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FOIA CONFIDENTIAL TREATMENT REQUESTED BY RAPID MICRO BIOSYSTEMS, INC.

CERTAIN PORTIONS OF THIS LETTER AS FILED VIA EDGAR HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED PURSUANT TO 17 CFR 200.83 WITH RESPECT TO THE OMITTED PORTIONS. OMITTED INFORMATION HAS BEEN REPLACED IN THIS LETTER AS FILED VIA EDGAR WITH A PLACEHOLDER IDENTIFIED BY THE MARK “[****].”

May 12, 2023

VIA EDGAR

Division of Corporation Finance

Office of Industrial Applications and Services

U.S. Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

Attention: Michael Fay

   Brian Cascio

Re:         Rapid Micro Biosystems, Inc.

Form 10-K for the fiscal year ended December 31, 2022

Filed March 10, 2023

File No. 001-40592

Dear Mr. Fay and Mr. Cascio:

Rapid Micro Biosystems, Inc. (the “Company”) respectfully submits this letter in response to the comment letter dated April 10, 2023 of the staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission relating to the Company’s above-referenced Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed March 10, 2023 (the “2022 Form 10-K”). For your convenience, we have reproduced the Staff’s comment in italics below, followed by the Company’s response.

Form 10-K for the fiscal year ended December 31, 2022

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Key business metrics, page 64

1. On page 65 you set forth that validation of a system takes anywhere from three to nine months and on page 70 you reference the impact to validation from coronavirus. Based on the table, it appears that a number of systems placed in 2021 were not validated as of December 31, 2022. As it relates to these 2021 systems, please describe for us in further detail:

• the reasons for any systems that were placed in 2021 and not validated as of December 31, 2022;

• the date revenue was recognized and the date the system was ultimately validated, for each of these 2021 systems;

• how the Growth Direct system is fully functional for use by the customer upon delivery without validation services, as set forth on page 66;

• whether these 2021 systems outlined in the table were in actual use prior to being validated;

• how you considered the guidance in ASC 606-10-25-21(c) in the accounting for your systems; and

• the significant terms of your 2021 arrangements. Provide us a copy of your actual 2021 contractual arrangement.

Response: The Company considers a Growth Direct system to be “placed” upon transfer of control of the system from the Company to the customer, at which point the revenue for that system is recognized.  For purposes of this letter, “place”, “placed”, or “placement” shall all have the same meaning: transfer of control of the system to a customer. Once a Growth Direct system has been placed, the separate performance obligations of system installation and system validation will follow in cases when customers purchase those services separately from the Company.  The Company generally expects system installation to take a few weeks and system validation to be completed between three and nine months following commencement of related activities.

1001 Pawtucket Blvd. West | Lowell, MA  01854 | ph:  978-349-3200 | fx:  978-349-2065

www.rapidmicrobio.com

Following placement of a system with a customer, the timing and duration of installation is dependent on customer site readiness and accessibility as well as customer staff availability to support the installation process.  In the event a customer site is not ready (due to factors such as site construction) or accessible (due to factors such as limitations relating to the coronavirus pandemic), or necessary customer specialized staff are not available (due to factors such as competing priorities or turnover), the time between system placement and installation can be extended.  Similarly, once a system has been installed, the time between completion of installation and start of validation as well as the duration of the validation process are dependent upon several factors including, but not limited to, the examples outlined in the preceding sentence as well as whether a specific customer has previously completed the validation process using a Growth Direct system (in which case several validation steps may be omitted, reducing the direct hours required to complete the validation process).  These factors are largely outside of the Company’s control and, in some cases, result in installation and validation timeframes that are longer or shorter than the general timeframes disclosed on page 65 of the 2022 Form 10-K.

Revenue was recognized for all 2021 system placements during the year ended December 31, 2021, as control of each system was transferred to the customer at a point in time during that period. Once transfer of control of each Growth Direct system had taken place, the amount of time between and for each separate performance obligation was subject to variability due to the factors outlined in the preceding paragraph.  A complete summary of 2021 system placements, including the dates each individual system was placed, installed and validated, as well as supporting details for systems placed in 2021 that were not validated as of December 31, 2022, are included as Exhibit A to this letter which is subject to a confidential treatment request pursuant to Rule 83 of the Commission’s Rules on Information and Requests, 17 C.F.R. §200.83.  The revenue attributed to each system placed in 2021 was recognized on the date of placement.

Each Growth Direct system undergoes quality control release testing prior to shipment and is fully functional for use by the customer upon delivery as the system can, at the customer’s election, be both installed and validated by the customer or a qualified third party other than the Company.  Both installation and validation activities have been completed by other parties (either customers themselves or a third-party service organization) in the past.  With respect to installation, detailed instructions are provided with each Growth Direct system when it is delivered which can be leveraged by the customer or a third-party service provider to install the system.  With respect to validations, the Company has a standardized validation process that was historically developed with a group of industry-leading pharmaceutical companies and can be leveraged by customers or a third-party service provider to complete the validation of the Growth Direct system.  This process allows the customer to demonstrate and document the accuracy, speed, and reliability of detecting microcolonies using the Growth Direct system’s automated image analysis compared to conventional manual methods and supports the use of the Growth Direct system in regulated environments.

While validation services are not required for the system to be fully functional to the customer, we believe that they add value when purchased as they provide the customer with documentation supporting the performance of their Growth Direct system, including as compared to their existing manual method of microbial quality control (MQC), which can be used to support compliance with regulatory requirements and operation under Good Manufacturing Practices (GMP). Therefore, and considering the provisions of ASC 606-10-25-21(c), the Growth Direct system placement and related validation services are not significantly affected by each other or interdependent, and we are able to fulfill our performance obligations with respect to each of the Growth Direct system placement, the installation services and the validation services independently.

Once a system is placed, the customer has the ability to direct the use of the asset as the customer can obtain installation, validation and other services from the Company or from a third party at the customer's sole discretion. As such, the customer can begin using the system together with other resources that are readily available (from third parties or the Company). Whether the system is in actual use is outside of the Company’s control.

The Company has standard terms and conditions that are provided to all of its customers.  Please refer to Exhibit B and Exhibit C to this letter for the Company’s 2021 Terms and Conditions of Sale and the Company's 2021 Terms and Conditions of Service, respectively. In addition to the Company's Terms and Conditions of Sale, any specific terms agreed to within our sales quotes, customer purchase orders, sales order acknowledgements, and, in less frequent situations, customer-specific master sales agreements, are combined together constituting the Company's contract with a customer. The Company believes the significant terms of its 2021 contractual arrangements that impact control transfer and thus drive revenue recognition include the following: (1) shipping / delivery terms, (2) cancellation terms, (3) payment and invoicing terms, (4) refund rights, and (5) customer acceptance provisions.  Our standard contractual terms with customers require payment for all products and services, including the Growth Direct system and validation services (when purchased), upon shipment of the system and do not include refund or cancellation rights, or substantive customer acceptance provisions.

Item 15. Exhibits 31.1 and 31.2, page 80

2. We note that your certifications filed as Exhibits 31.1 and 31.2 do not include paragraph 4(b) and the introductory language in paragraph 4 referring to internal control over financial reporting. Please file an amendment to your annual report that includes certifications that conform exactly to the language set forth within the Exchange Act Rule 13a-14(a). Please note that

you may file an abbreviated amendment that consists of a cover page, explanatory note, signature page, and paragraphs 1, 2, 4, and 5 of the certification.

Response:  Concurrently with the filing of this letter, the Company filed an abbreviated amendment to the 2022 Form 10-K with replacement Exhibits 31.1 and 31.2 that include only paragraphs 1, 2, 4 and 5 to address the Staff’s comment. The form of Exhibits 31.1 and 31.2 are attached hereto as Exhibit D and Exhibit E, respectively.

Consolidated Financial Statements

Revenue Recognition, page F-14

3. We note your contracts may include multiple performance obligations. Please revise your revenue recognition disclosure in future filings so that users can understand any impact between recurring and non-recurring revenues from your allocation of the transaction price. In this regard, please disclose the qualitative and quantitative information about the significant judgments, and changes in judgments, that significantly affect the determination of the amount and timing of revenue, as set forth in ASC 606-10-50-1(b) and 606-10-50-17(b). Please provide us any proposed disclosure.

Response: The Company’s recurring revenue stream includes sales of proprietary consumables and service contracts.  We consider these to be recurring revenues because customers typically place purchase orders for these items on a periodic basis as they use their Growth Direct system over time. The Company’s non-recurring revenue stream includes sales of systems, LIMS connection software, validation services, and field services (excluding service contracts). We consider these to be non-recurring revenues because customers typically place a single purchase order for a bundle of these products and services on a one-time or infrequent basis.

Our recurring revenues arise from contracts typically negotiated separately from the initial sale of a Growth Direct system and represent the entitled consideration for delivering proprietary consumables and providing system maintenance services. Once validation of a sold Growth Direct system has been completed, we expect our customers to transition from their legacy manual method of microbial detection to an automated method using the Growth Direct system and to begin regular utilization of consumables.  Recurring maintenance service contracts commence after our standard one-year warranty period lapses.  Our consumables contracts and our service contracts typically have a single performance obligation.  For our consumables contracts, that performance obligation is the delivery of our proprietary consumables recognized at a point-in-time once control is transferred (typically in line with shipping and delivery terms).  For our service contracts, that performance obligation is our stand-ready obligation to the customer to provide service and maintenance visits and is recognized ratably over time based on the start and end dates of the service contract. Significant judgment for recurring revenue contracts is typically not required due to their non-complex nature and the fact that the transaction price is typically allocated entirely to the single performance obligation associated with them.

Our non-recurring revenues typically arise from standalone contracts with multiple performance obligations that usually include a Growth Direct system, installation services, validation services, and LIMS connection software. Significant judgment is applied in identifying the distinct performance obligations within the arrangement, determination of the transaction price, transaction price allocation, and determination of the standalone selling price for each of the distinct performance obligations.  Occasionally, consumables and/or service contracts will be negotiated as part of a larger transaction with multiple performance obligations, but this is infrequent, and the overall consideration allocated to these recurring performance obligations is immaterial to the financial statements taken as a whole.

See Exhibit F for proposed revisions to the revenue disclosure.

4. We note payment terms for customer orders are typically between 30 to 90 days after the shipment or delivery of the product. Please clarify for us and in future filings whether these are the payments terms for all performance elements in a multiple element arrangement. Refer to ASC 606-10-50-12(b).

Response: Our standard terms and conditions allow us to invoice for all products and services within an arrangement upon shipment of the Growth Direct system. Regardless of whether there is a single performance obligation or multiple performance obligations, our payment terms are typically between 30 to 90 days after the shipment or delivery of the system or product, as the case may be.

See Exhibit F for  proposed revisions to the revenue disclosure.

5. Please clarify for us and in future filings whether your consideration is variable as set forth in ASC 606-10-32-5 through 32-9 and whether your estimate of variable consideration is typically constrained in accordance with paragraphs ASC 606-10-32-11 through 32-13. Refer to ASC 606-10-50-12(b) for the required disclosure.

Response: Our standard contracts (for both recurring and non-recurring revenue streams) do not include variable consideration or rights of return for any products or services sold within an arrangement. Any discounts provided are ordinary and fixed, and allocated across all performance obligations based on relative fair value. Payment for products and services are typically due within 30 to 90 days from product shipment or delivery for all products and services purchased within an arrangement and there are no significant financing components. We will update our policy in future filings to clarify that consideration is typically fixed and not variable.

See Exhibit F for  proposed revisions to the revenue disclosure.

* * * * *

Due to the commercially sensitive nature of information contained in Exhibit A to this letter, this submission is accompanied by the Company’s request for confidential treatme