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United States securities and exchange commission logo
February 17, 2022
Keith Gottesdiener, M.D.
President and Chief Executive Officer
Prime Medicine, Inc.
21 Erie Street
Cambridge, MA 02139
Re: Prime Medicine,
Inc.
Amendment No. 2 to
Draft Registration Statement on Form S-1
Submitted February
4, 2022
CIK No. 0001894562
Dear Dr. Gottesdiener:
We have reviewed your amended 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.
Amendment No. 2 to Draft Registration Statement on Form S-1
Our Prime Editing Platform, page 1
1. Although we note your
response to prior comment 2 and your revisions on page 45, we
continue to believe
that your disclosure in this section that your Prime Editing technology
has the theoretical
potential for repairing approximately 90 percent of known disease-
causing mutations
across many organisms, organs and cell types should be balanced with
disclosure that your
licenses from the Broad Institute are subject to an inclusive
innovation model, are
subject to march-in-licenses, and that the Broad Institute may
terminate your license
with respect to gene targets under the terms of the Broad License
Agreement. Please
revise your disclosure to make investors aware of these arrangements
in your prospectus
summary.
Keith Gottesdiener, M.D.
FirstName LastNameKeith Gottesdiener, M.D.
Prime Medicine, Inc.
Comapany17,
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2022 Medicine, Inc.
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Overview, page 1
2. We note your response to comment 5 and re-issue. Given your prominent
disclosure on
the first page that you have "proprietary Prime Editing technology[,]"
please provide
balancing disclosure on this same page that you do not currently own
any issued patents.
If the term "proprietary" is referring to another method of IP
protection, please so advise
and update this page accordingly. Your disclosure should also address
the technology that
is proprietary, or company-developed, versus the technology developed
at Broad Institute
which you have in-licensed.
3. We note your response to comment 6 as it concerns our request that you
disclose that Dr.
Liu will not be an officer or director of your company and will work
in the capacity as a
consultant to your company and will retain his positions and
affiliations with the Broad
Institute, Harvard University and the Howard Hughes Medical Institute.
Given your
prominent disclosure on page 1 that "Prime Medicine was co-founded by
a world-
renowned leader in the field of gene editing, David Liu, Ph.D.[,]"
there should be
balancing disclosure in this same section that Dr. Liu will not be an
officer or director of
your company, will solely work in the capacity as a consultant to your
company under a
consulting agreement the current term of which runs through September
2025, and will
retain his positions and affiliations with the Broad Institute,
Harvard University and the
Howard Hughes Medical Institute. If there is uncertainty to whether
Dr. Liu will or will
not be an officer or director of the Company, this uncertainty should
also be disclosed in
this section.
4. We note your response to comment 6 as it concerns our request that you
briefly indicate
Dr. Liu s involvement with other gene editing companies, including
Editas Medicine, Inc.
and Beam Therapeutics, Inc., and the potential for conflicts of
interest. While we are
satisfied with your response as it concerns Editas Medicine, it does
not appear that
you have responded to our request that you briefly indicate Dr. Liu
s involvement with
Beam Therapeutics, Inc. Please so indicate this involvement and
address any conflicts of
interest in the prospectus summary.
5. We note your amended disclosure on page 120 that you "have also
licensed certain
improvements to Prime Editing from Dr. Liu s laboratory at Broad
Institute and Dr. Liu
has entered into an agreement with us pursuant to which he is
obligated to assign to us any
inventions with respect to the services he performs for us. However,
such obligations are
subject to limitations and do not extend to his work in other fields
or to the intellectual
property arising from his employment with Harvard, HHMI and Broad
Institute. To
obtain such intellectual property rights, we would need to enter into
license agreements
with such institutions, including negotiations under the Broad Option
Agreement, which
may expire in November 2022, and such license agreements may not be
available on
commercially reasonable terms or at all." Please address this specific
risk in your risk
factor section and cross-reference this risk factor in your prospectus
summary. We do not
believe that the current risk factor on page 25 entitled "[t]he gene
editing field is relatively
Keith Gottesdiener, M.D.
FirstName LastNameKeith Gottesdiener, M.D.
Prime Medicine, Inc.
Comapany17,
February NamePrime
2022 Medicine, Inc.
February
Page 3 17, 2022 Page 3
FirstName LastName
new and is evolving rapidly" adequately addresses this specific risk.
Ensure that this
revised risk factor addresses whether you would need to enter into new
license agreements
to obtain the rights to the "engineered pegRNAs" that you mention on
page 137.
Pipeline Table, page 5
6. We note your response to comment 5. Please provide two separate
columns for your
phase 1 and phase 2 trials or, alternatively, disclose the basis for
your belief that you
will have a phase 1/2 trial for every indication listed in the
pipeline table.
Summary Financial Data, page 13
7. Please provide us with your calculation of pro forma net loss per
share attributable to
common stockholders. Based on the description included in footnote 4
for the numerator,
it would appear the amount is $0.82.
Risk Factors, page 15
8. We note your response to comment 12. While you adequately addressed
our repricing
concerns about the 2022 plan on page 224, it appears that these
concerns may still apply to
the 2019 plan. On page 222 you state "[t]he administrator of the 2019
Plan is specifically
authorized to exercise its discretion to reduce the exercise price of
outstanding stock
options or effect the repricing of such awards through cancellation
and re-grants." As
such, please include appropriate risk factor disclosure, including
whether proxy advisory
firms could find such repricing without stockholder approval contrary
to a performance-
based pay philosophy, or tell us why such disclosure would not be
appropriate.
Our rights to develop and commercialize our Prime Editing platform technology
and product
candidates are subject to the terms..., page 45
9. We note your response to comment 13 but we cannot locate responsive
revisions on page
45 or in the cross-referenced section which appears to refer to your
disclosure starting on
page 178. As such, we re-issue the comment. Please revise this risk
factor to identify the
product candidates that are or may be subject to the Broad
march-in-license. If all gene
targets are subject to the march-in-license, please make that clear.
Business
Overview, page 117
10. Although we note your response to prior comment 19, with respect to
your disclosure
that more than 1,500 laboratories have requested the reagents to
perform Prime Editing in
their laboratories, please disclose if those requests have made to you
or to Broad Institute.
Please also disclose if those requests are part of Broad Institute s
inclusive innovation
model pursuant to which Broad Institute retains the right, under
specified circumstances,
to grant to third parties (other than specified competitors of yours)
licenses under the
licensed patent rights that would otherwise fall within the scope of
the exclusive license
Keith Gottesdiener, M.D.
FirstName LastNameKeith Gottesdiener, M.D.
Prime Medicine, Inc.
Comapany17,
February NamePrime
2022 Medicine, Inc.
February
Page 4 17, 2022 Page 4
FirstName LastName
granted to you. Include risk factor disclosure as appropriate. Please
also clarify what
"reagents" encompasses in this context.
11. We note your response to comment 20 that "the Nature publication in
December 2019 did
not disclose any pegRNA, ngRNA or Prime Editor protein sequences that
are used in your
current programs." Please so indicate this on this page of the filing.
If your Prime Editors
were not used in the cited studies and papers, please qualify your
statement, as
appropriate, that "Prime Editing technology has been extensively
validated in vitro and in
animal studies."
12. With respect to your disclosure that "[a]lthough Prime Editing
technology is not yet
validated in clinical studies, as first described in a Nature
publication in December 2019,
Prime Editing technology has been extensively validated in vitro and
in animal studies
with over 50 papers published in the primary scientific literature to
date," we continue to
believe that you should balance your disclosure to indicate the
developing nature of this
technology. As requested by our prior comment 20, please indicate the
publication in the
science journal Cell in October 2021 co-authored by one of your
founders which indicated
that while prime editing enables precise sequence changes in DNA,
cellular determinants
of prime editing remain poorly understood and that DNA mismatch repair
(MMR)
impedes prime editing and promotes undesired indels and that new prime
editing systems
were recently developed in an attempt to overcome these limitations.
In this regard,
although we note your response that the company has recently developed
new Prime
Editing systems to overcome limitations such as MMR, we note your
disclosure on page
139 that you are developing approaches to transiently modify MMR so
that desired Prime
Edits are favored, and any undesired by-products are minimized, and
that you are
evaluating several different approaches to modulating the MMR response
including active
pharmaceutical ingredients, such as siRNA, or small interfering RNA,
or other approaches
that transiently modulate MMR activity which could be co-administered
with a Prime
Editor. Please indicate these developments and disclose to what extent
the new Prime
Editing systems and your approaches to transiently modify MMR have
been validated.
Scientific Advisory Board, page 121
13. We note your response to comment 30 and your amendment on page 121. In
addition to
the "focal points" already listed, as requested by our prior comment
please disclose if
there are any rules or procedures governing your Scientific Advisory
Board.
Our Prime Editing Platform, page 126
14. We note your response to comment 21. Given your disclosure on page 126
that this table
is not derived from head-to-head comparison studies, we do not object
to the inclusion of
this table in the filing; however, we request that you explicitly
disclose the "publicly
available data" underlying the conclusions in this table. We also note
that your February
4, 2022 correspondence states that "the Company s own data, form the
basis for these
assessments." If true, please amend the filing to disclose that the
conclusions in this table
Keith Gottesdiener, M.D.
FirstName LastNameKeith Gottesdiener, M.D.
Prime Medicine, Inc.
Comapany17,
February NamePrime
2022 Medicine, Inc.
February
Page 5 17, 2022 Page 5
FirstName LastName
are also derived from your own data.
Pledge to Broad Institute and Harvard, page 182
15. We note your response to comment 27. We do not agree that the written
agreement
underlying your Pledge to donate $5 million to the Broad Institute and
Harvard University
annually for 14 years is not a material contract in amount or in
effect. In amount, this
contract is worth a potential aggregate amount of $70 million over 14
years. In effect, it
appears that you are using this Pledge as a form of consideration in
order to have
continued access to the intellectual property owned by the Broad
Institute and Harvard
University. For example, you have an executed option agreement with
Broad Institute
connected to your patent rights and, in evaluating and approving the
Pledge annually, you
"will consider if the previous year s grant was used for the
intended purpose." Moreover,
Dr. Liu is employed at Harvard and you will consider whether Dr. Liu
"has continued in
good standing on his active agreements with Prime Medicine" in
determining whether to
renew the annual pledge. Accordingly, we believe this is a material
contract. Please file it
as an exhibit pursuant to Item 601(b)(10) of Regulation S-K.
Research Collaboration, Option and License Agreement with Myeloid, page 182
16. We note your disclosure on this page that Myeloid is a related party
and your disclosure
on page 230 that Newpath Partners, L.P. holds more than 5 percent of
your voting
securities, and holds more than 5 percent of Myeloid s voting
securities. As such, it
appears this agreement should be filed as an exhibit under Item
601(b)(10)(ii)(A) of
Regulation S-K. Please file your Research Collaboration, Option and
License Agreement
with Myeloid as an exhibit or tell us why you do not believe you are
required to file this
agreement.
Executive Compensation, page 216
17. We note your response to comment 32. We also note your disclosure that
Dr. Anzalone
was a co-founder of the company. Please tell us why Dr. Anzalone would
not be
considered a promoter for purposes of Securities Act Rule 405 and
Regulation S-K Item
601(b)(10)(ii)(A) and whether you should file the Employment Agreement
and the
Employee Confidentiality, Assignment and Nonsolicitation Agreement
with Dr. Anzalone
as exhibits, or file those agreements as appropriate.
11. License and Collaboration Agreements
Related Party Beam Collaboration Agreement, page F-40
18. We note your response to comment 35 in which you note that you
evaluated the protected
product option and the collaboration product option under the guidance
in ASC 606-10-
55-41 through 55-43. Please tell us how you concluded that these
options represent
options for additional goods or services rather than a material right
that you would not
receive without entering into that contract. In this regard, clarify
whether these options
Keith Gottesdiener, M.D.
Prime Medicine, Inc.
February 17, 2022
Page 6
offer a future discount that is incremental to the range of discounts
typically given to the
same class of customer. Please also tell us whether you will receive any
further
consideration for the license granted to Beam for products in which an
IND is filed but
Beam does not exercise the protected product option and you do not
exercise the
collaboration product option and how this consideration differs whether
either of these
options are exercised. For example, you disclose that the the sickle cell
disease product is
a licensed product under the Beam Collaboration and that Beam has not
designated this
product as a protected product and you therefore have not received any
development or
sales-based milestones in relation to this product. To the extent that
neither option is
ultimately exercised in relation to this sickle cell product, clarify
whether you are entitled
to any further consideration in the form of milestones or royalties.
You may contact Tracey Houser at 202-551-3736 or Angela Connell at
202-551-3426 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Dillon Hagius at 202-551-7967 or Tim Buchmiller at 202-551-3635 with
any other
questions.
Sincerely,
FirstName LastNameKeith Gottesdiener, M.D.
Division of
Corporation Finance
Comapany NamePrime Medicine, Inc.
Office of Life
Sciences
February 17, 2022 Page 6
cc: Marishka DeToy, Esq.
FirstName LastName