Correspondence 0001193125-24-015223 from Alto Neuroscience, Inc. (ANRO)
Alto Neuroscience, Inc.
Date: Jan. 25, 2024 · CIK: 0001999480 · Accession: 0001193125-24-015223
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-276495
Referenced dates: December 19, 2023, January 23, 2024
Letter
Divakar Gupta
+1 212 479 6474
dgupta@cooley.com
VIA EDGAR
January 25, 2024
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Life Sciences
100 F Street, N.E.
Washington, D.C. 20549
Attn: Lauren Hamill
Tim Buchmiller
Li Xiao
Mary Mast
Re: Alto Neuroscience, Inc.
Correspondence filed January 19, 2024
File No. 333-276495
Ladies and Gentlemen:
On behalf of Alto Neuroscience, Inc. (the “Company”), in response to a discussion with the staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) on January 25, 2024 regarding the Staff’s comment letter dated January 23, 2024 (the “Comment Letter”), relating to the Company’s correspondence submitted to the Commission on January 19, 2024 and January 24, 2024 pertaining to the Registration Statement on Form S-1 (the “Registration Statement”), we are submitting this supplemental letter to further address Comment No. 1 of the Comment Letter. For the convenience of the Staff, we have incorporated the relevant text of Comment No. 1 in italicized type into this letter, which is followed by the Company’s response with respect to such portion of Comment No. 1 of the Comment Letter.
Staff Comment
Correspondence filed January 19, 2024
General
1. We have read your response to our prior comment number 38 in our letter dated December 19, 2023. Please address the following:
…
•
Please clarify how you are determining the enterprise value for the November 20, 2023 valuation.
Cooley LLP 55 Hudson Yards New York, NY 10001
T:+1 212 479 6000 f:+1 212 479 6275 cooley.com
U.S. Securities and Exchange Commission
January 25, 2024
Page Two
Response: In response to the Staff’s comment, the Company advises the Staff that it determined the enterprise value for the November 20, 2023 Valuation using a market-based approach, taking into account the Series C convertible preferred stock financing as an arms-length transaction with new investors in the Company and applying an increase in value aligned with recent biotechnology company IPOs. This methodology resulted in an enterprise value within the preliminary price range proposed for the IPO. To determine the fair market value of the common stock, the Company then used a backsolve method assuming a weighting between an IPO scenario and a non-IPO scenario based on the likelihood of each determined at the time. This valuation methodology, consistent with all historical valuation approaches by the Company, is consistent with the guidelines for determining fair market value outlined in the outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.
The Company further advises the Staff that it intends to include disclosure in an amendment to the Registration Statement consistent with the foregoing explanation.
* * *
Cooley LLP 55 Hudson Yards New York, NY 10001
T:+1 212 479 6000 f:+1 212 479 6275 cooley.com
U.S. Securities and Exchange Commission
January 25, 2024
Page Three
Please contact me at (212) 479-6474 with any questions or further comments regarding the Company’s response to the Staff’s comment.
Sincerely,
/s/ Divakar Gupta
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CORRESP 1 filename1.htm CORRESP Divakar Gupta +1 212 479 6474 dgupta@cooley.com VIA EDGAR January 25, 2024 U.S. Securities and Exchange Commission Division of Corporation Finance Office of Life Sciences 100 F Street, N.E. Washington, D.C. 20549 Attn: Lauren Hamill Tim Buchmiller Li Xiao Mary Mast Re: Alto Neuroscience, Inc. Correspondence filed January 19, 2024 File No. 333-276495 Ladies and Gentlemen: On behalf of Alto Neuroscience, Inc. (the “Company”), in response to a discussion with the staff (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) on January 25, 2024 regarding the Staff’s comment letter dated January 23, 2024 (the “Comment Letter”), relating to the Company’s correspondence submitted to the Commission on January 19, 2024 and January 24, 2024 pertaining to the Registration Statement on Form S-1 (the “Registration Statement”), we are submitting this supplemental letter to further address Comment No. 1 of the Comment Letter. For the convenience of the Staff, we have incorporated the relevant text of Comment No. 1 in italicized type into this letter, which is followed by the Company’s response with respect to such portion of Comment No. 1 of the Comment Letter. Staff Comment Correspondence filed January 19, 2024 General 1. We have read your response to our prior comment number 38 in our letter dated December 19, 2023. Please address the following: … • Please clarify how you are determining the enterprise value for the November 20, 2023 valuation. Cooley LLP 55 Hudson Yards New York, NY 10001 T:+1 212 479 6000 f:+1 212 479 6275 cooley.com U.S. Securities and Exchange Commission January 25, 2024 Page Two Response: In response to the Staff’s comment, the Company advises the Staff that it determined the enterprise value for the November 20, 2023 Valuation using a market-based approach, taking into account the Series C convertible preferred stock financing as an arms-length transaction with new investors in the Company and applying an increase in value aligned with recent biotechnology company IPOs. This methodology resulted in an enterprise value within the preliminary price range proposed for the IPO. To determine the fair market value of the common stock, the Company then used a backsolve method assuming a weighting between an IPO scenario and a non-IPO scenario based on the likelihood of each determined at the time. This valuation methodology, consistent with all historical valuation approaches by the Company, is consistent with the guidelines for determining fair market value outlined in the outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. The Company further advises the Staff that it intends to include disclosure in an amendment to the Registration Statement consistent with the foregoing explanation. * * * Cooley LLP 55 Hudson Yards New York, NY 10001 T:+1 212 479 6000 f:+1 212 479 6275 cooley.com U.S. Securities and Exchange Commission January 25, 2024 Page Three Please contact me at (212) 479-6474 with any questions or further comments regarding the Company’s response to the Staff’s comment. Sincerely, /s/ Divakar Gupta Divakar Gupta Cooley LLP cc: Amit Etkin, M.D., Ph.D., Alto Neuroscience, Inc. Nicholas Smith, Alto Neuroscience, Inc. Erin McQuade, Alto Neuroscience, Inc. Christina Roupas, Cooley LLP Courtney Tygesson, Cooley LLP Laurie Bauer, Cooley LLP Nathan Ajiashvili, Latham & Watkins LLP Christopher Lueking, Latham & Watkins LLP Ross McAloon, Latham & Watkins LLP Cooley LLP 55 Hudson Yards New York, NY 10001 T:+1 212 479 6000 f:+1 212 479 6275 cooley.com