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United States securities and exchange commission logo
November 14, 2022
Geoffrey S. Dow, Ph.D.
President and Chief Executive Officer
60 Degrees Pharmaceuticals, Inc.
1025 Connecticut Avenue NW Suite 1000
Washington, D.C. 20036
Re: 60 Degrees
Pharmaceuticals, Inc.
Draft Registration
Statement on Form S-1
Submitted on
October 18, 2022
CIK No. 0001946563
Dear Geoffrey S. Dow:
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 October 18, 2022
Cover Page
1. We note your disclosure
on page 96. Please advise whether you will be a controlled
company under the
Nasdaq rules upon the completion of your offering. If so, please
include appropriate
disclosure on the prospectus cover page and in the Prospectus
Summary, and provide
risk factor disclosure of this status and disclose the corporate
governance exemptions
available to a controlled company. To the extent you will be a
controlled company, the
cover page and Prospectus Summary disclosure should include
the identity of your
controlling stockholder(s), the amount of voting power the controlling
stockholder(s) will own
following the completion of the offering and whether you intend
to rely on any
exemptions from the corporate governance requirements that are available
Geoffrey S. Dow, Ph.D.
60 Degrees Pharmaceuticals, Inc.
November 14, 2022
Page 2
to controlled companies.
Prospectus Summary, page 4
2. Please revise your disclosure here and in your Business section to
include a pipeline table
depicting your clinical development programs, the specific indications
being pursued, the
phase or status of development for each product candidate including
separate columns for
preclinical development, Phase 1, Phase 2 and Phase 3 trials with
arrows showing where
each program has progressed, and a column indicating the timing of
expected data from
trials. If the pursuit of any of the indications may be delayed or are
contingent on
additional resources (such as marketing Arakoda as a malaria
preventative treatment),
please clearly note that in your table.
Arakoda, page 6
3. We note your disclosure that you entered into a "cooperative research
and development
agreement with the United States Army in 2014" and that in 2021 "with
financial support
from the US Army [you] conducted a Phase II clinical investigation of
the safety and
efficacy of Arakoda[.]" Please revise your disclosure here and
elsewhere to provide
further detail with regard to your research and development agreement
with the U.S.
Army. Please disclose the material provisions of this agreement
including, but not limited
to, the term of the agreement and whether there are any milestone or
royalty payment
requirements.
4. We note your disclosure regarding the Phase II clinical investigation
of the safety and
efficacy of Arakoda in outpatients with mild-moderate COVID-19 that
was completed in
October 2021. If known, please indicate which variant of SARS-CoV-2
was represented
in this investigation and, if the results of this study may not be
applicable to newer
variants, please include appropriate balancing disclosure.
5. We note your disclosure that "Arakoda has the potential to improve
patient outcomes in
terms of recovery from yeast infections, and prevention of fungal
pneumonias in
immunosuppressed patients[,]" that "Arakoda has the potential to reduce
the duration of
treatment with antibiotic therapy in immunosuppressed patients and the
time to parasite
clearance in non-immunosuppressed patients[,]" and that "[o]nce
appropriate clinical
studies have been conducted, it is likely that Arakoda would be quickly
embraced for
post-exposure prophylaxis of babesiosis in patients with tick bites and
suspected of being
co-infected with Lyme disease." Given that Arakoda is currently approved
by the FDA
only for the prevention of malaria in individuals 18 years or older,
please revise these and
similar statements indicating or implying that your product is, or will
be determined to
be, safe and effective for indications other than the prevention of
malaria in individuals 18
FirstName LastNameGeoffrey S. Dow, Ph.D.
years or older. Safety and efficacy determinations are solely within the
authority of the
Comapany
FDAName60 Degrees
or similar Pharmaceuticals,
regulators Inc. are rendered only after
pivotal trials have
and those decisions
been14,
November completed.
2022 PageIf2these statements indicate your beliefs, please
revise accordingly.
FirstName LastName
Geoffrey S. Dow, Ph.D.
FirstName
60 DegreesLastNameGeoffrey S. Dow, Ph.D.
Pharmaceuticals, Inc.
Comapany 14,
November Name60
2022 Degrees Pharmaceuticals, Inc.
November
Page 3 14, 2022 Page 3
FirstName LastName
Celgosivir, page 7
6. We note your disclosure that a clinical study of Celgosivir confirmed
its safety. Please
indicate where this study was conducted, whether the study was powered
for statistical
significance and if the applicable regulatory authorities agreed with
your conclusion. If
true, please also indicate that other regulatory agencies may not
agree with the study s
safety conclusions and that you may need to conduct further studies in
other jurisdictions.
Strategy, page 8
7. We note your disclosure that it is your belief that "Arakoda has the
potential to reduce the
time to sustained clinical recovery [of COVID-19] by about three
days." In an appropriate
location in your prospectus, please provide data that supports this
disclosure.
8. We note your disclosure that one of the three routes for the
commercialization of Arakoda
for the malaria prevention market is "the prospect of additional U.S.
Department of
Defense [] and government agency procurement in the future[.]" Please
revise your
disclosure here to note that, as indicated on page 57, upon the
fulfillment of your existing
contract with the Department of Defense, the Department of Defense has
not issued any
further contracts nor contract modifications to allow additional
procurement.
Suppliers, page 10
9. We note your disclosure that you have quality and contract
manufacturing agreements
relating to Arkoda in place with Knight Therapeutics, among other
entities, "to allow
supply of Arakoda/Kodatef to Australia, Europe, Canada/Israel/Latin
America and
Russia[.]" Please identify whether any import or export control
restrictions and sanctions
related to Russia's invasion of Ukraine are applicable to your
business and describe the
impact on the company and investors.
Summary of Risk Factors, page 11
10. We note your last risk factor on page 43 regarding the potential for
generic competition
for Arakoda for malaria. Please tell us why including a summary of
this risk factor in this
section would not be appropriate or revise as applicable.
Common stock to be outstanding after the offering, page 15
11. We note your disclosure on page F-18 that preferred stock will be
issued for accrued
interest on the Knight Loan. If appropriate, please disclose these
securities and their
conversion terms in this section.
12. For the warrants described in footnote 3, please disclose the exercise
prices.
Geoffrey S. Dow, Ph.D.
FirstName
60 DegreesLastNameGeoffrey S. Dow, Ph.D.
Pharmaceuticals, Inc.
Comapany 14,
November Name60
2022 Degrees Pharmaceuticals, Inc.
November
Page 4 14, 2022 Page 4
FirstName LastName
Use of Proceeds, page 15
13. We note your disclosure on page 8 that your clinical study for Arakoda
for COVID-19
will utilize the majority of the proceeds of the offering reserved for
research and
development activities. Please indicate this use here and in your
disclosure under "Use of
Proceeds" on page 51.
Risk Factors, page 17
14. We note recent instances of extreme stock price run-ups followed by
rapid price declines
and stock price volatility seemingly unrelated to company performance
following a
number of recent initial public offerings, particularly among
companies with relatively
smaller public floats. Revise to include a separate risk factor
addressing the potential for
rapid and substantial price volatility and any known factors
particular to your offering that
may add to this risk and discuss the risks to investors when investing
in stock where the
price is changing rapidly. Clearly state that such volatility,
including any stock-run up,
may be unrelated to your actual or expected operating performance and
financial
condition or prospects, making it difficult for prospective investors
to assess the rapidly
changing value of your stock.
Our product candidates are subject to extensive regulation..., page 23
15. In your first paragraph on page 26, please define the "AF" indication.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Concentration of Revenues, page 57
16. We note your disclosure that you receive a majority of your revenues
from sales of the
Arakoda product to the Department of Defense and that you have an
existing contract with
the Department of Defense. Please revise your disclosure here to note
the termination
date of this existing contract.
Revenue, page 59
17. We note your disclosure that you have a contract that was "executed by
[y]our U.S.
government research partner to support commercialization efforts."
Please clarify which
government research partner you are referring to.
Business, page 64
18. We note the agreements you intend to file as Exhibits 10.20 through
10.23. Please
describe the material terms of each such agreement, including each
party's rights and
obligations thereunder, the duration of each agreement and any royalty
and termination
provisions, or tell us why such disclosure would not be appropriate.
We also note you
have rights to use patents, manufacturing information and non-clinical
and clinical data
licensed from the United States Army for tafenoquine for all
indications except P. vivax
Geoffrey S. Dow, Ph.D.
60 Degrees Pharmaceuticals, Inc.
November 14, 2022
Page 5
malaria. Please file that agreement as an exhibit, and, in an
appropriate location, disclose
how your licensing arrangement, which you disclose excludes P. vivax
malaria, would
impact any targeted marketing efforts of Arakoda for its currently
approved use.
Arakoda, page 66
19. We note your disclosure that you conducted a Phase II clinical
investigation of the safety
and efficacy of Arakoda in outpatients with mild-moderate COVID-19
disease.
Please provide further details about this study including, but not
limited to, where it was
conducted, how many outpatients were involved, how participants were
selected, whether
there were any adverse effects, and whether the results were
statistically significant. We
note, for example, that Arakoda reduced clinical recovery time from
shortness of breath,
cough, and fever (P<0.02), and improved aggregate symptom scores five
days after
treatment (P<0.1). If any of the p-values from this study were not
statistically significant,
please clarify that here and include balancing disclosure in your
prospectus summary.
Please also clarify here and in your prospectus summary whether the
trial was designed to
show if the observed results could be due to the administration of
Arakoda on a stand-
alone basis, or prior COVID infection, prior vaccination, or both, or
whether the results
could be due to chance.
Strategy, page 68
20. We note your disclosure that you plan to conduct additional
non-clinical studies to clarify
the process by which tafenoquine interacts with COVID-19 and that such
studies will
attempt to determine whether tafenoquine acts as an immunomodulator
(by decreasing the
production of immune system molecules that cause inflammation) and/or
exhibits an
antiviral effect via inhibition of the host protease TMPRSS2. If it is
found that
tafenoquine acts as an immunomodulator, please indicate whether this
could impact the
approval of prescribing tafenoquine for patients in the early stages
of the disease process.
Intellectual Property, page 70
21. Please disclose the expiration dates for your current patents and the
expected expiration
dates for your patent applications.
Certain Relationships and Related Party Transactions, page 97
22. We note your disclosure that 60P LLC entered into an agreement and plan
of merger with
60 Degrees Pharmaceuticals, Inc. Please file the merger agreement as an
exhibit or tell us
why such agreement is not required to be filed. See Item 601(b)(2) and
(10) of Regulation
S-K.
FirstName LastNameGeoffrey S. Dow, Ph.D.
23. Please disclose the standards that will be applied in determining
whether to approve any
Comapany Name60
of the Degrees
transactions Pharmaceuticals,
described Inc. Refer to Item
404(b)(1)(ii) of Regulation S-
in this section.
K. 14, 2022 Page 5
November
FirstName LastName
Geoffrey S. Dow, Ph.D.
FirstName
60 DegreesLastNameGeoffrey S. Dow, Ph.D.
Pharmaceuticals, Inc.
Comapany 14,
November Name60
2022 Degrees Pharmaceuticals, Inc.
November
Page 6 14, 2022 Page 6
FirstName LastName
Notes to Consolidated Financial Statements
2. Summary of Significant Accounting Policies
Revenue Recognition, page F-10
24. Please provide a description of business activities constituting
Research Revenue for 2021
and 2020 that includes linkage to associated research and development
activities and
contractual arrangements with the Department of Defense, US Army, NIH,
Florida State
University and other organizations, as applicable. Describe the
methods and key
assumptions underlying your accounting treatment for these revenues
and revise
corresponding discussion in the section, Critical Accounting Policies,
Significant
Judgments and Use of Estimates, accordingly. In addition, expand
Results of Operations
within MD&A to describe factors driving the significant increase in
Research Revenue
from $368,107 in 2020 to $5,192,516 in 2021 and explain the
relationship of these
revenues to reported research and development expense for each year.
General
25. Please 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.
You may contact Franklin Wyman at 202-551-3660 or Kevin Kuhar at
202-551-3662 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Joshua Gorsky at 202-551-7836 or Tim Buchmiller at 202-551-3635 with
any other
questions.
Sincerely,
Division of
Corporation Finance
Office of Life
Sciences
cc: Ross D. Carmel, Esq.