All right. Thanks, everyone, for joining us here at the GI and Microbiome Corporate Panel of TD Cowen's 44th Annual Healthcare Conference. I'm Ritu Baral. With me are my colleagues, Peyton Bohnsack and Anvita Gupta. On the panel, we have represented Morphic and Seres Therapeutics. From Morphic, we have CFO Marc Schegerin, and from Seres, we have Eric Shaff, President and CEO. Thank you, gentlemen, for joining us today. Thanks for having us. We'll start with some thematic questions on the overall space. The IBD space, in particular, has seen an explosion of therapeutic development in the last five years, with significant pharma investment. As you think about some differentiating factors for therapeutics to gain market share, what are the most important in order to do so, and what is a multimillion-dollar opportunity? Multibillion-dollar opportunity, I should say. Sure. So maybe I'll take that in, and you're right, there have been a lot of additional entrants to the field in the last five, 10, call it 20 years. Most of these have been biologics, but most recently, there have been some orals entering as well, and that's great for patients, of course. These drugs are all clearly better than placebo per se, however, not dramatically so. So you have more and more options for patients, which is always a good thing, but for the most part, these drugs are generally similar. So you can compare, you know, this percentage versus that, a couple percentage points, more or less here and there, but at the end of the day, they're in the same ballpark. It's true, some drugs may work for one patient, and a different drug works for another patient, and so this plethora of options matters, and that's helpful. But at the end of the day, there has been what's called the sort of ceiling of efficacy in the space, which has persisted over the years. Commercially, there's been tremendous advances in the sense that the pie has exploded, and many strategics have made billion-dollar investments, but reaped tens of billions of dollars in rewards and revenues, which is great for the industry. But there is still tremendous room for improvement, I guess, is the nice way to put it, with respect to efficacy and for most of the drugs safety. There's this narrow band that we talk about with respect to efficacy that most of these drugs fall into. It's a much wider band with respect to the safety- that the approved drugs and drugs in development fall into. It's a lot easier, of course, to measure efficacy numerically with numbers, and it's much harder to do so with safety, but still that dynamic range is very evident in the sort of various safety profiles of these drugs as well. So a lot of advances in the last 10, 20 years, just thinking very high level, and that's great for patients, but tremendous opportunity for improvement as well. I don't usually go off script quite this early, but, as far as gastros, Marc How promotion sensitive are they on the scale of doctors in general? I think, you know, you have to think about specific TAs because gastro- Sorry, TAs? Like, uh- Treatments ... specific disease areas. Because in a disease area like IBD, probably more so. You can tell that kind of from the number of commercials you see on CNN in prime time, right? Yeah. These companies are not spending those hundreds of millions of dollars on commercials for no reason. They do their research, and they know that there is this sort of, you know, bilateral communication between these patients and their docs, and that does translate into scripts. Of course, some other disease areas within GI might be much less patient-driven than IBD. But specifically in IBD, I'd say it's relatively high. The patient matters, the physician matters, the payers matter. But in IBD, it's very much kind of equal weight. Eric, thoughts? Yeah, I think for the work that we do in- recurrent C. difficile infection, it's a little bit different in the sense that, recurrent C. diff patients tend to be very motivated, right? Historically, the standard of care is antibiotics. Yeah. The notion is, you hit them again, and you hope for a different outcome, right? So, patients are extraordinarily motivated to get off the couch and search for patient advocacy groups- ... and clinical studies. It's one of the reasons that we were able to navigate through our phase 3 study amidst incredible and unique and unprecedented complexity with the pandemic. So, you know, for us, the commercial investment and the marketing is really focused on awareness, right? That there's a new option that's available. It can be effective, it can be well tolerated, it can, it can be oral, which is just a change of paradigm. Peyton, do you want to ask? Yeah, actually, maybe to follow up on that, do you, do you have any plans, or do you currently do any direct consumer marketing, especially because C. diff patients are so motivated and because the microbiome is kind of a novel, or microbiome-based treatment is kind of a novel therapeutic modality? I mean, we really have only seen that in the last couple of years, right? Yeah. Yeah, so- That question is only for you. Yeah. I think, Peyton, the answer is that we're pleased that we don't have to at this point. So, you know, our-- we're partnered with VOWST with Nestlé Health Science, and of course, Nestlé, in terms of that capability and skill set is uniquely positioned if we choose in the future to walk down that path to do so. But as I said before, these are motivated patients, and you know, they are identified. Where we focus on is really understanding patient awareness, physician awareness, understanding the change in the modality, change in the opportunity, and knowing that after decades of somewhat limited innovation in this space, you know, there is now an option which is effective. You know, approximately nine out of ten patients in the phase II study. It's well tolerated, it's oral, but it's different, right? And sometimes with new technologies, it takes time for people to understand that, you know, for us, the root cause of the disease and recurrent C. diff infection, we believe, is not actually the pathogen, right? It's the susceptibility of the system to that pathogen from what we call a dysbiosis or an injury or a disorder of the microbiome. So what we hope to do is to educate. And we've been at it for some time, and we've got, you know, the benefit of our New England Journal of Medicine paper and our JAMA paper that helps in terms of physician awareness to say, "Look, the paradigm is changing. You can't just kill the pathogen. You have to treat the system and make sure it's protected in the future from the pathogen reemerging. Yeah. Okay, so maybe to take a step back to actually go for a thematic question, as opposed to that kind of off-script, follow-on. Sorry, I learned from Ritu. Yeah. So maybe let's talk about innovation has been innovation in the GI space, focused on targeting the microbial environment for treating disease, and maybe through, like, specifically, gut microbiota. Is there still a role for traditional therapeutics? How do microbiome-based therapeutics have benefits or disadvantages compared to originals? And when would one approach be better than the other, or are combinations the answer, especially? I guess we'll start with you. Yeah, there's a couple of interesting pieces to that question. I mean- Yeah ... when Seres was founded, just maybe taking a step back into the theme of microbiome therapeutics, approximately 10+ years ago, the notion that bacteria was essential to human health was a little bit kind of unconventional, right? There was the idea that there was harmful bacteria and that there was neutral bacteria, but the idea that bacteria was essential and that disruptions to a healthy microbiome could be connected with disease, you know, that was a little bit of a foreign concept, right? So the idea of putting bacteria in a pill and using it as therapy, that's what attracted me to Seres originally. I had been at Genzyme for about a decade, and Genzyme had a Phase II program in recurrent C. diff infection, and it had this big Phase II miss. People said, "This is just too tough. Like, you can't do it with efficacy and safety and make it oral." And when I saw that phase I data set, I said, "Wow, this is, this is kind of amazing, right?" So, I do think, and we've proven, that there are approaches to treating complex diseases like recurrent C. diff infection with microbiome therapeutics. But to your question, Peyton, I think, you know, we talk about it all the time, the idea of combination therapy is really interesting. Where combination therapy sometimes falls down is safety, right? It's the idea of compounding or combining toxicities that could be detrimental to the patient. We think that the safety profile of our therapeutics, in general, is one advantage where combination therapy could be really interesting, you know, as the space continues to emerge. I had a follow-up to Mark, what he said earlier, that there's an efficacy range or a broad efficacy range. How do you think about that for the mild and moderate and severe IBD patients? What are the possible ranges there that doctors look for, patients look for? And of course, there's going to be oral, there's already IV and sub-Q approaches. How do those different subset of patients think about what they wanna go for? Yeah. So there's a couple things. There's mild, moderate, severe, and then there's refractory. So mild, moderate, severe is slightly different sort of spectrum or dimension than how refractory you are. Sometimes folks can be, you know, multi-refractory, but they're still in that mild-ish, mild, moderate spectrum, and vice versa. Someone can present severe and then respond beautifully to treatment and do very well on treatment and not be multi-refractory. But with respect to kind of how docs think about efficacy, you know, you look at how refractory the patient is first, because there is a fairly well-established progression of therapies as you fail whatever it is you were on last. So regardless of whether you're mild, moderate, to severe, if you're a new patient, you go on this generally safe, free oral drugs, 5-ASAs, and steroids as well. And so once you're starting to fail those, and then you get into more severe end of the spectrum, which means you're failing those, now you have to think about advanced therapies. And so in this country, it's normally Entyvio, but it's a combination, globally, it's a combination of Entyvio and Humira, kind of dealer's choice. That, of course, choice is based on familiarity and safety. And that's basically it. That's number one. That is. And of course, they're approved. You can't prescribe not approved drugs, and they were approved because they achieved some sort of level of efficacy. But if you're approved, it's about, it's about safety for that first-line, advanced therapy setting. And then after that, it becomes much more, call it trial and error, right? You're on drugs because it's the next one. It's the most safe one that you haven't yet tried. And once you've failed five or six of them, of course, you reach for the last one that you haven't tried. And it's not so much about whether the phase 3 trial 10 years ago was this percentage or that percentage, because they're all kind of in that range. Is there a biological understanding now how a patient can be refractory but still be mild? It's poor. The biologic understanding is poor, and the a priori prediction around whether this or that patient is going to respond to this or that mechanism or this or that drug is also very poor, unfortunately. Folks have tried to look at biomarkers and do things that prospectively will predict success or, I mean, success obviously, to a particular—and it's not a precise science. That would make everyone's lives easier. It would. It would. Well, so what is the commercial ROI of either of those strategies right now? Like, do you think it's better ROI to go more broadly, and move up the treatment paradigm, even if you don't have those amazing effect sizes in a certain population? Or is it better to say, like, "This is the population, and we are just gonna be amazing in this," but it's smaller, you know, as you look at the business, what makes more sense right now? I think if you knew for a fact that you could identify a subset of the population and have an amazing effect size, and just call it 90% market share in that- Yeah. There's a lot of utility to that in IBD or in any disease, frankly, if we could identify them beforehand. But in the absence of that, which is the case for most likely for us, but as well for all the other companies and all the other drugs, clearly the largest market is that first and early line market, which right now is defined as kind of that progression to the, to the needles, whether it's Humira or Entyvio, kind of dealer's choice. That's the largest market. There's probably an untapped market as well, as people are kind of dragging their feet and admitting failure, if you will, that they are not responding to those sort of first-line, true first-line therapies. That's not a well-defined—like, we talked about this, right? The people who are not in control, just in denial. Right. Right. How do you think about defining that population, or how, how is the field thinking about defining this population? We've done that to some extent with our own, sort of internal proprietary- Yeah research with the big consulting firms. But there's a large percentage of people who spend a couple of years kind of in denial, delaying that progression or that admission that you've failed therapies and going on to needle. Whether they're afraid of the needle, or they're just, you know, afraid of admitting that they've kind of truly failed that first-line approach. It's a huge population. But even, you know, that aside, the current first-line market is obviously a massive, massive market. So with respect to both our profile, but also what's most commercially attractive, it's that early line of therapy. Do you want to take a look? Actually, I was kinda hoping that Eric would weigh in a little bit on this, specifically because, you know, VOWST has shown so much efficacy across first, like, first refractory patients and then, you know, and then multiple on that, refractory C. diff patients. Yeah. Yeah. I think for us, you know, it starts with medicine, right? Yeah. If someone has a first recurrence or a fourth recurrence, the issue is the same. It's the dysbiosis, it's the injuries to the microbiome, the susceptibility to the pathogen. You know, we were pleased with the approval and what was really, for us, a best-case label, which included adults with a recurrence of C. diff. It makes sense to us, right? I mean, you know, why wait until the second or third recurrence, knowing that each time that you recur, you're more likely to recur again, so each time it steps up. You know, we've done the research where patients talk about this disease like it's, you know, PTSD-type syndrome. You know, the fear and anxiety of knowing, you know, I'm gonna be treated with antibiotics. It's gonna knock back the pathogen, but I don't know whether the recurrence is gonna happen or not. So from our perspective, it starts with the medicine, and there's every reason to think about treating it earlier and preventing future recurrences. But the same follows from an economic perspective, too, right? I mean, you know, for patients who recur, they can be expensive patients, they can be expensive to treat them, they can get abscesses, they can have comorbidities. And, you know, if you think about the pharmacoeconomic case of preventing not this, not just the next recurrence, but the one after that and the one after that, and you can probabilize each one, but that cumulative spend, if you can forego it, is a win-win. That's the discussions that we have with providers and with the reimbursement side as well. In our minds, you know, treating it earlier and thinking about preventing those future recurrences makes sense from multiple dimensions. Yeah, and then maybe it's kind of like a follow-up on something that was mentioned, is that people are kind of like wary of going under the needle. Given that VOWST is an oral drug, how would you compare that to, like, an enema? Do you think that they're—people are more willing to use it earlier on their first recurrence versus, you know, getting an FMT or an enema drug, or? This is all probably a snarky kind of answer to that question. I think most people understand that, when given a choice of an oral or an enema, you know, you'd rather take a couple of pills. I think maybe an underappreciated aspect of the technology is that because it's oral, it could allow us to reach populations in multiple areas and places and be a solution for significant healthcare problems globally. You know, obviously, within C. diff, I think that, you know, we've done the research to tell you what research doesn't have to tell you, which is, if it were you, then what would you choose? ... That is a good question. I'm glad it's not me. I think we should move to the company, the company's best. Great. So Mark, Morphic's lead asset, oral alpha-4 beta-7 inhibitor 057, is currently in being studied for treatment of UC in a large phase IIb, based on the success of the phase IIa last year. Can you talk about how your phase IIb design or the type of patients you're enrolling or the doses have optimized the likelihood of success in the phase IIb? Sure, happy to. So you're right, we're on the tail end of enrolling that phase IIb study, which should read out in the first half of next year. And overall, the patient population is very similar, very analogous to the much smaller patient population, but still the profile of the patient, the inclusion/exclusion criteria is very similar, you're right. There are some big structural differences, though, aside from just the N. So one is that we're exploring many doses. We're exploring three doses versus placebo to really kind of build out that dose response curve, which, of course, you can't do when you have only one dose like we did in phase IIa. And the second is, it should be obvious, but because it's placebo-controlled, we have that as our primary endpoint to be able to compare something to placebo, which, of course, is a different structural component versus phase II versus phase IIa. Also, those doses in terms of the three, you know, where they land, the middle dose is the phase IIa dose- So it's 100, BID. So that's kind of the middle dose in terms of peak and and total daily exposure, et cetera. The high dose is double that, so 200, BID. What does that mean in terms of receptor occupancy, by the way? Yeah. So what we see with 100 milligrams BID is for the vast majority of patients, their receptor is completely saturated- Yep ... in the blood, even, even at trough. There are some exceptions, whether it's within a patient or day by day. Compliance in the phase I trial was extreme because it's in a site, so you take it exactly 12.0 hours later ... after the last dose. The phase IIa study was in the real world, so someone may have taken the dose 15 hours prior or 10 hours, et cetera. And so you see a little bit of variability, and a couple of the patients dip below that 99+% receptor occupancy here and there. And so, you know, based on our computer modeling or even common sense, when you double the dose, you're going to take those patients out of circulation. So- Everybody's just saturated completely with that. That's our prediction for the- That's- ... for the 200 milligrams. So the question will be, does that matter? Which is a completely reasonable question. If you dip a little bit below 100% for an hour or two out of the day in 5% or 10% of people, does that, does that matter? We'll answer that question in the second dose, and then the first dose- Yeah ... the lowest dose, which is the lowest, call it, daily, total dose. Undisclosed. But the dose itself is undisclosed, but we have said it's a QD dose. Yep ... just for IP reasons, but I think a lot of folks have, kind of put two and two together. But at the end of the day, we would expect, based on our phase I data, that the C trough- Yes ... would predict a receptor occupancy at, you know, 23.5 hours after the last dose, that it's quite a bit below 100%. You know, in, call it, 70s … range. So that'll be another interesting data point for us, hopefully, to populate that dose response curve, but we don't know what the data will show in terms of efficacy. It may be that ephemeral dip towards the tail end of, you know, the day doesn't make that much of a difference in terms of efficacy- ... or, maybe it does. So that's, that's a question that hasn't really been answered by the available, therapies out there. Entyvio doesn't answer that question because it's in the high nineties, 24/7. AJM300- They never did any dose ranging, correct? Right, because they were saturating it- Yeah ... at all, at all Yeah ... even in phase II at very low doses. And so AJM300 provides a little bit of a window into that because we think they get down into the eighties- ... at trough, and they have 3 troughs per day because that's a gram TID. But still, they get down into the 80s and still see good efficacy with induction. So that kind of argues for, maybe it's fine. We've seen other alpha-4 beta-7 approaches which get down into the 30, 40, 50% range of trough, which does not show- Which is not ... great, great efficacy. Yeah. Somewhere in that range is the threshold. So what sort of profile for that QD do you think is... Like, what's a reasonable QD profile drug? Like, how far below BID can you go on efficacy to still say, "This is worth taking forward. This is something with appeal to patients? Got it. So we have done a little bit. I mentioned the market research that we did with a big consulting firm, which is that everything else equal, how much does BID- Yep ... versus QD, matter? Young patients. I mean, to young patients and, you know, at the end of the day, you have a sort of peak sales- ... estimates, and you make all the other assumptions the same. And it did turn out to be about a 10% difference. So not meaningless, but also- ... it wasn't an order of magnitude either. And so it's definitely something that we would shoot for either way. This particular dose doesn't necessarily. It's not the end-all, be-all for QD. Yeah. Because we have formulation efforts that are ongoing in parallel, and you can also adjust the dose, of course. So- ... If you look at that middle dose, the one with close to constant saturation, what sort of effect size on the primary endpoint would make you on the modified Mayo 12 weeks versus placebo, placebo-adjusted, would make you excited for the commercial prospects? What do you need for regulatory, or what do you want for commercial per that proprietary research you did? Yeah, absolutely. I think there's some table stakes with respect to sort of overall efficacy that is required for approval, right There's a threshold there, and we've seen that play out time and time again with most of the drugs, with the exception of Humira- -which is in the high single digits. Most of the drugs kind of break that 10%. The most recent being mirikizumab, which the most recent UC approval was just a hair over 10%. Entyvio is 11%. So somewhere in that range, I think you need to break through just as part of sort of table stakes with respect to efficacy for approval. And overall, once you have an approved drug that is deemed, you know, knock on wood, deemed safe because of the known target, so as with Entyvio is known to be, I think it's fair to say, safe and not immunosuppressive, plus being oral is sort of a slam dunk for those early-stage, first-line patients. And so that would get me very excited, I think. How good do you need to be compared to subQ Entyvio, where, you know, you don't have to go in for infusion, but, yeah, you still have the needle? Yeah, absolutely. I mean, I think, you know, whether it's subQ Entyvio or biosimilar subQ Entyvio or IV infused or subQ, whatever it is, there's needles and there's orals. I think, you know, you asked Eric a similar question with respect to mode of administration. And, although I have no skin in that game, I completely agree with what your market research told you. It's kind of obvious. The same thing goes in, in IBD. I mean, oral is sort of a no-brainer. And if you can achieve that sort of trifecta of just safe, oral, and effective, which to date, nobody has been able to do, I think that's a huge win that will get me, and I think all of us, and the patients, and the whole community very excited. Our KOL panel yesterday actually said that the uptake of the subQ Entyvio was very limited. Only for patients that are traveling, and for them, infusions might not be appropriate. Yeah. So that was surprising that, you know, it didn't, it didn't really move the needle. I've seen that in Europe, too, because it's been approved in Europe for a long time, and you see the uptake there very- Very minimal ... modest, and people just kind of- In the phase IIb, are you stratifying patients at enrollment? They're being stratified based on basic parameters, right? With, with respect to advanced therapy experience and generally with respect to severity. You can't control for multiple different variables because that's becomes intractable, but we are controlling for the biggest- On severity- The biggest differences -what parameters? It's really in particular, like MES of 2 and 3 is important, but they're not wildly disparate. You saw it. I mean, you can get lucky or you can get unlucky with respect to these things. For example, the Prometheus trial had two arms, placebo and active, and the placebo group had 80% MES of 3, and the treatment arm had only 60%. So that's great for them, of course. Have a much more severe population in the placebo group, but that's not the kind of dice you wanna, you wanna roll. Then, as we think about the primary endpoint, how should we think about comparing it to the Entyvio trial primary endpoints? Because ultimately, you know, everyone compares, wants to compare your efficacy to Entyvio. So are we thinking about it, like, correctly when we are, when we're doing modified Mayo versus complete Mayo at different- Yeah ... endpoints? So frame that for us, please. Absolutely. I mean, you can't roll back the clock 20 years on clinical trial design, so there is kind of a way in which people are conducting the trials now. People are designing the trials, and everything is totally different than it was 15, 20 years ago for Humira and Entyvio. You know, that said, the ultimate numbers that are coming out are again, still in the ballpark, within a couple of%, amazingly. And so, we'll design the trial the way trials are being designed today. We will measure the endpoints, like, for example, central reading of endoscopy versus investigator reading, which of course, I think people realize makes a huge difference. So we'll do things the modern way. I would always caution anyone, even though we're guilty of doing it, of making cross-trial comparisons, but in particular, in this case, when you're comparing to 20-year-old trials, it's a particularly dangerous activity. Although, again, I admit it doesn't stop us, even internally, from doing the same thing. But, but luckily, we have big changes in the way clinical trials are designed, the way those endpoints are measured, and the way that the population of patients looks. Completely different more refractory population today than in the past. However, the numbers actually have stayed pretty much the same over the last 10, 20 years for the, for the primary endpoint, so. Great, I guess we're gonna switch and talk about VOWST and C. diff now. So, as you announced yesterday, the VOWST launch has been going very well. Our KOL on the panel also talked about the fact that she's using it very frequently. She is at, you know, an FMT center. So I was guessing, kind of, if you could talk about how it's going in terms of your internal projections, and then maybe talk a little bit more about what the feedback you've been getting from the patient and KOL community, and then also how you plan to support the launch moving forward in 2024. Yeah. Yeah, so, we announced the- ... Q4 earnings yesterday. We had released the preliminary Q4 top-line results earlier in 2024, but we've been really pleased with what we've seen so far. We were approved in April, and we launched in June, and we've had a great start to the launch with VOWST. So $10.4 million in Q4, approximately $20 million since launch in June. As we think about enrollments, as we think about new patient starts, as we think about the conversion and kind of the dynamics within the hub, the 2023 numbers surpassed our expectations, Nestlé's expectations, and we think we're off to a terrific start. The feedback that we're hearing is basically what we had hoped to hear and what our research suggested, which is the number one thing that patients and physicians, in particular, physicians worry about, is recurrence, right? It's the idea that take antibiotics, clears the infection, and then you wait, and you hope. So far, VOWST has provided a solution for those patients that so far, in our opinion, is, in the last number of decades, has been kind of incremental in terms of innovation. So we've been really pleased with where we've gone, and we're hopeful for continued growth over the short and long term. We think that VOWST is on its way to be standard of care in the space. And we are working closely with our colleagues at Nestlé, to continue to support the factors that we think will continue to support growth. So, that starts with a physician experience, right? So, sometimes with new technologies or new modalities, a physician might be a little bit slow to use a, a new product. But what we're hearing is that, you know, for physicians who have patients that come in, they've got a recurrence, they've treated with VOWST, it goes well. They're more likely to use VOWST in the future with, not only their existing patients or, in the, multiply recurrent segment, where we've seen a disproportionate amount of use. But, ideally, those physicians move earlier in the treatment paradigm into first recurrence. We've seen first recurrence use, and we hope and expect to continue to see more. We will also continue to focus on operational excellence in the hub, ensuring that when patients come into the top of the funnel, they're not lost. We will continue to focus on patient awareness, on physician awareness, on our strategies as it relates to navigating through the hospital, being discharged with both VOWST and Vancomycin, and continuing to get utility from a commercial infrastructure that Nestlé has in place that we have leveraged. So, very happy with where we've gone, and we need to continue to work to support VOWST in the future. Great. And then I guess kind of as a follow-up, in supporting the actual, like, VOWST launch, real-world evidence, are you collecting it? Do you plan to release that to the street? How do you plan to release that to physicians and just to show that it's as equally as effective in your- Yeah ... obviously, very positive phase III trial and open label study? So we haven't commented, but I would just note we're, you know, in our third full quarter after launch, so it's still pretty early. The anecdotal feedback that we're hearing from physicians is highly positive, and again, it centers around the idea that the biggest single issue that people deal with is a recurrence, and that VOWST is serving that need. And, how do you go about gathering that data? Is it just through your MSL team, or can you look at codes from the hospitals and- It's really gathered from MSL feedback. Good. And then I kind of wanted to talk a little bit about your free drug program. Could you tell us who those patients are? Sure. Whether the rates, I believe, are hitting just a tad under, a tad above 40%. When do you start to see that free drug beginning to dissipate and maybe getting more people on reimbursed drug? And then also maybe talk about the different patients that are receiving VOWST in terms of their coverage and how the reimbursement process is going for them. Sure. So, let me start just in general. We've been pleased with the fact that patients are getting paid for. That said, we have a meaningful investment in both our patient assistance programs as well as our free drug program. And you asked about free drug. We've got three data points from a partial Q2, a full Q3, full Q4. They're all, as I think you mentioned, in kind of the mid-forties range, and that's up and down a little bit. I will say that free drug is an investment that we, together with Nestlé, are making, that we think is critical to provide the best possible experience for physicians who can be using drug for... We want to make sure that the patients who need VOWST get VOWST, that's first and foremost. But we also want to ensure that patients have a positive experience, and making the drug available, of course, we think is the way to do that. I will note that, as we march towards the IRA, and I think the rhetoric around the IRA has been considerable in the last period of time, one of the features that the IRA will provide, we believe, for us, is that some of these patients actually will be, they'll act more like commercial patients, right? So the copay sharing burden will be improved, and we think that converting those Medicare patients to paid patients after 2025 actually is a meaningful upside for us in terms of our potential growth. So, you know, we think holistically around the different ways, whether it's patient assistance programs, free drug, and of course, our efforts with providers and payers to ensure that patients that need this drug can get it. ... And then maybe just, one last question before I kick it back to, Ritu. We've obviously heard a lot of very positive feedback from GIs, IDs, and, recently from, primary care providers that are interested at least in using the drug. What has been your kind of, experience? Have you seen this kind of wide range of, physicians prescribing it? Are these largely physicians that are in large referral centers, that treat C. diff, that are tertiary care, or are you seeing it across the board? And where, where do you see the growth in the, in the segment coming from? Yeah, I think maybe a couple of reactions or observations in the time that we have since launch. The first is that, one of the, I think, positive surprises that we have seen is that, there are folks that are writing scripts that may not be at the top of the call list, and we've been really pleased with that. I think that that may be a function of some of the, the papers that we have. I mentioned before, the New England Journal paper, the JAMA paper. We've been working for some time prior to launch to ensure that the word was getting out in terms of the profile of the drug, how it could help patients, the parameters of the phase three study, the open label study thereafter. And I think that we've had traction with that. But, you know, look, I think that our key focus at launch has been in particularly the GI segment. As we've said before, we have approximately 150 reps that are Nestlé reps, that are focused on GIs, and about 20 reps that are focused on hospitals. And they're really the quarterbacks to ensure that, whereas hospitals can have different types of paths, navigating through this path to ensure that patients are discharged with two V's, with vancomycin and with VOWST, as outpatients not dealing with the DRG. And that's really been our focus to start. I think that over time, there will be additional opportunities to think about tertiary care, continued evolution in the hospital-to-home segment, but that's been our focus to start, and that's where we think we've gotten traction in the 2 1/3 quarters since we launched the drug. Great. So, going back to you, Marc. Your Crohn's trial will dose its first patient in first half of 2024. First, can you talk about the strategy for starting it when you, you have- how you look at that market versus the UC market? Yeah, absolutely. We're asked about that a lot because there's an expectation, sort of, translatability- from one to the next. Yeah. Most drugs, not just Entyvio, there's some sort of predictable effect size. If you have efficacy in one, you will likely have some degree of efficacy in the other. There are more drugs approved in UC than Crohn's, but for the most part, that translates, and it has with Entyvio, which of course is approved in both. And so people say, "Why not just... You know, it's kind of an expensive trial. Why not just- Yep Wait and let someone else pay for it? If you know what I mean? Yes, I do. So, I think the answer is twofold. One, you know, one of the important ones is that we don't want the approval of one to significantly lag the approval of the other, right? five, six, seven years- is probably too much. Typically, even big pharma does this, they do lag by a couple of years. That will, I assume, be the case with Morphic as well, because just the way that the timing of that works. But if it lags by too far, you run into a couple of different risks. I think IRA would benefit with some other stuff with respect to combinations, which would benefit by having these things a bit more in parallel than it would be if we just waited for something to happen. So that's one answer. I think the other is just enthusiasm and confidence and just scientific understanding, right? So the phase 2A trial did not gate the initiation of our phase 2B in UC. We are doing them kind of both as soon as they can be done, based on long-term preclinical tox and things like that. Crohn's is a little bit different. So Crohn's being sort of a larger trial, we wanted to get a little bit more biological just confidence, and we wanted to be 100% sure that we were in fact doing to the disease what we thought. And so Crohn's was, to some extent, predicated on a positive phase 2a trial. As soon as we saw the results from that trial, and it was very clear to us that we're doing- what we thought we were doing, and the drug is clearly effective, then that's what triggered the investment and the activities to get- Both the- phase 2b. Both the clinical endpoints and the receptor occupancy. Yes, but receptor occupancy was known even after phase 1. Yep. So it's really just point of going- It's really the phase 2a. It's really the patient UC data- Mm-hmm ... those 35 patients that gave us the confidence and comfort to kinda catalyze- Yep -those phase two B efforts in Crohn's. Can you talk about the trial design and the doses? Yeah, absolutely. So what we're doing in Crohn's is actually similar with respect to a dosing perspective. In UC, we have a 100 milligram BID dose and a 200 milligram BID dose that should cover sort of gamut of saturation and extreme saturation. That QD dose is not there in Crohn's. It would be, I think, redundant to include it. Crohn's patients enroll a little bit slower than UC patients- Yeah and the trials are longer. Why is that? I mean, I think there's, if there's 100 UC patients, there's 65 Crohn's patients, number one. Number two is just sort of the patients that are there, it's a different type of disease, it has a different color flavor to it. The severity is wide, including extremely severe surgical, life-threatening conditions, which is rare. So there's a more sort of intensity and reticence, I think, to try an investigational agent until you've tried what's already approved. And so I think those factors kind of play into it It doesn't take 10 times longer. It's just a little bit longer. And so each cohort is very valuable from a time and financial perspective. It's more, they are more expensive too. And I think our QD dose in UC is going to tell us a lot about, you know, this 70% receptor occupancy. Whatever it tells us will translate to, to Crohn's, so it would be kind of a wasted, redundant, use of time and- our investors' capital. Is it more expensive? Is it more expensive just because of the time it takes to enroll, or are there other aspects of the trial that make it more expensive? There are other aspects. It's slightly more expensive on a per-patient basis as well. And so these effects, whether it's the time plus the per patient monitoring, et cetera, makes it overall a bit- -more expensive. Can you talk about how site activation's ongoing and where the unmet need is that you think MORF-057 will slot into? With Crohn's in particular? Yep, with Crohn's. Yeah. I mean, I think, you know, there are less available therapies in Crohn's. Entyvio is used actually quite widely. I think there's an expectation, or not an expectation, a realization for the docs who prescribe a lot in Crohn's and focus on Crohn's, that Entyvio actually works way better than its label, than its label, says- because it's... The label was designed, the initial trials were designed at least six weeks. And so in practice, if you're willing to be patient, you go three, four, even five months on Entyvio, it works as well or better than anything else that's out there. So that's kind of the real-world practice. Some of that learning we've tried to incorporate- Right. into our trial design Sure. because we're 14 weeks. Yep. that I think is gonna- Will you have an open label that will keep them on drug for even longer to try and capture more? There can be long-term- Yep. -extension for sure. But the initial- Yep ... part is a typical placebo-controlled trial, and then patients, just like in UC, will have an opportunity, or in fact, a complication- ... in quote, to go on to an active dose as well. And Praveen? What's the range of efficacy we're looking for? Not that we're asking for guidance, but it'd be great. But we are. Yeah, I mean, I think in the Crohn's trial- Yep In particular, I mean, I think it's, it's probably too early to be overly quantitative about that. So what would make you happy? What would make doctors happy with this? I mean, I think it's probably too early to be specific. I mean, again, you want to be in the approvable range. You want to make sure that what you see in UC translates and has that same sort of correlation over to Crohn's disease. I fully expect that it would, not only with Entyvio, but with all of these drugs, there is significant sort of translatability and predictability between the two. So I think it's the overall profile. We wanna make sure it is maintained, that's safe, oral, effective. And then the next frontier, which is backbone of combination therapy, which again, we talked about how we're doing that, both our own, ourselves, but also there's other targets which would be sort of ideal combination targets with an alpha-4 beta-7, that's oral, that I think could really make a big difference in UC, but it can make a very big difference in Crohn's, too. We've seen some early evidence. We'll see in phase 3 how much plays out, but things related to the strictures in Crohn's, which are much more important than in UC and the TL1A mechanism. So if we can combine the non-immunosuppressive alpha-4 beta-7 oral with our own TL1A, which as of today is early, admittedly, that could be you know a game changer for Crohn's as well. Do you want to ask about that? Are you looking to go into combination therapies yourself, or is that something you'd want to license? Yeah, I think so. We can't, you can't wait for things to happen. You have to, you have to do it yourself. I think that some of the targets that we've disclosed, we've been working on for a year plus, and these are targets which scientifically sort of no-brainer combinations with alpha four, beta-seven. They're also targets that are difficult, but not impossible to drug with a small molecule, which is a perfect sweet spot for Morphic. Integrins themselves are difficult, but not impossible to target with a small molecule, and so for a variety of factors, our, our platform, our relationships, our exclusive arrangements with, Schrödinger kind of allow us to do these difficult but not impossible things with small molecules. In the case of TL1A, which is a heterotrimer, and IL-23, which has a couple of subunits, 19 and 40, but also a receptor. This is kind of perfect, because if it were super easy, then anyone could do it, and if it was impossible, then even we couldn't do it. But I think it's a, it's sort of an obvious place for us to start and work on these targets and create our own combinations and kind of fill out that matrix of the various combinations with each other, and Any plans to share any early data, maybe when you return? Combination data? I mean, I think at this point, just given the stage, we wanna make sure we have, again, the potent selective bi-binders, but inhibitors, and make sure that we can continue to- ... identify the best DCs and take those into the clinic, probably alone, but then Great. So I'm gonna switch gear and start talking a little bit about your pipeline program, SER-155. I think this program is really interesting, and I think it really is a great example of how you can build on the microbiome platform that Seres has. Can you kind of remind us of what this, what this drug is being developed for? What led you to choose this indication in graft-versus-host disease and infection protection, and then, what we can expect on the Q3 readout that's upcoming? Sure. So maybe just stepping back a little bit, one of the most interesting aspects of what we think the microbiome is just the potential breadth of application, right? We believe in the gut-brain axis, we believe in the role in inflammatory disease and metabolic disease. And I think those are all opportunities that will be explored, are being explored, and can help patients. And you know, we also can say with experience, it's, I think, similar to prior comment, if it were easy, anybody could do it. And it's not easy. And everyone thought that C. diff was kind of the quote, unquote, easy one, and I can tell you with certainty that there was nothing easy about C. diff, right? Well, let me look at it, like how many companies have tried to go after it, and you guys are basically the only ones left. Exactly. Yeah. No offense to you. But look, I think for us, we've made a strategic decision to step deliberately into more and more complex areas of biology, and for us, that means that infection is next, right? There are similarities between patients undergoing HSCT, where their microbiomes have been injured, right, through a number of different types of treatments, and oftentimes, these patients can have pathogen overgrowth, which the peer-reviewed literature suggests are correlated with infection, right? So the idea is that if we can repair the microbiome and prevent infections, we can have an impact into disease for these patients. This is really within the theme of the idea of we're taking knowledge, we're taking insights, we're taking know-how into adjacencies from C. diff, where we think we can improve the probability of success. So, SER-155 is a program currently in a 1b study. We actually read out our first cohort of patients last year, and what was really interesting was a couple of things. One is that the drug was, in that small N, that small cohort, it was well tolerated. The bacterial strains had engrafted, which is the first things that we were looking for. And I think for us, that was significant, the idea that, you know, these are complicated patients, and dosing high doses of bacteria, you know, the safety parameters are really important, and for us, that was a meaningful step forward, at least in a small cohort. But we also saw interesting data as it relates to pathogen overgrowth, right? We've been working with MSK and have developed a reference cohort. In the small number of patients in the 1B study, cohort 1, we saw one event of a pathogen overgrowth, and actually, it was transitory, right? And you would expect that these oftentimes are not. The reference cohort would suggest that we should see at least 60% of these patients having some sort of pathogen overgrowth, right? So really interesting, intriguing, kind of for us was the, you know, the gate to say, let's continue moving into the second cohort. Second cohort, approximately 50 patients, actually, with a placebo arm. So half those patients, roughly half those patients are inactive, roughly half will be in placebo. We're pretty excited about the upcoming readout, which we expect in Q3. Obviously, we'll be looking first for safety and the engraftment. And if we saw a pattern similar to what we saw in the first cohort, it will be really interesting. I think the other aspect that we have to note is we have a placebo arm, so we will be looking for signals of efficacy, both in terms of the most severe forms of Graft-versus-host disease, as well as bloodstream infections. And you know, are there differences between the two arms in terms of both of those types of events that these patients suffer from? So, for us, this is the next step in our journey, and we're excited about it. I guess kind of building off that, I mean, I know you did address this a little bit yesterday on your call, but can you tell us how you plan to move this program forward? What's your current thinking on it? And you guys did get fast track designation, and how will that influence the overall design of the program? Any additional details you'd give us would be great. Yeah, I think the short answer is it will depend on what we see, which is not too much of an epiphany. So the interesting aspect of this trial is that I think there's a couple of different ways in which we can help patients, right? Either it's through the most severe form of GVHD or as we think about bloodstream infections and the potential reduction in bloodstream infections. So the short answer, Peyton, is we will follow the data. But as you mentioned, we were really pleased at the end of last year that we got fast track designation. As we think about different ways in which we could potentially move quickly, that type of, you know, more frequent, higher quality interaction with the agency, I think will be to our benefit. So, you know, we know that it's on FDA's mind, CDC's mind, in terms of the risks of these types of infections, the risk of AMR more generally. And, you know, for us, this is an interesting step into that world. So, we have spent time thinking about what a next study could look like and how large it would be, and certainly how do we resource it. But for now, you know, we're looking forward to continuing to execute on the study and getting to the finish line, turning the card over, and we'll go from there once we do. Any chance you could tell us how, what% the enrollment's at? No, I, you know, what we've said yesterday in, in our earnings announcement was that we are on track for our readout in Q3. Got it. You know, we're pleased where we are, and you know, we think that'll be a really important next step for the platform. Yeah, I guess then also just, like, thinking about, like, the next steps for the platform in general. I know that there was a strategic reorganization and which was, you know, it's necessary in order to keep the funding to promote the VOWST launch and the SER-155. But do you continue to do development on some of the other infection protection candidates that you have, or have those been shelved for a later date? Yeah, the answer is, I think, somewhere in the middle, which is, you know, given the backdrop of a very difficult financial market. and the constrained availability of capital, we have made some really difficult decisions to focus. And for us, that's on VOWST and maximizing with our partner, the best possible launch for VOWST, and continuing to support 155 to a 1b phase, a phase 1b study readout. And our resources are allocated completely to those two endeavors. However, that doesn't mean that, if we are successful with this 1B readout, that that can't open up additional opportunities broadly. And, you know, what we said at the time of announcing the restructuring was, you know, 155 will stand on its own. So, if it is able to excite investors, if it is able to excite partners, we will move it forward in a way in which we think we can do, and we think we can do it with some speed. But, it will not consume resources from the [immunology]. So, you know, we continue to think that this technology is just in the first, the first couple of innings, and there's just simply too much evidence, both within our labs and as well as others, that the role of the microbiome in human health is profound. So, and we think that, with a positive readout on 155, it opens up all sorts of interesting opportunities for us. Great. Yeah, I'm definitely looking forward to it because I think it's a very interesting technology, and I think you guys have a good shot. Kick it back to Ritu for some- With that, we are at-