Seres Therapeutics Inc (NASDAQ: MCRB)

Seres Therapeutics had an incredibly rough day in the market today to cap the trading week off. Unfortunately, the company released top line results from a recent Phase 2 Study. Unfortunately, the study did not meet its primary endpoint. Today, we’ll talk about what we saw from the study, how the market reacted to the news, and what we can expect to see from MCRB moving forward. So, let’s get right to it…

MCRB Releases Phase 2 Results

As mentioned above, Seres Therapeutics released its results from a Phase 2 clinical study today. The study was designed to assess SER-109 as a way to prevent multiply recurrent Clostridium difficile infection, also known as CDI. During the study, the company planned to show that the treatment reduced relative risk of CDI recurrence at up to 8 weeks. Unfortunately however, this endpoint was not achieved. MCRB said that it will continue to gather and analyze data. Also, the company plans to have a consultation with the FDA in order to discuss appropriate adjustments to its SER-109 development plans. In a statement, Roger Pomerantz, MD, President, CEO and Chairman at Seres Therapeutics had the following to offer…

“These are unexpected clinical results in view of the positive data in our prior investigator-sponsored Phase 1b trial, as well as in a wide range of supporting clinical and preclinical data. Specifically, the recurrence rates observed in the overall SER-109 treatment group, in the age stratified subgroups, and in the placebo groups are inconsistent with our expectations. Our priority is to complete a full review of the clinical results and microbiome data of the Phase 2 study and to compare it to data from the prior investigator sponsored Phase 1b. Based on this information and pending discussions with the FDA, we plan to make any necessary changes to our development plans for SER-109.

C. difficile infection treatment options, including unregulated fecal microbial transplants, remain poor. The confounding placebo data obtained in this study further highlights the significant need for new, effective, FDA regulated therapeutic options for these patients. We will take our learnings from this study and continue in our pioneering efforts to develop meaningful new microbiome therapeutics for C. difficile infection and other serious diseases.”

How The Market Reacted To The News

As investors, one of the first things that we learn is that the news moves the market. Any time positive news is released with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with the news. Adversely, negative news will lead to declines. Unfortunately, the news released with regard to MCRB was anything but positive. As a result, we saw a massive decline in the value of the stock throughout today’s trading session. By the end of the day, the stock had fallen to $10.94 per share after a decline of $24.83 per share or 69.42% thus far today.

What We Can expect To See Moving Forward

Moving forward, I have a relatively mixed opinion of what we can expect to see moving forward. In the short term, there’s no doubt that the company is going to deal with headwinds. Unfortunately, the prime candidate in the company’s pipeline has proven to be inefficient in treating what it was designed for. However, I don’t think that the stock is going to fall forever. After all, the company does have a strong pipeline. Perhaps more importantly, the results of this study were shocking considering positive data in the past. I do believe SER-109 does have potential and am excited to hear what the FDA has to say. In the long run, this still could be a strong investment.

What Do You Think?

Where do you think MCRB is headed moving forward and why? Join the discussion in the comments below!

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