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CORRESP
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filename1.htm

APTORUM
GROUP LIMITED

17th
Floor, Guangdong Investment Tower

148
Connaught Road Central

Hong
Kong

August
16, 2019

VIA
EDGAR

U.S.
Securities and Exchange Commission

Division
of Corporation Finance

Office
of Healthcare & Insurance

100
F Street, N.E.

Mail
Stop 4631

Washington,
DC 20549

Re:
Aptorum Group Ltd

Registration
Statement on Form F-1

Filed
July 2, 2019

File
No. 333-232510

Dear
Sir and Madam:

Aptorum
Group Limited (the “Company,” “Aptorum,” “we,” “us” or “our”)
hereby transmits its response to the letter received from the staff (the “Staff”) of the Securities and Exchange Commission
(the “Commission”), dated July 30, 2019 regarding our Registration Statement on Form F-1 (the “Registration
Statement”) previously submitted on July 2, 2019 (the “Registration Statement”). For ease of reference, we have
repeated the Commission’s comments in this response and numbered them accordingly. An amended F-1 submitted publicly accompanying
this Response Letter is referred to as Form F-1.

Registration
Statement on Form F-1 filed July 2, 2019

Establishment
of Smart-ACT Platform, page 8

1.
Clarify what it means to “successfully screen” compounds against a target by clarifying what results would be deemed
successful.

Response:

In
response to the Staff’s comment, we made the clarifications on Page  8 of the Pre-Effective Amendment No. 1 to Form
F-1 as follows:

To
date, Smart Pharma has, under the recently established Smart-ACTTM platform, successfully screened 1,615 compounds
against 3 therapeutic target proteins which are related to poor prognosis of neuroblastoma (“NB”). NB is a type of
cancer that forms in certain types of nerve tissue and most frequently in the adrenal glands as well as spine, chest, abdomen
or neck. The preliminary results from the Smart-ACTTM platform have now identified a number of potential repurposed
drug candidates that could show promise against such disease. Smart Pharma will next move on to conduct further in vitro and in
vivo validation of these candidates through collaboration with Aptorum Group Limited to assess and validate the candidates’
usage for such new indication. To date, the Smart-ACTTM platform has completed computational screening based
on structural affinity and scoring analysis of around 1,600 approved drugs against 3 therapeutic target proteins related to poor
prognosis of neuroblastoma (i.e., a type of cancer that forms in certain types of nerve tissue and most frequently in the adrenal
glands as well as spine, chest, abdomen or neck). Among the ~1,600 drugs that have been screened, around 40 were identified for
further evaluation by wet lab validation.

We
are currently evaluating the shortlisted compounds via wet lab validation to confirm their efficacy in cell-based and animal models
in treating neuroblastoma. This validation will be conducted in vitro and in vivo validation in collaboration with
Aptorum Group Limited to assess and validate the compound’s usage for such new indication.

Smart
Pharma Token, page 8

2.
We note your disclosure that SMPT tokens will be issued in transactions exempt from the registration requirements of the Securities
Act pursuant to Regulation S. The basis for your reliance on Regulation S is unclear in light of the prominence of the disclosure
in your registration statement and the materials provided on the SMTPH website. Please provide a detailed legal and factual analysis
supporting your determination that these are not directed selling efforts in the U.S. Additionally, tell us what restrictions
are in place to ensure that US persons are not able to access the trading platform(s) on which SMPT tokens are listed or acquire
SMPT tokens.

Response:

The
SMPT tokens are being issued by Smart Pharmaceutical Limited Partnership (“SPLP”), a limited partnership registered
in Seychelles and are not being offered or sold to U.S. persons. SPLP is managed by SMTPH as its sole general partner and SMPTH,
which is an off-shore, foreign entity, is one of Aptorum Therapeutics Limited’s subsidiaries. As further detailed below,
many restrictions and procedures have been put in place to prevent a U.S. person from purchasing a SMPT token and to ensure they
will not be transferred to a U.S. person. We thought although the offering of the tokens is being conducted through this other
entity, which is managed by one of our subsidiaries, that the potential benefits (i.e. investing and helping to fund a subsidiary’s
operations and business, which indirectly impacts our business) were sufficiently material to warrant disclosure of same to our
investors. However, the SMPT tokens are not being registered in the F-1 and are not being offered to U.S. persons.

Rule
902(c) defines “Directed selling efforts” to mean any activity undertaken for the purpose of, or that could reasonably
be expected to have the effect of, conditioning the market in the United States for any of the securities being offered
in reliance on Regulation S. Such activity includes placing an advertisement in a publication “with a general circulation
in the United States” that refers to the offering of securities being made in reliance upon this Regulation S. As neither
we nor SPLP are selling the SMPT tokens in the U.S. or to U.S. persons, there is no related market to condition. We included language
in the original F-1 filing to emphasize that the F-1 was not an offer to sell or solicit the sales of SMPT token, but we added
the following language in the Smart Pharma Token section of the Pre-Effective Amendment No. 1 to Form F-1 to further clarify
same:

“On
April 24, 2019, the Company disclosed Smart Pharma’s, its indirectly wholly owned subsidiary group, announcement of the
Smart Pharma Token (“SMPT token”). The SMPT tokens are issued by Smart Pharmaceutical Limited Partnership (“SPLP”),
a limited partnership registered in Seychelles, and managed by SMTPH as its sole general partner. The SMPT token is not for
sale in the U.S. and is not offered, available for sale and/or otherwise transferrable to any U.S. persons, as such term is defined
in Rule 902(k) of Regulation S.”

    2

“Accordingly,
except in accordance with the provisions of Regulation S, the SMPT token is not and cannot be offered, sold or transferred to
a U.S. Persons (as defined in Rule 902(k) under the Securities Act). Currently, Smart Pharma has no immediate plan to register
the SMPT tokens under the Securities Act or to offer the SMPT tokens in the U.S.”

In
order to prohibit any U.S. persons from purchasing and/or trading the SMPT tokens, we have implemented a multiple-level compliance
approach:

(a)
Express restrictions specified in transaction documents and agreement governing the SMPT tokens:

In
both the Whitepaper of the SMPT tokens (see https://smtph.io/token/doc/WHITEPAPER.pdf) (hereinafter referred to as “Whitepaper”)
and the Terms and Conditions of Sale of the SMPT tokens between the seller and the buyer (see https://smtph.io/token/doc/terms-and-conditions.pdf)
(hereinafter referred to as “T&Cs”), it is specified that the United States is one of the restricted jurisdictions
for the SMPT tokens, and that citizens, nationals, residents (tax or otherwise), green card holders and/or company domiciled in
the U.S. are not permitted to participate in the token sale (see, e.g. Section 7.6 of the Whitepaper and Clause
3.5 of the T&Cs.)

It
is further specified that the SMPT tokens cannot be offered or resold in the U.S. and may not be transferred except in accordance
with the provisions of Regulation S (see, e.g. Clauses 4.3 and 6.3 of T&Cs and Sections 7.2 and 7.9 of the Whitepaper). Under
the T&Cs, the buyer has to provide representation that s/he/it is not a U.S. person as defined in Rule 902(k) of the Securities
Act of 1933 as amended (see, Clause 10.29 of the T&Cs).

(b)
Although we have no intention of registering the SMPT tokens under the US securities laws, all SMPT tokens issued bear the following
restrictive legend forbidding the SMPT tokens to be offered and sold in the U.S. This legend is coded into each SMPT token:

THE
SMPT TOKENS HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (“SECURITIES ACT”). THE TOKENS
WERE ISSUED IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT PURSUANT TO REGULATION S PROMULGATED
UNDER IT. THE SMPT TOKENS MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES UNLESS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION
FROM REGISTRATION IS AVAILABLE. TRANSFERS OF THE SMPT TOKENS MAY NOT BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION
S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION. FURTHER, HEDGING
TRANSACTIONS WITH REGARD TO THE SMPT TOKENS MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

(c)
In addition to legal barriers, Smart Pharma has also implemented compliance measures on the operations level. Specifically, all
buyers of the SMPT tokens must first complete a Whitelisting Process managed by Smart Pharma (see Sections 7.2 and 7.7 of the
Whitepaper and Clause 8 of the T&Cs). The Whitelisting Process can be found at the following link (https://www.smtph.io/whitelisting/).

In
order to sign up to the Whitelist, a prospective buyer must provide Smart Pharma with, inter alia, his/her full legal name, citizenship,
country of residence, copy of passport or alternative accepted government-issued identification and his/her wallet addresses.
Registration for applicants from the U.S. to the Whitelist will be rejected.

    3

With
respect to resale, we also seek to prevent any SMPT tokens from being subsequently transferred or resold to U.S. persons by requiring
all recipients/buyers to complete the above Whitelist. In the event that a token holder attempts to transfer a SMPT token to
a non-Whitelisted wallet addresses, the transaction will not be able to be completed. The transferred tokens remain in a state
that it will not be used until and unless the receiving wallet address is Whitelisted and vetted. This restriction has been coded
into the SMPT Tokens.

(d)
With respect to activities involving third-party trading platforms, we have implemented multiple measures on the legal and operations
level to prevent participation of U.S. person.

First,
we have entered into and signed listing agreements with each trading platform where the SMPT token is listed to restrict the trading
platform from facilitating any trading of the SMPT tokens that involve U.S. persons. The trading platform has represented to us
that the trading of SMPT tokens are disabled to any U.S. persons registered on their platform.

In
addition, prior to executing a trade on SMPT tokens, the T&Cs will be presented to each buyer of the SMPT tokens by the trading
platform in the form of a “clickwrap” agreement, and require such buyer to legally agree and be bounded by the T&Cs.

Further,
whenever a user on the trading platform attempts to withdraw SMPT tokens, the trading platform will provide a warning message
reminding the user to sign up for the Whitelist, and that only wallet addresses that are Whitelisted can complete the transfer
and use the tokens (please refer to (c) above for details).

To
this extent, we can confirm that to this date, there is currently no U.S.-based holder of SMPT tokens and given all of the aforementioned
procedures and protections, we do not believe that the SMPT tokens will land in the hands of any US persons, in a way that contravenes
with the applicable U.S. securities laws.

3.
Your disclosure on page 8 indicates that the Pharma Token tokenizes rights to a “portion” of the royalty income derived
from the commercialization of intellectual property rights of drug candidates discovered under your Smart-ACT platform. Please
revise to quantify the portion of the royalties token holders will be entitled to. We note that materials appearing on the Smart
Pharma website are inconsistent with some materials indicating that token holders are entitled to net profits from Smart Pharmaceutical
Limited Partnership, and others indicating that token holders are entitled to royalties upon commercialization, a percentage of
sublicensing revenue and consideration for assignment of intellectual property rights to third parties. Please revise your disclosure
to clarify how the amounts payable to token holders will be determined and when you are required to make these payments.

Response:

While
some parts of the Whitepaper (as defined above) specified that the token holders are entitled to the “net profits of SPLP”
or “net income of SPLP” (see, e.g. P. 13, 17 and 19 of the Whitepaper) and other parts of the Whitepaper make reference
to “royalty monetarization” (P. 2, 3, 13 and 17 of the Whitepaper). The two concepts are not incompatible nor inconsistent.

Specifically,
“net profits” or “net income” of SPLP are explicitly defined to be derived from “the intellectual
property rights and royalty monetarization of the Project IP” (see P. 19 of the Whitepaper). Given that SPLP is specified
to be only an “IP holding company” of the group, its only source of income is from the royalties upon commercialization
(see P. 13 of the Whitepaper). Further, while we have separately disclosed that the token holder is entitled to net income of
SPLP and that the net income of SPLP will solely come from royalties received by it, the above two points were often made together
(e.g. in the same page or sections). Accordingly, we respectfully believe that we have made the basis for the calculations clear
and do not believe any further revisions are necessary to ensure that readers and potential investors understand that the two
references are ultimately to the same basis. However, we shall review all disclosure related to the tokens once we clear your
comments and ensure information is consistent across all such materials.

    4

In
response to your comment, we revised the Smart Pharma Token section to read as follows:

“Smart
Pharma Token

On
April 24, 2019, the Company disclosed Smart Pharma’s, its indirectly wholly owned subsidiary group, announcement of the
Smart Pharma Token (“SMPT token”). The SMPT tokens are issued by Smart Pharmaceutical Limited Partnership (“SPLP”),
a limited partnership registered in Seychelles, and managed by SMTPH as its sole general partner. The SMPT token is not for sale
in the U.S. and is not offered, available for sale and/or otherwise transferrable to any U.S. persons, as such term is defined
in Rule 902(k) of Regulation S.

The
SMPT token is an ERC-1404 security compliant token with ERC-20 and ERC233 compliance on the Ethereum blockchain, which tokenizes
rights to a portion of the royalty income, sublicensing income, as well as other upfront, milestone payments and assignment income
(if applicable) (collectively referred to as “commercialization income”), derived from the eventual commercialization
of intellectual property rights of drug candidates discovered under our Smart-ACTTM platform. SMPT token is backed
by SPLP’s assets, including intellectual property rights of drug candidates created through the Smart-ACTTM program
and any royalty monetization income.

Specifically,
Smart Pharma has the right to commercialize the drug candidates discovered under the Smart-ACTTM platform (e.g. through
direct commercialization by affiliates, sublicensing to third parties, collaboration with third parties, and assignment to others).
Smart Pharma will set aside a royalty based on 3% (minimum) to 5% (maximum) of net sales (on a product-by-product basis and as
determined by Smart Pharma) to SPLP for distribution to the SMPT token holders. For drug candidates commercialized by sublicensee
or other authorized third parties, Smart Pharma will set aside 10% of the revenue received from sublicensee or other authorized
third parties to SPLP for distribution to the SMPT token holders. The above percentages are subject to adj