SecProbe.io

December 19, 2011

Via Email
Christoph Westphal, M.D., Ph.D.
Chief Executive Officer Verastem, Inc. 215 First Street, Suite 440 Cambridge, Massachusetts 02142
 Re: Verastem, Inc.
  Registration Statement on Form S-1/A
  Filed December 7, 2011
  File No . 333-177677

Dear Dr. Westphal:

We have reviewed your December 7, 2011 ame ndment and letter filed in response to our
November 30, 2011 comment letter and have the follo wing additional 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 re gistration statement and the information you
provide in response to these comments, we may have additional comments.
 Dilution, page 45

1. Please tell us why it is appropriate to use th e common shares outstanding and the unvested
common stock that remain subject to repurchase in your dilution table as  opposed to just the
common shares that are outstanding.  Please cite  for us any specific reference in ASC Topic
718 that allows you to include unvested common stock that rema ins subject to repurchase as
common stock outstanding.
 Management’s Discussion and Analysis of Financ ial Condition and Results of Operations, page
50
 Stock Based Compensation, page 50

2. We acknowledge your response to comment 14.  Please tell us why you selected the eight
representative companies for estimating the vola tility used to determine the value of your

Christoph Westphal, M.D., Ph.D.
Verastem, Inc. December 19, 2011 Page 2
 company.  Please describe the similarities between your company a nd the representative
companies, such that using their historical vol atility factor would produ ce the best estimate of
your valuation.  Additionally, please tell us w hy different representative companies were
used to determine your volatility factor in the notes to the fina ncial statements for your stock-
based compensation.

Financial Statements, page F-3

 Note 6 – Common Stock, page F-15

 3. We acknowledge your response and revisions fo r comment 21.  Please revise the estimated
volatility in your stock based compensation calcula tion such that the hist orical volatility of a
truly representative group of co mpanies is used, with similar characteristics, preclinical stage
of product development and therapeutic focus.   We reviewed the business and financial
statements disclosures of your representative  group of public companies and do not believe
that the companies used to determine your vola tility have similar char acteristics, including
their stage of product development and therap eutic focus.  Some of the companies are
generating revenue, others have a significantl y different market capitalization compared to
your current valuation, some have product candida tes in clinical development, some have
products on the market and others have a ne w drug application under review by the Food and
Drug Administration.  These are not companies that  have similar characteristics or start-ups
in an early stage of product development as you id entify yourself to be in  your risk factors or
throughout your financial statements.  In additio n, we identified some companies out of the
seven companies used in your sample that have  similar characteristics and are in a similar
preclinical stage of product development but do not have a similar therapeutic focus.
 Note 10.  License Agreements, page F-21

4. We acknowledge your response to comment 22 th at the remaining license agreements are
individually not material to th e Company.  We would expect th at disclosure of individual
activity that is not material to the company w ould not be reported in the Company’s financial
statements.  Since these agreements are include d in your financial stat ements, please revise
your disclosures to discuss the annual main tenance fees, upfront fees and milestones
payments that could be made cumulatively for all of the remaining license agreements. With
regards to the annual maintenance fee for the Whitehead Institute for Biomedical Research
agreement, consistent with your response, please disclose that this amount is not material to
the financial statements.  Alternatively, please tell us why this activity is significant for
disclosure to investors but not material enough to quantify for investors.
 Note 12.  Subsequent Events, page F-22

5. We note your agreement with Poniard for th e issuance of 500,000 warrants to purchase your
common stock for cash or on a cashless basis.   Please tell us how you will account for the
warrants and cite for us the authoritativ e accounting literature  that you relied upon.

Christoph Westphal, M.D., Ph.D.
Verastem, Inc. December 19, 2011 Page 3
 We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing incl udes the information the Securities Act of 1933 and
all applicable Securities Act rules require.  Since the company and its management are in
possession of all facts relating to a company’s disc losure, they are responsible for the accuracy
and adequacy of the disclosures they have made.
Notwithstanding our comments, in the event you request acceleration of  the effective date
of the pending registration statement please pr ovide a written statement from the company
acknowledging that:
 should the Commission or the staff, acting purs uant to delegated authority, declare the
filing effective, it does not foreclose the Co mmission from taking any action with respect
to the filing;

 the action of the Commission or the staff, acting pursuant to delegated authority, in
declaring the filing effective, does not relieve the company from its full responsibility for
the adequacy and accuracy of the disclosure in the filing; and

 the company may not assert staff comments a nd the declaration of effectiveness as a
defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Please refer to Rules 460 and 461 regarding re quests for acceleration.  We will consider a
written request for acceleration of  the effective date of the regi stration statement as confirmation
of the fact that those reques ting acceleration are aware of thei r respective responsibilities under
the Securities Act of 1933 and the Securities Excha nge Act of 1934 as they relate to the proposed
public offering of the securities specified in th e above registration stat ement.  Please allow
adequate time for us to review any amendment prior to the requested effective date of the
registration statement.
 You may contact Christine Allen at (202)  551-3652 or Gus Rodriguez, Accounting
Branch Chief, at (202) 551-3752 if you have que stions regarding comments on the financial
statements and related matters.  Please contac t Laura Crotty at (202) 551-3563, Bryan Pitko at
(202) 551-3203 or me at (202) 551- 3715 with any other questions.

Sincerely,
   /s/ Jeffrey P. Riedler
Jeffrey P. Riedler Assistant Director
cc: Brian A. Johnson (Wilmer Cutler Pickering Hale and Dorr LLP)