SecProbe.io

August 28, 2018
David Young
Chief Executive Officer
Processa Pharmaceuticals, Inc.
7380 Coca Cola Drive, Suite 106
Hanover, MD 21076
Re:Processa Pharmaceuticals, Inc.
Registration Statement on Form S-1
Filed July 30, 2018
File No. 333-226428
Dear Dr. Young:
            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-1
Cover Page
1.We note your disclosure that your common stock is quoted on the OTC Pink Market.
Please revise here, and make corresponding changes elsewhere in the
prospectus, to disclose a fixed price at which your shares will be sold until your shares
are listed on a national securities exchange or quoted on the OTC Bulletin Board, OTCQB
or OTCQX.

 FirstName LastNameDavid Young
 Comapany NameProcessa Pharmaceuticals, Inc.
 August 28, 2018 Page 2
 FirstName LastNameDavid Young
Processa Pharmaceuticals, Inc.
August 28, 2018
Page 2
Description of Business, page 1
2.Please provide more detail concerning the current stage of development of PCS-499 in
this section such as whether PCS-499 is in the preclinical stage of development and
whether you have conducted any clinical trials for PCS-499, filed any regulatory
applications or had any pre-filing conferences with regulatory agencies.
Prospectus Summary, page 1
3.Please revise your disclosure to briefly explain in terms a lay reader would understand
what you mean that your product candidate is an "analog of an active metabolite" of an
already approved drug.  Please also disclose the drug that is already approved, when it was
approved, the indication for which it was approved, and the fact that it was approved by
the FDA as disclosed elsewhere in the prospectus.
4.We note your statement here, and elsewhere in the prospectus, that your lead product
candidate compound has been shown to be "safe and tolerable" and "with a trend toward
efficacy in diabetic nephropathy."  Safety and efficacy determinations are solely within
the authority of the FDA and comparable regulatory authorities.  Please revise your
disclosure to remove all references to your product candidate as being effective, including
preliminary indications of efficacy (whether for your planned indication or other
indications).  Please make similar revisions regarding your statements about your product
candidate's safety.  In the "Description of Business" section, you may present the objective
results of trials.
Risk Factors, page 1
5.Please expand this section to disclose that you do not own any patents for your drug
candidate and you are dependent on a license.  Please also disclose in this section that you
have not initiated any clinical trials and your independent registered public accounting
firm’s doubt about your ability to continue as a going concern.
Risk Factors, page 6
6.Please add a risk factor to discuss the fact that you do not currently have an audit or
compensation committee and that only one of your directors is independent.
We depend on rights to certain pharmaceutical compounds that are or will be licensed to us, page
15
7.We note your disclosure in this risk factor that your drugs are in-licensed from other
biotech or pharmaceutical companies and that you do not own the patents that underlie
these licenses.  Please specify the product candidates that you are referring to as well as
the patents and the biotech or pharmaceutical companies from whom you have licensed
such patents.

 FirstName LastNameDavid Young
 Comapany NameProcessa Pharmaceuticals, Inc.
 August 28, 2018 Page 3
 FirstName LastNameDavid Young
Processa Pharmaceuticals, Inc.
August 28, 2018
Page 3
There may be limitations on the effectiveness of our internal controls, page 19
8.We note your disclosure that you experienced a cybersecurity breach that resulted in a
fraud loss where the probability of recovery of the loss is remote.  Please disclose when
the breach occurred and quantify the loss in this risk factor.
Our principal stockholders have significant influence over us, . . ., page 21
9.Please expand this risk factor to also discuss the combined ownership of your 5%
stockholders in addition to your executive officers, directors, and their affiliates.
Liquidity and Capital Resources, page 30
10.Please disclose how long you expect your business operations to continue given your
current amount of cash and funds.  If you expect that your business operations cannot
continue given your current amount of cash and funds, please disclose the amount of
additional financing necessary to continue operations.
Description of Business, page 37
11.We note your disclosure on page 37 regarding your team's prior experience developing
drug products.  Please revise your disclosure to provide balancing language that the prior
experience of your team is not an indication of a similar result with respect to Processa.
12.We refer to your statement that your business strategy is to identify drugs that can be
"quickly" developed within "2-4 years."  Please tell us why you believe this time frame is
realistic given the lengthy and uncertain process of seeking regulatory approval.
13.We note your statement that part of your business strategy is to identify drugs that have
potential efficacy in patients with an unmet medical need, even if the evidenice is
"anecdotal."  Please revise this disclosure to explain how you would consider anecdotal
information to serve as clinical evidence.
14.Please quantify your funding obligations under your CRO agreement with Integrium, LLC
to conduct your planned Phase 2 study for PCS-499 in the treatment of NL.  Please
also disclose whether the $1.8 million that will be paid directly to Integrium by the
investor will be sufficient to complete the planned Phase 2 clinical trial.
15.Expand your disclosure to explain how you identified Necrobiosis Lipoidica (NL) and
Radiation-Induced Fibrosis (RIF) in head and neck cancer patients as indications for
which PCS-499 may result in clinical efficacy.
16.We note your disclosure that you intend to pursue a Phase 2 clinical trial for PCS-499.
Please disclose how you will proceed to a Phase 2 trial given that it appears that you have
not conducted any Phase 1 clinical trials and disclose the regulatory pathway that you
intend to pursue.  Please expand your disclosure to discuss specific trial results for your
product candidate on which you intend to rely, including the duration of the trial, the

 FirstName LastNameDavid Young
 Comapany NameProcessa Pharmaceuticals, Inc.
 August 28, 2018 Page 4
 FirstName LastNameDavid Young
Processa Pharmaceuticals, Inc.
August 28, 2018
Page 4
number of subjects or patients in such trials, how the drug candidate was administered,
who conducted the trials, the dosage used, any serious adverse events experienced,
the primary and secondary endpoints and whether they were met.
Asset Acquisition, page 38
17.Please revise this section to discuss the material terms of your CoNCERT agreement,
including the nature and scope of the intellectual property transferred, each parties' duties
and obligations, the term of the agreement, the royalty term, the royalty rates, the
termination provisions and any potential milestone payments.  We also note the discussion
on page F-26 concerning CoNCERT's right to have one Board observer attend the
Promet's Board meetings.  If CoNCERT still has that right with respect to Processa's
Board meetings, please discuss it here.
Intellectual Property, page 38
18.Expand your disclosure to discuss the patents you have licensed relating to your product
candidate, including the jurisdiction, the type of patent protection (e.g., composition of
matter, use, or process), and the patent expiration dates.
Directors, Executive Officers, Promoters and Control Persons, page 43
19.Please revise to explain how Dr. Young helped Questcor transition from being nearly
bankrupt to having a valuation of over $5 billion in his role as an independent director or
remove this statement from his biography.
Corporate Governance, page 45
20.We note your statement here that Mr. Thompson is independent as defined by NASDAQ
Rule 5605, and your statement in your Annual Report on Form 10-K filed on April 2,
2018, as amended, that there were no independent directors on your board under this rule,
which would include Mr. Thompson.  Please explain what factors led to this change.
Security Ownership of Certain Beneficial Owners and Management, page 49
21.Please revise your disclosure to identify the natural person or persons who have voting
and investment control of the shares held by Promet Therapeutics, LLC, CorLyst, LLC
and CoNCERT Pharnaceuticals, Inc.  Please also confirm whether Dr. Young has voting
and investment control of the shares held by the Young-Plaisance Revoc Trust.
Transactions with Related Persons, Promoters and Certain Control Persons, page 50
22.We note your statement that Dr. Young is also the CEO and managing member of
CorLyst, LLC.  Please revise to clarify the percentage of time Dr. Young spends on your
business, and if the time spent on other businesses is not immaterial, please expand your
risk factor discussion to disclose this obligation.

 FirstName LastNameDavid Young
 Comapany NameProcessa Pharmaceuticals, Inc.
 August 28, 2018 Page 5
 FirstName LastNameDavid Young
Processa Pharmaceuticals, Inc.
August 28, 2018
Page 5
The Selling Stockholders, page 55
23.Revise your table to also include information relating to the percentage to be owned by
security holders after completion of the offering to the extent such percentage is 1% or
more.  In addition, please disclose the relationship you have with PoC Capital, LLC,
which appears to be the investor who is committed to fund up to $1.8 million of your
clinical trial expenses.  Refer to Item 507 of Regulation S-K.
Plan of Distribution, page 57
24.We refer to your statement that any pledgee of each selling stockholder may sell the
shares covered by the registration statement, and we note that under your agreement with
PoC Capital, PoC has pledged to you as collateral 50% of its securities received from its
investment.  If true, please revise to clarify the exclusion of these pledged securities from
your statement.  In addition, please tell us when the securities will be released from the
pledge, and file your agreement with this investor as an exhibit to your registration
statement, including all exhibits thereto.
Financial Statements
Notes to Consolidated Financial Statements
Note 2 - Intangible Asset, page F-38
25.You disclose that the $11 million intangible asset recorded as of March 31, 2018 includes
$3 million of costs capitalized to record an offset to a deferred tax liability related to the
exercise of your option to acquire an exclusive license from CoNCERT related to patent
rights and know-how to develop and commercialize compounds and products for CTP-
499.  You also disclose on page F-41 that this deferred tax liability was created when
CoNCERT sold its license and know-how to you for stock in a transaction under Section
351 of the Internal Revenue Code (Section 351 transaction) which treats the acquisition of
the license and know-how as a tax-free exchange.  Please provide us with a detailed
analysis explaining how you determined that this transaction met the requirements to be
considered a tax-free exchange under Section 351.  In this regard, it would appear that
under Section 351 an exchange would be considered tax free if (a) the property was
exchanged solely for stock of the company and (b) immediately after the exchange the
transferor controlled the company via 80% or more ownership of voting stock.  Based on
your beneficial ownership table on page 49, it appears that CoNCERT owns only 5.4% of
your outstanding shares.
            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.

 FirstName LastNameDavid Young
 Comapany NameProcessa Pharmaceuticals, Inc.
 August 28, 2018 Page 6
 FirstName LastName
David Young
Processa Pharmaceuticals, Inc.
August 28, 2018
Page 6
            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 Andi Carpenter at 202-551-3645 or Angela Connell at 202-551-3426 if
you have questions regarding comments on the financial statements and related matters.  Please
contact Dorrie Yale at 202-551-8776 or Ada Sarmento at 202-551-3798 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Healthcare & Insurance
cc:       Neda Sharifi