SecProbe.io

United States securities and exchange commission logo
June 9, 2023
Sammy Farah, M.B.A., Ph.D.
President and Chief Executive Officer
Turnstone Biologics Corp.
9310 Athena Circle, Suite 300
La Jolla, California 92037
Re:Turnstone Biologics Corp.
Draft Registration Statement on Form S-1
Submitted May 15, 2023
CIK No. 0001764974
Dear Sammy Farah:
            We have reviewed your draft 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 providing the requested information and either submitting
an amended draft registration statement or publicly filing your registration statement on
EDGAR.  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 the information you provide in response to these comments and your
amended draft registration statement or filed registration statement, we may have additional
comments.
Draft Registration Statement on Form S-1, submitted May 15, 2023
Cover Page
1.We note that you have applied to list your common stock on the Nasdaq Global Market.
Please revise the cover page of the prospectus as follows, and make conforming revisions
where appropriate:
•State, if true, that no assurance can be given that your listing application will be
approved.
•Disclose whether your offering is contingent upon final approval of your NASDAQ
listing, and ensure this disclosure is consistent with your underwriting agreement.  If
your offering is not contingent on listing approval, include a risk factor describing the
consequences of not being listed.

 FirstName LastNameSammy Farah, M.B.A., Ph.D.
 Comapany NameTurnstone Biologics Corp.
 June 9, 2023 Page 2
 FirstName LastName
Sammy Farah, M.B.A., Ph.D.
Turnstone Biologics Corp.
June 9, 2023
Page 2
Prospectus Summary , page 1
2.We note that your auditors have issued a going concern opinion regarding
your operations.  Please revise your disclosure throughout the prospectus as follows:
•Expand and balance your Summary disclosure by including discussion regarding
your recurring net operating losses with the exception of the year ended December
31, 2021, the expectation of continuing operating losses and negative cash flows
for the foreseeable future, the termination in 2021 and 2022 of the AbbVie and
Takeda Agreements that appear to have previously been your sole sources of
collaboration revenue, the need to raise additional capital to finance your
future operations, and the auditor's going concern opinion.
•Revise your summary risk factor on page 7 to disclose that if you cannot continue as
a viable entity, your stockholders may lose some or all of their investment in
your company.
3.Please revise your prospectus summary to define or explain briefly the following scientific
terms:
• potency and potent T cells
• TIL quality, function, and persistence
• clinically meaningful
• tumor heterogeneity
• PD-(L)1 treatments

Also, we note that you use terms such as "deep and durable response," "progression-free
survival," "objective response rate" and "complete response rate" throughout the
prospectus when describing third party clinical trial results.  Explain the meaning of these
terms in relation to observed clinical trial endpoints and clarify, if true, that they do not
indicate that the patient was cured of the condition.
Our Solution: Selected TILs, page 2
4.You state on page 2 and elsewhere throughout the prospectus that the company is
developing next generation TIL therapies designed to drive "curative outcomes" across
multiple solid tumors.  If true, please revise to clarify that no TIL therapies have received
FDA approval to date and that at present, no therapies in clinical development for the
solid tumor indications that you are addressing are curative.
5.You state on page 2, 113 and 120 that your selective expansion process "results in a
substantially higher absolute number and proportion of tumor-reactive T cells in the final
product in comparison to the relatively infrequent tumor-reactive T cells that are routinely
found in bulk TIL."  Please revise to provide the basis for this statement, and quantify the
number and proportion of tumor-reactive T cells in Selected TILs versus bulk TIL to the
extent appropriate so that investors can compare against your target rate of >70%
disclosed in the figure on page 3.

 FirstName LastNameSammy Farah, M.B.A., Ph.D.
 Comapany NameTurnstone Biologics Corp.
 June 9, 2023 Page 3
 FirstName LastName
Sammy Farah, M.B.A., Ph.D.
Turnstone Biologics Corp.
June 9, 2023
Page 3
6.In the figure depicting advantages of Selected TILs over bulk TILs appearing on pages 3,
113, and 121, please remove or revise the reference to tumor-reactive T cells contributing
to "efficacy."  In the appropriate place(s), please provide a reference for your disclosure
that the reported median of on-target tumor-reactive T cells in bulk TIL is <3%.
Additionally, on pages 2 and 113, please revise your related narrative discussion to
provide context for the statement that Selected TILs hold potential for "potent" targeted
tumor killing as you have on page 121.
Supporting Clinical Evidence , page 3
7.You state on pages 3 and 122 that clinical studies in academic centers utilizing selection
strategies to select for tumor-reactive T cells have "demonstrated positive outcomes in
challenging solid tumors, where bulk TILs have had limited to no success."  Please revise
your discussion of the results of these and any other clinical trials or preclinical studies,
whether conducted by you or third parties, to remove any conclusory statements regarding
the trial results or their meaning and instead focus on the specific factual details of the
studies, including quantitative information regarding the range of results observed
and describe the results using objective data and/or terminology based on the trial
endpoint(s).
Our Pipeline, page 4
8.We note that an investigator-sponsored clinical trial is ongoing with H. Lee Moffitt
Cancer Center and Research Institute, Inc., investigating TIDAL-01 as a potential therapy
in both cutaneous and non-cutaneous melanoma.  Please expand your disclosure in the
appropriate place(s) to clarify briefly the nature of the investigator-sponsored study, how
one differs from a trial sponsored by your company, and your role/responsibility, if any, in
the trial.  Please also tell us your consideration of providing risk factor disclosure
concerning the clinical trial risks associated with investigator-sponsored clinical trials.
Our History and Team, page 5
9.Please limit your Summary disclosure of specific investors to those identified in the
Principal Shareholder table on page 194.  Additionally, indicate that prospective investors
should not rely on the named investors’ investment decision, that these investors may
have different investment strategies and risk tolerances.  If true, disclose that the preferred
stock offering(s) in which such investors purchased shares were conducted at a significant
discount to the IPO price.
Our Strategy , page 5
10.We note your use of the term “high unmet medical need” here and elsewhere throughout
the prospectus, as well as your statement that you are pursuing a clinical development
strategy designed to "support an efficient path to registration."  Such statements might
imply that your products are eligible for fast track designation or priority review granted

 FirstName LastNameSammy Farah, M.B.A., Ph.D.
 Comapany NameTurnstone Biologics Corp.
 June 9, 2023 Page 4
 FirstName LastNameSammy Farah, M.B.A., Ph.D.
Turnstone Biologics Corp.
June 9, 2023
Page 4
by the FDA for products that treat certain serious unmet medical needs.  If material, please
expand this section to provide context for these references and briefly explain your
development strategy for your TIL product candidates in the U.S. and abroad.  In this
regard, we note that you state on page 55 that you intend to seek approval for your
candidates in both the U.S. and in "selected foreign jurisdictions," which should be
identified to the extent known or reasonably anticipated.

Additionally, please revise pages 6 and 117 to explain how the design of your analytical
characterization program will "minimize regulatory hurdles" or remove this reference.
11.We note that you have initiated two Phase 1 clinical trials for your lead product candidate,
TIDAL-01, for the treatment of various cancers.  On page 5, you state your belief that
positive results from one or both of these clinical trials has the potential to support
advancement of TIDAL-01 into registrational trials across multiple solid tumor types.
Please define the term "registrational trials" and explain the basis for your belief.  Your
discussion should clarify the factors that will determine whether your TIDAL-01
trials become registrational and who will make such determination.
The Offering
Use of Proceeds, page 10
12.Please revise your Use Of Proceeds disclosure here and on page 86 to provide your best
reasonable estimate regarding how far into development and/or the regulatory review
process you expect each such program to reach using the allocated offering proceeds.  If
any material amounts of other funds are necessary to accomplish any specified purposes
for proceeds from this offering, state the amounts and sources of other funds needed for
each specified purpose.  Refer to Instruction 3 to Item 504 of Regulation S-K.
Risk Factors
We may attempt to secure approval from the FDA or comparable foreign authorities..., page 38
13.We note your disclosure that you may seek accelerated approval for one or more of your
product candidates.
•Please revise your disclosure to clarify that because your candidates are in early
development, there can be no assurance that the FDA would approve any form of
application for expedited review for any of your product candidates.
•Affirmatively state that the FDA’s accelerated approval pathways do not guarantee an
accelerated review by the FDA.  Further, explain that even if a product candidate
could be granted a designation or qualify for expedited development, it does not
increase the likelihood that the product candidate will receive approval.
Our principal stockholders and management own a significant percentage of our stock..., page 77
14.We note your disclosure regarding the significant concentration of ownership of the
company.  Please tell us whether you will be considered a "controlled company" within

 FirstName LastNameSammy Farah, M.B.A., Ph.D.
 Comapany NameTurnstone Biologics Corp.
 June 9, 2023 Page 5
 FirstName LastNameSammy Farah, M.B.A., Ph.D.
Turnstone Biologics Corp.
June 9, 2023
Page 5
the meaning of NASDAQ listing standards post-offering.  If so, provide appropriate
disclosure of your controlled company status on the prospectus cover page and revise this
section and the Prospectus Summary, where appropriate, to indicate that you will be a
“controlled company" and the implications of such status, including whether you plan to
utilize any of the exemptions available to you.  Also revise the Prospectus Summary to
address the risks of being a shareholder in a controlled company, and include information
regarding the controlling shareholder(s) and their ability to impact your company and its
stated business strategies.
Our amended and restated certificate of incorporation will provide that the Court of Chancery of
the State of Delaware..., page 80
15.Please revise the last paragraph of this risk factor to disclose that the exclusive forum
provisions that will be contained in your amended and restated certificate of incorporation
may result in increased costs to shareholders to bring a claim.  Additionally, make
conforming revisions to the Choice of Forum section beginning on page 201.
Components of Our Results of Operations
Revenue
Collaboration Revenue, page 98
16.Please revise to clarify that you do not anticipate recording any additional revenue under
the AbbVie Biotechnology Ltd. agreement in the future due to the contract termination
and provide similar disclosure relating to the termination of the Takeda agreement for
which the second termination notice is effective on July 6, 2023.  Clarify on page 101 the
amount of the revenue recorded in 2022 and 2021 that related to the terminated
agreements.
Management's Discussion and Analysis of Financial Condition and Results of Operations
Components of Our Results of Operations
Collaboration Revenue, page 98
17.Please revise your disclosure in this section to briefly explain why the AbbVie Agreement
terminated in 2021 and the Takeda Agreement will be terminated in its entirety as of July
2023.  Additionally, please file the Takeda Agreement as an exhibit to your registration
statement or tell us why you believe you are not required to do so.  Refer to Item
601(b)(10) of Regulation S-K.
Results of Operations
Research and Development Expenses, page 101
18.Please disclose the costs incurred during each period presented for each of your key
research and development projects/indications.  In particular, clarify how much of the
historical research and development expense related to the RIVAL-01 program under the
Takeda agreement which was terminated.  If you do not track your research and

 FirstName LastNameSammy Farah, M.B.A., Ph.D.
 Comapany NameTurnstone Biologics Corp.
 June 9, 2023 Page 6
 FirstName LastName
Sammy Farah, M.B.A., Ph.D.
Turnstone Biologics Corp.
June 9, 2023
Page 6
development costs by project, please disclose this fact and explain why you are not able to
provide this level of disclosure.
Management's Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Policies and Estimates
Determination of the Fair Value of Common Stock, page 109
19.Once you have an estimated offering price or range, please explain to us how you
determined the fair value of the awards underlying your incentive units and the reasons for
any differences between the recent valuations of your units leading up to the IPO and the
estimated offering price. This information will help facilitate our review of your
accounting for equity issuances including stock compensation.  Please discuss with the
staff how to submit your response.
Business
Our Strategy, page 116
20.We note your disclosure that you are "leveraging deep and strategic relationships with a
number of academic collaborators, including Moffitt" to support development of your
Selected TIL therapies.
•Please revise to quantify the number of academic collaborators with whom you have
material relationships.
•We note your disclosure on page 134 regarding your "ongoing collaboration with Dr.
Simon Turcotte at the Centre Hospitalier de l'Universite de Montreal" and disclosure
on page 137 stating that you are collaborating with "the NCI," an acronym which
should be defined at first use on page 119.  Please advise if there is a collaboration
agreement in place with either institution or any others.  If so, please describe the
material terms of the collaboration agreements and file them as exhibits with your
next amendment or tell us why you believe you are not required to do so.  Refer to
Item 601(b)(10) of Regulation S-K.
Overview of Current Cancer Immunotherapies and Limitations, page 118
21.Please revise the figure on page 119 to remove the statements that TIL therapy is the only
cell therapy that "has shown clinical efficacy in multiple solid tumors" and has a
"manageable safety profile."
Virus Combinations, page 124
22.You state that the potential of viral immunotherapy has been "demonstrated through
subsequent clinical data achieved by the next generation of viral immunotherapies in
development."  Please revise to place this statement within the proper context by
objectively summarizing any material re