View:
United States securities and exchange commission logo
March 12, 2024
Ralph Schiess
Interim Chief Executive Officer
Onconetix, Inc.
201 E. Fifth Street, Suite 1900
Cincinnati, OH 45202
Re: Onconetix, Inc.
Registration
Statement on Form S-1
Filed February 14,
2024
File No. 333-277066
Dear Ralph Schiess:
We have reviewed your
registration statement and have the following comments.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe a comment applies 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 this letter, we may have additional comments.
Registration Statement on Form S-1
Prospectus Summary, page 1
1. We note your disclosure
that local diagnostic laboratories can easily add Proclarix, an
affordable
multiparametric test, to their existing infrastructure. Please provide
balancing
disclosure with your
statement on page 17 that Proclarix is complicated and expensive to
manufacture or
otherwise advise.
2. We note your disclosure
that ENTADFI will become the inaugural therapeutic drug in
[your] expanding
portfolio of oncology therapeutics once launched. However, we note
that ENTADFI appears to
be approved for an indication outside of the field of oncology
and you do not describe
any other oncology therapeutics approved or under development.
Please update your
disclosure to describe your expanding portfolio of oncology
therapeutics or
otherwise revise.
Ralph Schiess
FirstName
Onconetix, LastNameRalph Schiess
Inc.
Comapany
March NameOnconetix, Inc.
12, 2024
March2 12, 2024 Page 2
Page
FirstName LastName
Overview of Company, page 5
3. We note your disclosure that "In Europe, Proteomedix has begun
marketing Proclarix to
pilot laboratories in selected markets that are open to self-pay to
show initial adoption."
Please expand your disclosure to clarify and describe the material
details of the marketing
of Proclarix to date. For example only, please revise your disclosure
to describe when you
launched Proclarix and quantify how it has been accepted to date. In
addition, please
clarify what "self-pay" means.
4. We note your disclosure that "Proclarix is approved for sale in the
European Union under
the IVDR." Please revise your disclosure to clarify when the
diagnostic was approved and
describe the specific target market for Proclarix or otherwise advise.
Recent Acquisitions:
Proteomedix, page 5
5. We note that you acquired Proteomedix AG on December 15, 2023 in a
share exchange
transaction whereby the aggregate value of your exchange shares at
closing was equal to
approximately $75 million less the value of the Proteomedix Shares.
Please revise your
filing to include Proteomedix's audited and unaudited financial
statements and related pro
forma financial statements pursuant to Rule 8-04 and Rule 8-05 of
Regulation S-X similar
to those included within your amended Form 8-K filed on February 27,
2024.
6. The pro forma financial information included as Exhibit 99.3 to your
amended Form 8-K
filed on February 27, 2024 indicates that that Onconetix was
determined to be the
accounting acquirer in the share exchange agreement with Proteomedix.
Please provide to
us your detailed analysis of the guidance at ASC 805-10-55-10 through
15 for this
transaction to explain how you determined that Onconetix is the
accounting
acquirer under U.S. GAAP. Please also revise to provide expanded
disclosures as to how
you determined Onconetix is the acquiring entity. In this regard, we
note that upon
consummation of this transaction, as well as the related Conversion
and Subscription
transactions, Proteomedix shareholders were to own 87.2% of the
combined company.
7. We note that you issued 3,675,414 shares of common stock and 2,696,729
shares of series
B convertible preferred stock and that you determined that the
purchase price was $62.5
million. Please revise your filing to explain how you determined that
the fair value of the
shares exchanged in this transaction were $62.5 million. In this
regard, you indicate that
the 3,675,414 shares of common stock issued were valued at $1.1
million based on a per
share price of $0.30. Please explain how this per share price was
determined in relation to
your quoted market price. Please also explain how you determined that
the 2,696,729
shares of series B convertible preferred stock issued were valued at
$61.3 million.
Ralph Schiess
FirstName
Onconetix, LastNameRalph Schiess
Inc.
Comapany
March NameOnconetix, Inc.
12, 2024
March3 12, 2024 Page 3
Page
FirstName LastName
8. We note that you allocated $51.1 million of the purchase price to
internally-developed
technology with a useful life of 15 years. Please tell us and revise
your filing to explain
the nature of this technology, how you determined the fair value of
this technology and
determined its useful life.
9. Please identify the "Investor" referenced in this section.
10. It appears that you are attempting to rely on Instruction VII to Form
S-1 to incorporate by
reference previously filed and future filings of Exchange Act reports.
Because you have
not yet filed your Form 10-K for your most recently completed fiscal
year, December 31,
2023, it appears that you have not satisfied the requirements of
paragraph C of that
instruction. Please revise your filing to include all disclosures
required by Form S-1.
ENTADFI, page 9
11. We note your disclosure that "[p]ursuant to the Amendment, [you]
agreed to use
commercially reasonable efforts to obtain such shareholder approval by
December 31,
2023." Please revise your disclosure to clarify whether or not you
received shareholder
approval for the issuance of shares of Common Stock upon conversion of
your Series A
Preferred Stock or otherwise advise. In addition, if applicable,
describe any ramifications
if such shareholder approval is not obtained or otherwise advise.
12. We note you "purchased substantially all of the assets related to Veru
ENTADFI business
and assumed certain liabilities of Veru." Please revise your
disclosure to describe the
"certain liabilities" you assumed.
13. We note your transaction with Veru for ENTADFI closed in April 2023.
Please update
your disclosure here to clarify that you have not generated any
revenue from product sales
of ENTADFI consistent with your disclosure elsewhere. In addition,
please update your
disclosure to clarify and quantify where you are at in "building out
[y]our commercial
capabilities to launch ENTADFI" or otherwise advise.
Risk Factors
There is substantial doubt about our ability to continue as a "going concern.",
page 14
14. We note your disclosure that you do not currently have sufficient cash
to redeem the
shares of Series B Convertible Preferred Stock. Please quantify the
amount of cash
required to redeem the shares of Series B Convertible Preferred Stock
as of a recent date.
We may have violated, as amended (the "Exchange Act") implementing Section 402
of the
Sarbanes-Oxley Act of 2002)..., page 15
15. Please specify the certain expenses you paid to your former CEO
and Chairman, and
disclose the material terms of such loans.
Ralph Schiess
FirstName
Onconetix, LastNameRalph Schiess
Inc.
Comapany
March NameOnconetix, Inc.
12, 2024
March4 12, 2024 Page 4
Page
FirstName LastName
General
16. We note your acquisitions of substantially all of the assets related
to Veru ENTADFI on
April 19, 2023 and your acquisition of Proteomedix on December 15,
2023, as well as
your disclosures that you are currently focusing your efforts on
building out your
commercial capabilities to launch ENTADFI in the marketplace and
commercializing
Proclarix. Please provide a description of your business that
addresses the requirements of
Item 101 of Regulation S-K.
17. We note the reference on page 6 to your exclusive license agreement
with Laboratory
Corporation of America Holdings. Please describe the material terms of
the agreement file
the agreement as an exhibit to the registration statement or tell us
why you believe it is not
a material contract. Refer to Item 601(b)(10) of Regulation S-K.
18. Please file the employment agreement with Ralph Schiess and the
severance agreements
with Jon Garfield and Dr. Neil Campbell as exhibits to your
registration statement or
otherwise advise. Refer to Item 601(b)(10) of Regulation S-K.
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.
Please contact Tara Harkins at 202-551-3639 or Angela Connell at
202-551-3426 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Jimmy McNamara at 202-551-7349 or Jason Drory at 202-551-8342 with any
other
questions.
Sincerely,
Division of
Corporation Finance
Office of Life
Sciences
cc: Jessica Yuan