Seres Therapeutics, Inc., a leading microbiome therapeutics platform company, has announced that it has entered into an agreement with Nestlé Health Science for the development and commercialization outside of the United States and Canada for its product candidates in development for Clostridium Difficile infection (CDI) and inflammatory bowel disease (IBD), including ulcerative colitis and Crohn’s disease.
The agreement will support the expansion of Seres’ portfolio in markets outside of the United States and Canada and provide substantial financial support for Seres’ ongoing research and development. Seres retains full commercial rights to its entire portfolio of product candidates in the United States and Canada, where the company plans to build its own commercial organization.
“Nestlé Health Science is an ideal partner for Seres in a wide range of global markets, where its vast reach and long-standing GI focus should help drive the successful adoption of our lead microbiome therapies,” said Roger J. Pomerantz, M.D., President, Chief Executive Officer and Chairman of Seres. “With this transformational transaction, we are pleased that significant value was placed not only on our C. Difficile candidates, but also on the IBD franchise, which underscores the strong potential of our microbiome platform to address a wide range of challenging diseases across multiple areas in medicine.”
“Seres is leading the development of microbiome therapies with the potential to address a wide range of diseases of high unmet medical need, and we are thrilled to collaborate together to ensure that GI-focused products reach the best outcome for patients,” said Greg Behar, Chief Executive Officer of Nestlé Health Science. “By correcting the fundamental microbiome dysbiosis that is the root cause of many diseases, Seres is creating a profoundly new and important way of treating many conditions that are inadequately managed through current approaches. In essence, Seres is leading the creation of an entirely new field within medicine.”
Under the agreement, Seres granted Nestlé Health Science commercial rights in global markets outside of the United States and Canada to SER-109 and SER-262 for CDI, and SER-287 and SER-301 for IBD. The U.S. Food and Drug Administration (FDA) has granted SER-109 Orphan Drug, as well as Breakthrough Therapy, designations. In exchange for commercial rights, Nestlé Health Science agreed to provide Seres with an upfront payment of $120 million in cash and a series of contingent payments for development and sales milestones and tiered royalties on sales ranging from the high single digits percentages up to the high teens for all products.
Nestlé Health Science agreed to contribute to certain development efforts, including 33 percent of expenses for potential global Phase 3 studies for SER-287, SER-301 and SER-262. The full potential value of the up-front payment, milestones and royalties payable by Nestlé Health Science is over $1.9 billion, assuming all products receive regulatory approval and are successfully commercialized. Seres expects to receive a total of $30 million in milestone payments in 2016 associated with the planned initiation of a Phase 1b study for SER-262 in primary CDI and the anticipated start of the Phase 3 trial for SER-109 in recurrent CDI.
The upfront payment to be received under the agreement is expected to help fund the late-stage development of Seres’ lead programs, and drive the continued growth of Seres’ pipeline in a variety of conditions where addressing the microbiome could be an effective clinical strategy. Preclinical product candidates currently being investigated at Seres include promising new indications in infectious, inflammatory and metabolic diseases, including rare genetic diseases and immuno-oncology indications.