Sera Prognostics, Inc. (SERA) Earnings Call Transcript & Summary

Good afternoon, and welcome to the Sera Prognostics R&D Day. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. I would now like to turn the conference over to Peter DeNardo of CapComm Partners for a few introductory comments.

Thank you, John. Good afternoon, everyone. Welcome to Sera Prognostics R&D Day. Presenting for the company today and available for the question-and-answer session will be Zhenya Lindgardt, President and CEO; and Dr. J. Boniface, Chief Scientific Officer of Sera and principal investigator for the company's pivotal PRIME study, Dr. Brian Iriye. During today's event, we will present results of the premature risk assessment combined with clinical interventions for improving neonatal outcomes, or PRIME study, and answer questions regarding this pivotal research. This call can be heard live via webcast with the accompanying slide presentation available at seraprognostics.com, and a recording will be archived in the Investors section of our website. Please note that this presentation and some of the information presented today may contain projections or other forward-looking statements, events and circumstances that have not yet occurred, including plans and projections for our business, future financial results, market trends and opportunities, and potential reactions to the PRIME results by various stakeholders, including clinicians, payers and medical societies. These statements are based on management's current expectations and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company saw from time to time with the Securities and Exchange Commission specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections and other forward-looking statements. As a reminder, a webcast replay of this call will be available on the Investors section of our website. I will now turn the call over to Zhenya, Sera Prognostics President and CEO. Zhenya?

Thank you so much, Peter, and thank you so much, everyone, for joining us today virtually on the webcast as well as in person here in Denver, Colorado. We're really excited to have heard Dr. Brian Iriye's presentation this morning and wanted to give all of you the opportunity to hear exactly the same data as what we all heard in the ballroom of the Society for Maternal-Fetal Medicine Conference today. Dr. Brian Iriye is a physician from high-risk pregnancy center in Nevada and is our lead principal investigator of the PRIME study. Joined with Brian is our Chief Scientific Officer, J Boniface, and we look forward to presenting the data and answering any questions you might have on this pivotal study. And over to you, Brian.

Great. Well, I'm just going to get moving forward with this and give you the same presentation that was seen earlier today, I think it was well received, and we'll move forward. So neonatal impact, the prematurity risk biomarker screening with targeted interventions, a multicenter randomized controlled trial. I presented our declaration of interest in regards to the centers receiving payment for trial-related costs. Preterm birth is a complex condition that arises from a variety of diverse etiologies, making it a significant global and national challenge. In 2020, there was 3.4 million preterm births worldwide, tragically leading to over 900,000 infant deaths. In the United States, the preterm birth rate stands at 10.4%, a figure that's remained essentially unchanged over the past decade despite advancements in medical care. Effective screening for preterm birth remains a significant challenge in clinical practice. Current risk scoring systems frequently missed the target failing to identify about 50% to 60% of pregnancies that ultimately deliver preterm. These limitations emphasize the need for improved screening tools and broader strategies to identify patients at risk. Insulin-like growth factor binding protein 4 and sex hormone binding globulin, the preterm tests have been validated as biomarkers for predicting spontaneous preterm birth when measured in the mid-second trimester. These markers offer a promising tool for risk stratification have been presented in previous oral abstracts and in the papers listed below. However, while their detection may identify an issue, the critical question remains can results from these tests guide actionable clinical decisions that open the door to improve outcomes. Presenting our methods, the PRIME trial was a 19-site multicenter randomized controlled trial designed to evaluate whether knowledge of blood biomarker results and targeted treatment improve neonatal outcomes. Entry criteria focused on identifying a population at overall low risk for preterm birth. On inclusion, participants were aged 18 or over with singleton gestations. Blood was drawn for biomarker screening between 18 and 0 to 20 and 7 weeks and after informed consent. Ultrasound was performed at or after 18 and 07 weeks, but prior to enrollment. This screening ultrasound was used to exclude higher risk patients with structural fetal anomalies in a short cervical length. To further ensure a low-risk population, the exclusion criteria aim to remove higher risk scenarios for preterm birth categorized by pregnancy-related conditions, COVID infections, chronic medical illnesses, medication use, allergies and substance use disorder. These criteria are focused on ensuring this study's integrity by excluding high-risk scenarios or ones with known interventions that could confound outcomes. Subject to randomized one-to-one when the specimen arrives at the lab and prior to lab processing after randomization, participants were divided into 2 arms control and prevention. The control arm tests remain blinded and participants continue to receive routine care without modifications. For the prevention arm identified as low risk, no changes were made except -- to their standard care, except for notification of their results to patients and their providers. For prevention arm participants classified as higher risk of targeted treatment bundle is implemented, including daily oral low-dose aspirin, vaginal progesterone and weekly standardized telephonic nurse management to ensure close monitoring and support. The study focused on 2 co-primary outcomes. The first was a neonatal morbidity and mortality index adopted from Hassan in 2011 with criteria based upon the events of severe morbidity and NICU length of stay. The second outcome variable was neonatal length of stay focusing on the most affected quantile or approximately the 10% were the longest stays. Both co-primary analyses utilized the modified intent-to-treat population, which included participants who completed a second informed consent to review treatment, started the intervention bundle prior to 24 weeks and did not have moderate or elevated risk COVID as defined by ACOG and SMFM after enrollment. Analyses were adjusted for pre-enrollment low dose aspirin usage, parity and COVID positivity. Sample size calculations were based on simulations accounting for baseline risk, compliance, prevention, bundle efficiency and patient retention with an estimated 29% screen positive rate for biomarker testing, the initial sample size was estimated at 5,600 participants. The study enrolled 5,018 patients from December 6 -- I'm sorry, November 20, 2020 to December 6, 2023. Of note, the DSMB recommended study halting of enrollment at interim analysis due to efficacy by predetermined criteria. Due to time constraints, we have focused on the final analysis from here on. Our study found no significant differences overall between the groups at baseline. The populations were racially diverse, and of note, 27.6% were utilizing aspirin prior to enrollment. There was no difference in any other antipartum or delivery characteristics between the 2 groups, except for an increase in corticosteroid administration in the control group. Additionally, not a single circlage was performed during the entire study. In regards to the 2 co-primary outcomes of the neonatal morbidity Index, the odds ratio was 0.75 and significant at a p-value of 0.003. Thus, the odds of adverse outcomes on the NMI scale were 25% lower in the prevention as compared to the control group. In regards to the neonatal length of hospital stay, the hazard ratio was 0.82 with a p-value 0.044. Hence, infants in the prevention group had an 18% lower risk of prolonged hospital stays compared to the control group when focusing on those with a 10% longest hospital stays. Our full analysis set is a crucial subset of the IT population just missing 4.3% of patients that are missing the neonatal data for the 2 co-primary outcomes. Meanwhile, the ITT analysis remains the gold standard with data in -- with missing data handled by multiple imputation under both missing at random and missing not at random assumptions. The prevention arm demonstrated excellent outcomes in the full analysis set and the intent to treat population of 5,018 participants. Significant reductions were observed in neonatal morbidity, neonatal length of stay, NICU admissions and NICU length of stay. These findings highlight the possible effectiveness of the screen and treat strategy in this gold standard analysis and its potential to improve outcomes across diverse populations. The PRIME trial results showed no overall change in mean gestational or birth -- mean gestational age of birth, but this aligns with our expectations. This is because treatments for preterm birth target the 10% of pregnancies at highest risk leaving the central tendency or mean representing the other 90% largely unaffected. However, when a quintile analysis revealed, however, quantile analysis revealed a significant difference within the lowest 10% of gestational ages of birth with extension in the prevention arm by 4 days. Furthermore, the gestational age decreased treatment effect in the prevention arm became more pronounced. However, it did not reach statistical significance and should be interpreted with caution. In conclusion, in our trial involving patients at low risk for preterm birth, we found that employing a mid-trimester blood biomarker for screening and targeted intervention significantly reduced neonatal morbidity in hospital stays within the modified intent-to-treat population. Furthermore, the intent-to-treat analysis, the widely accepted benchmark, confirmed the decrease in neonatal morbidity and neonatal length of stay while also displaying notable additional reductions in NICU admissions and NICU length of stay enhancing the generalizability of the results. Study strengths are from its design as a large multicenter trial of 19 sites with a diverse population. Participants were defined as being low-risk at singleton preterm birth with the control group having a rate of 7.8% compared to the national average of 8.7%. This ensured the study was representative and applicable to a broad clinical settings. The intervention bundle, which was simple and easily implemented, demonstrated notable association with neonatal outcome improvements despite still targeting a low-risk population. With these overall outcomes in mind, we shifted our focus to the number needed to screen, which highlights the possible practical impact, specifically the number you needed to screen to prevent 1 NICU day was remarkably low at 3.1. The number needed screen to prevent 1 NICU admission was 41, which further emphasizes the meaningful impact of this protocol on reducing neonatal complications. Compared to cervical length screening, a widely accepted approach endorsed by multiple societies, such as ACOG and ISUOG, this protocol demonstrates excellent efficiency. Cervical length screening has a number needed to screen to prevent 1 NICU admission of 150, making our screening protocol a highly effective alternative or addition to patients who do not screen positive for short cervix. This study does have potential limitations. The co-primary outcomes are assessed in a modified intent-to-treat population, which could overestimate effects. However, this approach was chosen due to attrition in previous studies especially in the higher risk group refusing medications. Additional analyses on the full analysis set in the intent-to-treat populations, however, improved internal validity and concurred with the co-primary results. Lastly, as an open-label study, there's a possibility of bias and high-risk arm from changes in treatment pattern. In summary, by implementing a screen and treat approach in a low-risk population, we observed clinical meaningful outcomes and reductions in neonatal adverse events, underscoring the value of early detection and targeted intervention. This strategy strengthens maternal care while improving neonatal health outcomes and suggest the potential to mitigate significant medical and economic burdens associated with preterm birth. We do have one additional slide for you that we desired to present. And what we're doing is we're taking the PRIME data here and we are actually comparing it and putting it together with the Avert data. And what we're seeing overall is a similar treatment effect within the 2 groups, for neonatal outcomes of neonatal morbidity and also neonatal length of stay. And we think overall, when you put these 2 events together, the hazard ratios are -- showed dramatic reductions still of approximately 22% and both groups are combined at p-values that are 0.0003 and 0.0001, which are fantastic results. And so with that, I will end. Thanks.

Dr. Aria. Thank you so much. This was a speedy and very rich presentation with a lot of data. I hope everybody was listening fast. But with that, operator, let me open it up for questions. Perhaps we start with folks dialing in and then go to the room. Operator?

[Operator Instructions] Your first question comes from the line of Dan Brennan from TD Cowen.

I thought I would just start off by asking the high-level question. You provided obviously, there's a ton of information here to go through. But from your perspective, doctor, like do you feel that the study and the endpoints that the study achieved, do you think it warrants the guidelines to incorporate this into the next update? Or do you think there needs to be more work done? Just kind of wondering kind of how you felt the strength of the data would correlate with how the guidelines would view this opportunity?

Well, I think the data is very strong. Predicting guidelines one way or another, I think, is going to be very difficult to determine. I do think that the values that we are presenting are extremely clinically relevant. And I think the data that we present is pretty fantastic. I think studies before have concentrated on things such as preterm birth and that's really just a surrogate for what we really want to look at, which is the neonatal outcome. So with the strength of the data in regards to the neonatal outcomes we have, I cannot predict how guidelines will move forward. But what I can state is that I really feel that the test has come a long way in showing that now you don't only have a test that predicts something, you have something that you can do about it in regards to medical treatment.

Great. Maybe as a kind of second question, some feedback that we had gathered in terms of the impact on being able to reduce preterm birth with aspirin and progesterone. That is the data, but some doctors felt like they kind of wondered how those drugs might actually have that positive impact, given, I guess, the history of those drugs. But whereas steroids, some doctors fell actually steroids could have an impact of given at the appropriate time. I heard you during your presentation, I believe you said there was an imbalance on the steroid use. I guess the question is, how do you feel about the aspirin and progesterone like the course of treatment that's used in the active arm and do you feel steroids played a role? And if they did kind of what was that quantified? Do you think that should have been quantified? Just any help on that front?

Yes. So I think actually the corticosteroid use question is actually favorable to the results of the PRIME trial. So corticosteroids are used to enhance fetal lung maturity in prematurity. In this study, the control group actually got more corticosteroids, meaning that people were more afraid of them delivering early rather than the other group that was apparently delivering later. So I think overall, that's an excellent outcome for the trial. I think secondarily, in regards to low-dose aspirin and progesterone, I think there's a plethora of data on how both of those work in effect to stop either preterm birth or preeclampsia. And I think the important thing was probably the first slide that I presented that you have to realize that preterm birth is kind of a complex multifactorial endpoint and not a disease itself. The outcome is preterm birth, the disease may be preterm labor. But it's difficult, it could be infection. It could be fluid problems. It could be uterine abnormalities. There are so many different things. And so what I think we have is we've kind of together decided that a bundle of treatments is probably the best way to go about this. And the beauty of it is not only a bundle of treatments or a bundle of treatments that's been used for different reasons for over 40 years. We know that they're safe and bundling them together with a test that makes the efficacy and having the efficacy we have, I think, is super positive.

Great. And then maybe I'll speak to one more and then I'll get back in the queue. In terms of the NMI reduction, is it important in your mind to understand what's driving that NMI reduction? Like will doctors in the community largely look at the NMI and want to see the subcomponents of it between the different categories, respiratory distress and the bronchopulmonary dysplasia, which we've heard aren't really that as worrisome as some of the other areas, obviously, like [ PVL ] and [ sepsis ]. So I'm just wondering if the drivers of the NMI will be critical to really understanding how this test is viewed in the real world? And I guess, secondarily, can you share any insight about what were the drivers of the NMI reduction in terms of those components?

That's a great question. So we've looked at that a little bit. We haven't gone fully over that overall because it's just important that you have the NMI reduction. But looking at the outcomes that are much more severe, such as BPD or IVH or a necrotizing enterocolitis, those do not appear to have reached significance and difference, but as well the NICU stays are -- don't really reach an overall difference in a categorical method. I think the NICU does probably pay a little bit more into it, but that's just me guessing on my part. I think they both play an impact and one is a more long-term clinical impact than the other.

Your next question comes from the line of Andrew Brackmann with William Blair.

Operator. Operator, can you pause for a second? Okay. We'll have an addition.

[indiscernible] else in efficacy, but combined [indiscernible].

Well, combined with the NICU, they do. So one of the points here in the room is that these other events such as intraventricular hemorrhage or necrotizing enterocolitis, et cetera, they're very, very rare events. That's why they're usually bundled together to look at them as a whole. It would be almost impossible to decrease all of those events in a significant level. I think we're exceedingly pleased that we're reducing NICU admissions by 20% because in my lifetime, of over 30 years doing this, I haven't seen something similar to this in a low-risk population.

And I would add, this is Jay, that the manuscript has a table in it that is trying to address exactly the point of the question, which is the NMI is a highly significant reduction and it's composed of both morbidities and categories of NICU stay and those components of the NMI are broken down in the table in the manuscript with counts for each of those morbidities and counts of babies for each of those categories of NICU stay so that the reader can have insight into possible drivers.

Whenever it becomes available. Thank you, operator, we can go to the next question.

Your next question comes from the line of Andrew Brackmann from William Blair.

This is Maggie Boeye on for Andrew today. Can you talk about any early physician feedback now that the abstract and presentation have occurred? Just what are some of the things that are surprising most and just whatever you can talk about there.

I think I've been involved in more meetings since I've got out of the presentation than anything else. I haven't had a lot of feedback overall. Mostly of the people that have had feedback to me where people I know. I have seen a couple of entries on X or Twitter about the results that have been good. There have been several -- a few press interviews that have been done in regards to this and the study has been highlighted by the Society of Maternal Fetal Medicine, there's over 1,200 studies here, and it's 1 of 5 studies that the SMFM is putting on is a press -- that is putting out a press release in regards to a scientific study here, 5 out of 1,200. So I think it's probably something that's being looked at quite a bit.

Great. And then just, obviously, a very compelling number needed to screen here. So can you talk about the PPV and NPV and what those metrics might tell you about the utility?

We are not analyzing our reporting test performance from the PRIME study, but the results of the PRIME study suggests that the test has to be stratifying risk in order to achieve the results that we're seeing in the study or said another way, with a screen positive rate of 23% and a 22% reduction in NICU admissions over the entire arm, test stratification has to bring into that screen positive group, a large number of eventual preterm births or pregnancies destined for prematurity in order to achieve that level of reduction.

Operator, any more questions?

Your next question comes from the line of Sung Ji Nam from Scotiabank.

Thank you so much for your time. Just -- I'm not sure if I'm not getting this -- if I'm misunderstanding. But just looking at some of the data, if you look at the PRIME study, in the prevention arm, there was a significant number of patients. It seems like the declined intervention. I don't think that minimizes the efficacy or the value proposition of the test. But I was kind of curious what the reason behind that, some of the reasons behind the patients declining intervention?

Yes. So I think in the PRIME trial, we actually had the lowest dropout rate in regards to refusing medications in contrast to the previous studies. It was 28.3%. I think that is a number that will probably go down with time with the knowledge of these results and patient education. I think it's important to note that women during pregnancy, of course, do not want to take medications that might put their baby at risk if they are unsure about whether the treatment will work. Secondarily, I think another issue is the administration daily of a vaginal medication, which is slightly more intrusive, of course, and I think that -- those 2 things combined lead to a little bit more of a dropout rate than you would see in other studies. I think it does hurt temporarily in the study, the efficacy, but we still reached goals in terms of efficiency. And I think overall, what you'll see is with further patient education, you'll see more uptake, less dropout and the efficacy of this bundle will apparently increase.

Got it. That's super helpful. And then Dr. Boniface and Dr. Iriye, you talked about the limitations of the study towards the end. I feel like that went through that really quickly. So I have a bit more to digest there. But if you were to -- I know this is hypothetical, but if there were to be additional studies to address some of those limitations, just kind of curious in terms of how you would structure that or frame that?

Well, we have a number of opportunities here for ongoing investigations. The trial is a gold mine for future manuscripts. One question was about compliance with interventions and a planned study will be an analysis of what's referred to as the compliant completers population, which gets at that question, which is if compliance is nearly optimal than what do you see for efficacy in the overall study. So it points towards the opportunities down the road with compliance increasing as the test gains traction. So that's one future manuscript, Maybe, Brian, you have some others you might want to highlight?

Yes. I think an economic analysis is planned to go forward in the future in regards to cost savings involved. I think a subgroup analysis of different populations such as Medicaid or lower socioeconomic status would be a driver of pushing things forward. So I think those would be the main ones that we would look at. And then I also think we would probably get some really good positive results from putting together several of the trials doing a meta analysis of the results kind of like we did here on the last slide, but doing it more formally and adding also the results of PREVENT, which also in a secondary analysis alone had a very good outcome data. So I think that would push things forward within the obstetric and maternal fetal medicine community to drive a forward usage of the test.

Do we have any questions in the room?

No questions from the room at this time. If there are no further questions let us know.

We do have one more question on the queue right now. That would be Dan Brennan from TD Cowen.

Sorry about that. I was on mute. In terms of the absolute number of days like for NICU admissions and neonatal length of stay, is that something that will be out in the manuscript, -- is that important looking at the absolute number of days? And like obviously, statistically, the reduction met the efficacy hurdle, but I'm just wondering if like the absolute number of days difference might have been small, would that be something doctors would look at and say, that's not that compelling or payer or so. So I'm just wondering like can you share any information on that? I assume that will be in the manuscript.

Yes. So the absolute number of days will be in the manuscript. We have them totaled and that's what drives the number needed to screen to prevent on NICU day. So that's -- I think you'll be happy with those results if we're getting to a number of 3.1 patients to drive that change.

Got it. And kind of which is more important in the medical community and the kind of the payer community between [indiscernible].

I think any NICU data you could save in the payer community is super positive. So my other job is I am a President of a women's health care firm that is value-based. So I talk to payers all the time. And the 2 most important things on their mind are cutting down NICU admissions and NICU days and decreasing Cesarean delivery rates. So this is going to be high on their radar, I think, in regards to moving things forward.

And then when we see the results, is there anything when you look at the control versus the test arm on that NICU day reduction. Was there anything that stood out to you? I mean, I will have to see the details in terms of what drove it. Was it -- yes, just kind of wondering what you could share on any of the color behind the NICU reduction?

Well, one thing I will share with you is we did look at, well, was there any abnormalities or that was missed on ultrasound that might have been driving this or genetic abnormalities that might have been driving it and it was very equal. It was like 4 in each group, and they were roughly the same total of NICU days. So I really think that what we're really doing is we're really driving through improvements and not things that are driven by other sort of characteristics or confounding variables.

[Operator Instructions] Do we have any questions in the room?

No, I think we're good to get to close.

Thank you. There are no further questions at this time. I will now turn the call back to Zhenya Lindgardt for closing remarks. Please go ahead.

Thank you so much, operator. First of all, let me thank thousands of people who were a part of making this milestone come to life after many, many years, at least 5 years plus a reality. So thank you for the 19 investigators and your leadership, Dr. Iriye. Thank you for a lot of the opinion leaders, the staff who are in the room here in Colorado, who were part of this to hundreds, literally, nurses, study coordinators, the staff and the hospitals who took care of the 5,000-plus patients and many thousands more who were screened for the study, and last but not least, the 5,000 patients themselves who took the risk on an innovative treatment in the time of pregnancy and as a mom of 3, I will tell you, it probably was a difficult decision. So we are all extremely grateful to each and everyone who was a part of this incredible journey that is still a journey in the making with -- as you've heard, many more publications and releases of additional data that the PRIME investigator group is planning to bring to the future conferences and to all of us. So terrific. Thank you so much. We're so excited to have been able to steal a little bit of your time, Dr. Iriye, to present again to all of us today as soon as the community heard these results, and we are really excited about what's in store for Sera and for our preterm screen and treat intervention that could help literally millions of moms and babies every year. So thank you again, and we look forward to coming back to you in the future R&D days once more data becomes available. Over to you, operator, to conclude the call.

Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.