August 28, 2018
Daniel M. Bradbury
Chief Executive Officer
Equillium, Inc.
2223 Avenida de la Playa, Suite 108
La Jolla, CA 92037
Re: Equillium, Inc.
Draft Registration Statement on Form S-1
Submitted August 3, 2018
CIK No. 0001746466
Dear Mr. Bradbury:
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
Overview, page 1
1. Please refer to the second paragraph. We note your disclosure that
"[f]ollowing
completion of a Phase 3 clinical trial, itolizumab was approved in India
for the treatment
of moderate to severe plaque psoriasis." Please revise to clarify that
the Phase 3 trial was
not completed in the U.S. or Canada nor is itolizumab approved in the
U.S. or Canada.
Please also clarify in the summary that none of your product candidates
have commenced
clinical trials or been approved in the U.S. or Canada.
Daniel M. Bradbury
FirstName LastNameDaniel M. Bradbury
Equillium, Inc.
Comapany NameEquillium, Inc.
August 28, 2018
August 28, 2018 Page 2
Page 2
FirstName LastName
Development Plans Chart, page 2
2. Please revise the chart to reflect the actual, and not the
anticipated, status of EQ001 and
the various indications as of the latest practicable date. In this
regard, we note that you
have not completed any Phase 1 clinical trials for any indications.
Please revise the chart
to include a pre-clinical phase, to indicate that your aGVHD and cGVHD
indications are
at the beginning of Phase 1 and that your severe asthma indication is
in the pre-clinical
phase. Additionally, please delete the to be determined 4th indication
as that reference
appears premature.
3. We note that the chart is intended to summarize your development plans
and the status
thereof. Please delete the reference to Biocon and that ALZUMAb has
been developed
and marketed in India as it is not one of your products.
Strategy, page 3
4. We note the statement that you believe that the unique mechanism of
action of EQ001
may be effective in treating a subset of severe asthma patients who
are underserved by
currently marketed therapies. The statement implies that your product
candidate is
effective, which is a determination solely within the authority of the
FDA. Since your
product candidate has not completed clinical trials and the FDA has
not made such
determination, the inference is not appropriate. Please remove this
statement and similar
statements throughout the prospectus, including the statement that you
believe EQ001
may effectively treat Th2-low patients.
Implications of Being an Emerging Growth Company, page 5
5. 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.
Use of Proceeds, page 59
6. We note your disclosure that you intend to use net proceeds to fund
research and
development of EQ001. Please revise to specify how far in the
development of
EQ001 you expect to reach with the proceeds of the offering. If any
material amounts of
other funds are necessary to accomplish the specified purposes for
which the proceeds are
to be obtained, state the amounts and sources of such other funds
needed for each such
specified purpose and the sources thereof. Refer to Instruction 3 of
Item 504 of
Regulation S-K.
Daniel M. Bradbury
FirstName LastNameDaniel M. Bradbury
Equillium, Inc.
Comapany NameEquillium, Inc.
August 28, 2018
August 28, 2018 Page 3
Page 3
FirstName LastName
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Contractual Obligations, page 74
7. Tell us your consideration of including the convertible promissory
notes and interest on
the notes in the table.
Critical Accounting Policies and Significant Judgement and Estimates
Stock-Based Compensation Expense, page 75
8. Once you have an estimated offering price or range, please explain to
us the reasons for
any differences between the recent valuations of your common stock
leading up to the
initial public offer and the estimated offering price. This
information will help facilitate
our review of your accounting for equity issuances including stock
compensation.
Business
EQ001 Product Development, page 92
9. The inclusion of the "equillium" logo in the chart on page 93 suggests
that the company
was responsible for the Phase 1 clinical trial referenced underneath
the logo in the chart.
This suggestion, however, is inconsistent with the disclosure
regarding the trial that
follows the chart. Please revise the chart or explain the
inconsistency.
Development Plan in GVHD, page 95
10. We note the statement that you plan to initiate a Phase 2 clinical
trial of EQ001 for the
treatment of cGVHD in the first half of 2019. Please revise your
disclosure to discuss any
additional steps necessary to initiate such a trial, including the
filing of an IND and any
other material requirements you must satisfy.
Collaboration and License Agreement with Biocon, page 97
11. We note your disclosure in the second paragraph that you are "required
to pay quarterly
tiered royalties based on a percentage from the mid-single digits to
low double-digits."
Please revise your description of royalty rates to provide a range
that does not exceed ten
percent (e.g., between twenty and thirty percent).
Biocon Agreements, page 134
12. We note the disclosure elsewhere in the prospectus that Mr. Bradbury,
the company's
Chief Executive Officer, is a member of the board of directors of
Biocon. Please revise
your disclosure in this section to identify Mr. Bradbury as a related
party with respect to
the Biocon agreements or tell us why you believe he is not a related
party.
Daniel M. Bradbury
Equillium, Inc.
August 28, 2018
Page 4
Certain Relationships and Related Party Transactions, page 134
13. Please include a description of the common stock purchase agreement with
Biocon in this
section. Please also file the common stock purchase agreement and
investor rights
agreement as exhibits to the registration statement or tell us why you
are not required to
do so.
Financial Statements, page F-1
14. You have only included one year of audited financial statements when two
years are
required. Please advise if you are omitting one year under Section 71003
of the FAST Act
and will include audited financial statements for 2018 prior to
requesting effectiveness.
General
15. Please provide us mockups of any pages that include any additional
pictures or graphics to
be presented, including any accompanying captions. Please keep in mind,
in scheduling
your printing and distribution of the preliminary prospectus, that we may
have comments
after our review of these materials.
16. We note you have filed several exhibits pursuant to a request for
confidential treatment.
We will provide any comments we have on your application for confidential
treatment
under separate cover.
You may contact Bonnie Baynes at 202-551-4924 or Lisa Vanjoske at
202-551-3614 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Donald E. Field at 202-551-3680 or Justin Dobbie at 202-551-3469 with
any other
questions.
Sincerely,
FirstName LastNameDaniel M. Bradbury
Division of
Corporation Finance
Comapany NameEquillium, Inc.
Office of
Healthcare & Insurance
August 28, 2018 Page 4
cc: Karen Anderson
FirstName LastName