Seres Therapeutics, Inc. (NASDAQ:MCRB) Q4 2022 Earnings Call Transcript

David Ege: Sure. Thank you, Eric. And Mark, thanks for the question. Yes. So as it relates to the in-house and the Bacthera, so it’s been our strategy for quite some time that, as Eric mentioned just a moment ago, we’re bringing our Phase III process forward to launch. It’s adequate in scale and volume to meet the near-term forecast that we have together with Nestlé. And by design, Bacthera, as was mentioned earlier in the call, will start producing material ahead of the facility approval in 2024. And we anticipate an approval of — for that material to reach the market in 2025. So that’s augmenting capacity as the market grows as well as providing redundancy with what we had internally and with Recipharm currently.

Eric Shaff: And we’re really pleased with where we are with Recipharm and our relationship and the work that we’ve done with them. Mark, maybe on your second question, I can ask David to comment.

David Arkowitz: Yes. Thanks, Mark. So as you indicated, and as we have talked about, we are eligible for $125 million milestone from Nestlé upon SER-109 approval. The other cash flow that we expect relates to SER-109 commercial supply that we have been producing leading up to approval and thereafter. And we have been doing that at our cost. We will sell that inventory to Nestlé at or around approval, and then thereafter, there’ll be kind of — think about it as a steady cadence of purchases by Nestlé from a supply standpoint. So that will provide an initial bolus of cash coming in and then a steady supply thereafter.

Operator: John Newman with Canaccord.

John Newman: I just wondered if you could talk to us a little bit more about the initial launch targeting for SER-109. I know that you’ve got a really interesting focus on the outpatient setting. And just curious if you could talk just a little bit more about the types of physicians that you’ll be targeting initially.

Eric Shaff: Yes, John, let me start and then I’ll ask Terri to comment. But I would say that, for some time, we’ve been doing quite a bit of research and interaction with health care providers. Terri and I, with our partners in Nestlé, have spent quite a bit of time recently with a number of different folks. And I can tell you there’s a lot of excitement around the potential of SER-109. I think the idea of having a new tool to help patients in this space when it’s been so long without something that is effective, that is something that is — has a favorable safety profile, something that is, in particular, oral and scalable, we can kind of hear the hunger in the voices of those treating physicians for something new. But maybe, Terri, you can comment further on that.

Teresa Young: Sure. With the Gastroenterology sales force that Nestlé is currently deploying with one of their in-line products, we’ll be leveraging that sales team to reach their existing Gastroenterology targets, where they already have deep long-standing relationships. At launch, we’ll deploying that sales team. And we’ll also be, via that sales force, to reaching a small number of other physician extenders in those offices, NPs and PAs, for example, and other high-volume positions. So that’s the Gastroenterology outpatient sales force. I also mentioned that we recently stood up a hospital selling team that will be profiling and then ultimately selling to the largest institutions across the country that see the highest patient volume of recurrent CDI patients.