SecProbe.io

CORRESP
1
filename1.htm

  June
  2, 2023

Division
of Corporation Finance

Office
of Manufacturing

Securities
and Exchange Commission

100
F Street, NE

Washington,
D.C. 20549

Attn:
Eric Atallah and Mary Mast

    Re:
    Impact
BioMedical Inc.

    Amendment
    No. 9 to Registration Statement on Form S-1 Filed May 15, 2023

    File
    No. 333-253037

Dear
Mr. Atallah and Ms. Mast:

On
behalf of Impact BioMedical Inc. (the “Company”), this letter responds to comments provided by the staff of the Division
of Corporation Finance (the “Staff”), of the Securities and Exchange Commission (the “Commission”) provided to
the undersigned on May 25, 2023 regarding the Company’s Registration Statement on Form S-1.

For
convenience, the Staff’s comments have been restated below and the Company’s responses are set out immediately under the
restated comments. Unless otherwise indicated, defined terms used herein have the meanings set forth in the S-1.

Amendment
No. 9 to Registration Statement on Form S-1

Questions
and Answers about the Distribution

What
is being distributed to holders of DSS Common Stock in the Distribution?, page ii

1. Please
                                            tell us how you calculated the percentage given in response to this question or revise your
                                            disclosure as appropriate.

Response:
The disclosure has been revised in accordance with the Staff’s comment.

Item
11. Change in Auditors, page 48

2. Please
                                            revise your filing to include a letter filed as an exhibit to this registration statement
                                            from your former auditor stating whether it agrees with the statements made by you under
                                            Item 304(a) of Regulation S-K and, if not, stating the respects in which it does not agree.
                                            Refer to the guidance in Item 304(a)(3) of Regulation S-K.

Response:
The filing has been revised to include a letter filed as an exhibit to the registration statement from the Company’s
former auditor in accordance with the Staff’s comment.

Consolidated
Balance Sheet, page F-4

3. You
                                            state on page 45 under “General” that on May 11, 2023, you effected a forward
                                            split. As a result, there were 3,877,282,251 shares of Common Stock outstanding. Please retroactively
                                            revise the financial statements and throughout the filing, as applicable. See ASC 505-10-S99-4.

Response:
The filing and the financial statements have been revised to reflect the number of shares as a result of the forward split
effective May 11, 2023 in accordance with the Staff’s comment.

Notes
to the Consolidated Financial Statements

Note
5. Investments, page F-11

4. You
                                            state on page F-12 that as of December 31, 2022, you determined to impair 100% of your investment
                                            in Vivacitas, in the amount of $4,100,000. Please clarify to us and in the filing the reasons
                                            for the impairment and the timing thereof.

Response:
The footnotes to the financial statements have been revised to clarify the rationale for the impairment of the asset in accordance
with the Staff’s comment.

5. Please
                                            clarify in the third paragraph of Note 5 the dates the fair value of the Company’s
                                            investment in Nano9 is not readily available. It appears the reference to “Mach 31,
                                            2022” should be December 31, 2022.

Response:
The related footnote has been corrected and reflects the date December 31, 2022 in accordance with the Staff’s comment.

Note
7. Goodwill, page F-12

6. Goodwill
                                            and intangible assets are significant to your balance sheet. Based on pages 4 and 20-22 you
                                            have not conducted, and do not have plans to conduct, any preclinical testing for the products,
                                            technology, or compounds listed. You also do not appear to have identified third parties
                                            or customers interested in purchasing, licensing or co-developing your products. Please address
                                            the following:

 ● Provide
                                            us an update since your August 2, 2022 response as to why no impairment is required to be
                                            recorded with respect to goodwill. Tell us why a quantitative analysis is not required to
                                            be used in light of recurring operating losses and lack of development or apparent significant
                                            agreements to develop your products. Address the factors in ASC 350-20-35-3C in your analysis.
                                            For any agreements entered into, please clarify the status of any development with respect
                                            to your products and the significance of the agreement to your results of operations. For
                                            example, you state that you entered into a license agreement with ProPhase Labs in June 2022
                                            to produce and distribute compound Equivir and in July 2022 you executed a license agreement
                                            with ProPhase BioPharma, a subsidiary of ProPhase Labs, for the Linebacker portfolio but
                                            it is unclear if any development has occurred and, if not, why no impairment is required
                                            to be recorded.

 ● Please
                                            tell us the nature of and status of your developed technology disclosed in Note 8 on page
                                            F-12. Provide a detailed analysis as to why you believe an impairment is not required to
                                            be recorded.

Response: A
quantitative test was completed with an effective date of June 1, 2022. This test was finalized subsequent to the August 2, 2022
comment. The footnote question has been updated to reflect the results of the quantitative test, which indicated no impairment was
needed. Regarding the Staff’s second bullet point, the developed technologies discussed in the footnote pertain to the
Company’s latos and 3F formulations. As of December 31st 2022, the Company has determined no impairment is necessary due to
three factors: first, the Company continues to perform third party, independent testing of these assets to fully understand their
capabilities and market reach. Second, the Company is in the process of obtaining patent rights for these items and other countries,
and third, although no contracts have been signed, the Company has had significant conversations with major corporations regarding
the licensing of these technologies.

Note
9. Debt, page F-13

7. You
                                            state that the Revolving Promissory Note with DSS, a related party, which had a balance of
                                            $9.5 million and $12.5 million at December 31, 2022 and 2021, respectively, accrues interest
                                            at a rate of 4.25%. Please tell us why there is no interest expense recorded in 2022. In
                                            this respect, we note in the last amendment you had recorded $133,000 interest expense for
                                            the nine months ended September 30, 2022.

Response:
Interest expense has been recorded for the year ended December 31, 2022 and the financial statements have been updated to reflect
this in accordance with the Staff’s comment.

Exhibits

8. Please
                                            revise your opinion to opine on the updated amount of shares you are registering in connection
                                            with the Distribution.

Response:
The opinion has been revised to address the Staff’s comment.

Should
you have any questions regarding the foregoing, please do not hesitate to contact the Company’s counsel, Darrin Ocasio, of Sichenzia
Ross Ference LLP at (212) 930-9700.

Sincerely,

Frank
D. Heuszel

Chief
Executive Officer

  cc:
  Darrin M. Ocasio, Esq.