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United States securities and exchange commission logo
July 6, 2023
Stephen Mahoney
President, Chief Financial and Operating Officer
Magenta Therapeutics, Inc.
300 Technology Square, 8th Floor
Cambridge, MA 02139
Re: Magenta
Therapeutics, Inc.
Amendment No. 1 to
Registration Statement on Form S-4
Filed June 22, 2023
File No. 333-271917
Dear Stephen Mahoney:
We have reviewed your amended 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 amending your registration
statement and providing the
requested information. 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 any amendment to your registration statement and
the information you
provide in response to these comments, we may have additional comments.
Unless we note
otherwise, our references to prior comments are to comments in our June
13, 2023 letter.
Amendment No. 1 to Registration Statement on Form S-4
Opinion of Houlihan Lokey to the Magenta Board
Material Financial Analyses, page 162
1. We note your response
to our prior comment 10 that Houlihan Lokey identified a
sufficient number of
companies but may not have included all companies that might be
deemed comparable to
Dianthus. Please revise your disclosure to state how Houlihan
Lokey identified which
companies to include and which to exclude in its analysis.
Stephen Mahoney
FirstName LastNameStephen
Magenta Therapeutics, Inc. Mahoney
Comapany
July 6, 2023NameMagenta Therapeutics, Inc.
July 6,2 2023 Page 2
Page
FirstName LastName
Dianthus' Business
Dianthus' Pipeline of Next-Generation Complement Therapeutics, page 285
2. We note your response to our prior comment 17. Please revise your
pipeline table so that
all your text is legible. We note the text appearing directly below
the table is too small to
be legible. Also, eliminate the shadow arrows, as they do not reflect
the current status of
your trials.
3. We note your response to our prior comment 18 and reissue in part.
Your revised pipeline
table contains a row depicting "Ongoing Discovery Efforts to Identify
Additional Active
Selective Complement Targets" with no specific program or target
identified. Given the
early stage of development, it seems premature to highlight your
ongoing discovery
efforts as a specific row in the pipeline table. Please remove this
row from your pipeline
table. You may disclose your ongoing discovery efforts elsewhere in
your Business
section.
Unaudited Pro Forma Condensed Combined Financial Information, page 373
4. Please address the following regarding your response to comment 25 in
our letter dated
June 13, 2023:
Tell us how you considered whether the merger should be recorded
as an asset
acquisition by Dianthus under ASC 805 given the contingent cash
flow streams
resulting from the sales of certain assets, including intellectual
property, related to
its MGTA-117 antibody, MGTA-45 program and MGTA-145 program.
Tell us how you evaluated the extent to which the accounting would
be different if
you accounted for the merger as an asset purchase versus a reverse
recapitalization,
providing quantification where possible.
As part of your response and with a view to revised disclosure,
clearly detail how you
determined that the intangible assets for the contingent
significant future cash flows
resulting from the sales of certain assets, including intellectual
property, related to
its MGTA-117 antibody, MGTA-45 program and MGTA-145 program meet
the
definition of "nominal other assets" in section 1160.2 of the
Financial Reporting
Manual available on our website. In your response, specifically
address your
evaluation of these assets in isolation of the Contingent Value
Right (CVR)
agreement rather than net of the CVR.
Tell us and revise to reconcile the apparent inconsistency in your
conclusion to treat
the merger as a reverse recapitalization for accounting purposes
with the contractual
provision on page A-41 that "Magenta has not been and is not
currently determined to
be a shell company as defined under Section 12b-2 of the
Exchange Act."
5. Please address the following regarding your response to comment 26 of
our letter dated
June 13, 2023:
Revise your pro forma presentation to give separate pro forma
effect to the April
asset sales and CVR liability transactions pursuant to Article
11-1(a)(8) of Regulation
Stephen Mahoney
Magenta Therapeutics, Inc.
July 6, 2023
Page 3
S-X. The transactions have occurred and it appears given the nature
of the
transactions the disclosure would be material to investors.
To the extent you believe the asset sales are not material to
Magenta, provide us with
your evaluation of the sale transactions in isolation of the CVR
agreements, including
quantification of the amounts involved.
Tell us in detail and revise to clearly describe how Magenta
accounted for and valued
each of the individual transactions from the April asset sales and
CVR liability for
accounting purposes in their historical financial statements.
We note your statement on page 380 that "As any amounts related to
the asset
purchase agreements and CVRs are expected to be either not material
and/or not
probable to be recognized, the agreements were not deemed to be
significant and it
was determined not to give an effect to these agreements in the
unaudited pro forma
condensed combined financial information." To the extent you
determine the initial
recognition of one or all of these individual transactions will be
de minimis because
the probability of the receipt (or payment) of the contingent future
contractual cash
flows is so low as of the date of the transaction together with the
cash paid at the time
of the sale, clearly disclose that fact, and provide accompanying
disclosure of the
potential maximum future cash flows along with your assertion as to
the probability
of receipt (or payment). Clearly identify that your evaluation of
the materiality of the
asset sales is in isolation from the CVR agreements.
You may contact Jenn Do at 202-551-3743 or Kevin Vaughn at 202-551-3494
if you
have questions regarding comments on the financial statements and related
matters. Please
contact Doris Stacey Gama at 202-551-3188 or Jason Drory at 202-551-8342 with
any other
questions.
Sincerely,
FirstName LastNameStephen Mahoney
Division of
Corporation Finance
Comapany NameMagenta Therapeutics, Inc.
Office of Life
Sciences
July 6, 2023 Page 3
cc: Marianne Sarrazin, Esq.
FirstName LastName