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United States securities and exchange commission logo
August 6, 2020
Ronald Lloyd
President and Chief Executive Officer
Aziyo Biologics, Inc.
12510 Prosperity Drive, Suite 370
Silver Spring, MD 20904
Re: Aziyo Biologics,
Inc.
Draft Registration
Statement on Form S-1
Submitted July 10,
2020
CIK No. 0001708527
Dear Mr. Lloyd:
We have reviewed your 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.
Draft Registration Statement on Form S-1 submitted July 10, 2020
Prospectus Summary
Overview, page 1
1. We note your reference
to "partnerships" with major medical device companies including
Boston Scientific and
Medtronic. Please briefly clarify the nature of these partnerships,
and in the appropriate
section of the document, explain the form of the partnership, its
duration, the rights
and obligations of the parties and whether there are formalized
agreements in place
governing these relationships. If so, please file these as exhibits or tell
us why you do not
believe they are required to be filed under Regulation S-K Item
601(b)(10).
Ronald Lloyd
Aziyo Biologics, Inc.
August 6, 2020
Page 2
2. We note your statements here and throughout your document referring to
estimates. As a
non-exhaustive list of illustrative examples only, we note the
following:
It is estimated that more than two million patients were either
implanted with medical
devices...or tissue expanders...in the United States in 2019.
In 2019, it is estimated that there were more than 600,000
procedures in the United
States to install or replace implantable electronic
devices...which represents an
estimated $600 million opportunity.
It is estimated that there were more than 100,000 procedures in
the United States in
2019 using biologic matrices for plastic and reconstructive
surgery, which constituted
an approximately $500 million market.
Please revise your disclosure to provide the basis for these
estimates, including whether
they are based on third-party surveys and data gathering or on
management's belief.
3. For each of your products, please revise your disclosure to state the
procedures or
applications for which your product has been approved as well as the
procedures or
applications for which you are currently seeking approval.
Soft Tissue Reconstruction Market, page 7
4. Please define the term HADM the first time it is used in your
disclosure.
Implications of Being an Emerging Growth Company and a Smaller Reporting
Company, page 9
5. Please supplementally provide us with copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to
do so on your behalf,
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communications.
Use of Proceeds, page 77
6. Please revise your disclosure to indicate the approximate amount of
the proceeds from the
offering that is intended to be used for each purpose disclosed.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Net Sales, page 88
7. Given that non-core sales are material to total sales and declined
significantly in 2019,
FirstName LastNameRonald Lloyd
please disclose whether there are any known events or circumstances that
you expect will
Comapany
causeNameAziyo Biologics,
2020 non-core sales toInc.
decline materially relative to 2019. See
Section 501.02 of the
AugustFinancial Reporting
6, 2020 Page 2 Codification.
FirstName LastName
Ronald Lloyd
FirstName LastNameRonald Lloyd
Aziyo Biologics, Inc.
Comapany
August NameAziyo Biologics, Inc.
6, 2020
August
Page 3 6, 2020 Page 3
FirstName LastName
Revenue Interest Obligation, page 98
8. Please revise your disclosure to state which of your current products
are subject to the
Revenue Interest Obligation as well as any product candidates under
development that
may become subject to the Revenue Interest Obligation.
Business
Implantable Electronic Devices/Cardiovascular Market, page 106
9. We note your disclosure concerning a review of studies covering
publications from 1981
through 2019 regarding infection and migration rates for implantable
electronic devices.
Please revise your disclosure to discuss who conducted the review, how
many studies
were reviewed, the average infection and migration rates across the
studies and how
publications were selected to be included in the review.
Please also explain to us why you decided to include studies from 1981
through 2000.
10. We note your disclosure regarding the lack of provision of long-term
stabilization from
the TYRX device as well as your claim that any stabilization of the
implanted device is
provided by scar tissue, which can lead to complications. Please
revise your disclosure to
state whether these claims are based on third-party studies or on
management's belief.
Implantable Electronic Device
Clinical Studies, page 112
11. Please update your description of the SECURE study to state the
primary and secondary
endpoints of the study; whether any adverse events or serious adverse
events were deemed
to be related to the CanGaroo envelope and the nature of any such
events; and the
infection and migration rates for all of the patients in the study
that received the Cangaroo
envelope.
Orthopedic/Spinal Repair
Pre-clinical Studies, page 113
12. Please present support for your claim that your viable bone matrices
were superior in all
characteristics examined compared to other products.
Soft Tissue Reconstruction
Pre-clinical Studies, page 113
13. We note your disclosure regarding the preclinical studies conducted
for SimpliDerm.
Please revise your disclosure to provide the data that supports your
claims in this
subsection, including the statements that SimpliDerm's structurally
intact matrix was
closest to the native human dermis among the HADMs evaluated in one
study and that
SimpliDerm showed less acute and chronic inflammation and less
fibrosis than AlloDerm
RTU in another study.
Ronald Lloyd
Aziyo Biologics, Inc.
August 6, 2020
Page 4
Competition, page 114
14. We note your disclosure on page 26 that some of your competitors'
products are subject to
a simpler reimbursement process. Please update your disclosure to
further discuss the
reimbursement process for your products and those of your competitors.
Intellectual Property, page 116
15. Please provide the jurisdictions for your owned and in-licensed foreign
patents.
License Agreement with Cook Biotech, page 117
16. Please revise to disclose the expected expiration date of the
last-to-expire patent.
Principal Stockholders, page 147
17. Please identify the natural persons who are the beneficial owners of the
shares held by
KeraLink International, Inc.
Note 15, page F-23
18. Please say how the stock split referenced on page 11 impacts this
disclosure.
You may contact Tracey McKoy at 202-551-3772 or Al Pavot at 202-551-3738
if you
have questions regarding comments on the financial statements and related
matters. Please
contact Alan Campbell at 202-551-4224 or Mary Beth Breslin at 202-551-3625 with
any other
questions.
Sincerely,
FirstName LastNameRonald Lloyd
Division of
Corporation Finance
Comapany NameAziyo Biologics, Inc.
Office of Life
Sciences
August 6, 2020 Page 4
cc: Wesley C. Holmes
FirstName LastName