CORRESP 1 filename1.htm Correspondence Letter

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8001 Arista Place, Suite 200

Broomfield, CO 80021

Phone: 720-940-2200, Fax: 720-208-9261

December 21, 2010

Jim B. Rosenberg

Senior Assistant Chief Accountant

Division of Corporation Finance

U.S. Securities and Exchange Commission

450 Fifth Street, N.W.

Washington, D.C. 20549

 

Re:  ARCA biopharma, Inc.
      Form 10-K for Fiscal Year Ended December 31, 2009
      Filed March 4, 2010
      File No. 000-22873

Dear Mr. Rosenberg,

On behalf of ARCA biopharma, Inc. (“ARCA”), this letter responds to the comments of the Staff of the Securities and Exchange Commission (the “Commission”) set forth in the letter dated December 10, 2010 (“Comment Letter”) relating to the above-referenced Annual Report on Form 10-K. Set forth in italicized print below is the Staff’s comment, as set forth in the Comment Letter, followed by ARCA’s response.

Form 10-K for the Fiscal Year Ended December 31, 2009

Item 8. Financial Statements and Supplementary Data

Consolidated Statement of Cash Flows, page 66

 

1. Please tell us why your statement of cash flows reflects a $20.5 million change in accrued expenses and other liabilities, while the balance sheet appears to indicate that the change in these accounts is substantially less. Similarly, please also address the change in your accounts payable.

ARCA’s Response:

The difference between the change in accrued expenses and other liabilities reflected on the statement of cash flows compared to the change indicated on the balance sheet is primarily caused by the accrued expenses and other liabilities that ARCA assumed in the merger with Nuvelo, Inc. on January 27, 2009 (the “Merger”) and the subsequent satisfaction of such liabilities prior to December 31, 2009. As follows, ARCA has supplementally provided a roll-forward of the accrued expenses and other liabilities balances from December 31, 2008 to December 31, 2009.

 

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ARCA biopharma, Inc.

File No. 000-22873

 

 

(in thousands)              
Accrued expenses and other liabilities      

Balances as of December 31, 2008:

      

Accrued compensation and employee benefits

    $ 1,071      

Accrued expenses and other liabilities

      1,549      
           

Subtotal

       $ 2,620   

Liabilities assumed in the Merger: {a}

      

Accrued employee liabilities

      3,579      

Other current liabilities

      1,406      

Accrued facility exit costs

      13,278      

Other liabilities

      74      

Unfavorable lease obligation

      943      
           

Subtotal

         19,280   

Change in accrued expenses and other liabilities (net of amounts acquired and noncash items), as per the statement of cash flows:

         (20,454 ) 

Other roll-forward items, net: {b}

        (449 ) 

Balances as of December 31, 2009:

      

Accrued compensation and employee benefits

      241      

Accrued expenses and other liabilities

      756      
                 

Total

       $ 997   
           

 

{a} See Note 2, Merger with Nuvelo, Inc. on January 27, 2009, to ARCA’s consolidated financial statements on Form 10-K for the year ended December 31, 2009 for the acquisition consideration allocation as of the date of the Merger.
{b} Other roll-forward items, net includes, among other items, adjustments to reconcile net loss to net cash used in operating activities and certain noncash transactions.

 

2

ARCA biopharma, Inc.

File No. 000-22873

 

The difference between the change in accounts payable reflected on the statement of cash flows compared to the change indicated on the balance sheet is primarily caused by the accounts payable that ARCA assumed as a result of the Merger and the subsequent satisfaction of such liabilities prior to December 31, 2009. As follows, ARCA has supplementally provided a roll-forward of the accounts payable balance from December 31, 2008 to December 31, 2009.

 

(in thousands)       

Accounts Payable

   

Balance as of December 31, 2008

    $ 804   

Accounts payable assumed in the Merger {a}

      2,189   

Change in accounts payable (net of amounts acquired), as per the statement of cash flows

      (2,460 ) 
        

Balance as of December 31, 2009

    $ 533   
        

 

{a} See Note 2, Merger with Nuvelo, Inc. on January 27, 2009, to ARCA’s consolidated financial statements on Form 10-K for the year ended December 31, 2009 for the acquisition consideration allocation as of the date of the Merger.

In connection with responding to the Comment Letter, we acknowledge that:

 

  •  

ARCA is responsible for the adequacy and accuracy of the disclosure in the filing;

 

  •  

Staff comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and

 

  •  

ARCA may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

We trust this letter is fully responsive to the Comment Letter. Please do not hesitate to contact me if you have any questions relative to this matter.

 

Very truly yours,
/s/ Patrick M. Wheeler

Patrick M. Wheeler,

Chief Financial Officer

 

cc:       Brent D. Fassett, Cooley LLP
           Michael R. Bristow, President and Chief Executive Officer
           Christopher D. Ozeroff, Senior Vice President and General Counsel

 

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