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Gut check: Seres Therapeutics shares plunge after microbiome drug fails in trial

Roger Pomerantz, Seres Therapeutics
Scott Mlyn | CNBC
Roger Pomerantz, Seres Therapeutics

Shares of Seres Therapeutics plummeted more than 69 percent Friday after its microbiome treatment for preventing a bacterial infection failed in a mid-stage study and raised doubts about this growing area of research.

The product, known as SER-109, is a mix of bacterial spores designed to treat patients from recurring infection of the potentially deadly bacterium Clostridium difficile, or C. diff.

In a phase 2 study, SER-109 did not reduce the risks associated with the infection, compared to the placebo, at up to eight weeks of treatment.

Seres Chairman and CEO Roger Pomerantz said, in a press release, that the clinical results were "unexpected" in view of positive data in prior investigations and supporting clinical 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," he said. "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."

Seres said it will continue to gather and analyze study data, and in consultation with the U.S. Food and Drug Administration, make appropriate adjustments to its SER-109 development plans.

However, investors saw the results as potentially warning about the entire area of microbiome therapeutics, which has been looked on with much promise. The burgeoning field looks to treat illnesses by adding "good" bacteria to your digestive tract.

Seres is one of several companies racing to do that. Others include Vedanta Biosciences, Enterome, Second Genome and uBiome.

The spokesman for Seres didn't immediately respond for CNBC's request for comment.

MCRB 2016 Stock

Correction: An earlier version mischaracterized EpiBiome's approach to microbiome therapeutics.