more effectively deliver on our mission to bring microbiome therapeutics to patients in need. The June 30, 2022, pro forma cash balance inclusive of the net proceeds from the registered direct equity offering was approximately $291 million.

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 continuing to ramp up manufacturing operations for commercial supply internally and with our partner Recipharm as well as increasing longer-term SER-109 product supply through our Bacthera collaboration. And in conjunction with Nestle, continuing and accelerating launch readiness activities. In addition, we continue to invest to advance and expand our pipeline with a focus on infection protection opportunities and further build upon 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 but at a moderating rate of growth as we have already expanded our capabilities across much of the organization.

In summary, the company is well resourced to prepare for SER-109 commercialization, drive our ongoing development and preclinical programs while also deploying resources to continue to advance our research platforms where we believe we have differentiated proprietary and sustainable advantages. I'll now turn the call back to Eric.

Thank you, David. As you can see we are on a clear track to potentially bringing the first microbiome therapeutic to patients as we expect to complete our rolling BLA submission in the coming weeks. We are well positioned to succeed with a strong commercial launch as we believe we have a remarkable and highly differentiated product profile in SER-109, a highly capable collaborator and a strong balance sheet from which to support our execution plans. Later this year, we plan to host an investor event to provide further details regarding the commercial opportunity we envision with SER-109 as well as our commercial execution plans. In addition to our lead program, we are also advancing an earlier-stage pipeline of additional highly promising microbiome therapeutic candidates that we look forward to moving to key inflection points.

I'd like to take this opportunity to thank the talented and dedicated Seres team for their unwavering commitment and ongoing passion for bringing new medicines to improve quality of life for patients. Without their tireless efforts we would not be where we are today. With that now, operator, we'll open the call for questions.

Your first question comes from the line of Mark Breidenbach.

Just a couple, probably both aimed at Eric. I'm wondering if you can just briefly summarize what work still needs or still remains to be done before a BLA filing can be completed? And is the plan to inform the Street when the filing process is complete? Or will you wait until the FDA has agreed to review the application. And then a question kind of on the regulatory process in Europe. Is that process going to be spearheaded by Nestle or by Seres? And do you have any thoughts around timing of when an MAA application could be submitted?

Thanks for both questions. On the first I would say we haven't gotten in the past to kind of the blow by blow in terms of the BLA process. What I can tell you is as you might remember, the ECOSPOR IV study was kind of the critical path item for us, right? The FDA wanted at least 300 subjects, they wanted 6 months of follow-up. The study came out in excess of what were already high expectations. So that was and is the kind of gating item for us to move forward with finalizing the BLA. Of course, we are working on the other modules of the BLA alongside the ECOSPOR IV data. Without going further, Mark, what I can tell you is we are in the final stages of the BLA. The guidance is reconfirming midyear and actually saying in the coming weeks. So from where we sit today we're doing everything that we think we need to be doing and we're very, very pleased with our progress and we're very hopeful that we'll be done very soon. I won't comment in terms of what we might communicate or might not. I think in general you've seen that when we have events we try to be pretty transparent and current as to when they come out.

On the second question Mark, just around Europe, I would say, of course we believe that CDI is a global issue, right? And while our focus has been on the FDA and the U.S. market we're excited about the prospects of bringing SER-109 globally. We're also excited about the idea that we're doing so with Nestle as a single partner. You might remember back to when we're in our process of thinking about potential partners for the U.S., there are unquestionably synergies and thinking about global issues of pricing and branding and marketing and reimbursement and even regulatory strategy where it makes sense to have one unified partner. Which is why it made sense to work with Nestle in the U.S. in addition to our pre-existing relationship in the EU and rest of world. So we continue to work collaboratively and constructively with Nestle and I suspect we'll have more to say in the short term on next steps.

And maybe just one quick last one for me. Do you anticipate that Seres will be hiring any sales reps to support the launch? Or is the field force essentially already in place at Nestle (inaudible) to support a potential launch?

You mean in the U.S., right, Mark?

Yes, correct.

So a quick comment for me and then I'll turn it over to Terri who I think can provide some additional perspective. But one of the aspects of working with Nestle that was attractive to us was the idea that we could leverage existing capabilities, right? There was significant financial efficiency for us not hiring or building a commercial infrastructure and then having it sit idle until approval where we would switch it on. So there are capabilities that we can leverage from Nestle which we think will create value, allow us to get the patients more quickly, more effectively and ultimately more profitably than we could do ourselves. But maybe Terri, you can comment more specifically on your question around sales force.

I guess where I would start is we'll seek to reach the HCPs with the greatest potential for treating these patients. This is a gut infection. So it's no surprise that gastroenterology and infectious disease have the highest concentration of these patients relative to other specialties. And we'll continue to work with our colleagues at Nestle who have an existing gastroenterology sales force that calls on the specialty and the large practices now to determine how we want to augment to reach into infectious disease and potentially into hospitals and institutions. So that's work that's ongoing now with the teams. But we have a lot of great experience and capabilities at Nestle that we will continue to leverage. And our vision is that that's the most efficient path forward versus building out these capabilities ourselves. Back to you, Eric.

I think that answers it. Mark, any other questions?

Congrats on the forward progress.

Your next question comes from the line of Peyton Bohnsack.

I guess the first one would be when will we be able to see any additional analysis (inaudible) study? Would that be this year? And would that be included in the investor event that you mentioned later this year or would it released at a conference? And then I've got another one after that.

So we have a large data set and we're mindful of as soon as we can. We are also mindful of the upcoming conferences this fall. And as you know, when results are announced there. Those are embargoed until we actually release those results, but I can expect to see additional data very soon.

And then I guess kind of since the ECOSPOR IV has been released how has some kind of the interactions with like physicians and payers been? And I guess more specifically have you noticed some increased (inaudible) for using SER-109 in first reference?

Our med affairs group has been active in the field. And maybe Lisa can comment on the reaction to the ECOSPOR IV data with a specific question around first recurrence.

So the excitement has been in high and anticipating these results, obviously, based on what they saw in ECOSPOR III. And I think the fact that ECOSPOR IV looked not only as good but even slightly better. I think that just sealed it with so many folks. I will say that most of our KOLs had already been imagining using SER-109 assays for any recurrent disease just based on the pathophysiology of the disease. And once you're under the recurrent pool you're variably can't go of the fact that microbiome is no longer resilient enough to keep those spores from germinating. So I think that the fact that it worked well in first recurrence was not a surprise to anybody particularly those that follow the field. But I just would say that people are just very pleased with the strength of the data set and the consistency, right? It looks good from all angles, all groups, and that's really what you want to see.

When we expand our consultations to garden variety HCP prescribers and on the KOL audience what we hear is very similar. They don't necessarily discriminate between number of recurrences patients have. And that's probably based on the biology and pathophysiology that Lisa outlined. You're either a primary patient or you're in a recurrent pool and they sort of treat you the same. And in this pool of patients we know and we hear over and over that the largest unmet need is prevention of recurrence. HCPs really want this disease to go away and stay away. And they don't have good options for that today as evidenced by the placebo arm of our ECOSPOR III study. And with these confirmatory results it really just does give them increased confidence with respect to how they might expect SER-109 to perform in their patient population.

So it's very clear. We actually just completed a round of messaging research. So this is hot off the presses with HCPs. And in that work it was abundantly clear that HCPs value the high and durable efficacy observed across our studies of SER-109 and this will be a key driver of trial and adoption. And on the payer side you may recall I've spoken about this previously. We deployed the Nestle payer field team back in the spring. And that field team is able to talk not only about the ECOSPOR III results but the fact that we are enrolling and we're finishing up the ECOSPOR IV. So yes, there's a lot of excitement and interest with respect to what that trial may have shown. And we're now able to obviously expand and ramp those conversations particularly reaching out to the larger PBMs in the near future with this remarkable data. So we're excited about that but the feedback that we're getting to date upon deployment of that team which already had pre-existing deep relationships with the payer audience because the in-line products that Nestle already has. The reception has been very positive.

Your next question comes from the line of John Newman.

I just had a question on SER-155. Obviously, there's a lot of excitement around SER-109 that's going to be a marketed product pretty soon. But I find 155 really interesting as well because you're testing it in an area where there's a very, very high need for treatment. Just curious, you mentioned in the press release this morning that the data and safety mining committee recommended to continue enrollment in cohort 1. Just curious if you can remind me of the study design if that cohort is still sort of an open-label cohort before you move into the randomized portion? And then just curious if you could talk a bit about some of the efficacy endpoints that you're curious to investigate here in the Phase Ib.

I'm going to ask Lisa to comment on your question. I would just agree with your sentiment that we are incredibly excited about 155. And of course, there's a disproportionate amount of attention focused on 109 I think for good reasons. But we really do think that 155 is really the tip of the iceberg as it relates to our future efforts in infection and it leverages some of the capabilities and insights and knowledge that we have from 109 and from (inaudible) that we're leveraging an expansion of the pipeline. It really is where the early-stage pipeline is pointed now. But maybe Lisa can answer your question in terms of the DSMB trial design.

So just to remind you what the trial design looks like. It started with a cohort, a running cohort of 10 patients and that breaks into a placebo-controlled cohort of 60 patients. The BS valuation was preplanned restaged after a certain number and went fine. We have not guided on sort of patient-by-patient performance. And I think that we're very pleased with the progress in the trial. We've opened additional sites. We've moved from just our initial site at MSK and are now in a number of sites across the U.S. So we're very pleased with how it's going.

With regard to endpoints, we're interested in safety, of course. We're also interested in engraftment. And then from there we are very interested in looking at the polarization or ability to decolonize patients with regard to pathogens. We're interested in clinical outcomes such as blood stream infections or GI infections as well as acute graft host. So the way this trial is set up we're able to actually drill down from engraftment all the way through those other endpoints. We'll also be looking at biomarkers that reflect systemic immunity. So we expect to get an enormous amount of information from the study.

Your next question comes from the line of Ed Tenthoff.

Congrats on the progress. A huge milestone coming from the company adhesions. Just to kind of dig in a little bit more on the prep work that you and Nestle are doing. Can you kind of define your guys' responsibilities a little bit more in the promotion of SER-109. And is there anything that sort of come out as you discussed from that market research, any additional clarity in terms of where the initial focus will be. Obviously, the ultimate label and what patients are included in terms of relapse will help sort of determine that. But are there sort of greatest areas of needs that you think may be the initial focus?

When we designed the collaboration or the co-commercialization with Nestle, we tried to focus on what each party does best, right? What are we each uniquely positioned to maximize the value of the drive for patients. So in general, we have been focused on driving the bus in terms of med affairs as Lisa outlined earlier. I would add that has been supported enormously through the New England Journal of Medicine Paper in January. We of course, are continuing to lead the manufacturing efforts with 100 days. And one of the blessings and curses of being new in the category is that it's not easy to kind of access that technology off the shelf (inaudible) company. And we have for really much of a decade been building towards this moment where we're preparing to launch the product and support it commercially. And then we work with Nestle in terms of preparing for launch and some of the precommercial preparations are under Terri. And maybe I'll ask Terri to comment further.

But as it relates to your question on label, as I think Lisa mentioned earlier, we're thrilled with the ECOSPOR IV data. It's pretty remarkable to be kind of a mid-single-digit reference rate in that first current group but we were never counting on that number or that data. Those data to support our belief and we think most physicians believe that there's really 2 categories of patients. There's folks that have primary occurrence and then folks whose microbiomes are injured and have a recurrence. So maybe I can ask Terri to comment on your question around the initial. But hopefully, that provides a perspective on how we're thinking about things.

And I think one thing I would add to how we work together across the alliance is that it's very much a co-commercialization agreement, right? So the med affairs team have staff at both companies. The marketing team has staff at both companies and really work together as one team. We have joint governance committees where all of the major decisions around the launch are discussed and ratified. So it very much is a partnership where both companies are bringing different expertise to the table to achieve the best decisions. That's really the vision for the partnership from the outset. And with respect to your question around the kind of the foothold I think, the initial foothold you would expect to have in the marketplace. I view it and this is building on the comment that Lisa made around the biology of the disease and that I mentioned earlier around how HCPs see the patient pool. They don't differentiate necessarily between first recurrent, second, third plus 4. A lot of times they don't even know.

So I view the foothold as being less about the number of recurrences than I do about just the natural progression of the launch over time. Our ability in the first year to ultimately reach a broad HCP audience create awareness for the brand and engage these physicians over time, the access ramp over time, our ability to get into the payer review cycle and open up those pools of patients over time. Our ability to open up the hospital pool, that there's a pool of patients that transitioned from hospital to home as we call it. They receive SER-109 in the outpatient setting but there's inpatient discharge team involvement. So these things as we launch the product and scale our commercial footprint working with Nestle, where we have the reach and where we open up the patient pools and where we have the first payer review those will be our foothold.

Your next question comes from the line of Christopher Howerton.

I think just 2 for me. One would be with respect to the BLA submission and the anticipated review. Have you heard anything of competition with respect to Rebiotix product? Has that actually been submitted? Is that in review? Just curious if you guys have heard anything if that impacts your anticipated time lines for anything? And then secondly just given the commentary with respect to manufacturing scale and kind of working that up, I was hoping that you could give us a little more information what type of demand you expect to be able to serve at launch and what some of these scale-out procedures would be able to achieve and the time lines associated with that?

On the first, I'll provide a pretty short answer which is I would say we're fully consumed with our own BLA path and process. So I don't think (inaudible) on other folks. On the second I would say and maybe reiterate what we said before and I can ask Dave to add some additional color. But we've been preparing for launch for a fair amount of time. We're pleased that we're taking our Phase III process into launch. And we feel that we'll be well positioned to support the launch of the product as we hope to continue to move forward on planning on time. We did do the Bacthera agreement with the expectation that this is going to be a big drop and that there were opportunities to bring it to geographies beyond the U.S. And that would require and call it an industrialization of the manufacturing of this therapeutic. And we're making good progress with Bacthera as well. So Dave, I'm welcome additional perspective from you. But hopefully that provides some color.

You've said it very well. I mean I think the thing just worth restating is we feel very confident about where we are with our ability to supply at launch and in the initial years until the additional Bacthera capacity comes on. We're well positioned against the forecast that we have in mind with our partners at Nestle.

Your next question comes from the line of Chris Shibutani.

I was just wanting to touch base on 2 things. One relating to the payer value perception. I know that you have in the past and you continue based on the slides to frame the perception in the context of for instance, Harvoni, the hep C treatment. The regimen I believe that for SER-109 obviously from the studies is a 3-day oral treatment. So could you maybe comment on 2 things. Obviously that perception, is that framed against Harvoni including price? And then secondly, the clinical work has been about a single sort of episode of treatment for 3 days. And clearly, the data has showed some compelling efficacy there. What if any, information do you have to explore whether a patient would possibly be treated again in the future? And perhaps on a longer-term extension basis? Or if the treatment the first time did not work would it be part of a recommendation to redose once again? What is the opportunity for any individual patient to be a repeat customer?

So with respect to the clinical value rating that you see noted in our corporate deck that essentially was the payer audience reaction to the clinical value that SER-109 would bring and how transformative it was and how large the unmet need is today for preventing recurrence. So they very much recognize that there was no good option. Again as evidenced by the placebo arm in our trial. And so that was kind of the nature of their reaction. And when we asked a follow-up question regarding, okay, that's a very high clinical value rating. What is that analogous to help us understand what product may be similar when it came to market and that's when they went to the hep C market and the sort of next-generation products there. So it wasn't necessarily the benchmarking SER-109's price to products in that category which I think was your question.

So then, Chris, I think your second question is related to the possibility or maybe perspective around the idea of redosing. And it's something that we spent some time thinking about. I will say a pretty good problem for us to have is that there's so little data available from our studies of patients that didn't benefit from the drug, right? It was an incredibly small number of patients who were on the active who ultimately recurred. And maybe I can ask Lisa the comment on that. But our view is that there's no medical reason why if someone C. diff is treated with SER-109 hopefully has a successful outcome and does not recur in the time frame that we would expect someone would. A year later they go back to the hospital for whatever reason they get C. diff again. We don't think there's any reason why they couldn't be retreated with SER-109. But maybe I can ask Lisa to provide some additional perspective.

Just based on the mechanism of action we would fully anticipate that if somebody has recovered and then, let's say, they are out in the community and receive another blast of broad-spectrum antibiotics that injures the microbiome again. The mechanism of action would suggest that they would be a prime candidate for repair with SER-109 again. So there's nothing to suggest otherwise in our hands. And as Eric said we have very few patients that we could actually consider for retreating just given the fact that we had such a high rate of success. In the few that we did we had no safety problems at all. So there's again nothing to preclude redosing. But I think that based on mechanism of action is the strongest case.

This concludes the question-and-answer session. I will turn the call back to management.

So thanks everyone for joining and thank you for the thoughtful questions this morning. We look forward to keeping you updated on our progress. We hope everyone has a great day and a great week and we'll talk soon.