SEC Comment Letter for Lineage Cell Therapeutics, Inc. (LCTX) (CIK 0000876343) (LCTX) — Oct 26, 2010
Lineage Cell Therapeutics, Inc. (LCTX) (CIK 0000876343)
Date: Oct. 26, 2010 · CIK: 0000876343 · Accession: 0000000000-10-063402
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 001-12830
Letter
October 26, 2010 Dr. Michael D. West, PhD. Chief Executive Officer BioTime, Inc. 1301 Harbor Bay Parkway, Suite 100 Alameda, California 94502 Re: BioTime, Inc. 0B Form 10-K for the Fiscal Year Ended December 31, 2009 Definitive Proxy Statement Filed April 30, 2010 File No. 001-12830
Dear Dr. West: We have reviewed your August 3, 2010 respons e to our July 27, 2010 comment letter and have the following comments. Please respond to this letter within te n business days by providing the requested information or by advising us when you will provide the requested response. Where a comment requests you to revise disclosu re, the information you provide s hould show us what the revised disclosure will look like and identify the annual or quarterly filing, as applicable, in which you intend to first include it. If you do not be lieve a comment applies to your facts and circumstances, please tell us why in your res ponse. Please furnish us a letter on EDGAR under the form type label CORRESP that ke ys your responses to our comments. After reviewing the information provided, we may raise additional comments and/or request that you amend your filings. Form 10-K for the Year Ended December 31, 2009
Licensed Stem Cell Technology and Stem Cell Product Development Agreements, page 8
1. We note your response to comments 4, 5, and 6. Please confirm that your Form 10-K for 2010 will identify the anticipated expirations of your Product Production and Distribution Agreement with Lifeline Cell Technol ogy, LLC, your Stem Cell Agreement with Reproductive Genetics Institute, your license agreement with CJ Corp. and your collaboration agreements with Summit Phar maceuticals Internati onal Corporation.
Dr. Michael D. West, PhD. Biotime, Inc. October 26, 2010 Page 2 Results of Operations, page 40
2. Please refer to prior comment eight. We ac knowledge the information provided in your response, particularly your inability to produce research and development costs by project. As originally request ed, please revise to provide other quantitative or qualitative disclosures that indicate the amount of th e company’s resources being used on each significant research and development project. To the extent that the amount or range of costs and timing to complete the project ar e not estimable, disclose those facts and circumstances that preclude you fr om making reasonable estimates. Notes to the Consolidated Financial Statements
5.Royalty Obligations and Deferred License Fees, page 59
3. Please refer to prior comment 11. As originally requested, please refer us to the technical guidance upon which you relied in deferring lic ense fees until product sales commence and then amortizing these amounts over the estimated product revenue periods. Explain why this approach is preferable to amortizat ion over the term of the license agreement and why amortization did not begin when the fi rst revenues were recognized rather than waiting until significant revenues have been recognized. Explain why these license payments did not represent research and de velopment expense that would be expensed when incurred rather than capitalized as asse ts.Please refer us to the technical guidance upon which you relied: • for deferring license fees as an asset ra ther than charging them to expense as research and development; and • assuming that recording as an asset is appropriate, for waiting until product sales commence before amortizing them over the estimated product revenue periods rather than beginning the am ortization period immediately.
You may contact Lisa Vanjoske, Assistan t Chief Accountant at (202) 551-3614 if you have any questions on comments on the financ ial statements and related matters. You may contact Bryan Pitko, Staff Attorney, at (202) 551-3203 with questions on any of the other comments. In this regard, do not hes itate to contact me, at (202) 551-3679.
Sincerely,
Jim B. Rosenberg
Senior Assistant Chief Accountant
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October 26, 2010 Dr. Michael D. West, PhD. Chief Executive Officer BioTime, Inc. 1301 Harbor Bay Parkway, Suite 100 Alameda, California 94502 Re: BioTime, Inc. 0B Form 10-K for the Fiscal Year Ended December 31, 2009 Definitive Proxy Statement Filed April 30, 2010 File No. 001-12830 Dear Dr. West: We have reviewed your August 3, 2010 respons e to our July 27, 2010 comment letter and have the following comments. Please respond to this letter within te n business days by providing the requested information or by advising us when you will provide the requested response. Where a comment requests you to revise disclosu re, the information you provide s hould show us what the revised disclosure will look like and identify the annual or quarterly filing, as applicable, in which you intend to first include it. If you do not be lieve a comment applies to your facts and circumstances, please tell us why in your res ponse. Please furnish us a letter on EDGAR under the form type label CORRESP that ke ys your responses to our comments. After reviewing the information provided, we may raise additional comments and/or request that you amend your filings. Form 10-K for the Year Ended December 31, 2009 Licensed Stem Cell Technology and Stem Cell Product Development Agreements, page 8 1. We note your response to comments 4, 5, and 6. Please confirm that your Form 10-K for 2010 will identify the anticipated expirations of your Product Production and Distribution Agreement with Lifeline Cell Technol ogy, LLC, your Stem Cell Agreement with Reproductive Genetics Institute, your license agreement with CJ Corp. and your collaboration agreements with Summit Phar maceuticals Internati onal Corporation. Dr. Michael D. West, PhD. Biotime, Inc. October 26, 2010 Page 2 Results of Operations, page 40 2. Please refer to prior comment eight. We ac knowledge the information provided in your response, particularly your inability to produce research and development costs by project. As originally request ed, please revise to provide other quantitative or qualitative disclosures that indicate the amount of th e company’s resources being used on each significant research and development project. To the extent that the amount or range of costs and timing to complete the project ar e not estimable, disclose those facts and circumstances that preclude you fr om making reasonable estimates. Notes to the Consolidated Financial Statements 5.Royalty Obligations and Deferred License Fees, page 59 3. Please refer to prior comment 11. As originally requested, please refer us to the technical guidance upon which you relied in deferring lic ense fees until product sales commence and then amortizing these amounts over the estimated product revenue periods. Explain why this approach is preferable to amortizat ion over the term of the license agreement and why amortization did not begin when the fi rst revenues were recognized rather than waiting until significant revenues have been recognized. Explain why these license payments did not represent research and de velopment expense that would be expensed when incurred rather than capitalized as asse ts.Please refer us to the technical guidance upon which you relied: • for deferring license fees as an asset ra ther than charging them to expense as research and development; and • assuming that recording as an asset is appropriate, for waiting until product sales commence before amortizing them over the estimated product revenue periods rather than beginning the am ortization period immediately. You may contact Lisa Vanjoske, Assistan t Chief Accountant at (202) 551-3614 if you have any questions on comments on the financ ial statements and related matters. You may contact Bryan Pitko, Staff Attorney, at (202) 551-3203 with questions on any of the other comments. In this regard, do not hes itate to contact me, at (202) 551-3679. Sincerely, Jim B. Rosenberg Senior Assistant Chief Accountant