View:
United States securities and exchange commission logo
February 19, 2021
Garo Armen
President and Chairman of the Board of Directors
AgenTus Therapeutics, Inc.
3 Forbes Road
Lexington, MA 02421
Re: AgenTus
Therapeutics, Inc.
Draft Registration
Statement on Form S-1
Submitted January
22, 2021
CIK No. 0001840229
Dear Dr. Armen:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form S-1 submitted on January 22, 2021
Prospectus Summary , page 1
1. With reference to your
glossary of Industry Terms, please revise the Summary to explain
each of the terms at
first use in the Summary. Also, revise to explain the terms "off-the-
shelf" on page 1 and
"unmodified" and "targeted" on page 2.
2. With reference to your
disclosures on page 39, please revise to discuss your currents plans
for separating your
resources and functions from those of Agenus.
Overview , page 2
3. We refer to the bottom
three rows of your pipeline table under the heading "Targeted
Garo Armen
FirstName LastNameGaro
AgenTus Therapeutics, Inc.Armen
Comapany19,
February NameAgenTus
2021 Therapeutics, Inc.
February
Page 2 19, 2021 Page 2
FirstName LastName
INTELLIGENT iNKT Cells." We note that your Business section disclosure
does not
discuss any preclinical work that you have conducted to date relating
to any of the
candidates. In addition, we note that you do not appear to have
identified specific targets
or have milestones related to future work. Accordingly, it does not
appear appropriate to
highlight these programs prominently in your prospectus Summary.
Please revise to
remove these programs from the table.
Strategy , page 2
4. We note your disclosure referencing your plans to "rapidly advance"
your lead product
candidate, AGENT-797, through clinical development. With reference to
your risk
disclosures on pages 15 and 17-18, please balance the Summary
disclosure by
highlighting that it takes many years to develop a new medicine and
that no allogeneic
iNKT cell therapy has been approved for commercial use by any
regulatory authority.
Potential Advantages of Allogeneic iNKT Cell Therapy Compared to Current CAR-T
Cell
Therapy, page 6
5. Please tell us your basis for highlighting a more favorable safety
and relapse rate profile
relative to the current standard of care given your disclosure on page
17 that no allogeneic
iNKT cell therapy has been approved for commercial use by any
regulatory authority. In
addition, we note that it is not clear (i) that your INTELLIGENT iNKT
cells are
comparable to the autologous iNKT cells used in the referenced trials
or (ii) what is the
basis for your expectation that your INTELLIGENT iNKT cells will have
a higher level
of batch homogeneity and consistency than the autologous iNKT cells
used in the clinic to
date. Please note that we have similar concerns regarding you
disclosures under the
heading "Key Features of Our INTELLIGENT iNKT Cells." Please revise
accordingly.
Key Features of Our INTELLIGENT iNKT Cells, page 7
6. Please discuss briefly here or on page 93 the basis for your statement
that "allogeneic
iNKT cells may engraft better than other allogeneic cell types and
thus require less
lymphodepletion."
Implications of Being an Emerging Growth Company and Smaller Reporting Company,
page 8
7. Please provide us with supplemental copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to
do so on your behalf,
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communications.
Implications of Being a Controlled Company, page 9
8. We note that you are a "controlled company" as defined under the
relevant Nasdaq listing
rules. Please disclose your status as a controlled company in the
prospectus cover page.
Also, revise the Summary to indicate the equity stake that your parent
entity and affiliates
Garo Armen
FirstName LastNameGaro
AgenTus Therapeutics, Inc.Armen
Comapany19,
February NameAgenTus
2021 Therapeutics, Inc.
February
Page 3 19, 2021 Page 3
FirstName LastName
will hold following the offering.
Use of proceeds , page 10
9. You note that you will use a portion of the proceeds to fund the
IND submission and
development of AGENT-797 through completion of our planned Phase 1
clinical trial for
the treatment of patients with multiple myeloma and B cell lymphoma.
This appears to
contradict your statement that you will have already commenced your
Phase I clinical trial
in January of 2021, under which the IND should already have been
submitted. Please
revise or advise.
Summary Consolidated Financial Data, page 11
10. Please clearly show in the notes how you computed each pro forma
amount, including a
discussion of any significant assumptions and estimates used to arrive
at the amounts. For
example, please address the following:
Please specifically show in your disclosures how you computed the
number of basic
and diluted weighted average shares to use in determining pro
forma earnings per
share amounts; and
Your disclosures on page 81 indicate your outstanding convertible
note is payable in
cash or equity shares at Agenus election. In this regard,
please clarify your basis for
assuming that the notes will be settled in shares of your common
stock rather than
cash.
In a similar manner, please expand your disclosures related to the pro
forma amounts
presented in the Capitalization table on page 75.
Use of Proceeds, page 73
11. We note your disclosure that you may find it necessary or advisable to
use the net
proceeds for other purposes. We also note your risk factor disclosure
indicating that you
may experience difficulty in separating your resources from Agenus.
Accordingly, please
tell us and, revise as applicable, to discuss whether the proceeds
could be used to fund
Agenus operations.
Capitalization, page 75
12. It is not clear why you have not presented any debt amounts in your
capitalization table.
Please advise or revise your table accordingly.
13. You disclose that your pro forma amounts reflect the effectiveness of
your amended and
restated certificate of incorporation. Please better clarify in your
disclosures the specific
terms in the amended and restated certificate of incorporation that
you are referring to and
how they will impact your financial statements. It is also not clear
whether you intend to
give effect to the conversion of your convertible affiliated note in
your pro forma amounts
in a similar manner to the pro forma amounts presented on page 12.
Garo Armen
FirstName LastNameGaro
AgenTus Therapeutics, Inc.Armen
Comapany19,
February NameAgenTus
2021 Therapeutics, Inc.
February
Page 4 19, 2021 Page 4
FirstName LastName
Historical Results of Operations Year Ended December 31, 2019
Research and Development Programs, page 81
14. Please disclose your research and development expenses by product
candidate for each
period presented. To the extent that you do not track expenses by
product candidate,
please disclose as such, and provide a breakdown by nature of type of
expense.
Critical Accounting Policies and Estimates, page 82
15. You disclosures on page F-13 indicate that share-based compensation
was issued under
your 2018 Plan as well as under the Agenus 2019 Equity Incentive Plan.
Given it would
appear that there would be significant judgment related to share-based
compensation,
including how you determined the fair value of your shares in valuing
share-based
compensation issued under your 2018 Plan, please include share-based
compensation as
part of your critical accounting policies and estimates disclosures
and specifically address
the following:
the methods that management used to determine the fair value of
your shares and the
nature of the material assumptions involved;
the extent to which the estimates are considered highly complex
and subjective; and
the estimates will not be necessary to determine the fair value of
new awards once the
underlying shares begin trading.
Alternatively, please advise why you do not think additional
disclosures are necessary.
16. Once you have an estimated offering price or range, please explain to
us how you
determined the fair value of your common stock underlying equity
issuances and the
reasons for any differences between the recent valuations of your
common stock leading
up to the IPO and the estimated offering price. This information will
help facilitate our
review of your accounting for equity issuances including stock
compensation.
Preclinical Efficacy Data for iNKT Cell Therapy, page 94
17. Please revise to clarify whether this data relates to generic iNKT
cell therapies or your
INTELLIGENT iNKT cell therapy, AGENT-797. Also, revise to clarify
whether you or
your patent conducted or sponsored any of these trials. As applicable,
please revise your
disclosure on pages 96-97 to present the pre-clinical work and results
or revise to indicate
that such work has not been conducted.
Investigator-Initiated Clinical Data for iNKT Cell Therapy, page 95
18. You state that "[m]ultiple investigator-initiated clinical trials
using autologous iNKT cells
have demonstrated safety and efficacy across multiple cancer
indications, with clinical
trials for three different cancers published to date: melanoma,
non-small cell lung cancer
(NSCLC), and HNSCC." Please remove the implication that autologous
iNKT cell have
been proven to be safe and effective, as these determinations are the
exclusive authority of
the FDA or other regulators.
Garo Armen
FirstName LastNameGaro
AgenTus Therapeutics, Inc.Armen
Comapany19,
February NameAgenTus
2021 Therapeutics, Inc.
February
Page 5 19, 2021 Page 5
FirstName LastName
19. Please clarify whether the tables you have included on page 96 refer
to the four
investigator-initiated clinical trials that you mention in this
section. If so, please revise
your narrative description to make this more clear, as it appears
there are only three
clinical trials listed and there is no way to determine which, if any,
of the images of the
iNKT treatments correspond to each trial.
Additional Product Development
T-Rx, page 98
20. You state that, under your TCR platform, "[s]afety is ensured by using
extensive
proprietary off-target profiling." Please delete this sentence, as
safety determinations are
in the purview of the FDA.
Immuno-Oncology Combination Therapy Collaboration with Agenus, page 100
21. It is not clear why you have provided the pipeline table for two of
Agenus' products.
Please provide an explanation for why the stage of Agenus' clinical
development is
material to your investors or remove this pipeline table.
Intellectual Property, page 100
22. You disclose that you own "one issued patent and had 23 pending patent
applications." For the issued patent, please amend this disclosure to
include the type of
patent protection granted (i.e., composition of matter, use, or
process), its expiration date,
and its the jurisdiction. For the pending patent applications, amend
this disclosure to
include the date that these patent applications were submitted, their
jurisdiction, and their
expected expiration date.
Competition , page 112
23. Please revise to clarify whether any of your competitors are testing
their therapies
on COVID-19-related pneumonia and/or multiple myeloma/B cell lymphoma
in
clinical trials.
Certain Relationships and Related Party Transactions
Relationship with Agenus, page 129
24. Please disclose the material terms of your Intercompany Agreement with
Agenus. For
instance, and without limitation, discuss the term and termination
provisions and the
(i) duration and the applicable markup percentages in your "cost plus
basis" agreements.
Also, tell us whether the "new services agreement" referenced on page
39 will be executed
prior to effectiveness of the registration statement.
Note 2. Summary of Significant Accounting Policies
(h) Revenue Recognition , page F-9
Garo Armen
AgenTus Therapeutics, Inc.
February 19, 2021
Page 6
25. You disclose that revenue includes grant income recognized in accordance
with ASC 958-
605, Not-for-Profit Entities, Revenue Recognition. Please help us
understand how you
determined it was appropriate to follow the guidance of ASC 985 rather
than ASC 606 in
regards to revenue recognition. Based on the appropriate guidance, please
disclose how
you determined the appropriate amount of revenue to record related to the
agreement with
the Belgium Walloon Region Government as discussed on page F-13. Please
also expand
your disclosures to discuss the impact of terminating this agreement in
2020.
Financial Statements
Note 10. Related Party Transactions, page F-14
26. Pursuant to SAB Topic 1:B.1, please address the following:
Please clearly disclose, if true, that the financial statements
provided reflect all of the
costs of doing business related to these operations, including
expenses incurred by
other entities on your behalf;
Please specifically disclose the allocation method used for each
material type of cost
allocated and your assertion that the methods used are reasonable.
Your disclosures
indicate that costs were allocated primarily based on time devoted to
activities and
headcount-based allocations; however, it is not clear what specific
allocation method
was used for each significant cost; and
Please disclose management s estimates of what expenses would have
been on a
stand-alone basis, if practicable.
You may contact Nudrat Salik at (202) 551-3692 or Daniel Gordon at (202)
551-3486 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Dillon Hagius at (202) 551-7976 or Joe McCann at (202) 551-6262 with
any other
questions.
Sincerely,
FirstName LastNameGaro Armen
Division of
Corporation Finance
Comapany NameAgenTus Therapeutics, Inc.
Office of Life
Sciences
February 19, 2021 Page 6
cc: Zachary Blume
FirstName LastName