United States securities and exchange commission logo
August 20, 2020
John D. Shulman
Chief Executive Officer
Petros Pharmaceuticals, Inc.
1185 Avenue of the Americas, 3rd Floor
New York, NY 10036
Re: Petros
Pharmaceuticals, Inc.
Registration
Statement on Form S-4
Filed July 24, 2020
File No. 333-240064
Dear Mr. Shulman:
We have reviewed your 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.
Form S-4 Registration Statement Filed July 24, 2020
General
1. We note your
disclosures that outstanding options and warrants to purchase Neurotrope
common stock that have
not previously been exercised prior to the closing will be
converted into
equivalent options and warrants to purchase shares of Petros Common
Stock. Please tell us
why you are not registering such options and warrants. Additionally,
disclose here and
elsewhere as appropriate the amount of such outstanding Neurotrope
options and warrants as
of the latest most practicable date.
Prospectus Summary
The Companies, page 10
2. Please include an
organizational chart showing the various entities prior to the Mergers
John D. Shulman
FirstName LastNameJohn D. Shulman
Petros Pharmaceuticals, Inc.
Comapany
August 20, NamePetros
2020 Pharmaceuticals, Inc.
August
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FirstName LastName
and following the Mergers and spin-off. The diagrams should also
indicate the percentage
of ownership shareholders of Neurotrope and Metuchen will have in the
resulting entities.
The Companies Petros Pharmaceuticals, Inc., page 11
3. Please disclose the product candidates, and related phase or status of
each product
candidate, for Petros Pharmaceuticals, Inc. immediately following the
merger transactions
and taking into consideration the spin-off of Neurotrope Bioscience,
Inc.
The Companies Metuchen Pharmaceuticals, LLC, page 11
4. We note your disclosure that Metuchen believes that its potential
domestic growth for its
ED products will come through the expansion of its distribution
partner network. Please
revise to describe the distribution channels through which Metuchen's
ED products are
currently distributed and how that distribution network is expected to
grow.
5. We note that you acquired an exclusive global license for H100. Please
expand your
disclosure to describe where the development of H100 currently is in
Hybrid
Medical's product pipeline and when you anticipate it being part of
your available
products.
Merger Consideration, page 14
6. Here, and elsewhere in the document as appropriate, please provide a
chart indicating how
many shares of your stock each shareholder will receive for each share
of Metuchen
Common Unit and Metuchen Preferred Unit they own. If appropriate, that
chart should
provide the value at different dates beginning with the date prior to
announcement and as
of the last practicable date of your registration statement.
The Spin-Off, page 14
7. Please provide more detail regarding what Neurotrope SpinCo's
operations will be
following the spin-off. Specifically, indicate whether Neurotrope
SpinCo will continue to
pursue operations involving bryostatin-1 or other similar drug
candidates.
Risks Related to Petros (the Combined Organization )
The combined organization s bylaws designate the state and federal courts
within the State of
Nevada as the exclusive forum for certain..., page 62
8. We note that provision 9.10 of Exhibit 3.3, the Amended and Restated
Bylaws of Petros
Pharmaceuticals, Inc., provides that "Any action, suit or other Legal
Proceeding relating to
this Agreement or the enforcement of any provision of this Agreement
will be brought or
otherwise commenced exclusively in the Court of Chancery of the State
of Delaware or, if
jurisdiction over the matter is vested exclusively in the federal
courts, the United States
District Court for the Southern District of Delaware." This provision
is inconsistent with
your risk factor disclosure on page 62 stating that "the state and
federal courts within the
State of Nevada will be exclusive forums" for certain actions.
Further, it appears
John D. Shulman
FirstName LastNameJohn D. Shulman
Petros Pharmaceuticals, Inc.
Comapany
August 20, NamePetros
2020 Pharmaceuticals, Inc.
August
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FirstName LastName
inconsistent with the Thirteenth article of Exhibit 3.2, of the
Amended and Restated
Certificate of Incorporation of Petros Pharmaceuticals, Inc., which
states "the Court of
Chancery in the State of Delaware shall be the sole and exclusive
forum for any
stockholder (including a beneficial owner) to bring certain actions,
including derivative
actions, except for any claim "which is vested in the exclusive
jurisdiction of a court or
forum other than the Court of Chancery, or for which the Court of
Chancery does not have
subject matter jurisdiction."
Please revise to clarify the description of your forum selection
provision and disclose
whether this provision applies to actions arising under the Securities
Act or Exchange
Act. If so, please also state that there is uncertainty as to whether
a court would enforce
such provision. If the provision applies to Securities Act claims,
please also state that
investors cannot waive compliance with the federal securities laws and
the rules and
regulations thereunder. In that regard, we note that Section 22 of the
Securities Act
creates concurrent jurisdiction for federal and state courts over all
suits brought to enforce
any duty or liability created by the Securities Act or the rules and
regulations thereunder.
If this provision does not apply to actions arising under the
Securities Act or Exchange
Act, please also ensure that the exclusive forum provision in the
governing documents
states this clearly, or tell us how you will inform investors in
future filings that the
provision does not apply to any actions arising under the Securities
Act or Exchange Act.
Additionally, please describe the provision under your Description of
Petros Capital
Stock.
Forward-Looking Statements, page 64
9. Section 27A(a)(1) of the Securities Act of 1933 and Section 21E(a)(1)
of the Securities
Exchange Act of the 1934 apply only to forward-looking statements made
by an issuer
that, at the time that the statement is made, is subject to the
reporting requirements of
section 13(a) or section 15(d) of the Securities Exchange Act of 1934.
Insofar as Petros
and Metuchen do not meet this description, please make clear, each
time you refer to the
Litigation Reform Act, that the safe harbor does not apply to
forward-looking statements
with respect to Petros and Metuchen.
The Mergers
Opinion of the Neurotrope Financial Advisor as of May 15, 2020, page 79
10. We note the disclosure on page 93 that GVS has not performed services
for, or received
any compensation from, Neurotrope. Please revise this section to
disclose the
compensation GVS will receive for acting as a financial advisor to
these related
transactions.
Material U.S. Federal Income Tax Consequences of the Mergers and Material U.S.
Federal
Income Tax Consideration...., page 100
11. Please revise your prospectus disclosure to remove any statement that
assumes the
John D. Shulman
FirstName LastNameJohn D. Shulman
Petros Pharmaceuticals, Inc.
Comapany
August 20, NamePetros
2020 Pharmaceuticals, Inc.
August
Page 4 20, 2020 Page 4
FirstName LastName
material tax consequences at issue (e.g., "Assuming that the receipt
of [Petros shares] in
exchange for [shares or interests in Neurotrope/Metuchen] qualifies as
an 'exchange'
described in Section 351 of the Code.") and to clearly state that the
conclusion is the
opinion of counsel. Refer to Section III of Staff Legal Bulletin No.
19 for guidance.
Milestone Payments, page 109
12. Please indicate the number of new Petros common shares each Petros
common share
outstanding after the Merger Closing will be entitled to receive in
each of your described
Milestone Earnout Payments.
Notes to the Consolidated Financial Statements
1) Nature of Operations, Basis of Presentation and Going Concern, page F-27
13. You state that after the transaction, JCP owns or controls 82% of
the outstanding equity
interests in the Company. Please explain your accounting treatment
for the apparent 18%
non-controlling interest. In addition, given your purchase of a 55%
ownership interest in
Metuchen from Krivulka on December 10, 2018, as stated on page 206,
describe the
subsequent transactions that increased your ownership percentage to
82%. Refer us to the
technical guidance upon which you relied.
Note 2) Summary of Significant Accounting Policies, Revenue Recognition , page
F-29
14. We reference the significant variable consideration included in the
reconciliation of net
sales to gross sales on page 222. Please revise your revenue
recognition policy to provide
the disclosures required by ASC 606-10-50-20 related to significant
variable consideration
included in the transaction price.
Exhibit Index, page II-4
15. We note that, in connection with entry into the Merger Agreement,
Neurotrope and an
affiliated entity of Juggernaut Capital Partners have entered into a
Backstop Agreement,
and Neurotrope, Metuchen and Juggernaut have entered into a Note
Conversion and Loan
Repayment Agreement. Please file these agreements as exhibits to your
registration
statement or tell us why you believe you are not required to do so.
Refer to Item
601(b)(10) of Regulation S-K for guidance.
16. We note your disclosure on page 182 under the heading Metuchen
Business History and
Corporate Information that Metuchen has entered into several
agreements related to the
licensing and supply of Stendra. Please file these agreements as
exhibits to your
registration statement or tell us why you believe you are not required
to do so. Refer to
Item 601(b)(10) of Regulation S-K for guidance.
Exhibit 3.3, Amended and Restated Bylaws of Petros Pharmaceuticals, Inc., page
II-4
17. We note the Amended and Restated Bylaws of Petros Pharmaceuticals,
Inc. include a
John D. Shulman
Petros Pharmaceuticals, Inc.
August 20, 2020
Page 5
provision waiving all parties' right to a jury trial for any action or
proceeding arising out
of or related to the merger transactions. Please expand your Description
of Petros Capital
Stock and related risk factor disclosure to describe the waiver
provision, including
whether it applies to claims under the federal securities laws, and the
risks of the provision
or other impacts on shareholders. Your disclosure should address, but not
be limited to,
any uncertainty about the enforceability of such a provision, and clearly
state whether or
not the provision applies to purchasers in secondary transactions. If the
provision is not
intended to apply to secondary purchasers, disclose any difference in
rights between
primary and secondary purchasers.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Franklin Wyman at 202-551-3660 or Brian Cascio at
202-551-3676 if
you have questions regarding comments on the financial statements and related
matters. Please
contact David Gessert at 202-551-2326 or Eric Envall at 202-551-3234 with any
other questions.
Sincerely,
FirstName LastNameJohn D. Shulman
Division of
Corporation Finance
Comapany NamePetros Pharmaceuticals, Inc.
Office of Life
Sciences
August 20, 2020 Page 5
cc: Jeffrey P. Schultz, Esq.
FirstName LastName