SEC Comment Letter for ADMA BIOLOGICS, INC. (ADMA) (CIK 0001368514) (ADMA) — Apr 13, 2012
ADMA BIOLOGICS, INC. (ADMA) (CIK 0001368514)
Date: April 13, 2012 · CIK: 0001368514 · Accession: 0000000000-12-018861
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File numbers found in text: 000-52120
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April 12, 2012 Via E-mail
Adam S. Grossman Chief Executive Officer ADMA Biologics, Inc. 65 Commerce Way Hackensack, New Jersey 07601
Re: ADMA Biologics, Inc.
Amendment No. 1 to Form 8-K Filed March 29, 2012 File No. 000-52120
Dear Mr. Grossman:
We have reviewed your response date d March 29, 2012 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 within ten business days by amending your filing, by
providing the requested information, or by advising us when you will provide the requested response. 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 filing and the information you provide in
response to these comments, we may have additional comments. Our Strategy, page 14
1. We note your response to our prior co mment 8. Please revise the bulleted
discussion “Develop and commercialize RI- 001 as a treatment for PIDD” to state
when you expect to generate revenue fr om the commercialization of RI-001 as a
treatment for PIDD.
2. Please revise the statement on page 15 th at “ADMA plans to sell normal source
plasma to buyers in the open market” to st ate, if true, that you are already selling
normal source plasma. We note on page 45 that you recorded revenue during the
Adam S. Grossman
ADMA Biologics, Inc. April 12, 2012 Page 2
most recently completed fiscal year “fro m the sale of blood plasma collected in
[your] Georgia-based blood plasma collection center.”
3. Please revise the discussion on the bottom of page 15 to clarify whether additional
FDA licensing, local approvals, and federal and state inspections will be required
to open new ADMA BioCenters locations.
Our Product Candidate, page 16
4. We note your response to our prior comme nt 11. We note the statement that you
believe RI-001 will be clearly differen tiated from currently marketed IGIV
products in part because of “the manuf acturing processes [the company] intends
to employ.” We also note the statement on page 18 that “Biotest does not have
access to [y]our trade secrets during the ma nufacturing of RI-001.” In light of
this please revise to clarify how the ma nufacturing process will differentiate RI-
001. To the extent the manufacturing pr ocess to which you refer is Biotest’s
rather than yours, please revise accordingly.
Manufacturing and Supply, page 18
5. Please refer to the second-to-last paragra ph on page 18. Please revise to clarify
what you are referring to by “ADMA’s contra ct laboratories.” Revise to clarify,
if true, that this is not a reference to Biotest.
Certain Relationships and Relate d Party Transactions, page 59
6. Please revise to clarify the reference to “Item 404(c)(iii)” on page 61 as it is
unclear to us to what you are referring.
Exhibit 99.1 to Form 8-K/A filed March 29, 2012
7. Refer to our previous comment 22. Please tell us how your auditor was able to
come to the conclusion that a going concer n paragraph was not necessary in their
opinion issued on your December 31, 2011 audited financial statements.
Specifically address, in expanded detail, your history of losses from operations,
your cash flow burn rate, your disclosure on page F-7 that you have experienced
net losses and negative cash flows from operations since ince ption and the fact
that you expect these conditions to continue for the foreseeable future. In addition, address the fact that you will not be able to generate revenues from RI-
001 until after FDA approval which may not occur, and that you will need to
secure additional funding prior to th e third quarter of 2013 to continue
development and operations.
8. In this regard, consideration should be given to includi ng an explanatory
paragraph that discloses the substa ntive reasons why the going-concern
Adam S. Grossman
ADMA Biologics, Inc. April 12, 2012 Page 3
explanatory paragraph has been eliminated from the reissued report for December
31, 2010 by analogy to AU Section 508.69.
Summary of Significan t Accounting Policies
Inventories, page F-7, and
Revenue Recognition, page F-8
9. Please revise both of these policies to di stinguish between your treatment of the
different types of plasma inventories you hold and sell as part of operations, and
those you hold for use in research and de velopment. Ensure consistency with
your responses to our previous comments 29 and 30.
10. As a related matter, please revise your discussion of research and development
expenses on page 46 of the Form 8-K to speci fically state, if true, that the plasma
sold is not plasma collected at the Plasma center.
You may contact Amy Gedde s at (202) 551-3304 or Ma rgery Reich at (202) 551-
3347 if you have questions regarding comments on the financial statements and related
matters. Please contact John Dana Brown at (202) 551-3859 or the undersigned at (202)
551-3469 with any other questions.
S i n c e r e l y , / s / J u s t i n D o b b i e
Justin Dobbie Legal Branch Chief
cc: Roland S. Chase SNR Denton US LLP