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February 14, 2019
Shoshana Shendelman
President and Chief Executive Officer
Applied Therapeutics, Inc.
340 Madison Avenue
New York, New York 10173
Re: Applied Therapeutics, Inc.
Draft Registration Statement on Form S-1
Submitted January 25, 2019
CIK No. 0001697532
Dear Dr. Shendelman:
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.
Form S-1 filed confidentially on January 25, 2019
Prospectus Summary
Overview, page 1
1. We note the following disclosure on page 1: "We recently completed a
Phase 1a/1b
clinical trial evaluating AT-001 in 80 patients with type 2 diabetes, in
which we observed
a favorable safety and tolerability profile." Please remove all
statements throughout the
filing that present your conclusions regarding the safety or efficacy of
your products, as
these determinations are within the authority of the FDA or comparable
regulatory
bodies. With respect to safety, we will not object to statements that
your product
candidates were well tolerated.
Shoshana Shendelman
FirstName LastNameShoshana Shendelman
Applied Therapeutics, Inc.
Comapany NameApplied Therapeutics, Inc.
February 14, 2019
February 14, 2019 Page 2
Page 2
FirstName LastName
Our Pipeline, page 3
2. Please include a column for Phase 3 in your product pipeline table
here and on page 77.
3. Given the early stage of development of your PI3K kinase inhibitors,
and limited
disclosure you have provided with respect to such product candidates,
please provide us
with an analysis as to why inclusion of such product candidates in the
pipeline table here
and on page 77 is appropriate. The table is intended to provide
information about your
product candidates in development that are reasonably likely to result
in an approved
product in the foreseeable future.
Implications of Being an Emerging Growth Company, page 4
4. Please supplementally provide us with 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 copes of the communications.
Risk Factors
Our amended and restated certificate of incorporation provides ..., page 53
5. Please reconcile the disclosure in this risk factor with the
disclosure on page 151 that
states, "Our amended and restated certificate of incorporation further
provides that the
federal district courts of the United States of America will be the
exclusive forum for
resolving any complaint asserting a cause of action arising under the
Securities Act."
Market and Industry Data, page 56
6. We note your statement that the information included in the prospectus
from industry
publications and other third party sources is reliable and "such
information is inherently
imprecise." Please revise to disclose clearly whether you believe such
information is
reliable.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Funding Requirements, page 69
7. We note that you expect expenses to increase substantially in
connection with ongoing
activities related to your product candidates. Please amend to
disclose the amount of
research and development expenses incurred during each period
presented and to date by
project (i.e., product candidate and target indication). If research
and development costs
are not maintained by project, disclose that fact and explain why
management does not
maintain and evaluate research and development costs by project.
Provide other
quantitative or qualitative disclosure that indicates the amount of
the company's resources
being used on the project.
Shoshana Shendelman
FirstName LastNameShoshana Shendelman
Applied Therapeutics, Inc.
Comapany NameApplied Therapeutics, Inc.
February 14, 2019
February 14, 2019 Page 3
Page 3
FirstName LastName
Stock-Based Compensation, page 72
8. Once you have an estimated offering price or range, please explain to
us how you
determined the fair value of common stock underlying your equity
issuances and the
reasons for any differences between the recent valuations of your
common stock leading
up to your initial public offering and the estimated offering price.
This information will
help facilitate our review of your accounting for equity issuances
including stock
compensation and beneficial conversion features.
Business
Our Product Candidates
AT-001 for the Treatment of Diabetic Peripheral Neuropathy, page 91
9. We note the disclosure on page 91 that states, "we believe a
significant market
opportunity for a more effective ARI with a favorable dosing regimen
still exists in Japan"
and the disclosure on page 92 that states, "We plan to seek a
strategic partnership to
develop AT-001 for treatment of DPN and advance the program into Phase
3 clinical trial
for this indication." Please clarify to what extent your efforts to
develop AT-001 for
treatment of DPN are focused on the Japanese market, to what extent
they are focused on
the U.S. market, and to what extent you may be targeting any other
markets.
AT-007 for the Treatment of Galactosemia
Clinical Development Plan, page 99
10. We note disclosure on page 99 that states, "Based on feedback from the
FDA at our pre-
IND meeting ...," "Based on discussions with the FDA ...," and "We
believe that a
pediatric indication in galactosemia may qualify for the RPD-PRV
program." Please
advise as to when you expect to know more definitively the FDA's views
on this subject
and how that may affect your plans.
Exclusive License Agreement with Columbia University, page 101
11. We note disclosure of your requirement to pay a "low to mid double
digit percentage" of
net sublicensing revenue. Please revise your disclosure to present a
range of not more
than 10 percentage points.
Certain Relationships and Related Party Transactions
Series B Preferred Stock Financing and Warrants, page 140
12. We note your disclosure on page 141 that, "Each share of Series B
Preferred Stock in the
table below will automatically convert into one share of our common
stock immediately
upon the completion of this offering." Please also disclose whether
all outstanding Series
B Preferred Stock will convert into common stock upon completion of
the offering. Also
discuss, as applicable, any terms of the conversion that are
contingent upon the offering.
Shoshana Shendelman
Applied Therapeutics, Inc.
February 14, 2019
Page 4
General
13. Please explain the meaning of all abbreviations and defined terms the
first time they are
used so as to ensure that lay readers will understand the disclosure. For
example, the
abbreviation cGMP first appears on page 25 but is not explained until
later in the
document.
14. Please provide us proofs of all graphics, visual, or photographic
information you will
provide in the printed prospectus prior to its use, for example in a
preliminary prospectus.
Please note that we may have comments regarding this material.
You may contact Mark Rakip at 202-551-3573 or William Demarest at
202-551-3432 if
you have questions regarding comments on the financial statements and related
matters. Please
contact David Plattner at 202-551-8094 or Tom Kluck at 202-551-3233 with any
other questions.
Sincerely,
FirstName LastNameShoshana Shendelman
Division of
Corporation Finance
Comapany NameApplied Therapeutics, Inc.
Office of
Healthcare & Insurance
February 14, 2019 Page 4
cc: Divakar Gupta, Esq.
FirstName LastName