May 1, 2019
Sam Backenroth
Chief Financial Officer
Ohr Pharmaceutical Inc.
800 Third Avenue, 11th Floor
New York, NY 10022
Re: Ohr Pharmaceutical Inc
Amendment No. 1 to Registration Statement on Form S-4
Filed April 16, 2019
File No. 333-230168
Dear Mr. Backenroth:
We have reviewed your amended 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 amending your registration statement
and providing the
requested information. 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 any amendment to your registration statement and the
information you
provide in response to these comments, we may have additional comments. Unless
we note
otherwise, our references to prior comments are to comments in our April 8,
2019 letter.
Amendment No. 1 to Registration Statement on Form S-4
Summary, page 15
1. We acknowledge your revised disclosures in response to prior comment 4.
Please revise
your statements regarding drug development using the PATRoL platform to
explain its
mechanism in a manner a lay person would understand, including by
defining the terms
"chiral" and "stereoisomer." In addition, balance this disclosure by
noting that all of
NeuBase's programs are in the research or preclinical stage and that
NeuBase's approach
to nucleic acid therapeutics is novel, as you more thoroughly explain on
pages 67-68.
2. Please revise your registration statement to present the estimated
aggregate number of pre-
split shares that will be issued to NeuBase shareholders in the merger.
Sam Backenroth
FirstName LastNameSam Backenroth
Ohr Pharmaceutical Inc.
Comapany NameOhr Pharmaceutical Inc.
May 1, 2019
May 1, 2019 Page 2
Page 2
FirstName LastName
Risk Factors
Risks Related to the Merger, page 37
3. Please provide a separate risk factor discussion disclosing that
Roth's fairness opinion
relies on projections provided by NeuBase, which do not consider the
possibility that
NeuBase product candidates do not receive FDA approval. Your
discussion should
address the possible consequences if the NeuBase product candidates do
not obtain FDA
approval.
The combined company's amended and restated certificate of incorporation will
provide. . ., page
120
4. We acknowledge your revised disclosure in response to prior comment 7
and your
revisions in Annex C. Please further revise to clarify that the
exclusive forum provision
also does not apply to Exchange Act claims.
Opinion of Ohr's Financial Advisor, page 150
5. We note that Roth used the described analyses to determine a range of
"implied enterprise
values" for NeuBase. Generally, the "implied enterprise value" is
implied by the terms of
the merger, not determined by valuation analyses. Please revise your
discussion to clearly
identify the implied enterprise value of NeuBase based on the terms of
the merger
agreement and ensure that the enterprise value based on Roth's
analyses are clearly
distinguishable from the enterprise value implied by the terms of the
merger.
6. We note your revised disclosures in response to prior comment 16.
Please clarify that the
enterprise value range determined by Roth consists of $56.8 million
using the low end of
the range calculated using the discounted cash flow analysis and
$342.8 million, the mean
calculated using the Publicly Traded Company Analysis. Please also
explain the how
Roth calculated the "average implied enterprise value" of $140.9
million and $237.4
million and the basis for the belief that the NeuBase enterprise value
falls within the range
of the comparable company values.
7. Please further revise your disclosure regarding the discounted cash
flow analysis to
explain how the success rate probabilities were applied to the NeuBase
projections. You
state that Roth applied the probabilities for each phase of clinical
development. Please
explain how the cash flows for the indicated years were adjusted. In
addition, your
revised disclosure indicates that you did not consider the separate
possibility that the
Neubase product candidates do not successfully complete clinical
trials. Please explain
why.
Consideration Analysis, page 155
8. Please clarify whether the number of shares to be issued and December
31, 2018 and 20-
day volume weighted average trading price were pre-reverse split or
adjusted to reflect the
Sam Backenroth
FirstName LastNameSam Backenroth
Ohr Pharmaceutical Inc.
Comapany NameOhr Pharmaceutical Inc.
May 1, 2019
May 1, 2019 Page 3
Page 3
FirstName LastName
February 4, 2019 reverse stock split. Additionally, clarify the time
period used to
calculate the 20-day volume weighted average.
Discounted Cash Flow Analysis, page 158
9. We note that Roth applied a "probability of success" adjustment based
on Clinical
Development Success Rates 2006-2015. Please explain how Roth
calculated the average
probability of continued clinical development at each phase of
development. The
disclosure appears to imply that 100% of product candidates under
development for
neurological and rare diseases between 2005 and 2016 successfully
advanced through
preclinical and Phase I trials. Please clarify whether all INDs for
neurology and rare
diseases was considered in calculating the 100% or a subset of all
product candidates.
10. Please explain the rationale behind adjusting projected unlevered cash
flow to account for
the probability of success when the projected revenues are based on
the assumption that
NT0100- Huntington's Disease and NT0200-Myotonic Dystrophy are
approved by the
FDA and begin generating revenue in 2024 and 2025, respectively. In
other words, since
FDA approval is necessary to generate any of the projected revenues, a
valuation based on
30.4% of projected revenues does not appear to contemplate either of
the mutually
exclusive outcomes for either product candidate.
NeuBase Projections, page 160
11. Please revise to clarify whether the projections presented in this
section have been revised
by Roth in accordance with the methodology described on page 158 or if
these were the
projections provided by NeuBase.
Material U.S. Federal Income Tax Consequences of the Merger
U.S. Federal Income Tax Consequences of the Merger Generally, page 172
12. We note your revised disclosures in response to prior comment 20.
Please further revise
to remove language from the header of this section indicating that
these are tax
consequences "generally." Please also clearly state that the
disclosure in this section is the
opinion of the respective counsels.
NeuBase Executive Compensation, page 226
13. We note your revised disclosure on page 226 in response to prior
comment 21 that certain
compensation tables have been omitted because there was no activity to
report. However,
you also state that the employment agreement with Dr. Stephan was
effective as of August
28, 2018, prior to your September 30 year end, and that options vested
commencing on
August 28th. Please reconcile your disclosures. In addition, please
file the employment
agreement with Dr. Stephan.
Compensation of Neubase Directors, page 228
Sam Backenroth
Ohr Pharmaceutical Inc.
May 1, 2019
Page 4
14. Your revised disclosure states that following the merger, non-employee
directors are
expected to be granted a stock option to purchase common stock in an
amount that
represents approximately 1% of the total common stock of the combined
company on a
fully diluted basis. Revise to clarify whether this amount is for each
non-employee
director or all non-employee directors in the aggregate.
License Agreement with Carnegie Mellon University, page 264
15. We note your revised disclosures and response to prior comment 28.
However,
disclosures regarding total payments made to date and the aggregate
amount of all your
potential milestone payments are material information. We are only able
to grant
confidential treatment for individual milestone amounts if the aggregate
amounts of
payments made to date and aggregate potential payments are disclosed.
Also revise to
clarify that if NeuBase challenges the validity of intellectual
property, Carnegie Mellon is
the party with the termination ability.
You may contact Ibolya Ignat at 202-551-3636 or Angela Connell at
202-551-3426 if
you have questions regarding comments on the financial statements and related
matters.
Please contact Dorrie Yale at 202-551-8776 or Suzanne Hayes at 202-551-3675
with any other
questions.
Sincerely,
FirstName LastNameSam Backenroth
Division of
Corporation Finance
Comapany NameOhr Pharmaceutical Inc.
Office of
Healthcare & Insurance
May 1, 2019 Page 4
cc: Joseph Walsh, Esq. - Troutman Sanders LLP
FirstName LastName