Seres Therapeutics, Inc. Q1 FY2024 earnings call

• Commercial Launch: 2024 sees continued execution on VOWST commercialization. While Q1 growth wasn't as hoped, Nestle implemented refinements like retraining sales teams, increasing HCP call lists, and simplifying the patient enrollment process. As of end-Q1, 4,239 completed prescription enrollment forms for VOWST were received, with 3,096 culminating in new patient starts. - SER-155 Program: Phase 1b study Cohort 2 enrollment complete, data expected in late Q3 2024. SER-155 is a microbiome therapeutic candidate aimed at preventing GI infections and reducing bloodstream infections. - Restructuring: R&D and G&A expenses decreased due to headcount cuts and other cost-saving measures following the 2023 restructuring, with focus on SER-155 program.

In Q1 2024, for VOWST, net sales were $10.1 million with Seres' share of the loss being $7.1 million. R&D expenses were $21.7 million, a decrease from $44 million in Q1 2023. General and administrative expenses were $15.5 million, down from $22.5 million in Q1 2023. VOWST net sales in Q1 were based on 642 units sold to specialty pharmacies and distributors, with an estimated 15% gross-to-net reduction. Seres supplied $7.4 million of VOWST inventory to Nestle in Q1 and received $8.7 million in payments related to prior quarter purchases.

• Expect acceleration in VOWST performance due to Nestle's refinements, as seen in March and April net sales increases. - Company is working with urgency to evaluate various options to support the pipeline with additional capital, including considering different financing alternatives beyond relying solely on the Oaktree tranche drawdown.

• In May, Seres received a notice of default and reservation of rights letter from Oaktree due to nonpayment of a milestone to Bacthera under the manufacturing agreement. Seres disputes the event of default, stating the milestone hasn't been met and is in constructive discussions with Bacthera.

Q: Reminder on VOWST price changes and number of reps?

A: Approximately 150 reps on the GI side and 20 reps for hospital; price increased 6% on December 31, 2023, to a WACC of $18,550.

Q: Launch trajectory for VOWST?

A: Refinements by Nestle lead to expected acceleration, with April seeing all-time highs in patient enrollment and net sales. Expect continued acceleration over coming quarters.

Q: Manufacturing milestone for Bacthera?

A: Making progress, with milestones expected soon, and working collaboratively with Bacthera to bring validation batches to patients as quickly as possible.