SecProbe.io

CORRESP
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filename1.htm

BY EDGAR

David Peinsipp

T: (415) 693-2177

dpeinsipp@cooley.com

*FOIA Confidential Treatment Request*

Confidential Treatment Requested by ALUMIS INC.

In connection with its Registration Statement
on Form S-1 (File No. 333-280068)

June 14, 2024

U.S. Securities and Exchange Commission

Division of Corporation Finance

Office of Life Sciences

100 F Street, N.E.

Washington, D.C. 20549

    Attention:
    Jessica Dickerson

    Franklin Wyman

    Kevin Vaughn

    Tim Buchmiller

    Re:
    ALUMIS INC.

    Draft Registration Statement on Form S-1

    Submitted on April 11, 2024

    CIK No. 0001847367

Ladies and Gentlemen:

On behalf of ALUMIS INC.
(the “Company”), we submit this supplemental letter in response to comments from the staff (the “Staff”) of the
U.S. Securities and Exchange Commission (the “Commission”) received by letter dated May 8, 2024 (the “Initial
Comment Letter”) regarding the above-referenced draft Registration Statement on Form S-1, as confidentially submitted to the
Commission on April 11, 2024, resubmitted to the Commission on May 15, 2023, and filed with the Commission on June 7,
2024 (the “Registration Statement”). This supplemental letter addresses comment 11 of the Initial Comment Letter.

Because of the commercially
sensitive nature of certain information contained herein, this supplemental letter is accompanied by the Company's request for confidential
treatment for selected portions of this supplemental letter. The Company has filed separate correspondence with the Office of Freedom
of Information and Privacy Act Operations in connection with its confidential treatment request, pursuant to Rule 83 of the Commission's
Rules on Information and Requests, 17 C.F.R. §200.83. For the Staff's reference, we have enclosed a copy of the Company's correspondence
to the Office of Freedom of Information and Privacy Act Operations, as well as an unredacted copy of this supplemental letter, marked
to show the portions redacted from the version filed via EDGAR and for which the Company is requesting confidential treatment.

The Company respectfully requests that the
bracketed information contained in this letter be treated as confidential information pursuant to Rule 83 promulgated by the Commission,
17 C.F.R. §200.83, and that the Commission provide timely notice to David Peinsipp at (415) 693-2177 before it permits any disclosure
of the bracketed information in this letter.

For the convenience of the
Staff, we have recited the prior comment from the Initial Comment Letter in italicized type and have followed the comment with the Company's
response.

11. Once
                                            you have an estimated offering price or range, please explain to us the reasons for any differences
                                            between the recent valuations of your common stock leading up to the planned offering and
                                            the midpoint of your estimated offering price range. This information will help facilitate
                                            our review of your accounting for stock compensation.

FOIA Confidential Treatment Requested by ALUMIS
INC.

Cooley LLP 3 Embarcadero Center 20th Floor San Francisco, CA 94111-4004

t: +1 415 693 2000 f: +1 415 693 2222 cooley.com

    U.S. Securities and Exchange Commission

    June 14, 2024

    Page Two

The Company's discussion
of its accounting for stock-based compensation is primarily contained within the sections of the Registration Statement entitled “Management's
Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Judgments
and Estimates—Stock-Based Compensation Expense and “—Determination of Fair Value of Common Stock” appearing on
pages 99-100 of the Registration Statement.

The
Company submits the below additional information to assist the Staff in its review of the Company's position with respect to its determination
of the fair value of the shares of common stock underlying its outstanding equity awards and the reasons for the difference between the
recent valuations of the common stock and the estimated offering price for its initial public offering (the “IPO”).

Stock Split

Prior
to the filing of the Registration Statement in connection with the launch of the Company’s road show, the Company will conduct
a reverse stock split (the “Stock Split”) of its common stock (currently anticipated to be at a ratio of 1-for-[***]). Each
share of the Company’s common stock and each option to purchase its common stock that is issued and outstanding immediately prior
to the effective date of the stock split will become [***] shares, with the option exercise price being adjusted proportionally. The
conversion rate of the Company’s outstanding shares of preferred stock will adjust accordingly to reflect the as-converted adjustments
to the common stock. Unless noted otherwise, all references to share and per share amounts in this memo does not give effect to the proposed
stock split.

Preliminary IPO Price Range

The
Company advises the Staff that it preliminarily estimates a price range of approximately $[***] to $[***] per share (the “Preliminary
Price Range”) of the Company’s common stock for its IPO. The Preliminary Price Range does not reflect the impact of Stock
Split. On a post-reverse stock split basis, the Preliminary Price Range is estimated to be $[***] to $[***] per share. The Preliminary
Price Range does not take into account the current lack of liquidity for the Company’s common stock and assumes a successful IPO,
with no weighting attributed to any other outcome for the Company’s business, such as remaining as a privately held company or
being sold in a change of control transaction.

As is typical in IPOs, the
Preliminary Price Range was not derived using a formal determination of fair value but was determined through discussions among the board
of directors of the Company (the “Board”), senior management of the Company and the lead underwriters for its IPO. Among
the factors (the “Price Range Factors”) that were considered in estimating the Preliminary Price Range were the following:

 · the Company's financial
                                            position and prospects;

 · an
                                            analysis of the typical valuation ranges seen in recent IPOs for comparable companies in
                                            the Company's industry;

 · the
                                            general conditions of the securities market and the recent market prices of, and the demand
                                            for, publicly traded common stock of comparable companies; and

 · feedback
                                            from potential investors following “testing the waters” meetings that occurred
                                            from March through June 2024, which suggested that there was investor’ interest
                                            in the Company at a step-up in valuation from its last private financing round.

FOIA Confidential Treatment Requested by ALUMIS
INC.

Cooley LLP 3 Embarcadero Center 20th Floor San Francisco, CA 94111-4004

t: +1 415 693 2000 f: +1 415 693 2222 cooley.com

    U.S. Securities and Exchange Commission

    June 14, 2024

    Page Three

The actual bona fide price
range to be included in the Registration Statement has not yet been determined and remains subject to adjustment based on further discussions
between the Company and the lead underwriters, developments in the Company's business, market conditions and other factors that are outside
of the Company's control. However, the Company believes that the actual bona fide price range will be within the Preliminary Price Range.
In addition, the actual bona fide price range to be included in the Registration Statement will be reflected in an amendment to the Registration
Statement that will be filed before the commencement of the road show and will comply with the Staff's interpretations regarding the
permissible parameters of a bona fide price range.

Summary of Recent Equity Awards

The following table summarizes
by grant date the number of stock options granted by the Company since January 1, 2023, the exercise price per share of common stock
underlying the stock options and the estimated fair value of a share of common stock on each grant date:

    Grant Date

    Number
    of
 Shares
 Underlying
 Equity Awards

    Exercise

 Price
 Per Share

    Estimated Common

    Stock
 Fair Value
 Per Share
 on Date of Grant

    February 10, 2023*

    [***]
    $
    [***]
    $
    [***]

    March 13, 2023*

    [***]
    $
    [***]
    $
    [***]

    June 22, 2023*

    [***]
    $
    [***]
    $
    [***]

    July 18, 2023*

    [***]
    $
    [***]
    $
    [***]

    August 7, 2023*

    [***]
    $
    [***]
    $
    [***]

    October 9, 2023*

    [***]
    $
    [***]
    $
    [***]

    December 11, 2023*

    [***]
    $
    [***]
    $
    [***]

    March 29, 2024*

    [***]
    $
    [***]
    $
    [***]

    May 6, 2024*

    [***]
    $
    [***]
    $
    [***]

    June 6, 2024

    [***]
    $
    [***]
    $
    [***]

*
The estimated common stock fair value for grants from February 2023 to May 2024 was interpolated on a straight-line
basis between the valuation reports’ dates in connection with a fair value assessment for accounting purposes.

No other stock options or stock-based awards have
been approved by the Board from January 1, 2023, through the date of this supplemental letter and the Company does not expect to
make any additional grants prior to the completion of its IPO other than grants that would become effective at the pricing of the IPO
and granted at the IPO price.

Determination of Common Stock Fair Value Prior to IPO

As
there has been no public market for the Company’s common stock to date, the estimated fair value of the common stock underlying
the Company’s stock option awards has been determined by the Board as of each option grant date with input from management, considering
the most recently available third-party valuations of common stock and the Board’s assessment of additional objective and subjective
factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the
grant. The Company, specifically the Board, assumed responsibility for the estimates of fair value of its common stock in the consolidated
financial statements. The Company utilized methodologies, approaches and assumptions consistent with the American Institute of Certified
Public Accountants’ Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation
(the “Practice Aid”).

FOIA Confidential Treatment Requested by ALUMIS
INC.

Cooley LLP 3 Embarcadero Center 20th Floor San
Francisco, CA 94111-4004

t: +1 415 693 2000 f: +1 415 693 2222 cooley.com

    U.S. Securities and Exchange Commission

    June 14, 2024

    Page Four

Prior to May 2023, the
Company utilized an Option Pricing Method (“OPM”) based analysis, primarily the OPM backsolve methodology, to determine the
estimated fair value of the common stock. Within the OPM framework, the backsolve method, for inferring the total equity value implied
by a recent financing transaction or by an estimated equity value of the Company’s pipeline product candidates, involves the construction
of an allocation model that takes into account the Company’s capital structure and the rights, preferences and privileges of each
class of stock, then assumes reasonable inputs for the other OPM variables (expected time to liquidity, volatility, and risk-free rate).
The total equity value is then iterated in the model until the model output value for the equity class sold in a recent financing round
equals the price paid in that round. The OPM is generally utilized when specific future liquidity events are difficult to forecast (i.e.,
the enterprise has many choices and options available), and the enterprise’s value depends on how well it follows an uncharted
path through the various possible opportunities and challenges. In determining the estimated fair value of the common stock, the board
of directors also considered the fact that the stockholders could not freely trade the common stock in the public markets. Accordingly,
the Company applied discounts to reflect the lack of marketability of its common stock based on the weighted-average expected time to
liquidity. The estimated fair value of the common stock at each grant date reflected a non-marketability discount partially based on
the anticipated likelihood and timing of a future liquidity event.

For valuations performed
on and after May 2023, the Company utilized a hybrid method that combines the Probability-Weighted Expected Return Method (“PWERM”),
an accepted valuation method described in the Practice Aid, and the OPM. The Company determined this was the most appropriate method
for determining the fair value of its common stock based on the stage of development and other relevant factors. The PWERM is a scenario-based
analysis that estimates the value per share of common stock based on the probability-weighted present value of expected future equity
values for the common stock, under various possible future liquidity event scenarios, considering the rights and preferences of each
class of shares, discounted for a lack of marketability. Under the hybrid method, an option pricing model was utilized to determine the
fair value of the Company’s common stock in certain of the PWERM scenarios (capturing situations where its development path and
future liquidity events were difficult to forecast), potential exit events were explicitly modeled in the other PWERM scenarios. A discount
for lack of marketability was applied to the value derived under each scenario to account for a lack of access to an active public market
to estimate the common stock fair value.

The following table summarizes
the dates of these independent third-party valuations and the suggested fair value per share of common stock and total estimated equity
value of the Company.

    Valuation
    Date as of

    Estimated
    Fair Market Value per
 share of Common Stock

    Estimated
    Equity Value
 (in millions)**

    December 17, 2022
    $
    [***]
    $
    [***]

    May 9, 2023
    $
    [***]
    $
    [***]

    June 30, 2023*
    $
    [***]
    $
    [***]

    September 20, 2023
    $
    [***]
    $
    [***]

    March 4, 2024
    $
    [***]
    $
    [***]

    March 4, 2024*
    $
    [***]
    $
    [***]

    April 1, 2024
    $
    [***]
    $
    [***]

    May 29, 2024
    $
    [***]
    $
    [***]

FOIA Confidential Treatment Requested by ALUMIS
INC.

Cooley LLP 3 Embarcadero Center 20th Floor San Francisco, CA 94111-4004

t: +1 415 693 2000 f: +1 415 693 2222 cooley.com

    U.S. Securities and Exchange Commission

    June 14, 2024

    Page Five

* June 30, 2023
and March 4, 2024 valuation reports were prepared by the third-party valuation specialist for accounting purposes only based on
the retrospective review of the valuations completed and approved by the Board and considering accounting for subsequent tranches included
in Series B-2 and Series C preferred stock financings.

**Estimated equity value
is calculated based on probabilities weighting of the IPO scenario and staying private scenario valuations.

For options that were granted
between valuation report issuance dates, the Board considered the amount of time that had passed since the last valuation and assessed
if there had been any significant changes to the estimated fair value of the Company’s common stock since the date of the last
valuation. In addition to considering the results of independent third-part