United States securities and exchange commission logo
March 10, 2021
Laura Cohen, MD
President and Chief Executive Officer
CoLabs Int'l, Corp.
18593 Main Street
Huntington Beach, CA 92648
Re: CoLabs Int'l, Corp.
Draft Offering
Statement on Form 1-A
Submitted February
11, 2021
CIK 0001584879
Dear Dr. Cohen:
We have reviewed your draft offering 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 offering statement or publicly filing your offering
statement on
EDGAR. Please refer to Rule 252(d) regarding the public filing
requirements for non-public
submissions, amendments and correspondence. 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 your amended draft offering statement
or filed offering
statement and the information you provide in response to these comments,
we may have
additional comments.
Draft Offering Statement on Form 1-A
Summary, page 7
1. Please revise your
Summary to provide a balanced and factual presentation of your
business. As a
non-exhaustive list of examples only, please revise to discuss: (i) your
revenues and other
top-line financial information for recent periods, (ii) the specific
impacts of COVID-19 on
your business, (iii) your historical reliance on a limited number
of customers, including
a related party customer, for a significant portion of your
revenues, and (iv) the
regulatory landscape applicable to your products.
Risk Factors, page 11
Laura Cohen, MD
FirstName LastNameLaura Cohen, MD
CoLabs Int'l, Corp.
Comapany
March NameCoLabs Int'l, Corp.
10, 2021
March2 10, 2021 Page 2
Page
FirstName LastName
2. Please revise the Risk Factors section to discuss risks related to
ownership of your
common stock and the offering. Please include risk factors addressing
the fact that you
have a history of net losses, the valuation of the offering was set by
you, there is no
currently established market for your common stock, there is no
minimum amount
required in order for you to close the offering, two of your directors
and officers will
control a majority of your voting shares following the offering, and
any subsequent
financings may be dilutive to investors who purchase shares in this
offering.
Description of Business, page 26
3. Please revise the Business section to include a discussion of the
regulatory landscape for
your products and any required regulatory compliance efforts. In the
event the FDA has
not made safety or efficacy determinations in relation to your
products, please remove all
statements throughout the document indicating that your products are
safe and/or
effective, as these determinations are solely within the purview of
the FDA and similar
regulatory bodies. In addition, in relation to the claims you make
regarding the superiority
of your products to competitors in the market, please ensure the basis
for such claims is
sufficiently clear or that such statements are expressed as opinions.
Otherwise, these
statements should be removed from the disclosure.
4. Please revise the Business section to specifically discuss the
patent/IP coverage for your
QS Technology and your commercialized products, including the type
of patent
protection, jurisdiction(s) of the patents covering your products and
technology, and
whether the IP covering your products and technology is owned or
licensed.
5. Please revise this section to describe the manufacturing process for
your products, your
reliance on one or a few major customers or suppliers, and how new
products are
formulated, tested and approved for sale. In your revisions, please
include the employee
information required by Item 7(a)(iv) of Form 1-A.
The Issue--Therapeutic Risks of Topical Drugs, page 26
6. We note your statements that competitors' skin medications offer
uncontrolled release,
limited effectiveness and systemic absorption with potentially toxic
side effects. Please
revise to provide the basis for this statement and to clarify whether
any toxic side effects
have been observed in studies of your competitors' products. Please
also revise to provide
the basis for your statement that these traits of your competitors'
treatments are concerning
to medical providers, the FDA and to your competitors themselves.
Unique Features of Klenskin Sunscreen, page 29
Laura Cohen, MD
FirstName LastNameLaura Cohen, MD
CoLabs Int'l, Corp.
Comapany
March NameCoLabs Int'l, Corp.
10, 2021
March3 10, 2021 Page 3
Page
FirstName LastName
7. Please revise your disclosure accompanying the graphs on page 30 to
explain how this
information was derived and to describe the studies or comparisons
that generated the
information presented in the graphs. Please also make clear whether
the data cited has
been independently verified or reviewed by any regulatory authority
for accuracy.
2. Summary of Significant Accounting Policies, page 68
8. We note that revenues to "one international customer" as quantified on
pages 69 and 80
have accounted for 42% and 59% of your revenues for the nine months
ended September
30, 2019 and 2018, respectively, and for 57% and 68% of your revenues
for the years
ended December 31, 2019 and 2018, respectively. Given this significant
concentration,
please revise herein or in MD&A to address the apparent declining
trend of revenues
thereto, which appears to have commenced prior to the impact of
COVID-19. Any
changes in economic conditions abroad or your relationship with
significant foreign
distributors that have negatively affected the volume of your
international sales and results
of operations should be specifically addressed.
9. Regarding the inventories significant accounting policy on page 70,
you state that no
reserve for excess and obsolete inventory was required at September
30, 2020. Please
clarify for us whether your sunscreen products which contain SPF
expire and, if so, how
you considered the foregoing shelf life in your determination that no
such reserve was
necessary.
4. Line of Credit, page 71
10. Given your going concern status, among other things, please revise to
quantify the
committed amount available for borrowing under the revolving credit
agreement with
Fundbox. Confirm, if true, that there have been no borrowings thereon
subsequent to
September 30, 2020.
Exhibits
11. Please file any agreements governing the company's relationship with
the "international
customer" accounting for a significant portion of the company's
revenue, pursuant to Item
17.6(b) of Form 1-A. Please also include disclosure in the Business
section naming the
customer and describing the material terms of the relationship and
governing agreements,
including the term and termination thereof.
You may contact Jenn Do at 202-551-3743 or Angela Connell at
202-551-3426 if you
Laura Cohen, MD
CoLabs Int'l, Corp.
March 10, 2021
Page 4
have questions regarding comments on the financial statements and related
matters. Please
contact Alan Campbell at 202-551-4224 or Laura Crotty at 202-551-7614 with any
other
questions.
Sincerely,
FirstName LastNameLaura Cohen, MD
Division of
Corporation Finance
Comapany NameCoLabs Int'l, Corp.
Office of Life
Sciences
March 10, 2021 Page 4
cc: Lynne Bolduc
FirstName LastName