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United States securities and exchange commission logo
September 3, 2020
Bobak Azamian
Chief Executive Officer
Tarsus Pharmaceuticals, Inc.
15440 Laguna Canyon Road
Irvine, CA 92618
Re: Tarsus
Pharmaceuticals, Inc.
Draft Registration
Statement on Form S-1
Submitted August 7,
2020
Amendment No. 1 to
Draft Registration Statement on Form S-1
Submitted August
14, 2020
CIK No.: 0001819790
Dear Dr. Azamian:
We have reviewed your draft offering 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 offering statement or publicly filing your offering
statement on
EDGAR. Please refer to Rule 252(d) regarding the public filing
requirements for non-public
submissions, amendments and correspondence. 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 your amended draft offering statement
or filed offering
statement and the information you provide in response to these comments,
we may have
additional comments.
Draft Registration Statement on Form S-1, submitted August 7, 2020
Cover Page
1. Please revise the table
on the cover page and on page 185 to also take into account
underwriting
commissions. We note your disclosures elsewhere in the prospectus
reflecting information
after deducting estimated underwriting discounts and commissions.
Prospectus Summary
Overview, page 1
Bobak Azamian
FirstName LastNameBobak
Tarsus Pharmaceuticals, Inc.Azamian
Comapany 3,
September NameTarsus
2020 Pharmaceuticals, Inc.
September
Page 2 3, 2020 Page 2
FirstName LastName
2. We note your references to your product candidates as "first-in-class"
on page 1 and
throughout the registration statement. This term suggests that the
product candidates are
effective and likely to be approved. Please delete these references
throughout your
registration statement. If your use of these terms was intended to
convey your belief that
the products are based on a novel technology or approach and/or is
further along in the
development process, you may discuss how your technology differs from
technology used
by competitors and, if applicable, that you are not aware of competing
products that are
further along in the development process. Statements such as these
should be
accompanied by cautionary language that the statements are not
intended to give any
indication that the product candidates have been proven effective or
that they will receive
regulatory approval. Additionally, with respect to TP-03, there are
existing FDA
approved treatments for rosacea.
3. We note your statement that you estimate that the number of Demodex
blepharitis cases
may be as high as approximately 25 million based on your internal
studies, and your other
references to your research and surveys in the Summary. Please remove
discussions of
your surveys from the Summary, and in the Business section, provide
additional details
regarding the surveys so that an investor may understand their
significance, including
which types of ECPs were included in the survey, how the surveyed ECPs
and patients in
eye care clinics were selected, whether there was any ECP education
that took place
between May 2019 and May 2020 that may have led to a rise in the
number of
diagnoses, and what information regarding the indication and product
candidates were
provided to those surveyed. Please also revise to provide balancing
disclosure regarding
the small number of ECPs and patients surveyed. Also explain the basis
for why you
believe there may be 25 million Demodex blepharitis patients when you
state on page 2
that your research also indicates 58% of patients presenting to ECP
offices have
collarettes indicative of Demodex blepharitis and that there are 20
million patients who
suffer from blepharitis.
4. Please revise the pipeline table on page 2, which also appears on page
108, so that it
reflects the current status of your product candidates. As such,
please remove the grayed
out portion of the arrow for TP-04, and also shorten the length of the
arrows for
the preclinical studies that are not yet completed. For example, we
note your disclosure on
page 133 that you are conducting pre-clinical studies for TP-04.
Please also expand your
disclosure on page 133 to state that you will need to obtain an IND
for TP-04 prior to
commencing trials in the U.S., which you explain on page 19.
Blepharitis: A Significant, Underserved & Underdiagnosed Market , page 2
5. Please include a statement citing the number of people with
collarettes that do not have
Demodex blepharitis.
6. Please remove the comparisons of the blepharitis market to the dry eye
market and your
TP-03 product to Allergen's Restasis in your Summary section.
Additionally, tell us why
you believe it is appropriate to make such comparisons when there are
numerous
Bobak Azamian
FirstName LastNameBobak
Tarsus Pharmaceuticals, Inc.Azamian
Comapany 3,
September NameTarsus
2020 Pharmaceuticals, Inc.
September
Page 3 3, 2020 Page 3
FirstName LastName
differences, including but not limited to the intended indication,
regulatory approval status
and company operating history.
Our Approach: TP-03 , page 3
7. We note your statements on page 4 and elsewhere that your results are
highly statistically
significant. Please limit your discussions of trial results in the
Summary section to
statements regarding the primary endpoints and whether they were met,
or that the trials
and endpoints were exploratory, as applicable. The discussion of
specific p-values and
whether they are statistically significant should be in the Business
section, where you
should also explain how statistical significance relates to FDA
approval and what you
mean by "highly" statistically significant.
8. We note your statement on page 4 regarding the robust and
consistent clinical efficacy
of TP-03 that you observed in your Phase 2 clinical trials, as well as
"meaningful and
consistent clinical efficacy and safety results" from your Phase 2
program. You also refer
on page 6 to "[c]ompelling efficacy and safety data" from your Phase 2
program, on page
7 that you observed in Phase 2 trials that TP-03 "results in
collarette cure and mite
eradication," and your Figure 15 advertises a key advantage of TP-03
as its "Efficacy and
Efficiency." Please revise these and all similar statements throughout
your prospectus that
state or imply that your product candidates are safe or effective as
these determinations
are solely within the authority of the FDA and comparable regulatory
bodies.
9. Please explain the basis for the amounts set forth in the following
statement on page 5: "In
the United States, MGD prevalence has been found to be approximately
two-thirds of that
of the estimated 34 million dry eye patient population." We note that
on page 3,
you state the diagnosed population for dry eye was over 6 million in
2015 and similar
levels have been maintained since.
10. The footnotes to the graphic on page 5 indicate the Saturn trials are
pending FDA
feedback. Please disclose this in your discussions of the Saturn
trials and describe this
process and expected timeline. Please also increase the font size of
the footnotes to the
graphic to make them more legible.
11. Please describe how the formulation of TP-03 that is expected to
support your NDA
submission for Demodex blepharitis is different than the formulation
of TP-03 used in
certain of your prior trials.
Our Strengths and Differentiation, page 6
12. Please balance your first bullet to explain that based on FDA
feedback, your Phase 3 trials
will be using primary endpoints that are more stringent than the ones
used in your Mars
and Jupiter trials and involve longer durations. Also explain that you
expect to enroll 700
patients in your two Phase 3 trials as compared to your largest trial
to date with 54
patients, that all your other trials were conducted outside of the
U.S., and that the FDA has
not yet approved your trial designs.
Bobak Azamian
FirstName LastNameBobak
Tarsus Pharmaceuticals, Inc.Azamian
Comapany 3,
September NameTarsus
2020 Pharmaceuticals, Inc.
September
Page 4 3, 2020 Page 4
FirstName LastName
Our Strategy, page 7
13. Please revise the last bullet on page 7 regarding the rights you
retained, and similar
references elsewhere, to explain that you are dependent on
intellectual property licensed
from Elanco Tiergesundheit AG for both TP-03 and TP-04.
Risks Related to our Business, page 7
14. Please revise your risk factor discussion so that they are of the same
prominence as the
discussion of your strategies. Please add bullets to discuss the risks
associated with the
significant concentration of share ownership by your principal
shareholders, officers and
directors, as referenced on pages 77-78, and that you are dependent on
a license
agreement for the intellectual property underlying your lead product
candidate.
Implications of Being an Emerging Growth Company, page 9
15. 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.
Risks Related to Intellectual Property, page 48
16. In the first risk factor on page 48 please include your obligation to
grant Elanco a license
to your patents and know-how if Elanco terminates the agreement for
failure to meet a
development milestone, which is mentioned on page 137.
Market, Industry and Other Data, page 85
17. It is not appropriate to directly or indirectly disclaim liability for
statements in your
registration statement. Accordingly, please delete the statements that
the sources of the
data cannot guarantee the accuracy or completeness of the information,
and that your
internal assumptions have not been verified by any independent source.
Alternatively,
specifically state that you take liability for these statements. We
also note you state that
you have conducted or sponsored surveys and studies set forth in this
prospectus.
Please expand your Business discussion to clarify which surveys were
conducted by a
third party, identify the party, and whether you commissioned the
study for use in the
registration statement. Please also tell us what consideration you
gave with respect to
filing a consent for such third party pursuant to Securities Act Rule
436.
Use of Proceeds, page 86
18. Please revise to disclose how far you expect to proceed in your Phase
3 trials of TP-03 for
the treatment Demodex blepharitis and in the development of your other
product
candidates. Also, to the extent material amounts of other funds are
necessary to
accomplish your specified purposes, state the amounts of such other
funds and the sources
Bobak Azamian
FirstName LastNameBobak
Tarsus Pharmaceuticals, Inc.Azamian
Comapany 3,
September NameTarsus
2020 Pharmaceuticals, Inc.
September
Page 5 3, 2020 Page 5
FirstName LastName
thereof.
Critical Accounting Policies, Significant Judgments and Use of Estimates
Fair Value of Common Stock, page 105
19. Once you have an estimated offering price or range, please explain to
us how you
determined the fair value of the common stock underlying your 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 and
beneficial conversion features.
Business
Blepharitis Overview, page 113
20. On page 116, please clarify which of your clinical studies is
referenced, or otherwise
disclose information regarding the trial, including the number of
participants and the
results. In particular, you state only 7% of patients without
collarettes had Demodex
and you also state [e]ven for those subjects without collarettes,
but who were performing
daily lid scrubs with shampoo for a full year, 50% had Demodex
infestation . Please
clarify how the 50% relates to the 7% in the description and Figure 7.
Market Opportunity in Blepharitis, page 116
21. On page 117, please revise the disclosure to state why a comparison to
dry eye is being
presented in a study that you state was conducted to determine ECP
awareness of the
connection between collarettes and Demodex infestation. With respect
to the graphic,
please revise as necessary to clarify if any of these patients had
overlapping diagnoses, in
particular with respect to MGD and dry eye.
22. On page 120 please explicitly state the basis for your comparison to
dry eye and why that
comparison is meaningful. Please note whether there was any overlap
between patients
that had both collarettes and were on a prescription therapeutic for
dry eye disease and
explain how the survey results relate to your stated belief that there
is a significant
population for Demodex blepharitis.
Our Approach: Treating Demodex Mites, a Root Cause of Disease, page 121
23. In the graphic on page 121 please clarify what you mean by "near
complete resolution on
mean reduction of collarettes and mites" and either here or on page
114 include a
statement describing the basis for which you feel TP-03 may
meaningfully improve
patient satisfaction with cataract and refractive surgery.
Clinical Development Program, page 122
24. On page 124 you state your study treated 15 people through day 28 and
three did not
Bobak Azamian
Tarsus Pharmaceuticals, Inc.
September 3, 2020
Page 6
continue after day 28. The results on pages 125 and 126 show a total
of 13 subjects on
days 7 and 14, and 14 subjects on day 28. A similar disconnect appears
in connection
with the Io phase 2a trial discussion on page 127 with respect to Day
14. Please reconcile.
Our Additional Product Candidates - TP-04 Topical Formulation for the Treatment
of Rosacea,
page 132
25. We note you indicate that TP-04 is in a preclinical stage. Please
explain why you expect to
move TP-04 directly to a Phase 2a trial.
26. On page 133, please describe in more detail how you feel your TP-04
treatment for
rosacea would address the unmet medical need in the rosacea market and
be more
effective than existing treatments that also target Demodex. For
example, please expand
upon the following parenthetical "(longer half-life, more lipophilic,
greater therapeutic
window)."
Intellectual Property, page 135
27. Please revise your discussion to clarify which patents (and their
corresponding
jurisdictions and expiration dates) are licensed, and which ones are
owned by you, and
whether your treatment and composition of matter claims are covered by
issued patents or
pending patent applications.
License Agreements, page 136
28. Please state the duration of the Elanco license agreement and the term
of the royalty due
thereunder. Please also provide the time period for the diligence and
dermatology milestones or a range. We note that the earliest
milestones were within a
number of months after the agreement date per Exhibit 10.10. If you
have missed any
deadlines thus far please so state, and also note whether they were
COVID-19 related or
not.
You may contact Ameen Hamady at 202-551-3891 or Kate Tillan at
202-551-3604 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Margaret Schwartz at 202-551-7153 or Dorrie Yale at 202-551-8776 with
any other
questions.
FirstName LastNameBobak Azamian Sincerely,
Comapany NameTarsus Pharmaceuticals, Inc.
Division of
Corporation Finance
September 3, 2020 Page 6 Office of Life
Sciences
FirstName LastName