Seres Therapeutics, Inc. (MCRB) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to the Seres SER-109 Investor Event 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, Eric Shaff, CEO. Thank you. Please go ahead, sir.

Good morning, and welcome to Seres Therapeutics SER-109 Investor Day. Thank you for spending time with us this morning. This is an important moment for Seres and for the microbiome space in general. We believe that our upcoming SER-109 Phase III readout will be the catalyst to demonstrate that the microbiome has moved from an emerging treatment modality to one that is here now. Our primary goal for today is to provide you with information that will enable you to better understand and appreciate our pending SER-109 Phase III results, which we are expecting this summer. Now we will be making forward-looking statements in today's presentation, so I encourage you to review our safe harbor statement included in our last 10-Q. Now on Slide 3, just a quick word about Seres. We are the leader in microbiome drug development with differentiated drug discovery, manufacturing and clinical capabilities. We have a rich and promising pipeline that is focused on C. diff infection, inflammatory bowel disease and oncology. We are driven by the opportunity to help patients with very serious diseases. Our focus today is on SER 109, but we intend to host future events like this one for our other development programs. We have an experienced and highly accomplished team with track record of success in drug development, and you will hear from some of those team members this morning. So on Slide 4, I'm pleased to be joined by my colleagues, Dr. Lisa von Moltke, Seres' Chief Medical Officer; Dr. Matt Henn, our Chief Scientific Officer; Dr. John Aunins, Seres' Chief Technology Officer; and we're very pleased to be joined by Professor Mark Wilcox of the University of Leeds, who is among the top experts in the world on C. diff. Mark has published widely on C. diff infection and he is recognized as a clinical leader in the area. We are honored to have him with us today. We have focused today's agenda on the significant unmet medical need in C. diff and our vision for how SER-109 will help patients that are in need of new solutions. We have slides alongside our presentation, and I would encourage you to view these as we proceed. The slides from today's presentation have been posted on our website, and a replay of this webcast will be available following the event. We intend to leave time at the end for Q&A, and we look forward to hearing your questions. So on Slide 5, what you will hear from us today is as follows: first, C. diff is a devastating disease that represents a significant clinical burden on providers and an economic burden on the U.S. healthcare system. Current treatment approaches are suboptimal, and both efficacy and safety are poorly understood. SER-109 is designed to break the cycle of C. diff recurrence by restoring the body's natural microbiome, which has been negatively altered by repeated treatment with antibiotics to control acute infections. The market opportunity for the treatment of recurrent C. diff is substantial, with approximately 170,000 recurrent cases in the U.S. Second, if successful, we believe SER-109 will set the standard for microbiome therapeutics and development for C. diff infection, and that SER-109 is competitively differentiated based on a rigorous clinical trial design, refined manufacturing approach and oral administration. We believe the requirement of toxin testing will give Seres the clearest, most interpretable, most reliable data set. We include manufacturing steps that are intended to support patients. Donor screening is necessary but insufficient to support patient safety, and it is inherently reactive. And there have been increasing FMT-related safety concerns that highlight the urgent need for an FDA-approved treatment option for C diff infection. Third and last, we believe SER-109 represents an entirely new treatment modality and if successful, will establish definitive clinical evidence for this new class of medicines. We believe the readout from our SER-109 Phase III study will be both a pivotal moment for Seres and a tipping point for microbiome therapeutics. A positive readout from our study will demonstrate the promise of this new approach for C. diff, further validate other programs in our pipeline and highlight the promise of microbiome-based medicines in general. We believe microbiome therapeutics are here now to serve patients starting with SER 109. So we'd like to thank you again for joining us this morning, and I'm very pleased to hand the presentation to Professor Wilcox.

Hello. Good morning, and I'm speaking to you from the U.K. -- from England in the U.K. Thank you for joining us this morning. I'd like to start by introducing some details about C. diff and what the disease is. It's a toxin-mediated disease that leads to inflammation of the large intestine, sometimes called the colon. It typically presents with debilitating diarrhea, and that can be up to 10, 15 or more times a day. Some patients have additional symptoms, including nausea, abdominal cramping, low-grade fevers, tiredness, fatigue and weight loss. A minority of patients go on to develop severe disease, and that's typified by a condition called pseudomembranous colitis, which is characterized by yellow plaques that appear on the background of severely inflamed mucosa on endoscopy, as you can see on this slide. Some patients may go on to develop toxic megacolon, where the colon expands severely and is indeed at risk of rupturing. And the plain X-ray here demonstrates loops of distended large bowel at risk of perforation and death. Next slide. The C. diff is a common condition, particularly in those aged over 65 years of age. And that partly explains some of the major effects on people and indeed on healthcare systems. But CDI is also involved -- or so observed in all age groups. We'll come for the patient outcomes and economic burdens on the next slide. But here, we're dealing with the disabling diarrhea and the poor quality of life and loss of productivity that the disease causes. And you can see here some of the patient-related quotes that highlight the burden of this infection on many aspects of life. And indeed, in a survey of more than 350,000 patients, those who'd had C. diff in the past had a dramatically lower quality of life in all healthcare domains, including general health, vitality, mental and emotional health and physical and social functioning. And this speaks to the devastating impact of C. diff on patients' lives that we treat every day in hospitals and in the community. The next slide deals with the economic and outcome burdens. You can see some large numbers here, very large numbers. In terms of the U.S. healthcare system, the latest estimates from CDC in 2017 include more than -- or nearly 0.5 million cases and almost 0.25 million hospitalizations with more than 20,000 deaths. C. diff infection is associated with adverse outcomes, including transfers to short- and long-term care facilities and overall mortality, but also attributable mortality as well. So it directly causes death. Treatment costs are estimated at approximately $5 billion annually, which are driven by -- primarily by increased length of stay and need for readmissions. Plus, of course, recently with a new economic burden due to CMS penalties. Next slide, please. The current treatment options for C. diff infection are, at the moment, primarily antibiotics, typically, vancomycin or fidaxomicin. But about 1 in every 4 patients treated with an antibiotic for C. diff infection has a recurrence, and the majority of these recurrences develop in the few weeks after completing 10 days, 14 days of CDI antibiotic therapy. So typically within 1 to 3 weeks. The risk factors for recurrence include older age, female gender and recent hospitalization. Notably, many but crucially not all of these risk factors are fixed. And so we can't alter these. Now importantly, the risk of recurrence continues to climb with each episode. Hence, I'd like to use the term, "The escalator of recurrence." And the crucial thing about this term here is that when you get on this escalator, it's very hard to get off. And indeed, we know that increasing recurrences increases the risk of poor outcomes, including death. The bezlotoxumab is sometimes used to treat C. diff infection and you can use that to try and reduce the risk of recurrence. But if you actually use it in a patient who's had a recurrence, then its efficacy is reduced. So the treatment options for multiply recurrent disease in general are very limited, often leading to recycling of drugs over and over again, which drives up costs, marginal benefit and poor outcomes in general. The bottom line is that we don't need a better antibiotic or indeed a better monoclonal antibody. And indeed, it's illogical to use an antibiotic to treat the disease that's caused by antibiotics. Instead, we need a drug that addresses the underlying pathogenesis of C. diff infection. Next slide, please. The pathogenesis of C. diff infection is a 2-hit process. Firstly, a deranged microbiome caused by antibiotics. And this first hit leads to the loss of beneficial bacteria and their associated health functions, which play a dominant role in host defense. And so the patient's vulnerable to potential pathogens, including C. diff. And indeed, the second hit leads to patient exposure to C. diff. And these pathogenic C. diff spores go on to germinate in the deranged microbiome and produce toxin and that leads to diarrhea and the inflammation of the large bowel, colitis. So CDI in effect is the canary in the mine, signaling that the patient has microbiome disruption and so is in need of microbiome repair. Next slide. Now over the last few years, fecal microbiota transplants have been used as a crude method to repair the microbiome. And as a proof of concept, the transfer of minimally processed stool from a screened healthy donor or apparently screened healthy donor to a patient with recurrent CDI can often lead to sustained clinical response. Now that durable response is associated primarily with a gain of Firmicute bacteria, which play a central role in gastrointestinal health. But the estimates of efficacy of FMT range widely from 56% to 96% depending on the study. And that can be affected by whether the FMT is delivered by colonoscopy or not and about other risk factors that the patient may have. Of course, colonoscopy adds cost to the procedure. Fecal animus is another way of delivering FMT, but those themselves are not easy to deliver and pose infection control hazards. So the wide range of efficacy estimates is probably due to the quality of evidence from these studies. And indeed, we know that the poorly controlled studies tend to come up, surprise, surprise, with higher apparent efficacy levels of about 80%, whereas the high-quality controlled trials for FMTs show an average efficacy rate of about 67%. And that's why, in the IDSA guidelines, the recommendation is to use FMT for recurrent CDI after -- not before, after 3 trials of antibiotics. And indeed, that evidence is only -- that recommendation is only based on moderate quality evidence. Another important issue here is the selection of appropriate screening assays for CDI, which leads on to the next slide, please. So a major shortcoming of these other studies is the fact that they haven't adequately determined that the patient has the infection in question. That might seem a strange issue, but it's really crucial because if you don't have the infection in question, then you -- clearly, the trial is flawed. Now we know that this is a great consequence to CDI because of the availability of 2 categories of diagnostic assays: one that detects the toxin, which actually causes the disease; and another PCR or NAT tests, which don't detect the toxin, detect the genes that produce toxin, but not all bugs with the genes produce the toxin. And so it's important because the tests that detect toxin are a better indicator of true disease and the tests that don't detect toxin can lead to the overdiagnosis of C. diff infection. So it's important that going forward, good quality studies should include toxin testing. And yet today -- to date, no published placebo-controlled trials of FMT or FMT-like drugs have required this specific test. Next slide, please. So importantly as well, we're aware sadly of major safety concerns that with FMT that have been made apparent with recent alerts from FDA. That was less than a year ago. One major report that indeed went on to be published in the New England Journal of Medicine and another report in March of this year, highlighting deaths and hospitalizations even in patients who apparently being screened correctly. Sometimes they're not screened correctly, but this is a major concern. And of course, in the era of COVID-19, where the virus can be excreted in feces, how can we be assured that a patient is free of the virus causing COVID-19 in their feces. The simple answer is, at the moment, we can't be assured of that. So in summary, C. diff -- the next slide, please, Slide 15. In summary, C. diff infection causes debilitating toxin-mediated diarrhea with significant effects on morbidity, mortality and quality of life. The 2-hit process, the deranged microbiome and the exposure to C. diff spores is fundamental to understanding how to control the disease. And patients suffer multiple recurrences, which adds to the burden of this disease, and we need to break that escalator of recurrence. Whilst FMT can provide proof-of-concept here for helping to reverse the deranged microbiome, estimates of its efficacy are unclear and safety concerns are a major pause for thought. Thank you for listening, and I would now like to hand over to Lisa von Moltke.

Thanks, Mark, and good morning, everyone. Moving to Slide 17. As you heard from Mark, the pathogenesis of CDI is a 2-hit process, involving initial microbiome disruption followed by the germination of pathogenic C. difficile spores. These toxin-producing bacteria can flourish and cause the disease Mark described. Vancomycin and fidaxomicin are efficient at killing C. difficile bacteria. Symptoms rapidly improved as stool toxin concentrations decline. However, antibiotics have no effect on the dominant -- on the dormant C. diff spores. And these serve as a reservoir that feeds a vicious cycle of recurrent infection. Thus, antibiotics are necessary but insufficient. This 2-hit process requires a two-pronged treatment approach. Slide 18. That therapeutic partnership is complete with the addition of SER-109 and ecology of Firmicute spores, which play a dominant role in gastrointestinal health. As you will hear from Matt, we believe that Firmicute spores are critical in achieving a sustained clinical response because they prevent the germination and growth of C. difficile spores. SER-109 spores are stable and resistant to gastric acid, enabling formulation into oral capsules. SER-109 can then reach the target organ where these Firmicute spores can germinate into bacteria that replicate and produce beneficial metabolite. Spore purification also reduces the risk of transmission of infectious agents. In summary, SER-109 is designed to deliver only the essential components needed for efficacy, while mitigating risk to patients. On the regulatory side, SER-109 was granted breakthrough and orphan status by FDA in recognition of the unmet need. Slide 19. We have made a couple of key determinations from our prior Phase I and Phase II clinical trials, which have informed the design of our ongoing Phase III ECOSPOR III study. In the earlier Phase II study, most of the subjects were qualified for enrollment by PCR testing, which was common clinical practice. However, as mentioned by Mark, PCR does not differentiate between colonization and true infection and likely confounded the results of that study. In addition, through reanalysis of the dose-ranging cohort in the Phase Ib trial, we confirmed that dose matters. We believe that there is a dose-dependent effect of SER-109 on the rate of microbiome repair. And since 50% of the recurrences in the Phase II trial were observed within 11 days of antibiotic completion, it is critical to rapidly repair the microbiome. By doing so, the defense properties of the microbiome may be quickly reestablished to reduce the risk of recurrence, which Matt will discuss shortly. These lessons learned have formed the foundation for the design of the ECOSPOR III trial. Toxin testing is required at study entry and at the time of suspected recurrence. This enhances the selection of candidates with true disease and ensures the accuracy of the primary endpoint. In addition, the total dose of SER-109 has been increased substantially over that used in the Phase II study. We recently published these detailed analysis in Clinical Infectious Diseases, which is the official journal of the IDSA. In an accompanying editorial, Dr. Vincent Young, an expert in microbiome sciences and C. difficile infection wrote, and I quote, "The results of their analysis, including the potential confounding effects of PCR versus toxin-based methods used to diagnose CDI should inform others conducting clinical studies and trials of this important nosocomial infection." This level of recognition on the clinical trial design speaks to the appropriateness of this approach. Slide 20. Another compelling issue for drug development is obviously safety. I am happy to report that all Seres trials to date have had a favorable safety profile. We have observed mainly mild-to-moderate adverse events with most described as gastrointestinal in nature, including diarrhea, abdominal pain, flatulence and nausea. None of the serious adverse events were considered drug-related. This safety profile may result from the fact that SER-109 is designed to deliver only Firmicute spores, which normally reside in the healthy GI microbiome. Slide 21. ECOSPOR III is a double-blind, randomized controlled trial for adults greater than or equal to 18 years of age. To be eligible, patients must have had a history of 2 or more CDI recurrences and the qualifying episode of CDI must meet the requirements of having 3 or more unformed stools per day or 2 consecutive days, plus a positive C. difficile stool toxin test. Patients also must have a clinical response to standard of care antibiotics before randomization. Slide 22. So looking ahead, we think that ECOSPOR III is a model for all trials in the CDI therapeutic space based on this rigorous trial design and top line results are expected in mid-2020. We have enrolled patients with multiply recurrent disease using the strict criteria of toxin testing. Our study subjects have been treated with either vancomycin or fidaxomicin for only 10 to 20 weeks as per investigator discretion. Subjects are then randomly assigned 1:1 to either placebo or SER-109 administered at 4 capsules daily for 3 days. Subjects are stratified by age, so either 18 to 64 years old or 65 and older, and by the antibiotic they received for CDI. The primary endpoint is the proportion of subjects who have recurrence by 8 weeks after dosing. Recurrence is determined by the return of diarrhea, the need to reinitiate CDI antibiotics as per investigator's judgment and confirmation of the clinical diagnosis with a positive toxin test. 67 sites in the U.S. and Canada participated in the trial and recruitment was halted in April due to COVID-19 after 182 of the 188 planned subjects had been enrolled. Important features of our trial design that differentiate it from others include: number one, inclusion of subjects with recent onset CDI; two, exclusion of subjects on long-term suppressive antibiotics; three, use of a placebo arm that is well blinded, which will give us clear insights into efficacy and safety; and finally, number four, our strict diagnostic criteria. Slide 23. In fact, the critical importance of toxin testing has already been confirmed from the ECOSPOR III study where the most common reason for screen failure in subjects with a history of recurrent disease has been a negative toxin test. As a result, we expect that our study will generate the highest quality clinical data available in recurrent CDI patients. Slide 24. So with all these study design improvements, what do we expect success to look like? We are hopeful that SER-109 efficacy will be demonstrated in patients with true CDI with a clinically compelling and statistically significant delta between treatment and placebo. And that the adverse event profile of SER-109 will be comparable to that of the earlier trials. We are well positioned to deliver on all key aspects of this Phase III trial because ECOSPOR III will be the first rigorously controlled trial of a microbiome therapeutic to require C. difficile toxin assays, enhancing confidence in our efficacy estimates. We expect that the safety profile will continue to be favorable, given that Firmicutes are abundant in a healthy microbiome. In addition, SER-109 will stand in a class of its own based on inactivation and purification processes that mitigate risk beyond donor screening alone. With these attributes, SER-109 is poised to fill an unmet need for patients with recurrent CDI. Slide 25. Now based on prior interactions with the FDA, ECOSPOR III has the potential to be a single pivotal trial to support SER-109 product registration. In recognition of the existing unmet need, FDA granted us breakthrough and orphan drug status with the potential for approval based on the strength of the data, although additional safety data may be required. In addition to the unmet CDI need, FDA's safety alerts on FMT, including the potential for SARS-CoV-2 transmission, highlight the consequences of emerging infections when no safety net exists. We believe that enforcement discretion for FMT should be eliminated if and when SER-109 is approved. Slide 26. In summary, I want to leave you with the understanding that CDI is a 2-hit process that requires a 2-pronged treatment approach to prevent the cycle of recurrence. SER-109 is an investigational orally delivered ecology of Firmicute spores essential for gut health. Our purification and inactivation processes have been designed to deliver only the essential components needed for microbiome repair while mitigating patient risk. We expect that the ECOSPOR III study will set the bar for all CDI trials in the field based on prior learnings and Seres scientific leadership in microbiome sciences. We are hopeful that with increased SER-109 dosing compared with our Phase IIb study, ECOSPOR III will demonstrate compelling efficacy and a favorable safety profile. With favorable results from this study, we plan to meet with the FDA to discuss the path to advance SER-109 toward product approval and commercialization. If we obtain the results we are hoping for, we will plan to seek a product label corresponding to the recurrent CDI population, which we estimate to initially be approximately 170,000 patients per year. So to conclude, our clinical and regulatory teams are preparing for success, and we are now very much looking forward to obtaining our study results. And with that, I'll turn it over to Matt.

Thank you, Lisa, and good morning to everyone. I'll now discuss SER-109 drug pharmacology. On Slide 28, since Seres inception, we have been building the research tools and platforms required to characterize the microbiome and microbiome biomarkers of disease and states of health. Our reverse translational platform and capabilities power both the design of consortia of bacteria with specific pharmacological properties and the delineation of the specific mechanisms by which our current drugs modulate host's function to treat disease. Our platforms integrate from human data with screening data from human cell-based assays and disease model results from customized in vivo models to define high-resolution microbiome signatures of disease and health. Many of our tools are validated for use in late-stage clinical trials, and we have pioneered their use in the derivation of microbiome therapeutic drug pharmacology. As shown in this slide, the bacteria in our drugs are designed to first engraft, which is the germination and vegetative growth of the drug bacteria in the gastrointestinal tract. Engraftment is a measure of SER-109 pharmacokinetics. Engraftment needs the broad modulation of the gastrointestinal microbiome and microbiome-associated metabolites that are then impact targeted disease pathways. These broader changes in the microbiome and functional changes are measures of SER-109 pharmacodynamics. Moving to Slide 29. SER-109 is designed to directly target the proximal cause of CDI, the gastrointestinal microbiome. With SER 109, we seek to prevent CDI recurrence by increasing the diversity of commensal spore-forming Firmicute bacteria that are severely depleted in subjects with CDI and by shifting the metabolic state in the gastrointestinal tract to prevent C. difficile spore germination and growth. This includes the depletion of primary bile acids that stimulate C. difficile spore termination and the increase of secondary bile acids that inhibit C. difficile vegetative growth. Preclinical studies at Seres confirm that spore-forming Firmicute bacteria are the active bacteria in reducing CDI recurrence. These data support that SER-109 bacteria can outcompete C. difficile in vitro on various nutrient sources, establish secondary bile acid metabolism in vivo and can prevent mortality in a CDI in vivo model at lower doses than FMT. Moving to Slide 30. In the Phase II SER-109 trial, the engraftment of drug species was observed by 1 week post treatment and was durable through 8 weeks. In this plot, we are showing changes in the number of SER-109 bacteria detected on average across subjects through 8 weeks. Prior to treatment, the diversity of drug species was not different between subjects treated with placebo versus SER-109. By 1 week after treatment, we see significant increases in SER-109 drug species in 109-treated subjects as compared to placebo subjects. SER-109 engraftment was detected early with maximum engraftment achieved by 4 weeks post treatment. Notably, engraftment did not vary across drug lots. Moving to Slide 31. In addition to looking at engraftment, we also examined biochemical changes resulting from engraftment. SER-109 engraftment is associated with a metabolic shift that increases secondary bile acid concentrations in the gastrointestinal tract by 1 week post treatment with SER-109. We observed a positive correlation between the number of SER-109 species engrafted shown on the x-axis and the concentration of the secondary bile acids with lithocholic acid and deoxycholic acid. Across the bile assets measured, we observed a near-complete conversion of primary bile acids to secondary bile acids, and we expect the effect of SER-109 on bile acid concentrations is sufficient to inhibit C. difficile germination and growth through this mechanism. Moving to the next slide. SER-109 engraftment by 1 week post treatment, shown here on the x-axis, was also associated with the prevention of CDI recurrence. At 1 week post treatment, SER-109 treated subjects that did not recur, had significantly greater engraftment than subjects that recurred. As Lisa previously noted, in the Phase II trial, 50% of the CDI recurrence occurred within the first 11 days. These data support that the therapeutic window for a microbiome therapeutic to treat CDI is early after the completion of antibiotic treatment to control C. difficile. Increasingly, key opinion leaders refer to an early window of vulnerability, and there is a race to repair the microbiome. Rapid engraftment kinetics and modulation of the gastrointestinal microbiome and associated function are important in preventing C. difficile spore germination and growth. Moving to Slide 33. This therapeutic window was a key learning from our SER-109 Phase II trial. In light of this insight, reevaluation of engraftment of the Phase Ib dose-ranging data that included subjects administered a higher total dose over multiple days of dosing, indicated that these subjects had significantly greater and less variable engraftment by 1 week post treatment than subjects administered lower doses or the dose in the Phase II study. Based on these data, we have increased the total dose in the Phase III study significantly with unit doses administered over 3 days to increase both the probability and extent of engraftment across patients. Notably, prior to finalizing the Phase III dose in collaboration with Dr. Wilcox, we evaluated the Phase III dose regimen versus that of the Phase II in a bioreactor system that stimulates the human gut and confirmed improved engraftment with the higher dose administered over several days. Moving to Slide 34. To wrap up, the data presented support that the mechanism of SER-109 includes the durable engraftment of drug bacteria, a measure of pharmacokinetics; and the modulation of disease-relevant microbial-associated metabolites, measures of pharmacodynamics. Learnings from SER-109 pharmacology informed our Phase III trial design and microbiome endpoints. Most notably, the Phase III study has a modified dose regimen to increase the probability of rapid engraftment within the therapeutic window to prevent CDI recurrence. I'll close by saying that Seres in-house reverse translational platforms are powerful tools for both drug discovery and pharmacology. We have advanced qualified and validated analytics for microbiome pharmacokinetics and pharmacodynamics and clinical readouts that importantly meet requirements for late-stage clinical trial use and are not commoditized. Additionally, from our SER-109 trials as well as our other clinical trials, we continue to gain key insights in a human setting on the mechanisms by which the gastrointestinal microbiome and microbe-associated metabolites functionally engage host cells and tissues to alleviate disease. These critical human insights on microbiome signatures, both disease and health states as well as our unique knowledge base on the engraftment of specific species, our leverage in the design and development of Seres drug candidates such as SER-301 and SER-155 and further inform disease targets for future pipeline programs. I'll now pass the call over to John.

Good morning. And thank you, Matt. I'll be speaking briefly on the production of SER-109. If we go to Slide 36, SER-109 is a novel product, the first highly purified biologically derived microbiome therapeutic. And although it may appear to be a complex and unusual product, if you break it down as we have in this cartoon, we've drawn from extensive precedent and each of the individual production steps. Process steps are straightforward, scales are modest, and this results in a conventional-looking drug candidate. Now as a commensal live biotherapeutic, it's much like a live virus or a live bacterial vaccine. We use the human gut as a bioreactor for growth of our bacteria. So our manufacturing requirements and scales of operation do not need to be large. We also take advantage of the efficient delivery properties in spores, which are resistant to gastric acid and heat and result in a convenient shelf-stable product. The donor requirements are quite small, requiring only double-digit numbers of donors and lots to provide market supply. Now when we initiated development of SER-109, one of the unknowns was how consistent a natural product composition would be and how consistently it would behave in the clinic. We've been diligent about exploring this, both clinically and analytically. To date, we've used materials from 14 donors and 28 preparations in the clinic with no indication of a donor effect or a lot effect so far. In addition, characterization of lots made by the large-scale manufacturing process show an excellent mean 78% similarity by measures that assess species overlap and relatedness, as shown in the figure to the right. Going to Slide 37. From the beginning, we were attentive to building safety into the SER-109 product and processes. Our donor program is comprehensive and custom-built from a ground-up analysis of infectious disease and microbiome literature to ensure it's appropriate to the SER-109 product. Donors are extensively screened using health history questionnaires, physical examinations and appropriate laboratory testing to ensure clean starting material, and the donor management and screening intervals are geared to assure detection of even rapid transient diseases. Pathogen inactivation and clearance steps have been incorporated into the process and validated against the panel of representative vegetative bacteria, viruses, fungi and parasites with widely varying properties as shown in the table. The assurance that these data provide is that we are less susceptible than FMT products by far to unrecognized or emergent pathogens such as SARS-CoV-2. We conduct our processing in controlled GMP environments. We employ disposable closed systems, extensive facility decontamination and extensive facility air and surface monitoring during processing to make sure we avoid contamination of the product. And last, we employ rigorous testing on the final product using custom assays to ensure that it meets specifications for identity, potency and purity, especially microbiological purity. On Slide 38, we show manufacturing of live biological products. And to do this to pharmaceutical standards as opposed to the food standards used for probiotics requires specialized facilities that are purpose-built. Our facilities also incorporate FDA guidance on manufacturing of spore-forming organisms, which calls for certain design and operating features to ensure that the product isn't contaminated and that manufacturing staff and the environment are not exposed to the spore product. Our integrated capabilities include not only manufacturing, but also extensive quality control and quality assurance for Seres products. Our proprietary analytics for drug quality control are well developed. Using this infrastructure, we're producing SER-109 lots at commercial scale. And across the universe of Seres product candidates, our overall success rate in batch release from initiation is over 98% over the last couple of years, a testament to the professionalism and efficacy -- efficiency of the staff. Now FDA has published CMC expectations for the development of live biotherapeutics, and these are useful to demystify the regulatory experiences for Seres products, including SER-109. The quality control scheme for release and characterization of SER-109 is consistent with our guidance as well as other guidances from the European Union and elsewhere. In addition, direct conversation with FDA regulators has been very helpful in tuning the regulatory expectations for SER-109, and this has provided with an education on the product and its features and informed Seres of the CMC expectations for licensure, and we believe we're well positioned here. Now if I could transition to Slide 39. Although the focus of today's meeting is SER-109, I'd also like to point out that Seres is developing fermented multistream products. And although our currently active products, SER-301 and SER-155 are at an earlier clinical stage than SER-109, I'd note that we've been developing the CMC capabilities for our fermented products since the very early days of the company. We believe we have industry-leading capabilities here in the manufacture of anaerobic, spore-forming and nonspore-forming gut organisms. And we've successfully produced dozens of different strains for clinical use under GMP, including drying of vegetative species that do not sporulate. So next slide. The key takeaways I would leave you are that SER-109 is unusual to produce, but we have mastered production and quality control to [indiscernible] a safe, characterized and consistent product that we think will meet regulatory expectations. We have applied learnings from SER-109 into the development of our fermented products SER-301 and SER-155. Thanks for your attention and time, and back to you, Eric.

Thanks, John. Moving to Slide 42. Why are we so excited about our approach with SER-109? We see recurrent C. diff infection as a significant opportunity to help patients and create value, with approximately 170,000 patients in the U.S. with recurrent C. diff infection. And as we discussed today, options today are suboptimal for the sick patients that require considerable care and can be extremely costly to the system. If you can break the cycle of recurrence, you can create value for patients and you can return value to the system, and we think these are the types of solutions that are desperately needed in society today. Now moving to Slide 43, anticipating a positive top line results and understanding patient need, we have initiated the key activities to prepare for launch. Market assessment, primary research, pricing reimbursement work with positive data, we are looking to deliver SER-109 to patients as quickly as possible, creating a new solution for patients with recurrent C. diff infection and demonstrating that you can interdict into the health of a patient's microbiome to impact serious disease. And we think that SER-109 for recurrent C. diff is really just the beginning. So I'd like to thank my colleagues, I'd like to especially fit Professor Wilcox. And we'd like to thank you for your attention. Operator, let's open it up now to questions, please.

[Operator Instructions] Our first question comes from the line of Chris Shibutani from Cowen.

This is Pam on for Chris. Our first question is for Dr. Wilcox. Can you talk about what level of recurrence you would expect in the placebo arm? And then maybe go through some scenarios for the active arm for what would be considered clearly compelling, clearly not compelling and maybe somewhere in the middle?

Okay. Pam, an easy question to start off with. That's a joke, by the way. So -- but it's clearly an important one. And we know the baseline risk of recurrence is about 25%. We'd expect, given that it's a multiply recurrent patient population at the placebo rate should be on that escalator. And I would expect in the 40s and possibly higher percent, 40%, 50% range. Particularly because we're using a good diagnostic method here, indeed the most robust diagnostic method. So if you can reduce that, quite frankly, down back to even down to a 25% rate of recurrence, so you're reversing that escalator. I would see that as a good progress and definitely compared with the current options we've got. If it can go further, even better. And a lot depends, I'd say, lastly, on the pedigree of the patients here just how many recurrences, how certain is that diagnosis of recurrent CDI in the past. You can control going forward, and you can't control the back -- going backwards? And what other risk factors have they got for recurrence? And we'll only see that those data, of course, when we get data, market data analysis.

Pam, maybe I can just add one comment, but I certainly agree with Mark's comments. We would just add that in our view, the unmet need in this space relates to both efficacy and safety. And the fact that we will be running a rigorously studied GMP manufactured therapeutic, which hasn't been tested the way that we're testing it, we think provides value to patients beyond hitting the efficacy dimension. And maybe I'd just ask Lisa, if she has anything to add on that.

Yes. I would just emphasize that as Mark noted that the quality of trials with FMT has been just all over the place. And we're going to be focusing in this gold standard trial and really focusing on the delta between our treatment and placebo. So we're focused very much on what our trial looks like in comparison to that gold standard arm.

Got it. Now if we can have a couple of questions for John, maybe on the process. First question is, how has your product processing changed over the course of clinical studies from the successful Phase Ib to Phase II to now Phase III? And a separate but related question, perhaps would be regarding the biological material you're using for SER-109. Is your processing such that you are confident using donor material after COVID-19 appeared in the U.S., for example, after December 1?

John, can you respond to those 2 questions, please?

Yes, punching my mute buttons. Sure. So the Phase I process was a very, very small-scale process laboratory like as many are in the biological space. And it was not scalable. So we moved to a different process, the Phase II. In our investigations of the Phase II clinical trial results, we really failed to identify any factor that had changed between the Phase I and Phase II that could be responsible for the result. And so as a consequence, we've really maintained that same process through to the Phase III, right? With regards to your second question, so of course, FDA is concerned about coronavirus for fecal transplantation. In our discussions with them, they clearly indicated that they consider us to be different from FMT, and they believe that our validation packages and studies were appropriate that we had done prior to the COVID epidemic. Of course, we want to also protect our clinical donation staff and our facilities and so forth. So we are implementing coronavirus protection measures. And we think we're fine in a post COVID world.

Got it. Okay. So no restrictions on donors then. That sounds confident.

No.

Thanks for the question, Pam.

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

Thanks for holding the event and giving the presentation. My first question is for Dr. Wilcox. Dr. Wilcox, I wondered if you could talk about the experience in the real-world with FMT. We know that there's some efficacy here from this process. But I just wondered if you could discuss what it's like actually using this treatment in the real-world and any potential challenges that can occur when you opt for this FMT treatment?

Okay. So in the real world, I think it's a surprise to all of us at the enthusiasm for FMT. It's been widely used. There are major practical differences in practical and sort of problems, hurdles to overcome. We mentioned briefly about colonoscopy versus an enema, indeed, potentially versus a nasogastroduodenal tube delivery which rarely, but documented, has been associated with death from aspiration. So the issue, the main issue for it is the procedure to deliver the FMT. And it does appear that the procedure matters because if you deliver the donor's stool just to the very distant part, bottom part of the colon, you may, of course, not reach the diseased area, which is could be the upper part of the colon many, many feet away potentially distance wise from where you've delivered the donor's stool. So there are a series of practical difficulties and complications. And I think it's fair to say that the initial enthusiasm which has been stark for FMT has become more and more tempered by the safety concerns because we all get up in the morning we first do no harm. And these are a desperately ill patient population, but it's really worrisome, knowing that the definite risk of harm, severe harm, ultimate harm indeed occasionally that FMT can lead to.

Okay. Great. And then just a question for the Seres team. Just curious if you would expect that most patients in this study would have received both vancomycin and fidaxomicin or if you'll have some patients that have received both in some patients that perhaps have received just multiple treatments with vancocin?

Yes, John, thanks for the question. Maybe I can ask Lisa to comment on that one.

Yes. Are you talking about for their previous episodes over the course of multiple episodes?

Yes.

Or -- yes. I think that we're seeing the same about percentage overall that we've seen in the past, which is fidaxomicin tends to be somewhere in the 25% to 30%. And everybody else was Vanco, seems to be pretty consistent.

And then just in terms of the capacity that you have to manufacture SER-109. Just wondering if you could talk about what type of capacity you would expect to have maybe at launch and then maybe over the next 12 months post the initial launch?

Yes, John, thanks for the question, and I'm going to ask John to comment after my initial comment. But we've been thinking about this top line data set. We've been thinking about the unmet medical need, perhaps accentuated by some of the safety issues that we've seen from FMT in the last period of time. So we've been thinking about those long lead time items to launching including some of the market research, the reimbursement analysis as well as CMC scale up. So maybe I can ask John to comment further on that.

Yes. As I mentioned in my discussion, we're already making lots at full manufacturing scale, and we believe we've got very much adequate capacity to address launch to launch plus 2.

Our next question comes from the line of Gbola Amusa from Chardan.

One of them was already asked. So I want to go a little bit broader than the C. diff program. And just ask, to the extent you meet your goals with the upcoming SER-109 data. Can you discuss aspects of the program or lessons learned that would have enabled a positive result for 109 that may be relevant in reassessments of your other pipeline programs? And then could you update us as well on your planned approach to discussions with payers or cost effectiveness organizations to ensure access and ROI?

Sure. So Gbola, and thanks for the question. Let me start on the first, and then I'm going to ask Matt to comment, but we're excited for this upcoming data set for 2 main reasons. First is that we think there is a desperate need in this space for patients with recurrent C. diff. And as I said before, I think that the safety issues that have popped up in the last 9 months and especially with the sensitivity, somewhat unfortunately because of the COVID pandemic, people are thinking about safety in a way in which maybe we've been talking about for some time, but we really think that with the positive top line data set, SER-109 really help these patients. The other side of it is we are really excited about this moment in time for the space, right? I think that as we think about what really moves the needle in this space, in our minds, it's positive data. It's line of sight to a BLA, and it's giving that validation that the microbiome is here now. It's not some years away. it's here to help patients. And in that sense, we think that some of the work that Matt has done in his group in microbiome sciences, some of the capabilities that John laid out, at least, in a high level this morning, those provide us the right tools to approach IBD in oncology in a way in which it increases our probability of success and maybe provide some visibility that the application of this technology is actually really quite broad to help patients. So Matt, maybe I can ask you to comment on mechanistic lead through, if you will, or maybe greater visibility into some of the work that we've done in 287 as an example.

Yes, sure. Yes. So as I spoke to previously, we continue to leverage our clinical trial data sets and key insights that we gain from them in both the design and of our future pipeline drugs and drugs that are moving into the clinic in the near term including both SER-301 and SER-155. And we've put particular attention on really understanding specific microbe-microbe interactions and then microbe-host interaction that occur in the gut, both in the context of how microbes compete with one another as well as how the microbes are engaging various host tissues, in particular, the epithelial barrier. And we have used these insights in terms of which bacteria engraft the timing of their engraftment, which bacteria engraft well across a broad number of patients versus those that do so in smaller numbers of subjects. We've looked at the transition of engraftment to the onset of various development, various microbe associated metabolites and how those then associate with disease progression or prevention, and we've incorporated all of those types of insights into our various different programs as appropriate. So I think the additional thing I would say is that from a safety perspective, we've continued to maintain a good safety profile for all of our drugs across the portfolio. And I think something you'll notice as we recently launched our SER-155 program, which is a rationally designed fermented product, we're targeting immunocompromised patient population. So I think as we maintain the safety profile that we anticipate with our drugs, I think there's ways to be thinking about this modality both in acute infectious diseases as we are currently doing, both in chronic diseases, such as ulcerative colitis, which is our 287 and 301 programs. And then even thinking about settings where patients are immunocompromised to have an impact.

And then, Gbola, let me address your second question, which is around payers and reimbursement. I'd say you heard from Professor Wilcox around the economic burden, which is considerable. Remember, these recurrent patient populations are patients that have really that recurred, they're expensive. They've got significant comorbidities. We have done the market research we've engaged to understand that if you can break the cycle of recurrence, you can actually create a win-win situation for creating value with the therapy, but also returning value to the system by stopping this cycle of recurrence. But really, what we're focused most on is driving towards our late-stage readout this summer.

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

Questions. Maybe a couple for Dr. Wilcox and then one for Eric at the end. But Dr. Wilcox, it sounds like the toxin assay is required for accurate diagnosis and I'm just wondering if you can comment on how frequently it's being used in a real-world setting relative to PCR testing? And if it's only being used in a minority of cases right now, I guess I'm wondering how we can be confident in the prevalence data that you're including in the presentation.

Thank you for the question. So a lot of the data that has been compiled from the U.S. have indeed been based driven, not entirely, but driven certainly, to a large extent, by NAT PCR testing. The recent data showed about 70% of labs in the U.S. were using PCR test alone. However, I say recent, there are some more recent data suggesting in particular since the 2017 IDSA guidelines, which just to confuse, were published in 2018. And since that publication, there has been a shift, and that shift appears to be increasing from NAT PCR testing to toxin based testing. So I can't give you an accurate figure at the moment as to how many labs are doing that, but it's going in the right direction towards truth. It also -- there are some sensitivity in [ LSCs ] that are being done. If you look back into some of the publications, in particular, the [ LASA ] paper in 2014, there's a sensitivity analysis of if all the labs have been doing that, what the number -- the headline rate number would have been if all of them being toxin testing, what the headline number would have been. So there are some data out there about the degree of uncertainty. But whatever headline rate we've got, remember, is there a huge degree of under diagnosis. I think people never get a sample taken. It never gets to a lab, never gets tested by anything. So when you put all that lot together, and I don't think it's unreasonable the headline figures that we've got. Exactly it is that absolute truth, nobody knows.

That's very helpful. And I'm also wondering how you explain the discrepancy in the reported cure rate for FMT in randomized trials versus the open-label study? So if you could just comment on what you see as the main sources of bias that are being introduced into the open-label studies that may be artificially increasing cure rate. I'd appreciate it.

Yes. Okay. Well, I'm afraid human behavior is the most important one here. And studies are blinded and controlled for a reason. And okay, it might be difficult to apply a complete blinded control. But if you don't have that and if you also add in the problem with diagnosis that we've just been talking about, then a belief tends to believe that a therapy is going to work. In this case, FMT, like it or not, influences a subjective assessment of outcome. And particularly you marry that subjective assessment of outcome with an imprecise diagnostic method in terms of specificity, predictive value for real disease, which is what NAT does, and then you get an embellished version of the real -- of the truth. That's just is it whether this is C. diff infection or some other condition. So a controlled trial preferably blinded if you can do that, is the best way of getting accurate data on efficacy.

Okay. Maybe one last quick one for Eric. Just on the time line of events for later this year. Can you comment on when you're planning to meet with the FDA after announcing top line data? And sort of what's the realistic time frame for when we might receive updated regulatory guidance for SER-109?

Yes. Mark, thanks for the question, and especially the last one, I thought was a really important one. But from a time line perspective, as we said, we expect top line readout this summer. Remember that this is a breakthrough designated program. It's an orphan designated program by the FDA. And our intention would be to meet with the FDA as quick as possible following the top line result. And certainly, we're in preparations for that interaction as we speak today. So looking to move as quickly as possible with top line results.

Okay. Is it fair to say we would have an outcome from that meeting in the second half of this year, though?

That certainly would be our hope and expectation.

Our next question comes from the line of Chris Howerton from Jefferies.

Good morning, everybody. So I guess maybe the first question might be for Lisa or Dr. Wilcox. I guess I was just curious to get a little more color around the cessation of antibiotics, given that there's a range of 10 to 21 days in terms of the most recent treatment as well as retreatment during the trial itself on recurrence. So maybe if you could just give us a little more information with respect to the criteria there and how that may or may not affect outcomes?

Yes Chris, thanks for the question, and good morning. Maybe I can ask -- as it relates to our trial, maybe I can ask Lisa to start and then Mark to add additional color.

Sure. Yes. No. Thanks for the question. So the range is there to allow for investigator discretion, right? Because it's a clinical diagnosis. And obviously, the investigators are looking for clinical response. I think it's important to remember that once that course is finished, there's a -- for all people, for all patients, there is a finite window that they have to be able to start in on SER-109. And all patients undergo the bowel prep before that to take care of any residual antibiotics. So there is a standardization regardless of how long they've actually been on that therapy. And I think that, that takes care of any kind of variability. And with regard to why patients may be on 10 versus 21, maybe Mark can address that.

I think the only thing I would add to that is that the range of treatment duration is to see the missed patients who genuinely are eligible, I think, for this intervention. If you'd fixed it at 10 days or 14 days, some real candidates, real-world candidates would be missed. So I think it's -- that's why, but it's that washout period and that assessment that diarrhea really has stopped, but it's important what Lisa just referred to.

Got it. Okay. And so maybe what the clinical response that they'd be looking for is the diminution of the unformed stools and that, that would allow them to kind of go into that washout period? Is that the right way to think about that, Lisa?

Yes. That's right. So they would have to have a clinical response to their antibiotics. That's right.

Okay. Great. And then maybe to follow-up on some of the implications for the toxin testing. I think I guess what I'm trying to understand is what you think the true differentiation in terms of the evaluation of SER-109 in the context of those data. Is that very important from a regulatory perspective and that maybe the FDA would then require additional therapies to be evaluated against that standard? Or is it more than -- this is more palatable for physicians, and they believe or they have a greater degree of confidence in these data? So I guess I'm just trying to understand what you believe the implications of this testing is from both of those sites.

Yes, Chris, it's a good question. Let me start, and I'll ask Lisa to comment further. I think our view is that the requirement of toxin is likely to give us the most interpretable, clearest most reliable data set of the studies that are being done, have been done, will be done, especially within the microbiome. And in our view, we think that, that is an advantage with the regulators. We think it will be an advantage commercially. I would prefer not to speculate on what it would mean specifically in terms of additional action from the regulators. But maybe Lisa can comment further on that.

Yes. And I think Mark addressed this in his talk as well that in the clinical trial setting, it's really imperative to make sure we have the right patients, right, that we're including and that we actually assess the primary end point. The expectation on our part would not be and we were not intending, that there would be any kind of clinical directive as to how physicians make the diagnosis because this remains a clinical diagnosis, and physicians will continue to use, choose their tools in terms of helping to make that diagnosis based on their population. Some of them may have particular arrangements with their institutions, with regard to what kind of samples get submitted. So really, this is -- the use of toxin is really about ensuring that we have the best possible clinical trial.

Okay. Yes. Totally. Right. And then in terms of kind of the next steps in capturing additional safety data. Could you maybe give us a little more information in terms of what that is? Is that just additional follow-up from the already treated patients? Or do you anticipate more subjects would need to be dosed?

Yes. Chris, we -- I think what we said in the past and what we'll reiterate today is that we're focused on working towards these top line results. And once we understand what those top line results are, we will engage with the FDA around next steps. And our view was that if there is additional requirements from a safety perspective to fulfill a [ Phase III ] database, there's ways to do that, whether it's Phase IV commitments or continued open-label exposure. We feel strongly that our platform and we noted it in the prepared remarks, has been safe across a number of different therapeutic areas. Of course, these are all organisms that have coevolved with us for millions of years. But certainly, we will work with the regulators to address whatever additional safety requirements may be in place to try to get this drug to patients as quickly as we can.

Okay. Yes, totally fair. And then maybe with respect to the collaboration with Nestlé, what -- maybe you could remind us in terms of what the additional milestones are? And any plans that you might have in the EMEA or other territories ex-U.S.?

Yes, Chris, we -- thanks for the question. We have not provided additional guidance in terms of forward milestones with Nestlé on this program. What I will say is they've been a terrific partner to us. They've been a great supporter of us. And we really look forward to working with them in collaboration following a top line readout in the U.S. in the study to then engage with additional regulatory bodies to talk about ex-North American plans for this program going forward. We're really pleased to have them as a partner, and we would love to move as quickly as possible to get this drug to patients globally. Of course, this is not just a U.S. problem.

Yes, yes. Okay. And then I know, I appreciate you taking all these questions, and I actually don't think you're going to answer this, but I'll ask it anyway. For if you could maybe just help us understand the powering assumptions initially for the ECOSPOR trial to kind of where we are today with respect to the truncated size that was announced last year and then, of course, the slightly smaller enrollment than anticipated?

Yes, Chris, when we designed the trial and adjusted the design, we believed that with 188 design subjects, we were going to have a well powered study. So 2 arms. And as we said, when we noted amidst the COVID pandemic that we were halting enrollment at 181. Of course, we've got 182nd subject subsequent to that. We, of course, did the math, and we thought that the powering change with that small handful of patients was not significant. But certainly, we'll be working towards those top line results, and we'll see what happens.

All right. Well, fair enough. I mean, like I said, I very much appreciate you and just like everyone else, I'm very excited for these results to come up, and I hope them to be positive.

Thanks very much. Thanks, Chris. Thanks for the questions.

Our next question comes from the line of Terence Flynn from Goldman Sachs.

Maybe just 2 from me. Just wondering how important durability of the efficacy of 109 is beyond week 8 from maybe first, a regulatory perspective and secondly, a payer perspective? And then on 109 reimbursement dynamics, just wanted a reminder here. I'm assuming this would be outpatient therapy, so it wouldn't fall under the DRG. But just can you confirm that? And then how should we think about the size of a commercial footprint here?

Terence, thanks for the question. On the first one, in terms of durability, we know that if a patient is going to recur, the vast majority of patients recur reasonably quickly. And maybe I can ask Lisa to take that and then I can take the rest.

Yes. I think one of the things we learned from our earlier is that we really have that short window that Matt described. And within 2 weeks, within 11 days, really, is when we have the opportunity to intervene because that's where the recurrences were happening. So following out to 8 weeks for the end point is it's obviously beyond that, and of course, the trial continues on for 24 weeks. So we're watching people across time. But it's really that proximal time period, that's critical.

Right. Terence, I think you had asked about the commercial footprint and maybe when the script is written. We believe this is -- of course, this is an orphan designated patient population. These are sick patients who have recurred multiple times. Some of these patients are treated by infectious disease physicians who get a referral based on multiple recurrence. Some of them are treated by certain GI physicians who tend to specialize in this patient population including sometimes giving FMT. So we think it's a relatively specialized group of folks that would -- that could be served with a relatively small commercial infrastructure. So we -- as I said before, we've been doing the payer research and thinking about MSL strategy and so forth. And we do think that this is a patient population that can be served by a relatively small company with a specialized call point with positive results. We'll certainly consider that.

Great. And then the second part was just related to the outpatient therapy. So this wouldn't be a DRG reimbursement?

Yes. It can be outpatient. Of course, there are certain patients within long-term care facilities that are in scope. So it is a mix of those groups.

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

Great. Very thorough update today. Lots of good questions asked. For Dr. Wilcox, I just wanted to get a sense from you what you think the cost might be for fecal transplant? And in the case that doesn't work or there are complications, what are the follow-up therapies? Or what do you do as sort of a last chance?

Okay. So I think your first question was, what's the approximate cost of FMT? And it depends who you're talking to. The optimist would try and have you that a handful of a few hundred dollars, $200, $300. What Is the cost? It's not. That cost estimate does not take into account the substantial setup costs for setting up an FMT program. It doesn't account for all the safety measures that need to be taken into account, including if you're doing it properly, an extensive, rigorous testing protocol per patient per donor and per recipient with appropriate follow-up as well. So there is a paper. Forgive me I can't remember the name of the first author. It was published in the last 12 months or so in one of the European journals, which came up with a cost of EUR 2,000 to EUR 3,000 per FMT when you take in for account all those other set up institutional, maintenance, et cetera, costs. What do you do if a patient fails FMT and probably try another FMT? That's very frequently seen. And often these rates, you see quoted the high rates of FMT high rates claimed rates of success are not for the first episode of FMT but for the subsequent one or the one after that. So -- and that's possible to do with failure of engraftment, but that's not always clear or just a straight administration issue. And so you probably would try another episode of FMT. If all that fails, what I would recommend. You need to really seriously consider, have you got the right diagnosis, have you used a robust test to pin down the diagnosis here. If you have, then you need to look individualize your treatment and go back and say, well, what has this patient not had? What have they not tried? If you haven't tried bezlotoxumab, for example, you could try that. So there isn't an easy answer, but I think the message is you need to individualize the treatment and see what has been tried and what has not and then make an informed decision on where to go.

Our next question comes from the line of Vernon Bernardino from H.C. Wainwright.

Thanks, from me, as well for holding this event. It's very informative and very helpful. You had already mentioned several times as far as the readouts is concerned to expect would be the primary end point recurrence at 8 weeks. But will you also be giving some information regarding the level of engraftment, for example, like a success rate? And in answer to Ted's question from Dr. Wilcox as far as the success also of the second and third, would you be, at some point, perhaps in this summer readout or sometime down the road, be quantifying or giving some numbers as far as the species that engrafted then, success and what are the implications there? I'm sure there are implications, but how important are the implications in the presentation in front of the FDA as well as the determination of moving forward with the 301 and 155?

Yes, Vernon, thanks for the question, and good morning. I'm going to direct this to Matt. I think that Matt, maybe you can speak to with the microbiome analysis for 109, just as Vernon asked, what will we be looking for? I think, is maybe the right way to say. Go ahead.

Sure. Thanks for the question. As with all our trials, we continue to build in various pharmacological end points targeted at the microbiome, where we look at both the engraftment of various different drug species, as I spoke about previously. And then also looking at how those changes how those engraftment dynamics change the microbiome as a whole, and importantly, the functional parameters of the gut and key metabolite changes that are relevant for various different disease pathways that we're seeking to target. So we certainly provide these data to the agencies as we discuss our programs with them. And in the Phase III trial, we will be evaluating engraftment as an exploratory end point. And to evaluate what those levels look like, and importantly then associate the engraftment of particular species and key metabolites with the clinical outcomes. Those are the types of data that we've developed pretty sophisticated both in terms of specificity and sensitivity analytics to be able to look at those dynamics at high resolution, and we carry those insights forward to our other programs and use those as appropriate to inform both the assays that we develop in the lab to evaluate the pharmacological properties of our drug as well as various different release assays. So those types of data carry through in multiple different ways across -- in the program as well as across the portfolio.

So those would be definitely very important for commercial aspects. How important do you think it'd be in as far as a presentation to the FDA on engraftment and species and all that? I assume it's going to be quantifiable and you will have numbers, but how important would the FDA place on those kind of numbers?

Sure. So I wouldn't want to be in the position of speaking on behalf of the agency. What I can tell you is that we continue to provide them those types of data and to me, I think, a good gauge of their interest in that data. It certainly -- this is the type of data we went to them with our Phase II trial when we didn't hit statistical significance on the clinical outcome, yet saw directionality that was favorable. We went back to them with a comprehensive data package that included the data that supported our view that both we had a diagnostic issue which has been discussed quite a bit today as well as our belief that we needed to increase the dose, and that was based on these various different microbiome end point readouts, and it was the agency that came back to us after looking at those data and said, we agree with you moving to a Phase III trial. And here's what we would like to see in the design of that. And so that's part of the basis of our Phase III design. So I think they look at these data. But in the end, it's the efficacy and safety data that drives licensure.

Yes, Vernon…

Yes, looking forward to your results.

I just agree with Matt's last comment. I think efficacy and safety will speak. But certainly, our microbiome analysis has been useful, important, helpful in our interactions with the agencies in the past, and we expect they will be in the future as well.

Terrific. Yes, look, I'm academic so I'm looking forward to the science as well.

Thanks for the questions, Vernon.

Thank you. At this time, I'm showing no further questions. I would like to turn the call back over to the company for closing remarks.

Great. Thank you, operator. I know that we're well over time. So we'd like to thank you again for your attention this morning. We look forward to connecting with you soon. Be safe and healthy, and have a great week. Thanks very much.

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