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United States securities and exchange commission logo
April 22, 2021
Rajiv Shukla
Chairman and Chief Executive Officer
Alpha Healthcare Acquisition Corp.
1177 Avenue of the Americas
5th Floor
New York, NY 10036
Re: Alpha Healthcare
Acquisition Corp.
Registration
Statement on Form S-4
Filed March 23,
20021
File No. 333-254597
Dear Mr. Shukla:
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.
Registration Statement on Form S-4, Filed March 23, 2021
Summary
Board's Reasons for the Business Combination, page 3
1. We note your statement
on page 3 that [t]he Board considered that Humacyte can seek
accelerated approval
for its bioengineered human, acellular tissue-based vessels ( HAVs )
relating to vascular
trauma. Please remove any implication that Humacyte will receive
approval on an
accelerated basis and clarify that they might not receive approval at all.
You may instead explain
the significance of receiving Fast Track designation. Please also
revise to explain the
significance of a priority designation under Public Law 115-92 and
an RMAT designation by
the FDA.
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 222, 2021 Page 2
Page
FirstName LastName
2. We note your heading on page 3: Anticipated product launch for
trauma and short vessel
trauma in 2023, AV access in 2023 and PAD in 2025. Please revise to
remove any
implication that Humacyte s product candidates will receive
regulatory approval.
3. Please revise to explain the meaning of patient years of data on page
4 and clarify that the
measure whether it provides information about long term performance.
Interests of the Sponsor and AHAC's Directors and Officers in the Business
Combination, page
10
4. Please revise the sixth bullet point to quantify the value of all
shares held by the Sponsor
and initial shareholders that will become worthless if you fail to
consummate an initial
business transaction within 24 months of the close of the Initial
Public Offering.
5. In the eight bullet point, please confirm that in the event
outstanding loans to the Sponsor,
AHAC's officers or directors or affiliates are converted into units,
that such units would be
redeemable by AHAC under the same terms as warrants issued as
components of the units
sold in the Initial Public Offering. If they are not redeemable,
please revise the statement
that units would be identical to the units issued in the Initial
Public Offering.
Risk Factors
Risks Related to Humacyte's Business and Industry, page 24
6. Please include risk factor disclosure regarding your reliance on
SeraCare Life Sciences,
Inc. as the current single source supplier of human plasma used in
your manufacturing
process and Confluent Medical Technologies, Inc. as the current single
source supplier
of polymer mesh. Alternatively, explain why you believe your reliance
on these sole
source suppliers doe not present a material risk.
If SAEs occur or other unacceptable side effects are identified in our HAV's we
may need to
delay, abandon or limit development ..., page 26
7. To the extent trial participants have experienced any serious adverse
events, please
describe the events and disclose the number of occurrences.
The Sponsor and AHAC's officers and directors own AHAC Common Stock and
Warrants...,
page 59
8. Please quantify the our of pocket expenses incurred to date that are
reimbursable if the
Business Combination is completed.
AHAC may redeem your unexpired Warrants prior to their exercise..., page 60
9. Please revise your risk factor caption to clearly indicate that the
Private Placement
Warrants held by the Sponsor and its permitted transferees are not
subject to the same risk
as these warrants ae not redeemable.
Proposal 1: The Business Combination Proposal
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 322, 2021 Page 3
Page
FirstName LastName
Background of the Business Combination, page 70
10. Please revise to provide a more detailed description of the process
used in eliminating
potential business combination candidates as you progressed from
dozens of candidates
to Humacyte. Please provide more detail on these other potential
targets, including with
respect to the 16 that executed NDAs, details concerning their
industries, size and why
discussions ended on a company-by-company basis.
11. We note your statement that the Units sold in the Concurrent Private
Placement are
identical to the Units sold in the Initial Public Offering. We also
not your discussion page
232 that the Private Placement Warrants are exercisable on a cashless
basis and are not
redeemable by AHAC so long as they are held by the Sponsor. Please
revise to here and
throughout your document to remove the statement that they are
identical and highlight
the differences between the units issued in the Initial Public
Offering and the units issued
privately.
12. We note your disclosure on page 72 that you reviewed financial
information provided by
Humacyte and comparisons to certain publicly traded companies and
certain companies
acquired in recent mergers and acquisitions transactions, including
"publicly traded
comparisons derived from information that had been prepared by
investment banks
advising regarding the public equity markets." Please expand your
discussion to provide
the following information:
Clarify whether the financial information provided by Humacyte
included
information in addition to the financial projections provided on
page 83.
Clarify whether the publicly traded companies were the same as the
publicly traded
companies disclosed on page 80.
Identify the companies acquired in recent mergers and acquisition
transactions.
Clarify who identified each group of companies.
To the extent you considered additional financial information and
additional publicly
traded companies, please expand your discussion to provide the
additional
information you considered.
To the extent the financial information included the projections
on page 83, please
explain how you considered the speculative nature of projections
over such an
extended period.
13. We note your disclosure on page 77 that AHAC's management team its own
financial
analysis supporting the equity valuation of Humacyte, which was
reviewed by the Board.
Please indicate when this analysis and review occurred and included
this financial analysis
in your prospectus.
Opinion of AHAC's Financial Advisor, page 78
14. Please revise page 80 to provide the criteria used to select the
comparable companies..
Please also disclose whether any comparables meeting the selection
criteria were excluded
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 422, 2021 Page 4
Page
FirstName LastName
from the analyses, and, if so, the reasons for making such exclusions.
15. On page 83 you state that the Humacyte projections are "[p]robability
adjusted for
customary regulatory success rates of pre-commercialization products."
Please revise to
state the rate used in this adjustment. Please also revise to provide
the date the projections
were prepared and explain how Free Cash Flow was calculated.
16. With respect to the comparable companies analysis, please explain how
your advisors
calculated EV/CY revenues through 2026 without the comparable
companies' revenue
projections.
Opinion of AHAC's Financial Advisor
Certain Projected Financial Information, page 81
17. We note that Humacyte s management provided internal financial
forecasts regarding
Humacyte s anticipated future operations for fiscal years 2021
through 2034, which
incorporated the financial forecasts prepared by Humacyte management,
as adjusted for
customary regulatory success rates of pre-commercialization products.
We note that you
presented a summary of this information at the top of page 83. We have
the following
comments regarding this disclosure:
Identify the material assumptions and estimates underlying the
prospective financial
information. For example, please explain the nature of the
adjustments for
probability of regulatory/technical success and how you arrived
at such
adjustments.
Explain whether Humacyte applied the same regulatory success rates
for each of the
pre-commercialization products, and if so, why.
Explain the nature of the material assumptions underlying Humacyte
s revenue
growth rates, operating costs and free cash flows; and
Explain how management and the Board considered and relied upon
the forecasts,
particularly in light of the length of the projections and their
current status as a
development stage company.
Related Agreements, page 98
18. Please revise the description of the Investor Rights and Lock-up
Agreement on page 100
to provide more detail concerning the term of the lock-up, the number
of shares that will
be covered by the registration rights and describe the provisions
related to the New
Humacyte Board.
Material U.S. Federal income Tax Considerations, page 101
19. Please revise this section to include a discussion of the material
U.S. federal income tax
considerations with respect to the Humacyte shareholders' share
exchange. Refer to Item
4(a)(6) of Form S-4.
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 522, 2021 Page 5
Page
FirstName LastName
Unaudited Pro Forma Condensed Combined Financial Information
General, page 107
20. We note from your Item 7.01 Form 8-K filed April 14, 2021, that
Humacyte closed on a
secured debt financing facility with Silicon Valley Bank for up to $50
million, of which
the first $20 million was funded at closing. Please address the need
to reflect this
transaction within your pro forma financial statements.
Basis of Pro Forma Presentation , page 108
21. Please provide in tabular form the number of shares underlying the not
yet exercisable
warrants and unvested stock option awards.
2. Transaction Accounting Adjustments to Unaudited Pro Forma Condensed Combined
Financial
Information, page 115
22. We note the $20 million preliminary estimated payment of direct and
incremental
transaction costs incurred prior to or concurrent with the Business
Combination and PIPE
investment. Please separately disclose the amounts of such costs
related to the Business
Combination and PIPE. Address the need to reflect the Business
Combination transaction
costs within your pro forma statement of operations pursuant to Rule
11-02(a)(i)(6)(B) of
Regulation S-X
3. Loss Per Share, page 117
23. Please quantify the outstanding options, warrants and Contingent
Consideration shares
that are not included in the calculation of diluted earnings per
share.
4. Contingent Consideration, page 117
24. Please disclose the Price Targets and the number of shares to be
issued if those Price
Targets are met. Please also disclose the underlying accounting for
the Contingent
Consideration. Ensure that you explain that the Contingent
Consideration will be
remeasured to fair value at each reporting date and such changes in
fair value will be
recognized in earnings. Clarify, if true, that such changes could be
material to future
results of operations.
Information about Humacyte
Business Overview, page 150
25. We note your statement on pages 2 and 150 that your technology
platform is best-in-
class. This term suggests that your product candidates are
effective and likely to be
approved. Please delete this reference. If your use of the term was
designed to convey
your belief that your product candidates are based on a differentiated
technology or
approach, you may further discuss how your technology or approach
differs from those of
your competitors.
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 622, 2021 Page 6
Page
FirstName LastName
Our Market Opportunity, page 153
26. Please provide quantitative and monetary support for the market size
valuations you
provide on pages 154-155, except for Type 1 Diabetes.
Our Clinical and Pre-Clinical Stage Product Pipeline, page 155
27. Please provide a definition for primary and secondary patency on pages
156-157.
28. We note the presentation of tables comparing your technology to
published studies of
alternative treatments. To the extent the data was not compiled based
on head to head
studies, please revise your disclosure to eliminate the comparison.
Please note, you may
present efficacy and rate of infection for alternative treatments but
you cannot compare
that information to Humacyte clinical trial results.
Proposed Indication #3: Peripheral Arterial Disease, page 165
29. Please revise to explain the meaning of the following statement on
page 166: after
censoring for deaths, we observed a strong tolerability profile .
Intellectual Property, page 175
30. Please revise to cite the foreign jurisdictions covered by your
patents and pending patent
applications.
31. Please revise pages 176-178 to provide the amount of the upfront fee,
maintenance fees
and milestone fees paid and payable to Yale University under each of
the three license
agreements. Additionally, we note the agreements expire on a
country-by-country basis on
the date on which the last of the patents in such country expires,
lapses or is declared
invalid. Please revise to state when these patents are due to expire.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Result of Operations, page 196
32. We note that Humacyte does not allocate research and development costs
by program.
Please explain to us how R&D costs are managed and how they are
reported within
the organization. Please clarify if costs are tracked by other
classifications, such as
salaries and related overhead expenses for personnel in research and
development
functions, fees paid to consultants and CROs and other categories such
as those listed on
page 194. If so, please provide this additional information for each
period presented.
Comparison of Stockholders' Rights, page 233
33. We note that your forum selection provision on page 240 identifies the
Court of Chancery
of the State of Delaware as the exclusive forum for certain
litigation, including any
derivative action. Please disclose whether this provision
applies to actions arising under
the Securities Act. Please be sure to reconcile this disclosure with
Annex C-5, which
Rajiv Shukla
FirstName LastNameRajiv Shukla
Alpha Healthcare Acquisition Corp.
Comapany
April NameAlpha Healthcare Acquisition Corp.
22, 2021
April 722, 2021 Page 7
Page
FirstName LastName
states that the provision does not apply to claims arising under the
Securities Act.
Audited Financial Statements of Humacyte, Inc.
Grant Revenue, page F-28
34. Please provide in the disclosure a brief narrative for each of the
awarded grants. As part
of the narrative, include material terms and provisions.
12. Commitments and Contingencies, page F-44
35. Please disclose the amount of annual maintenance fees the Company has
agreed to pay
Yale.
14. Subsequent Events, page F-48
36. Please disclose the approximate amount of any additional stock
compensation that will be
recorded as a result of the 2021 stock option awards and whether
vesting of these awards
will accelerate upon finalization of the Business Combination. If so,
please address the
need to address any accounting implications in the pro forma financial
information
presented elsewhere.
General
37. Please provide us with copies of the materials that your financial
advisors prepared and
shared with your board in connection with this transaction, including
any board books,
transcripts and summaries of oral presentations made to the board. We
may have
additional comments after we review those materials.
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 Michael Fay at 202-551-3812 or Jean Baker at
202-551-3691 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Margaret Schwartz at 202-551-7153 or Suzanne Hayes at 202-551-3675 with
any other
questions.
Sincerely,
Division of
Corporation Finance
Rajiv Shukla
Alpha Healthcare Acquisition Corp.
FirstName
April LastNameRajiv Shukla
22, 2021
Page 8
Comapany NameAlpha Healthcare Acquisition Corp.
April 22, 2021 Page 8 Office of Life Sciences
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