Seres Therapeutics receives $50 million from Nestlé Health Science

CAMBRIDGE, Mass. - Seres Therapeutics, Inc. (NASDAQ:MCRB), a clinical-stage biotherapeutic company with a market capitalization of $133 million, announced today that it has received a $50 million installment payment from Nestlé Health Science. This payment is part of the transition obligations following the sale of Seres' VOWST business to Nestlé Health Science in September 2024. According to InvestingPro data, the company has been rapidly burning through cash, with negative free cash flow of $158 million in the last twelve months.

The company expects an additional installment of $25 million from Nestlé Health Science in July 2025, which will be slightly reduced by employment-related payments. With these funds, along with its current cash reserves, Seres Therapeutics anticipates being able to finance its operations into the first quarter of 2026. The company's current ratio stands at 1.12, while InvestingPro analysis indicates the stock is currently trading below its Fair Value, with significant volatility reflected in its beta of 2.12.

Seres, known for developing VOWST™, the first FDA-approved oral microbiome therapeutic, continues its work in the field with SER-155. This product has been granted Breakthrough Therapy and Fast Track designations and has shown promise in reducing bloodstream infections in patients undergoing allo-HSCT, as compared to a placebo, in a Phase 1b clinical study.

The company's pipeline includes SER-155 and other cultivated live biotherapeutic candidates, which are produced via cultivation from standard clonal cell banks, a different approach than the donor-sourced production process used for VOWST. Seres intends to evaluate these candidates in various medically vulnerable patient populations, including those undergoing autologous-HSCT, cancer patients with neutropenia, CAR-T recipients, and individuals with chronic liver disease, among others.

The information reported is based on a press release statement from Seres Therapeutics, Inc. The company has cautioned that forward-looking statements contained in the press release are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include the company's history of operating losses, the need for additional funding, and the reliance on third parties for clinical trials and manufacturing, among others. InvestingPro subscribers have access to 10 additional ProTips and comprehensive analysis of Seres Therapeutics' financial health, which currently shows a 'FAIR' overall rating based on multiple financial metrics and market indicators.

In other recent news, Seres Therapeutics has made significant strides in the biopharmaceutical sphere. The FDA granted Breakthrough Therapy designation to the company's investigational drug, SER-155, aimed at reducing bloodstream infections in adult patients undergoing allo-HSCT for hematological malignancies. This is the second such designation for Seres, following a Fast Track designation in December 2023.

The company's Phase 1b study data revealed that SER-155 led to a 77% relative risk reduction in bacterial bloodstream infections compared to placebo. Seres is planning to meet with the FDA in the first quarter of 2025 to discuss the next clinical study of SER-155.

On the financial front, Seres reported a net loss of $51 million in its Q3 2024 earnings call, largely due to the extinguishment of Oaktree debt. However, the company also completed the VOWST sale to Nestlé Health Science, which provided substantial upfront cash and allowed the company to retire debt.

Seres is actively seeking partnerships to enhance its clinical development capabilities and extend the application of SER-155. The company's financial position includes $66.8 million in cash, expected to fund operations into Q4 2025. These are recent developments that investors should take note of.

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