Plotting a comeback after 2016 flop, Seres to raise $100M to prep C. difficile program for launch
Microbiome pioneer Seres Therapeutics faced numerous setbacks throughout the years in numerous fields, most prominently for its lead program in C. difficile infections. But the biotech has plotted a comeback after a major flop six years ago, and is confident enough to start seeking cash ahead of a possible market launch.
Seres on Thursday said it plans to raise $100 million by offering stock purchases to new and existing investors, giving the company some money to prepare for commercial activity and additional manufacturing capabilities. The biotech offered the shares $MCRB at $3.15 apiece, equal to Wednesday’s closing price.
The offering will close on July 5. Seres’ stock was down slightly, about 2%, in early Thursday morning trading.
Seres’ raise comes a few weeks after it said it had enough data to begin submitting a rolling BLA for the program, known as SER-109. Earlier this month, Seres reported that a Phase III study saw 91.3% of patients achieve a sustained clinical response at eight weeks, and 86% maintained their response at the 24-week mark.
Those data provided results similar to an earlier Phase III trial, in which 88% of subjects in the SER-109 group were free from C. difficile recurrence after eight weeks, compared to 60% in the placebo group. At the time, Seres execs said the BLA may be completed as early as mid-2022.
With the biotech bear market continuing to batter the sector, some public companies are still securing funding on the backs of positive clinical data. Sometimes, they are able to raise the money within hours or even minutes of announcing their trial results, such as a 24-hour period back in March when three biotechs combined to pull in $1.5 billion after reading out data.
Though it took a bit longer for Seres, the company is ostensibly confident in its ability to finally get SER-109 past the finish line. An approval would mark a significant comeback for the program after it missed badly in a Phase II test back in July 2016, wiping out 78% of Seres’ market cap, good for $1.4 billion.
A previous breakthrough therapy designation could open the door to priority review, with a potential commercial launch in the first half of next year if everything goes well at the FDA. Seres would have a leg up on some industry heavyweights, as C. difficile has flustered not just biotechs but Big Pharma companies, with Pfizer reporting a big failure earlier this year and Sanofi whiffing back in 2017.
Nestlé Health Science had previously paid $120 million upfront and promised more than $2 billion in milestones to partner with Seres. As part of Thursday’s raise, Nestlé will once again be pitching in, and joined by Flagship, Federated Hermes Kaufmann Funds, Heights Capital Management and Janus Henderson investors.