SecProbe.io

December 10, 2024
Patrick Schnegelsberg
Chief Executive Officer
Picard Medical, Inc.
4 Palo Alto Square, Suite 200
Palo Alto, CA 94025
Re:Picard Medical, Inc.
Amendment No. 1 to Draft Registration Statement on Form S-1
Submitted November 12, 2024
CIK No. 0002030617
Dear Patrick Schnegelsberg:
            We have reviewed your amended draft registration statement and have the following
comments.
            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 a comment applies 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 this letter and your
amended draft registration statement or filed registration statement, we may have additional
comments.
Amendment No. 1 to Draft Registration Statement on Form S-1
Prospectus Summary, page 1
1.We note your disclosure on page 1 that "SynCardia was incorporated in Delaware in
August 2001 as SynCardia Systems, Inc." and your disclosure on page 3 noting
that "[t]he 70cc SynCardia TAH is designed for implantation into adult patients and
has supported over 1,939 patients globally since 1982." Please revise your disclosure
here and in your description of business to clarify the timeline of your operations,
including the manufacturing and distribution of your products.
We note your disclosures here and in your description of business that you
manufacture and sell "the only U.S. FDA, and Health Canada approved implantable
SynCardia TAH," "the SynCardia TAH is an established alternative to heart 2.

December 10, 2024
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transplantation for patients with biventricular failure in the U.S., and around the
world," and "[a] total artificial heart . . . does replace the heart." Please revise your
disclosure here and throughout the filing, including your business description, to
clarify that your product is approved in the United States and Canada for temporary
bridge to transplantation indication, and briefly explain this type of approval as
compared to approval for a long-term indication. Where you discuss that your product
is an established alternative to heart transplantation, please clarify that your product is
indicated for short-term support, and revise your disclosure to define Bridge to
Transplantation and Bridge to Decision.
3.Please revise your prospectus summary to disclose that you have incurred net losses
since inception and, as you disclose on page 59, that you expect to incur significant
expenses and operating losses for the foreseeable future. Quantify your net losses and
accumulated deficit for the financial periods presented in the filing.
4.We note your disclosure on page 4 that "[a]fter the introduction of the Freedom
Driver, there have been documented accounts of patients playing golf and basketball,
fishing, and hiking while on the SynCardia TAH." Please revise your disclosure to
provide support for this statement, including the entity or person that observed and
documented these accounts, the specific implanted device, the patients' health status
prior to the implantation, the number of patients that were observed experiencing
these outcomes, and any adverse events that occurred.
5.We note your disclosure that your products are "superior to peers in total artificial
heart category" and your discussion of your competitors products, regulatory
approvals, and clinical trials. We also note your disclosure describing the limitations
of LVADs compared to your TAH. To the extent that head-to-head trials have not
been conducted, please revise to remove comparisons of your product's performance
or efficacy to other approved products.
6.Please revise your prospectus summary to disclose, as you do on page 59, that
management has concluded that there is substantial doubt over your ability to continue
as a going concern, and revise your risk factors to discuss the related risks to
investors.
7.We note your disclosure on page 12 that, while you were working on the re-
certification of the SynCardia TAH under MDD, BSI highlighted several post-market
surveillance deficiencies and in May 2022, BSI suspended SynCardia's CE mark
pending completion of a post-market surveillance study needed to reinstate the CE
mark under MDD. We also note your disclosure on page 36 that your managers have
identified significant issues with your regulatory compliance regime and are actively
working to solve these issues. Please revise your disclosure here and in your relevant
risk factor to discuss the specific post-market surveillance deficiencies and issues with
your regulatory compliance regime, and clarify how you intend to address those
deficiencies and issues, including your intended timeline for the same.
Risk Factors, page 19
We note your disclosure that in the event of a sale of shares in a public offering
resulting in gross proceeds of $25 million to the Company, the conversion of your
Series A-1 Preferred Stock will become mandatory. We also note your disclosure that, 8.

December 10, 2024
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in the event of an initial public offering, your related party loan would be
automatically converted into common stock. Please revise to include a risk factor
discussing the risks to investors related to these conversions, including those related to
dilution and volatility.
SynCardia has significant customer concentrations . . ., page 23
9.We note your disclosure that a small number of your customers account for a
substantial portion of your revenues. Please disclose, as you do in the notes to your
financial statements, the customers that account for more than 10% of your revenue
for the periods presented in the filing, and quantify the percentage contribution of
each customer.
Use of Proceeds, page 48
10.We note your disclosure that a portion of your proceeds will be used to fund research
and development activities of your products, and your disclosure elsewhere that you
plan to conduct "first-in-animal trials" and clinical trials related to your products.
Please identify any specific trials you intend to fund with proceeds from the offering
and quantify the relevant amount of proceeds, as appropriate. In addition, please
disclose the portion of proceeds you intend to use for each of the listed products.
Management's Discussion and Analysis of Financial Condition and Results of Operations
Results of Operations, page 55
11.In addition to quantifying your U.S. and non U.S. declines in revenues, expand your
disclosures to address the specific underlying reason(s) for the $1.2 million decrease
in revenues for the three months ended June 30, 2024 and the $.6 million decrease in
revenues for the six months ended June 30, 2024.
12.Please expand your disclosures to discuss your cost of revenues as a percentage of
revenues for each period presented. Address why you have negative gross margins for
your rental revenues.
13.Expand your discussion of the change in cost of revenues to quantify the additional
inventory reserves and other significant underlying reasons for the decrease in cost of
sales in the three and six months ended June 30, 2024. Specifically address the
reasons underlying the changes in your inventory reserves. Address this comment as it
relates to your fiscal year cost of revenues discussions.
14.We note the significance of your research and development expenses. Please expand
your disclosure to provide more detail for your research and development expenses
for each period presented, including but not limited to by product candidate as well as
by the nature of the expenses. To the extent that you do not track expenses by product
candidate, please disclose as such.
Liquidity
Sources of Liquidity, page 60
We note your disclosure that "[t]o date, we have funded its operations primarily with
the proceeds from Series A-1 Preferred Stock and loans from related parties." Please
revise your disclosure in this section to discuss the material terms of the loans and 15.

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Series A-1 Preferred Stock issuances, including relevant dates, parties, interest rates,
accrued or undeclared dividends, outstanding amounts, and any other material terms.
Discuss the impact of these loans, share issuances, undeclared dividends, and related
obligations on your liquidity.
Critical Accounting Policies, page 61
16.The disclosures of your critical accounting policies and estimates appear to be more
descriptive of the accounting policies utilized, rather than any specific uncertainties
underlying your estimates. Please revise the disclosures for each of your critical
estimates made in preparing your consolidated financial statements to sufficiently
explain to investors what each critical estimate is; the uncertainties associated with the
critical estimates; the methods and assumptions used to make the critical estimates,
including an explanation as to how you arrived at the assumptions used; the events or
transactions that could materially impact the assumptions made; and how reasonably
likely changes to those assumptions could impact your consolidated financial
statements. Provide investors with quantified information to the extent meaningful
and available. Refer to Item 303(b)(3) of Regulation S-K, Instruction 3 to Item
(303)(b)(3), and Section V of Release No. 33-8350 for guidance.
Business
Our Components, page 67
17.Please address the following comments related to your components.

•We note your disclosure that, on April 11, 2022, "Heitek Automation and
we entered into a purchase order, which covers the terms for purchasing the
pneumatic manifold drawings for the C2 Driver." Please briefly describe the terms
of this agreement, if material, and the significance to your business of purchasing
these drawings.

•We note your disclosure that "we have started development of the C3 Driver,
which is not expected to need this pneumatic manifold." Please revise to provide
additional detail regarding the significance of the development of this driver to
your product and your business, including the timing for the development of this
driver and the significance to the manufacturing of your product.
Clinical Efficacy, page 69
We note your reference on page 66 to "the Freedom Driver System IDE Study that
began in 2010," your reference on page 69 to "more recent studies examining the
clinical outcomes of patients reviewing SynCardia TAH as BTT therapy," and your
bulleted list of examples of a study, retrospective analysis, and prospective
institutional database. Please revise your disclosure to clearly identify the studies,
retrospective analysis and prospective institutional database. Clarify what is meant by
an "all comer" patients, and disclose the criteria for selecting patients for the
SynCardia TAH study between January 2014 and May 2019. Revise your disclosures
to provide all material information about each study, including the sponsor of the
study, number of participants, whether statistical significance was demonstrated, and 18.

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the p-values supporting statistical significance. The first time you use the term p-
value please explain what it measures and the p-value that you have to achieve in
order to conclude a statistically significant result.
Adverse Events, Including Those That Affected Outcomes. . ., page 70
19.Please revise your disclosure to provide a more detailed explanation of the data
presented within the Adverse Events table on page 70, including the specific studies
and devices related to the data presented, and whether and to what extent the events
reported in the table were Serious Adverse Events. For events in the table that are
scientific or technical terms, please clarify the meaning of these terms in order to
ensure that lay readers will understand the disclosure. In addition, please provide
further detail regarding the differences noted within the footnotes, including the
circumstances under which patients ineligible to receive the implant per protocol
received and implant, clarify the relationship between the N-values and the figures
presented, clearly label the two columns under "All Events," and clarify whether the
figures within all of the parentheticals represent percentages, as you indicate next to
"number of patients (percent)."
Our Pipeline, page 70
20.We note your disclosure that "[t]he exchange of information and data prior to
submission helps to align both parties and speeds up the approval timeline." Here and
throughout your filing where you discuss regulatory approvals, please disclose that
there is no guarantee you will receive regulatory approval, the timing is unknown, and
approval may take longer than planned. Make conforming changes throughout your
filing, including here and in your prospectus summary where you discuss the intended
timing for FDA approval of your products and indications.
New Product Development, page 71
21.We note your disclosure that "[t]hese prototypes have been shown to achieve pulsatile
flow with life-sustaining rates of cardiac output." Given that efficacy determinations
are solely within the authority of the U.S. Food and Drug Administration, please
revise this and all similar statements throughout your disclosure to remove such
implications. We do not object to the disclosure of objective data obtained in your
clinical studies.
Industry Overview, page 72
We note your disclosure that the total addressable market in the United States for the
BTT indication is approximately $1 billion and the total addressable market in the
United States for long-term indication is approximately $50 billion, based on 6,000
heart implants and approximately 300,000 patients, respectively. Please revise your
disclosure to clarify how you arrived at the $1 billion TAM for BTT indication based
on 6,000 patients, including how you determined that the market includes 6,000
patients and how you calculated these 6,000 patients represent a market opportunity of
$1 billion. In addition, please clarify how you determined that the market for long-
term indication included 300,000 patients and how you calculated a total market of
$50 billion based upon these patients. In your discussion, clarify why your TAM 22.

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includes long-term indication given that you have yet to receive regulatory approval
for this indication. As a related matter, where you discuss your serviceable
addressable market, please provide more detail regarding how you arrived at an
estimate of 1,400 implants in the United States, and how you calculated the $230
million SAM based on these heart implants. Please also clarify whether your SAM
includes your BTT indication and/or long-term indication.
23.Where you provide statistics and data about your industry, please provide support for
these statements or characterize the same as management's opinions or beliefs. If these
disclosures are the opinions or beliefs of management, please provide the basis for
their opinions or beliefs. In addition, where you refer to studies generally for support,
please identify the studies.
Government Regulation, page 78
24.We note your disclosure that "stockholders are required to perform their own analysis
of regulations that apply to our business." Given that Item 101 of Regulation S-K
requires disclosure of the material effect that compliance with government regulations
may have on your business, and because investors are entitled to rely upon your
disclosure within the registration statement, please revise your disclosure to remove
this qualification.
25.We note your references throughout your filing to Humanitarian Device Exemption as
a pathway for commercialization of your products. Please revise this section to
discuss the regulations related to HDE approval.
Management, page 83
26.We note your disclosures that you have wholly owned German and Australian