View:
United States securities and exchange commission logo
July 26, 2021
Yizhe Wang, Ph.D.
Chief Executive Officer
LianBio
103 Carnegie Center Drive, Suite 215
Princeton, NJ 08540
Re: LianBio
Draft Registration
Statement on Form S-3
Submitted June 28,
2021
CIK No. 0001831283
Dear Dr. Wang:
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 Submitted June 28, 2021
Prospectus Summary
Overview, page 1
1. Please provide a
organizational chart of your operations reflecting your corporate history
and structure in the
summary prospectus. In this chart, please illustrate the relationships of
the various entities
discussed throughout the filing, indicating those entities you own and
those with which you
may have a contractual relationship. This chart also should
illustrate the states
or countries of incorporation of the various legal entities and various
affiliations that
exist.
Yizhe Wang, Ph.D.
FirstName
LianBio LastNameYizhe Wang, Ph.D.
Comapany
July NameLianBio
26, 2021
July 26,
Page 2 2021 Page 2
FirstName LastName
Our Pipeline, page 2
2. Please revise your pipeline table and other graphics throughout your
filing to ensure that
the text in all graphics, including footnotes, is legible.
3. The pipeline table should reflect the actual, and not the anticipated,
status of your material
product candidates and their various indications as of the latest
practicable date. In that
regard, please revise the table to reflect the following: (1) The
table indicates that Phase 3
trials of mavacamtem for the treatment of oHCM have been completed,
but your
disclosure on page 126 indicates that you are planning additional
Phase 3 and PK trials;
(2) The table indicates that Phase 3 trials of TP-03 for DB are
completed, but disclosure
on page 127 indicates that your partner, Tarsus, is currently
conducting Phase 3 trials;
(3) The table indicates that Phase 1 trials of TP-03 for MGD are
ongoing, but disclosure
on page 128 indicates that Tarsus has announced but not yet initiated
such trials; (4) The
table indicates that Phase 1 trials of NBTXR3 for solid tumor IC
combinations are
complete, but disclosure on page 133 indicates that your partner,
Nanobiotix, is currently
conducting a Phase 1 trial; (5) The table indicates that Phase 1
trials of BBP-398 for
MAPK-driven solid tumors are ongoing, but disclosure on page 138
indicates that Phase 1
dosing trials have not yet been initiated; (6) The table indicates
that Phase 1 trials of NX-
13 for CD are ongoing, but your disclosure does not appear to address
whether any
clinical trials to date have tested NX-13 for this indication.
4. Please explain why it is appropriate to include infigratinib for
Second-line
Cholangiocarcinoma with FGFR2 Fusions in the pipeline table. We note
your filing
contains no narrative discussion regarding the infigratinib program
contemplating this
indication. As such, it appears that it is not currently sufficiently
material to your
operations to warrant inclusion in the table.
5. For any product candidate that has received regulatory approval,
please include a
clarifying footnote disclosing (1) the nature of the approval and the
jurisdiction in which it
was obtained; (2) whether such approval comes from a regulator outside
of your licensed
or target jurisdiction where you intend to market the product; and (3)
obtaining and
maintaining regulatory approval in one jurisdiction does not mean that
you will be
successful in obtaining or maintaining regulatory approval of the
product candidate in
other jurisdictions that are material to the success of the company.
Please also include a
footnote or other prominent disclosure proximate to the pipeline table
indicating, as we
note you have on page 18, that each of your current product candidates
will require
regulatory approval in multiple jurisdictions. We note certain
disclosure in your risk
factors regarding the foregoing points, and you may choose to provide
a cross-reference to
these or other disclosures.
Our Strengths, page 4
6. We note that you identify certain entities as comprising "a leading
syndicate of investors
based in the United States and China" in your company on page 5 and on
page 117.
Yizhe Wang, Ph.D.
FirstName
LianBio LastNameYizhe Wang, Ph.D.
Comapany
July NameLianBio
26, 2021
July 26,
Page 3 2021 Page 3
FirstName LastName
However, certain of these entities do not appear to be among your
principal stockholders
as disclosed on page 218-219. If material, please expand your
disclosure to describe the
nature of each such entity's investment in your company and explain to
us why including
this information is appropriate. In your response, please also explain
your plans to update
investors about any changes these entities make with respect to their
investments in your
company.
7. We note your disclosure on page 4 and on page 115 that "[your]
pipeline currently
consists of nine compelling product candidates across cardiovascular,
oncology,
ophthalmology, inflammatory disease and respiratory indications, a
majority of which are
late-state and have been clinically validated in controlled clinical
trials." This statement
seems to conflict with the next sentence, and other disclosure
throughout the prospectus,
which indicates that the late-stage development pipeline is led by
only three candidates.
Please reconcile these statements. Additionally, please revise the
summary prospectus
and business section to describe what you mean by "clinically
validated" and the basis for
that claim. Please revise the summary prospectus to indicate the
jurisdiction(s) in which
any of your product candidates are approved and whether you expect you
will need
additional approvals in the jurisdictions where you are licensed to
develop and
commercialize the candidate.
Our Vision and Strategy, page 5
8. We note statements such as the following throughout your prospectus:
(1) Disclosure at
page 5 regarding the company's pursuit of a strategy to ""rapidly
advance [its] late-stage
product candidates"; (2) Disclosure at page 5 and page 118 regarding
strategies you
believe will enable the company to leverage data generated in
partners' global
registrational trials and clinical development programs"[i]n order to
accelerate
development in China . . ." and "with the goal of accelerating
regulatory approval . . .";
and (3) Disclosure at page 118 that you expect to use data generated
in a partner's global
Phase 3 trial to "accelerate potential regulatory approval in Greater
China and other Asian
markets." Please revise these and any similar disclosures throughout
the prospectus to
remove any implication that you will be successful in obtaining
necessary regulatory
approvals or commercializing your product candidates in a rapid or
accelerated manner as
such statements are speculative, particularly in light of your
disclosure at page 33
indicating that use of foreign clinical data to secure regulatory
approval of an application
in China is subject to review by NMPA authorities, who may conclude
that foreign data is
insufficient to approve your product candidates.
Risk Factors Summary, page 6
9. We note the bullet in your risk factors summary on page 7 that
pertains to your
relationship with Perceptive Advisors. Please revise the disclosure to
better highlight the
risks related to the concentration of ownership of your common shares,
as discussed in
your risk factor on page 52. Please also include here, and in your
risk factor on page 83, a
discussion of the number of your executive officers and directors who
are affiliated with
Yizhe Wang, Ph.D.
FirstName
LianBio LastNameYizhe Wang, Ph.D.
Comapany
July NameLianBio
26, 2021
July 26,
Page 4 2021 Page 4
FirstName LastName
Perceptive Advisors and discuss the nature of the conflicts of
interest that may exist
between you and minority holders of your ADSs, on the one hand, and
Perceptive and its
shareholders on the other.
Risk Factors, page 15
10. We note your risk factor beginning on page 36 that addresses current
or pending Chinese
data protection laws and regulations and the possible effects of
non-compliance. In that
regard, please disclose (1) whether the company anticipates that any
new draft laws or
regulations proposed since the filing of your DRS will apply to the
company, such as draft
rules published by the Cyberspace Administration of China in July
2021; and (2) whether
the PRC Measures for Managing Scientific Data (2018) presents a
risk to your
business. Please also clarify the risk factor to disclose whether the
PRC could prevent you
from seeking foreign approval and commercialization of your product
candidates in the
territories outside of China where you plan to develop and
commercialize your in-licensed
product candidates. As appropriate, please also highlight any new
material risk
information in this regard in the summary prospectus.
11. We note your inclusion of risk factors related to doing business in
China, including one
such risk factor at page 43 captioned as follows: "China s economic,
political and social
conditions, as well as governmental policies, could affect the
business environment and
financial markets in China, our ability to operate our business, our
liquidity and our access
to capital." Please expand this risk factor to disclose, if true, that
the PRC government
also has significant authority to exert influence on the ability of a
China-based company,
such as your company, to conduct its business.
Use of Proceeds, page 94
12. We note your disclosure on page 94 that you intend to use the net
proceeds of the offering
to: (i) further the clinical development of your three leading
late-stage candidates in
various Phase 3 clinical trials; (ii) advance your additional pipeline
candidates; (iii)
support commercialization efforts; (iv) fund new business development
and in-licensing
opportunities; and (v) use the remainder for working capital and other
general corporate
purposes. We also note your statement on page 94 that you cannot
currently predict the
stage of development you expect to achieve for your product candidates
with the net
proceeds from the offering. While we understand the inherent
uncertainty with respect to
the development of product candidates, where you have identified
specific purposes for
which you intend to use the offering proceeds, investors are entitled
to your best estimate
as to how far such proceeds will allow you to advance towards the
achievement of the
specified purposes. As such, please revise your disclosure to provide
an estimate as to (1)
how far along you expect to be able to develop your three lead
late-stage candidates and
(2) which specific additional pipeline candidates will be advanced and
how far into
development you expect such programs to reach with the offering
proceeds. You may, as
necessary, provide additional disclosure that advises investors of the
particular factors and
assumptions that form the basis of your estimate, any uncertainty
surrounding your
Yizhe Wang, Ph.D.
LianBio
July 26, 2021
Page 5
estimate and the reasons that the actual results could vary.
13. If you do not have a reasonable basis to believe that you will be able
to fund any product
candidates to the commercialization stage using the proceeds of this
offering, please either
remove the reference to "commercialization" or revise to include
disclosure explaining
more specifically how proceeds may be used to support
commercialization efforts."
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of operations
Research and development expenses , page 105
14. You indicate on page 109 that you track direct research and
development expenses on a
program-by-program basis. Please disclose a breakdown of this
information, including
any upfront payments, in your filing to provide additional context to
your research and
development activities. Provide a reconciliation to the amount
included on the Statements
of Operations.
Liquidity and Capital Resources, page 106
15. Please revise your liquidity disclosures to address the fact that you
are a holding company
with no operations of your own and that you depend on your
subsidiaries for cash. Please
also disclose any restrictions or other factors that could inhibit
your subsidiaries' ability to
pay dividends or make other distributions to the parent company.
Please refer to Item
303(a)(1) of Regulation S-K.
Emerging Growth Company and Smaller Reporting Company Status, page 112
16. 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 copies of the communications.
Business
Our Pipeline, page 122
17. We note your reference to BBP-398's "favorable safety/tolerability
profile" on page 139
and to Omilancor's "well-tolerated safety profile to date" on page 142.
As safety and
efficacy determinations are solely within the authority of the FDA and
comparable
regulatory bodies, it is inappropriate to state or imply that your
product candidates are safe
or effective. Please revise these and other similar statements
throughout your prospectus
FirstName LastNameYizhe Wang, Ph.D.
that suggest the safety and efficacy of your candidates. Where you deem
appropriate, you
Comapany
may NameLianBio
present objective data without including your conclusions related
to safety or
July 26,efficacy.
2021 Page 5
FirstName LastName
Yizhe Wang, Ph.D.
FirstName
LianBio LastNameYizhe Wang, Ph.D.
Comapany
July NameLianBio
26, 2021
July 26,
Page 6 2021 Page 6
FirstName LastName
License and Collaboration Agreements, page 152
18. With respect to the disclosure beginning on page 152 regarding the
license agreements
with your partners, please revise your discussion of the term and
termination provisions.
In that regard, we note that the license agreements will terminate
upon the last-to-expire
patent on a country-by-country basis. Please revise to clarify when
such patents are
expected to retire.
19. With respect to any supply agreements, please disclose the minimum
purchase
requirements if the agreement involves manufacturing.
20. We note your reference on page 154 to royalty rates of "up to the low
teens." Please
revise to narrow the royalty range disclosed for this agreement to no
more than ten
percentage points (for example, between twenty and thirty percent).
Description of Share Capital, page 224
21. Once you have an estimated offering price range, please explain to us
the reasons for any
differences between recent valuations of your common shares leading up
to the planned
initial public offering and the midpoint of your estimated offering
price range. This
information will help facilitate our review of your accounting for
equity issuances
including options and warrants.
Governing Law/Waiver of Jury Trial, page 246
22. We note your disclosure that parties to the Deposit Agreement
irrevocably waive the right
to a jury trial. Please include a risk factor to highlight the risks
and impact associated with
the jury trial waiver provision to those holding ADS or an interest
therein, which may
include increased costs to bring a claim, the possibility of less
favorable outcomes, limited
access to information and other imbalances of resources between the
company and
shareholders, and that these provisions can discourage claims or limit
shareholders' ability
to bring a claim in a judicial forum that they find favorable. Please
also disclose whether
this provision would apply if an ADS holder were to withdraw the
ordinary shares.
23. We note on page 246 that your forum selection provision identifies
state and federal
courts in New York, New York as the exclusive forum for certain
litigation by those
holding ADS or an interest therein. Please provide clear and prominent
risk factor
disclosure of the impact and risks to ADS holders related to the
provision. Please disclose
whether this provision applies to actions arising under the Securities
Act or Exchange Act.
If so, please also state that there is uncertainty as to whether a
court would enforce such
provision. If the provision applies to Securities Act claims, please
also state that investors
cannot waive compliance with the federal securities laws and the rules
and regulations
thereunder. In that regard, we note that Section 22 of the Securities
Act creates concurrent
jurisdiction for federal and state courts over all suits brought to
enforce any duty or
liability created by the Securities Act or the rules and regulations
thereunder. If this
provision does not apply to actions arising under the Securities Act
or Exchange Act,
Yizhe Wang, Ph.D.
LianBio
July 26, 2021
Page 7
please also ensure that the exclusive forum provision in the governing
documents and
Deposit Agreement states this clearly, or tell us how you will inform
investors in future
filings that the provision does not apply to any actions arising under
the Securities Act or
Exchange Act.
Notes to Consolidated Financial Statements
Note 3. Material Agreements, page F-12
24. With respect to your license agreements, please address the following
in the filing:
Clarify the value attributed to the warrants granted under the QED
License
Agreement. Tell us how the value was determined and how the
conversion feature
into the company's stock was considered. Disclose the accounting
treatment and tell
us the basis thereof.
Tell us how you determined the $33.8 million value attributed to
the warrants issued
for the License Agreement with MyoKardia. Clarify the accounting
treatment for the
warrants and accounting basis thereof. Also tell us if the
warrants may be converted
into the company's stock, and if so, provide disclosure in the
filing.
Clarify the accounting treatment for the $70.0 million of
restricted, non-dilutive
capital, including a $20.0 million upfront payment, to be paid by
Pfizer to the
company.
Note 9(C). Warrants, page F-19
25. Please tell us why the warrants issued in connection with license
agreements appear to be
classified as stock compensation instead of research and development
expense.
Note 12. Subsequent Events
Tarsus License, page F-23
26. With respect to the Tarsus License, please clarify the following:
the number of shares underlying the warrants,
the minority percentage of the fully diluted equity of Lian
Ophthalmology,
the value attributed to the warrants and how the value was
determined,
the accounting treatment for the warrants and basis thereof,
if the warrants are convertible into the company's common stock and
the conversion
terms, if such is the case, and
the amount of milestones related separately to each significant
event such as
FirstName LastNameYizhe Wang,
development vs sales Ph.D.
milestones. In this regards, please
separately disclose the
Comapany amount
NameLianBio
of milestone payments that may be made for each License
discussed in Notes
3 and
July 26, 2021 12.7
Page
FirstName LastName
Yizhe Wang, Ph.D.
FirstName
LianBio LastNameYizhe Wang, Ph.D.
Comapany
July NameLianBio
26, 2021
July 26,
Page 8 2021 Page 8
FirstName LastName
You may contact Christie Wong at 202-551-3684 or Mary Mast at
202-551-3613 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Lauren Hamill at 303-844-1008 or Celeste Murphy at 202-551-3257 with
any other
questions.
Sincerely,
Division of Corporation
Finance
Office of Life Sciences
cc: Thomas Danielski