Mail Stop 6010
June 16, 2005
Emile Loria, M.D.
President and Chief Executive Officer
Epimmune Inc.
5820 Nancy Ridge Drive,
San Diego, California 92121
Re: Epimmune Inc.
Revised Preliminary Schedule 14A
Filed June 2, 2005
File No. 1-19591
Form 10-K for the year ended December 31, 2004
File No. 1-19591
Form 10-Q for the quarterly period ended March 31, 2005
File No. 1-19591
Dear Dr. Loria:
We have reviewed the above-referenced filings and have the
following additional comments. Where indicated, we think you
should
revise your documents in response to these comments. If you
disagree, we will consider your explanation as to why a comment is
inapplicable or a revision is unnecessary. Please be as detailed
as
necessary in your explanation. In some of our comments, we may
ask
you to provide us with supplemental information so we may better
understand your disclosure. After reviewing this information, we
may
or may not raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your
filings.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
Revised Preliminary Proxy Material
General
1. Please note that our page references in this letter are to the
marked version of the proxy statement that accompanied your
letter
of June 1, 2005.
2. The shareholders of Epimmune are being asked to approve the
authorization of additional shares in order to enable Epimmune to
issue shares in accordance with the Share Exchange Agreement.
Under
this agreement the IDM shareholders will hold 78% of Epimmune on a
fully diluted basis after the acquisition occurs. It appears to
the
staff that the projections provided by IDM to the Epimmune Board
would have been material information to the Epimmune Board in
deciding whether to enter in the Share Exchange Agreement and will
also be material to the shareholders of Epimmune in deciding
whether
to approve the authorization of additional shares. Therefore,
Epimmune should summarize this information in the proxy statement
or
in the alternative, provide additional disclosure explaining why
the
Board did not rely on this information in negotiating and
ultimately
agreeing to the Share Purchase Agreement. If you decide not to
provide this information you should also provide us your analysis
of
why the information does not need to be disclosed pursuant to Rule
10b-5.
Risk Factors, pages 24-41
"If IDM fails to obtain all required contractual consents and
approvals ...," page 31
3. We note your response to comment 16 of our prior letter dated
May
20, 2005 and the associated revisions to your proxy statement
disclosure. In addition to these changes, please be more
specific
about the third-party material licenses and collaboration
agreements
for which consents or approvals are necessary.
"The combined company`s supplies of certain materials ...," page
32
4. We note your response to comment 24 and associated revisions to
the proxy statement. Please also provide a brief description of
the
material terms of IDM`s 2003 agreement with Biotecnol, S.A. for
the
development of a clinical grade IL-13 manufacturing process,
including the term of the agreement and termination provisions.
In
addition, provide us with a copy of this agreement and advise us
that
you will file it as an exhibit to the registrant`s next periodic
report. .
Results of Operations, pages 93 - 97
5. Please expand your disclosures in response to prior comment 52
to
disclose the amount of costs incurred to date for each major
research
and development project category.
Contractual Obligations, pages 98-99
6. Refer to your response to prior comment 53. Please disclose,
to
the extent material, the amount and timing of milestone and other
related payments under licensing and collaboration agreements that
are reasonably likely to be paid. If the payments cannot be
determined with a reasonably level of certainty, please disclose
the
timing and a range of the possible amounts that are reasonably
likely
to be paid.
Financial Statements of IDM
Notes to Consolidated Financial Statements
3. Intangible Assets-Net, page F-15
7. Consistent with your response to prior comment 70, please
disclose
the facts and circumstances that lead to IDM`s decision not to
further pursue a development program in connection with MDX-210
antibody in 2004. As previously requested, disclose how you
determined the fair value of the Medarex licenses in your
impairment
analyses. Clarify your disclosures to explain why the license to
develop this product was found to have no future alternative uses.
Form 10-K for the fiscal year ended December 31, 2004
Management`s Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations, page 32
8. Please expand your proposed disclosures in response to prior
comment 72 to disclose the amount of costs incurred to date for
each
major research and development project category.
Notes to Consolidated Financial Statements
1. Summary of Significant Accounting Policies
Research Grants and Contract Revenue, page F-8
9. Please expand your proposed disclosures in response to prior
comment 75 to clarify, if true, that revenue recognized based on
costs incurred approximates the services performed under the
contract.
* * *
As appropriate, please amend your filings in response to these
comments. You may wish to provide us with marked copies of
amendments to expedite our review. Please furnish a cover letter
with your amendments that keys your responses to our comments and
provides any requested supplemental information. Detailed cover
letters greatly facilitate our review. Please file your cover
letter
on EDGAR under the form type label CORRESP. Please understand
that
we may have additional comments after reviewing your amendments
and
responses to our comments.
You may contact Todd Sherman at (202) 551-3665 or Don Abbott
at
(202) 551-3608 if you have questions regarding comments on the
financial statements and related matters. Please contact Daniel
Greenspan, Attorney-Advisor, at (202) 551-3623, or me at (202)
551-
3715 with any other questions.
Sincerely,
Jeffrey Riedler
Assistant Director
cc: Kay Chandler, Esq.
Jason Conger, Esq.
Cooley Godward LLP
4401 Eastgate Mall
San Diego, CA 92121-1909
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