Revance Therapeutics
Annual Report 2017

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 FORM 10-K xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2017or¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934For the transition period from to Commission File No. 001-36297 Revance Therapeutics, Inc.(Exact name of registrant as specified in its charter) Delaware 77-0551645(State or other jurisdiction ofincorporation or organization) (I.R.S. EmployerIdentification Number) 7555 Gateway BoulevardNewark, California 94560(510) 742-3400(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) Securities registered pursuant to Section 12(b) of the Act:Title of Each Class Name of Exchange on Which RegisteredCommon Stock, par value $0.001 per share The Nasdaq Stock Market LLCSecurities registered pursuant to Section 12(g) of the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No ¨Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No xIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90days. Yes x No ¨Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted andposted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit andpost such files). Yes x No ¨Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best ofregistrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. xIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growthcompany. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.Large accelerated filer¨Accelerated filerx Non-accelerated filer¨ (Do not check if a smaller reporting company)Smaller reporting company¨ Emerging growth companyxIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialstatement accounting standards provide pursuance to Section 13(a) of the Exchange Act. ¨Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No xThe aggregate market value of the registrant’s common stock held by non-affiliates of the registrant as of the last business day of the registrant’s most recently completedsecond fiscal quarter was approximately $672.0 million, based on the closing price of the registrant’s common stock on the Nasdaq Global Market of $26.40 per share for suchdate.Number of shares outstanding of the registrant's common stock, par value $0.001 per share, as of February 23, 2018: 36,684,782DOCUMENTS INCORPORATED BY REFERENCENone Table of ContentsTable of Contents PagePART I Item 1Business1Item 1ARisk Factors21Item 1BUnresolved Staff Comments48Item 2Properties49Item 3Legal Proceedings50Item 4Mine Safety Disclosures51 PART II Item 5Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities52Item 6Selected Financial Data55Item 7Management’s Discussion and Analysis of Financial Condition and Results of Operations56Item 7AQuantitative and Qualitative Disclosures about Market Risk73Item 8Financial Statements and Supplementary Data74Item 9Changes in and Disagreements with Accountants on Accounting and Financial Disclosure75Item 9AControls and Procedures76Item 9BOther Information77 PART III Item 10Directors, Executive Officers and Corporate Governance78Item 11Executive Compensation82Item 12Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters87Item 13Certain Relationships and Related Party Transactions, and Director Independence90Item 14Principal Accounting Fees and Services91 PART IV Item 15Exhibits, Financial Statement Schedules92Item 16Form 10-K Summary92Signatures “Revance Therapeutics,” the Revance logos and other trademarks or service marks of Revance appearing in this annual report on Form 10-K are theproperty of Revance. This Form 10-K contains additional trade names, trademarks and service marks of others, which are the property of their respectiveowners. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement orsponsorship of us by, these other companies.Table of ContentsSPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSThis Annual Report on Form 10-K, or Form 10-K, contains “forward-looking statements” within the meaning of Section 21E of the Securities ExchangeAct of 1934, or the Exchange Act, as amended, which are subject to the “safe harbor” created by that section. The forward-looking statements in this Form 10-K are contained principally under “Item 1. Business,” “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Conditionand Results of Operations.” In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,”“expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms orother comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and otherfactors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or impliedby these forward-looking statements. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Form 10-K,we caution you that these statements are based on a combination of facts and factors currently known by us and our projections of the future, about which wecannot be certain. These forward-looking statements include, but are not limited to, statements concerning the following: •our expectations regarding the results, timing and completion of our clinical trials and regulatory submissions needed for the approval of RT002injectable for the treatment of glabellar (frown) lines, muscle movement disorders, including cervical dystonia, and plantar fasciitis, in the UnitedStates, Europe and other countries;•our expectations regarding our future development of RT002 injectable and our topical product candidate for other indications;•our expectations regarding the development of future product candidates;•the potential for commercialization by us of RT002 injectable, if approved;•our expectations regarding the potential market size, opportunity and growth potential for RT002 injectable and our topical product candidate, ifapproved for commercial use;•our belief that RT002 injectable and our topical product candidate can expand the overall botulinum toxin market;•our ability to build our own sales and marketing capabilities, or seek collaborative partners including distributors, to commercialize our productcandidates, if approved;•our ability to manufacture in our facility and to scale up our manufacturing capabilities and those of future third-party manufacturers if our productcandidates are approved;•estimates of our expenses, future revenue, capital requirements and our needs for additional financing;•the timing or likelihood of regulatory filings and approvals;•our ability to advance product candidates into, and successfully complete, clinical trials;•the implementation of our business model, and strategic plans for our business, product candidates and technology;•the initiation, timing, progress and results of future preclinical studies and clinical trials and our research and development programs;•the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates and technology;•our ability to establish collaborations or obtain additional funding;•our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012, orthe JOBS Act;•our financial performance; and•developments and projections relating to our competitors and our industry.Table of ContentsIn addition, you should refer to “Item 1A. Risk Factors” in this Form 10-K for a discussion of these and other important factors that may cause our actualresults to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that theforward-looking statements in this Form 10-K will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracymay be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation orwarranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all. Also, forward-looking statementsrepresent our estimates and assumptions only as of the date of this Form 10-K. We undertake no obligation to publicly update any forward-lookingstatements, whether as a result of new information, future events or otherwise, except as required by law.Table of ContentsPART I ITEM 1.BUSINESSOverviewRevance Therapeutics, Inc. is a clinical-stage biotechnology company focused on the development, manufacturing, and commercialization of novelbotulinum toxin products for multiple aesthetic and therapeutic indications. We are leveraging our proprietary portfolio of botulinum toxin type Acompounds, formulated with our patented and proprietary peptide technology, to address unmet needs in large and growing neuromodulator markets. Ourproprietary peptide technology enables delivery of botulinum toxin type A through two investigational drug product candidates, DaxibotulinumtoxinA forInjection (RT002), or RT002 injectable, and DaxibotulinumtoxinA Topical. We are pursuing clinical development for RT002 injectable in a broad spectrumof aesthetic and therapeutic indications and are planning to conduct additional preclinical development of our topical program. Neither of our productcandidates contains albumin or any other animal or human-derived materials. We believe this reduces the risk of the transmission of certain viral diseases. Wehold worldwide rights to RT002 injectable and our topical product candidate, and the pharmaceutical uses of our proprietary peptide technology. RT002injectable is a novel, injectable formulation of botulinum toxin type A designed to be a targeted and long-acting injectable botulinum toxin treatment. Weare studying RT002 injectable for aesthetic indications, such as glabellar (frown) lines and therapeutic indications, such as cervical dystonia and plantarfasciitis. We believe RT002 injectable has the potential to expand into additional aesthetic and therapeutic indications in the future.PIPELINEPRECLINICALPHASE 1PHASE 2PHASE 32018 PLANNED MILESTONES Glabellar (Frown) Lines (RT002) Complete Phase 3 open-label - 2H2018 Cervical Dystonia (RT002) Initiate Phase 3 program - 2Q 2018 Plantar Fasciitis (RT002) Complete Phase 2a 16-week study -Q1 2018 Topical Program Our Product CandidatesDaxibotulinumtoxinA for Injection (RT002), or RT002 InjectableWe are developing an injectable formulation of botulinum toxin type A, which we refer to as RT002 injectable, for indications where a long-lasting effectis desired. We believe, and our preclinical and clinical studies using RT002 indicate, that daxibotulinumtoxinA combined with our novel peptide maypermit safe administration of higher doses of botulinum toxin and may result in long-lasting effect. We are initially focusing on developing RT002 for thetreatment of glabellar lines, cervical dystonia, and plantar fasciitis.Glabellar LinesGlabellar (frown) lines are the result of the gathering of the tissue between the eyebrows into a fold. They are caused by the repeated action of underlyingmuscles associated with facial expression. Years of squinting and frowning tend to leave deep wrinkles in the skin between the eyebrows and on the bridge ofthe nose, across the forehead and at the corners of the eyes. On many people, frown lines produce an angry or sad look that detracts from a pleasant facialappearance. Physical, emotional, and social reasons for treating frown lines and forehead furrows include improved appearance and enhanced self-esteem.The most common cosmetic use of BOTOX® Cosmetic is for the treatment of glabellar lines, which we believe represent a global opportunity of nearly $1billion in 2016. In general, consumers enjoy the benefits of currently available botulinum toxin1Table of Contentsinjections and express a high rate of satisfaction. However, consumers are less satisfied with the duration and longevity of currently available botulinumtoxin injections.Botulinum toxin treatment of glabellar lines is the largest proportion of cosmetic neuromodulator sales in the United States and, according to theAmerican Society for Aesthetic Plastic Surgery, botulinum toxin treatment is the number one nonsurgical cosmetic procedure in the United States. Accordingto market research Revance conducted in October 2017, which involved a quantitative study with 80 dermatologists and plastic surgeons, 80% of thephysicians surveyed stated that longer duration is extremely important in their selection of which botulinum toxin to use for the treatment of glabellar lines,and 59% stated duration is the most important unmet need not addressed by currently available botulinum toxin products. When asked why their patientsrequest to change from one approved botulinum toxin to another, 68% said it is because the treatment did not last as long as the patient expected. Thequantitative survey also included eighty patients. When asked what attributes an ideal wrinkle treatment would include, duration was cited as the numberone reason by 56% of patients. Also, in Revance's primary qualitative market research among aesthetic physicians, patients, and office practice managers indicated that they were veryimpressed by the clinical data generated in the RT002 Phase 2 BELMONT study. In fact, a majority of those physicians interviewed reported that if RT002injectable demonstrated similar results in Phase 3 trials the increased duration of effect would cause them to change their treatment or purchase habits fromcurrently available botulinum toxins to include RT002 injectable. Duration of effect was reported in the qualitative market research to be the greatest unmetneed and the primary driver of adoption amongst physicians, patients, and office managers.We believe that a product that shows increased persistence of effect over time, with a slower return to baseline and a meaningful consumer benefit up tosix months would better fit the current treatment regimen and consumer habits. Quantitative market research shows that the majority of consumers only visittheir physicians twice per year for treatments and the longer duration would mean that they would enable patients to remain more satisfied betweentreatments.We believe that RT002 injectable may provide the following benefits to patients and physicians for treatment of glabellar lines, as compared toBOTOX® Cosmetic:•RT002 injectable may permit longer lasting effect up to 6 months and increase response rates.•RT002 injectable may also provide the ability to administer higher doses without associated adverse events. This could potentially decreaseunwanted side effects like eyelid ptosis (droopy eyelids), which leads to patient dissatisfaction.We believe that RT002 injectable may provide the following benefits to physicians:•RT002 injectable may be simple to use and consistent with the method of administration of current treatments.•RT002 injectable may lead to more sustained patient satisfaction between treatments, which is critical for self-pay procedures.•RT002 injectable could potentially enable physicians to expand their practices by appealing to consumers who are unwilling to come inmultiple times per year to sustain the benefits of treatment.•Physicians may be willing to pay more for RT002 injectable compared to currently available neuromodulators with the belief that they couldeasily pass that cost along to their patients, who would be willing to pay for increased duration of effect.•In Phase 2 and Phase 3 studies, RT002 injectable appeared to be well-tolerated with no significant safety concerns.Development of RT002 Injectable for Treatment of Glabellar LinesPhase 3 Clinical Trials. We are in Phase 3 clinical development for RT002 injectable in North America for the treatment of glabellar lines. In December2017, we announced positive top-line results from our SAKURA Phase 3 program.The Phase 3 clinical program includes two randomized, double-blind, placebo-controlled pivotal trials (named SAKURA 1 and SAKURA 2) to evaluatethe safety and efficacy of a single administration of RT002 for the treatment of moderate to severe glabellar lines in adults. The SAKURA 1 and SAKURA 2trials enrolled more than 600 subjects at 30 sites in the United States and Canada. In both trials, subjects were randomized in a 2:1 ratio to either the RT002or placebo treatment groups,2Table of Contentsrespectively. Post-treatment, subjects were followed for at least 24 weeks and up to 36 weeks. The primary efficacy endpoint of the pivotal trials was acomposite of the proportion of subjects who achieve a score of 0 or 1 (none or mild) and a two-point improvement from baseline in glabellar line severity onthe Investigator Global Assessment-Facial Wrinkle Severity (IGA-FWS) and Patient Facial Wrinkle Severity (PFWS) scales, at maximum contraction (frown),at Week 4. Duration of the reduction of severity of the glabellar lines was assessed as a secondary efficacy endpoint in the Phase 3 pivotal trials.In December 2017, we announced top-line results for the SAKURA 1 and SAKURA 2 pivotal trials:Primary Endpoint. Both SAKURA 1 and SAKURA 2 met the primary composite endpoint by delivering highly statistically significant improvementagainst placebo in reducing the severity of glabellar lines. The percentage of RT002-treated patients who had none or mild wrinkles and achieved at leasta two-point improvement from baseline on both validated physician and patient assessments was 73.6 percent in SAKURA 1 and 74.0 percent in SAKURA 2compared to placebo (p<0.0001) at Week 4. Also, at that time point, 88 percent of RT002-treated patients in SAKURA 1 and 91 percent of RT002 patients inSAKURA 2 said they were very satisfied or satisfied with their treatment experience.Secondary Duration Endpoints. There were several secondary endpoints used to evaluate duration of effect, including the proportion of patientsachieving none or mild response on IGA-FWS compared to placebo, median duration for time to loss of none or mild wrinkle severity on both IGA-FWS andPFWS, and median duration for time to return to baseline on both IGA-FWS and PFWS. The percentage of RT002-treated patients who achieved a none ormild response on IGA-FWS was 35.3 percent in SAKURA 1 and 29.4 percent at SAKURA 2 compared to placebo (p<0.0001) at Week 24. The medianduration for time to loss of none or mild wrinkle severity on both IGA-FWS and PFWS for RT002-treated patients was 24.0 weeks for SAKURA 1 and 23.9weeks for SAKURA 2. The median duration for time to return to baseline wrinkle severity on both IGA-FWS and PFWS for RT002-treated patients was 27.7weeks for SAKURA 1 and 26.0 weeks for SAKURA 2. For comparison, an additional exploratory duration endpoint was evaluated, which mirrors the durationmeasure used in the BELMONT Phase 2 study. This endpoint, was the median duration of greater or equal to 1 point improvement from baseline on IGA-FWSfor RT002-treated patients, and the results were 24.1 weeks for both SAKURA 1 and SAKURA 2, and 23.6 weeks for BELMONT.In addition to SAKURA 1 and SAKURA 2, the SAKURA Phase 3 program includes a long-term, open-label safety trial (SAKURA 3), which is designedto evaluate the long-term safety of RT002 injectable for the treatment of moderate to severe glabellar lines in adults following both single and repeattreatment administration. In the fourth quarter of 2017, we completed enrollment of more than 2,500 subjects at 66 sites in the U.S. and Canada for SAKURA3. Depending on the number of treatments and duration of follow-up, a subject may be on trial for a maximum of 86 weeks. We have designed SAKURA 3 tosupport a safety database adequate for both domestic and international marketing applications. Assuming successful completion of our SAKURA Phase 3program in the second half of 2018, we plan to file marketing applications first in the United States followed by the European Union, Canada, and certainLatin American and Asian countries. If approved, we believe RT002 injectable has the potential to address significant unmet needs in these markets.European Union Agency Interactions. We requested scientific guidance from the European Medicines Agency, or EMA, on the development of RT002injectable for the treatment of glabellar lines and the proposed Phase 3 program in 2016. The EMA provided comments on Quality, Nonclinical and Clinicalprograms. Overall, the EMA agreed with the proposed programs and provided details and suggestions to be considered for our marketing application. Wehave taken the EMA comments into consideration in the Phase 3 program and will provide data to support the various requests in the marketing application.Pre-Phase 3 FDA Interactions. In 2016, we completed a pre-Phase 3 meeting with the U.S. Food and Drug Administration, or FDA, regarding RT002injectable for the treatment of glabellar lines. Based upon the discussion with the FDA and the minutes received following the meeting, we submitted anInvestigational New Drug Application (IND) for the SAKURA Phase 3 clinical program for RT002 in glabellar lines and other supportive studies required fora Biologics License Application (BLA) submission.Phase 1 and 2 Clinical Trials. RT002 has demonstrated long-lasting effect and appeared to provide safe administration of botulinum toxin in Phase 1and 2 clinical trials, even at high targeted doses. Long-lasting effect was first demonstrated in 2014 in the final cohort of a four-cohort Phase 1/2 clinical doseescalation trial conducted outside the United States for improvement of glabellar lines. In the trial, RT002 injectable met its primary efficacy and safetyendpoints. The open-label, dose escalating, Phase 1/2 trial enrolled 48 adults. All subjects had moderate to severe wrinkles at baseline, measured using the 4-point Global Line Severity Scale (GLSS). In summary, the data showed:•96% of subjects were rated with None or Mild wrinkle severity at maximum frown 4 weeks post-treatment using the GLSS as assessed by theclinical investigator.3Table of Contents•83% of subjects assessed themselves as achieving None or Mild wrinkles at maximum frown at the same time point.•In the final cohort, which was the only cohort where duration of effect was measured, RT002 injectable achieved a median duration of 29.4weeks or seven months based on both investigator and subject Glabellar Line Severity Scale scores better than baseline.•In this final cohort, 60% of subjects maintained None or Mild wrinkle severity at 6 months.•RT002 injectable was well-tolerated, and there was no evidence of spread beyond the treatment site at any dose; additionally, adverse eventrates did not change in frequency, severity, or type with increasing doses.RT002 appeared to be generally safe and well-tolerated with minimal adverse events in our Phase 1/2 trial. Adverse events were generally mild,localized and transient. The most common adverse events observed were headache and injection site reactions. There was no evidence of spread beyond thetreatment site at any dose. There were no serious adverse events or evidence of any systemic exposure based on clinical laboratory results and relatedevaluations. Adverse event rates did not change in frequency, severity, or type with increasing doses.Based on the results of this study, in 2015 we conducted BELMONT, a Phase 2, Randomized, Double-Blind, DosE Ranging, Active and PLaceboControlled, Multi-Center Study to Evaluate the Safety, Efficacy, and Duration of Effect Of RT002, a BotuliNum Toxin Type A for Injection, injectable totreat glabellar lines. The primary endpoints for the study were the investigator's assessment of glabellar line severity at maximum frown at Week 24 basedupon the subject response definition of at least a 1 point improvement from baseline on the IGA-FWS scale and median duration of effect from the date oftreatment back to baseline severity. The BELMONT trial evaluated treatment for glabellar lines in 268 subjects with moderate to severe glabellar lines at nineinvestigational sites in Canada. The trial compared the safety, efficacy and duration of three doses of RT002 injectable, the labeled dose of BOTOX®Cosmetic/VISTABEL® and a placebo control in a randomized 1:1:1:1:1 trial design. In 2015, we reported positive 24-week results from the trial that showedRT002 injectable achieved its primary efficacy measurement with high statistical significance. In addition, the 40 Unit dose of RT002 injectabledemonstrated a 23.6-week median duration, compared to BOTOX® Cosmetic with an 18.8-week median duration. Across all cohorts, RT002 injectableappeared to be generally safe and well-tolerated.Cervical Dystonia and Other Muscle Movement DisordersWe have also been developing RT002 for the treatment of cervical dystonia, a muscle movement disorder. We will continue to evaluate developmentfor other therapeutic indications, such as neurological movement and other disorders, based on the results of our current preclinical studies and clinical trials.Muscle movement disorders, such as cervical dystonia, are neurological conditions that affect a person's ability to control muscle activity in one or moreareas of the body. Muscle spasticity happens after the body's nervous system has been damaged, most commonly by a stroke, disease, or trauma. While notlife-threatening, spasticity can be painful and may have a significant effect on a person's quality of life. Certain tasks, like getting dressed or bathing, becomedifficult, and a person's self-esteem may be affected by an abnormal posture. Common muscle movement disorders include cervical dystonia (excessivepulling of the muscles in the neck and shoulder), upper or lower limb spasticity (stiffness in muscles), and blepharospasm (involuntary closing of the eyelids).Botulinum toxin type A has proven safe and effective for such uses, as the most common treatment for muscle movement disorders is to relax the muscle byinjecting it with botulinum toxin. We believe that muscle movement disorders have accounted for over $1 billion of therapeutic neuromodulator salesglobally in 2016.RT002 Injectable for Treatment of Cervical DystoniaIn 2015, we initiated a Phase 2 dose-escalating, open-label clinical study of RT002 injectable to evaluate safety, preliminary efficacy, and duration ofeffect of RT002 injectable in subjects with moderate to severe isolated cervical dystonia symptoms of the neck. In December 2016, we announced positiveinterim results from the Phase 2 clinical trial. The interim data showed that RT002 injectable appeared to be generally safe and well-tolerated, demonstrated amedian duration of at least 24 weeks for the first cohort of the study, and displayed a clinically significant impact on cervical dystonia signs and symptoms.The trial enrolled 37 subjects and follows three sequential treatment cohorts for up to a total of 24 weeks after treatment for each cohort. The trial’s firstcohort of 12 subjects received a single dose of up to 200 units of RT002 injectable, the second cohort of 12 subjects received between 200 and 300 units, andthe third cohort of 13 subjects received from 300 to 450 units. In May 2017, we announced positive 24-week topline results in all three cohorts from thePhase 2 trial. The topline data demonstrated a median duration of at least 24 weeks for all three cohorts.4Table of ContentsKey results of the cervical dystonia trial are as follows:Safety. In all three cohorts, RT002 injectable appeared to be generally safe and well-tolerated through Week 24. There were no serious adverse eventsand no dose-dependent increase in adverse events. The treatment-related adverse events were transient and mild to moderate in severity, except for one caseof neck pain reported as severe, with a duration of 2 days. The most common adverse events were dysphagia, or difficulty in swallowing (14%), of which allcases were mild in severity, injection site redness (8%), bruising (5%), injection site pain (5%), muscle tightness (5%) and muscle weakness (5%). Forreference, trials for botulinum type A products approved to treat cervical dystonia have reported adverse events for dysphagia ranging from 13% to 39%.Efficacy. The trial’s 4-week primary efficacy measurement was the improvement in dystonia symptoms as determined by reduction from baseline on theToronto Western Spasmodic Torticollis Rating Scale (TWSTRS)-Total score. RT002 injectable showed a clinically significant mean reduction of 16.8 frombaseline, or 38%, across all three cohorts at Week 4. This reduction continued to increase to 50% at Week 6 for all subjects, was 42% at Week 12 and wasmaintained at or above 30% through Week 24. Clinically meaningful mean reductions in the TWSTRS Severity, Disability and Pain subscales wereconsistent and observed at all follow-up visits across all subjects. For reference, placebo-controlled trials for botulinum toxin type A products approved totreat cervical dystonia had a reduction in the TWSTRS-Total score from baseline of 21% to 26% at Week 4 and 13% to 16% at Week 12.Duration of Effect. The median duration of effect was at least 24 weeks for each of the three dose cohorts studied. Duration of effect was defined as thenumber of weeks from treatment until the return of signs and symptoms that warrant retreatment, based on subjects reaching their target Toronto WesternSpasmodic Torticollis Rating Scale (TWSTRS) score. For reference, treatment with currently approved neuromodulators for cervical dystonia calls forinjection of botulinum toxin approximately every 3 months (12 weeks), or 4 times per year.FDA and EMA Interactions. In November 2017, we completed our End-of-Phase 2 meeting with the FDA and received Scientific Advice from the EMAregarding RT002 for the treatment of cervical dystonia. Based on the Phase 2 safety and efficacy results and guidance from the FDA and EMA, we plan toinitiate our Phase 3 program for cervical dystonia in the second quarter of 2018. In November 2017, the FDA also granted orphan drug status toDaxibotulinumtoxinA for Injection for the treatment of cervical dystonia in adults.Plantar FasciitisWe are also developing RT002 for the treatment of plantar fasciitis. Plantar fasciitis is a painful affliction caused by inflammation of the ligamentrunning along the bottom of the foot and is the most common cause of heel pain. Heel pain is the most common complaint of patients who visit podiatristsand orthopedic foot and ankle surgeons. Eighty percent of reported heel pain complaints are due to plantar fasciitis. Plantar fasciitis is estimated to affect 10to 18 million individuals in the United States. Risk factors include age, long distance running, excessive weight, abnormal foot posture, use of poor footwear, and repetitive trauma.Symptoms can last six months or more, sometimes requiring surgery. In the United States alone, more than two million patients undergo treatment forplantar fasciitis each year. Treatment options for less severe cases include leg and foot stretching exercises, nonsteroidal anti-inflammatory drugs, shoeinserts, heel pads, and night splints. More severe or refractory cases are currently treated with steroid injections, extracorporeal shock wave therapy, plateletrich plasma injections, and/or surgery. Preclinical and clinical research suggests a neuromodulator candidate such as RT002 injectable may provide patientswith sustained relief from chronic heel pain and support healing of the plantar fascia without the risks of plantar fascia rupture or atrophy of the fat pad thatcan occur with corticosteroid injections, a common treatment.Botulinum toxin is not currently approved for treating plantar fasciitis; the clinical endpoints, however, are well established. Published estimates placethe annual U.S. evaluation and treatment market for plantar fasciitis at more than $250 million, and we believe the market could grow significantly larger ifpatients had a compelling neuromodulator treatment option.5Table of ContentsRT002 Injectable for Treatment of Plantar FasciitisIn 2016, we initiated a Phase 2 prospective, randomized, double-blinded, placebo-controlled trial of RT002 injectable in the therapeutic indication ofplantar fasciitis. This study will evaluate the safety and efficacy of a single administration of RT002 injectable in reducing the signs and symptoms of plantarfasciitis. The study completed enrollment of 59 subjects in the United States in October 2017. The study's primary efficacy endpoint is the improvement inthe American Orthopedic Foot and Ankle Score (AOFAS).In January 2018, we announced the interim 8-week Phase 2a results for the plantar fasciitis trial. The trial’s primary endpoint, the reduction in thepatient-reported visual analog scale (VAS) for pain at Week 8, showed a robust impact on pain, with a greater than 50% reduction for patients treated withRT002. In the intent-to-treat population, a mean reduction in the VAS score of 54.2% from baseline was achieved with RT002, compared with a 42.6%reduction in the placebo group, which upon further subgroup analysis, was driven primarily by a strong placebo response in the control group at three of thefive study sites. While the results are not statistically significant (p=0.39) , RT002 provided patients with considerable pain relief. Similar numeric trendswere seen in the secondary and exploratory endpoints. RT002 appeared to be generally safe and well-tolerated through Week 8. The majority of adverseevents in both treatment groups were mild in severity. There were no treatment-related serious adverse events. The most common treatment-related adverseevents for RT002 and placebo were injection site pain (10.0 percent and 10.3 percent) and muscle weakness (3.3 percent and 3.4 percent), both respectively,all of which were classified as mild in severity. The Company plans to complete the 16-week trial and then expects to conduct another Phase 2 trial with amodified design to demonstrate the ability of RT002 to treat plantar fasciitis in the second half of 2018.DaxibotulinumtoxinA TopicalDaxibotulinumtoxinA Topical is a topical formulation of botulinum toxin type A. The botulinum toxin in our topical product candidate blocksneuromuscular transmission by binding to receptor sites on motor or sympathetic nerve terminals, entering the nerve terminals and inhibiting the release ofspecific neurotransmitters. The topical product candidate is designed to provide treatment with no needles, no downtime, no bruising, and no pain.We previously completed topical clinical trials for the treatment of lateral canthal lines (crow’s feet) and primary axillary hyperhidrosis, butdiscontinued further clinical development in 2016 following the results of our REALISE 1 Phase 3 clinical trial using topical to treat crow's feet. We plan tostudy our topical in a preclinical setting for therapeutic and aesthetic applications where topical administration of a neuromodulator provides a meaningfuladvantage over injection.Preclinical Program In accordance with international guidelines and in consultation with the FDA, we previously conducted a nonclinical topical development program.The program included preclinical efficacy, safety bioavailability and single and repeat dose toxicity studies of our topical product candidate, includingchronic studies of up to nine months' duration. Genotoxicity, local tolerance and formulation bridging studies were also conducted, along with reproductivetoxicity testing. Together, these studies support future clinical development.Based on the results of additional preclinical studies, we plan to evaluate further development of indications for our topical candidate, such as axillaryhyperhidrosis, neuropsychiatric disorders, and chronic inflammatory diseases.Our TechnologyOur Proprietary Peptide TechnologyCombining our proprietary peptide technology with active drug macromolecules such as daxibotulinumtoxinA may help address currently unfulfilledneeds in aesthetic medicine and therapeutic categories. Employing our proprietary peptide technology may ensure overall formulation performance of theRT002 injectable where the focus is on delivering the first potentially long-acting neuromodulator. Our daxibotulinumtoxinA compound is often referred toas "a pipeline within a product," as there are multiple indications that may potentially be treated by our daxibotulinumtoxinA compound.6Table of ContentsRT002 Injectable Delivery of Botulinum ToxinRT002 injectable utilizes our proprietary botulinum toxin-peptide complex in a saline-based formulation. In RT002 injectable, the peptide interactswith both extracellular structures and cell surface receptors in the targeted muscle. This interaction restricts the toxin molecule to the target site andpotentially reduces unwanted spread to other neighboring muscles. We believe that by limiting the spread of RT002 injectable to neighboring muscles,RT002 injectable is likely to be better tolerated at higher doses than BOTOX® Cosmetic. Additionally, at doses where the spread of BOTOX® Cosmetic andRT002 injectable were compared, RT002 injectable appeared to be more targeted with longer duration in our preclinical studies. Nonclinical and clinicaldata taken together suggest that RT002 injectable may provide long duration of effect at the target muscle and reduce spread to untargeted muscles.The Botulinum Toxin OpportunityBotulinum toxin is a protein and neuromodulator produced by Clostridium botulinum. Since 1989 botulinum toxin in an injectable dose form has beenused to treat a variety of aesthetic and therapeutic indications in the United States and globally. Botulinum toxin has been approved for a variety oftherapeutic indications including cervical dystonia, upper limb spasticity, blepharospasm, strabismus associated with neurological movement disorders,hyperhidrosis, migraine headache, overactive bladder and, most recently, lower limb spasticity. In the United States, botulinum toxin has been approved totreat three aesthetic indications, glabellar lines, forehead lines and lateral canthal lines, although we believe botulinum toxin to be widely used for otheraesthetic indications. Three products, Allergan’s BOTOX® Cosmetic, Ipsen and Galderma’s Dysport®, and Merz’s Xeomin®, each of which is delivered in aninjectable form, have been approved for the treatment of glabellar lines in the United States.According to Global Industry Analysts, Inc. or GIA, the global opportunity for botulinum toxin was estimated to be $4.0 billion in 2017 compared to$3.6 billion in 2016. The market is projected to reach $7.4 billion by 2024, registering a compounded annual growth rate of 9.6% over the analysis period of2016 to 2024. In 2017, the aesthetic segment amounted to $1.6 billion while therapeutic indications totaled $2.4 billion. We expect continued growth to bedriven by new indications and product launches in new geographies. According to clinicaltrials.gov, as of December 31, 2017 there were more than 170active clinical trials for a wide range of uses of botulinum toxin, with approximately one-fourth of these identified as being in Phase 3 clinical development.While we are unaware of any clinical trials for potentially competitive long-lasting products that may be commercialized before RT002 injectable, it ispossible that clinical trials for such potentially competitive products have occurred or are occurring.The Opportunity for Botulinum Toxins for Aesthetic IndicationsToday’s culture places significant value on physical appearance, leading to widespread adoption of anti-aging and aesthetic treatments. Aesthetictreatments have grown dramatically in the United States, driven by a large population of consumers who are looking to delay signs of aging and improvegeneral appearance.Injectable botulinum toxin treatments are the single largest cosmetic procedure in the United States and the rest of the world. According to theAmerican Society for Aesthetic Plastic Surgery, or ASAPS, a strong consumer preference for non-surgical options and the increasing availability of effectivealternatives have prompted adoption of non-surgical aesthetic procedures by a broader patient population. These trends have made non-surgical proceduresthe primary driver of growth in aesthetic medicine, accounting for 85% of the total number of procedures performed in 2016, according to the ASAPS annualstatistics. Injectable botulinum toxin was the most frequently performed non-surgical procedure in 2016, with 4.6 million procedures in the US, a 7.8%increase over 2015. Injectable treatments overall, botulinum toxins and dermal fillers, increased 10.1% in 2016, according to ASAPS. Injectable botulinumtoxin treatments have been the number one nonsurgical procedure since 2000, according to ASAPS. The number of procedures surpassed 4.5 millionannually for the first time in 2016.The Opportunity for Botulinum Toxins for Therapeutic IndicationsWhile currently approved botulinum toxin products may be better known for their aesthetic applications, according to GIA, the fastest-growingsegment for botulinum toxin treatments in the United States and Europe is actually for therapeutic indications. This growth has been driven largely by theapproval of botulinum toxin products in new indications such as preventive treatment of chronic migraine headache and upper limb spasticity in 2010,urinary incontinence in 2011, overactive bladder in 2013, and lower limb spasticity in 2016. Botulinum toxin’s ability to affect neuromuscular junctions,muscle activity or the release of neuropeptides, neurotransmitters and neuromediators in a controlled manner has enabled it to be developed and used in awide range of therapeutic indications.7Table of ContentsIn addition to the approved therapeutic indications mentioned above, botulinum toxin products are being evaluated in clinical trials in multiple othertherapeutic indications including acne, rosacea, skin and wound healing, scar reduction, hair loss treatments, plantar fasciitis and several musculoskeletalconditions.We believe there is opportunity to improve injectable botulinum toxin use in neurological movement and other disorders. Muscle movement disordersare neurological conditions that affect a person’s ability to control muscle activity in one or more areas of the body. Muscle spasticity happens after thebody’s nervous system has been damaged, most commonly by a stroke, disease, or trauma. Muscle spasticity can be painful and may have a significant effecton a person’s quality of life. Certain tasks, like getting dressed or bathing, become difficult, and a person’s self-esteem may be affected by an abnormalposture. Common muscle movement disorders include cervical dystonia (excessive pulling of the muscles in the neck and shoulder), and upper or lower limbspasticity (stiffness in arm or leg muscles). Botulinum toxin type A has proven safe and effective for such uses, as the most common treatment for musclemovement disorders is to relax the muscle by injecting it with botulinum toxin. However, such injections must be repeated every 3-4 months and requirelarge doses, typically more than 200 BOTOX® units each treatment. As a result of the discomfort associated with muscle movement disorders and theassociated demand for treatment that currently requires up to four visits per year, we believe that there is a significant need for a long-lasting and targetedinjectable botulinum toxin.HyperhidrosisAccording to published medical articles, hyperhidrosis affects approximately nine million people in the United States (or 2.8% of the currentpopulation), with approximately half experiencing axillary hyperhidrosis, or underarm excessive sweating. Prevalence in the United States is slightly higheramong men than women, but women are more likely to take action to have the condition treated. GIA estimates the global market for treatment of axillaryhyperhidrosis with botulinum toxin to be $98 million in 2016. In 2014, the International Hyperhidrosis Society or IHHS fielded a survey among its emailsubscribers. While it is recognized that consumers who regularly read newsletters from the IHHS are likely to be more severe sufferers and those who are morelikely to treat their disease, this survey does provide up to date information on this population. Additionally, we believe that these consumers may be earlyadopters of new treatments. In this population, hyperhidrosis is a multi-focal disease where the majority of people (81%) suffer in more than one focal area inaddition to their underarms, most commonly the hands and feet. Among this group of consumers, 90% have sought assistance from a medical professional(compared to 38% cited in medical literature that describes the general population of hyperhidrosis sufferers). Of the 90% who seek medical assistance, 79%receive a diagnosis of hyperhidrosis, and of those, 87% seek some type of treatment. The most commonly used treatments and percentage of respondents thatuse each are:•Over-the-counter antiperspirants (78%)•Prescription antiperspirants (77%)•Oral medication (53%)•Botulinum Toxin Injections (41%)•Iontophoresis, or the use of electrical current on skin (38%)•Surgery (13%)•Other (10%)Neuropsychiatric DisordersMigraine Headache. Migraine headache is a central nervous system disorder characterized as moderate to severe headache and often includesadditional symptoms such as nausea and vomiting. The global market for treatment of migraine headache was estimated to be $3.2 billion in 2015 accordingto a report published by Decision Resource Group. Migraine headache affects more than 38 million people in the United States, of which more than 3 millionof whom suffer from chronic migraine headache. In the United States, this debilitating condition results in $36 billion each year in healthcare and lostproductivity costs, according to the Migraine Research Foundation. Injected delivery of botulinum toxin has been validated as a therapeutically effectivepharmaceutical agent for the preventive treatment of migraine headache. Botox® was approved for the treatment of chronic migraine headache in 2010. In2017, BOTOX® sales for migraine were estimated to be more than $550 million. However, the treatment requires up to 31 injections in a patient’s head andneck and may have significant side effects, including the potential for injected botulinum toxin to diffuse to neighboring sites causing muscle weakness andpain, sometimes even triggering migraine headache attacks.8Table of ContentsChronic Daily Headache. Chronic daily headache, which is defined as an idiopathic headache occurring on more than 15 days per month for at least3 months and for a daily duration of at least 4 hours, is considered a headache disorder that may benefit from treatment with botulinum toxin A. It is likelythat those patients with chronic daily headache (with or without medication overuse) who are severely impaired (i.e., highest loss of productivity) and whoare not receiving any other prophylactic treatment are the appropriate group of patients that may benefit from treatment with botulinum toxin. Since this totalpatient group shows a prevalence of up to 4% in population based epidemiological studies, it is warranted to further elucidate the clinical efficacy ofbotulinum toxin in this subgroup.Major Depressive Disorder. Major depressive disorder is a common and serious disease that may be resistant to routine pharmacologic andpsychotherapeutic treatment approaches. Preliminary studies have shown a single treatment of botulinum toxin in the forehead region can improve symptomsof depression in patients with major depressive disorder, or MDD, as defined by DSM-IV criteria. Positive effects on mood have been observed in subjectswho underwent treatment of glabellar lines with botulinum toxin and, in an open case series, depression remitted or improved after such treatment.Neuropathic Pain. Neuropathic pain is a condition that may arise as a result of a lesion or disease affecting the nervous system and, as a collection ofsyndromes, is often chronic in nature causing significant negative impact to quality of life. Existing treatments include antidepressants, serotonin inhibitorsand calcium channel agonists, each of which require daily dosing and are often accompanied by side effects and modest efficacy. More recently, injectedbotulinum toxin has been shown to address many forms of neuropathic pain and provide extended relief, of approximately three months, in line with theknown duration profile for botulinum toxin treatment of other targets.Chronic Inflammatory DiseasesRosacea. Rosacea is a common skin condition that causes redness, dilated blood vessels and may produce small red pus-filled bumps of the face. Itaffects an estimated 16 million Americans, yet only a small fraction are being treated. While there is no cure for rosacea and the cause is unknown, medicaltherapy is available to control or reverse its signs and symptoms.Psoriasis. Psoriasis is a chronic skin condition that affects an estimated 125 million people worldwide, 2 to 3 percent of the total population, and isthe most prevalent autoimmune disease according to the World Psoriasis Day consortium. Animal-model studies have shown the potential role of botulinumtoxin in addressing inflammatory skin conditions, specifically demonstrating that botulinum toxin injections improved the clinical appearance of psoriasis.Eczema. Eczema is another chronic inflammatory skin condition marked by dry, itchy skin. Atopic dermatitis - the most common form of eczema -affects millions of people, including an estimated 6 to 10 percent of children. Early research suggests that there could be a role for botulinum toxin incombating itch by better understanding the interaction of the vascular system in inflammatory skin conditions. While there are available therapies to treateczema and psoriasis, not all therapies are equally effective. In inflammatory conditions such as these, a topical botulinum toxin could potentially provide a viable treatment alternative to the current standardtreatment, topical steroids, which have side effects, such as rosacea, perioral dermatitis, and acne.Rheumatic conditions. In rheumatology, botulinum toxin may be able to help treat painful blood vessel conditions, such as Raynaud’s disease andScleroderma. In initial studies, botulinum toxin injections have shown overall improvement in patient pain as well as a reduction in soft tissue ulceration.Our StrategyOur objective is to be a leading provider of neuromodulator products across multiple aesthetic and therapeutic indications in both injectable andtopical dose forms and to expand the opportunity for botulinum toxin products. To achieve this objective, we plan to develop and commercialize twoproprietary, patent-protected product candidates: first, our RT002 injectable, followed by our topical product candidate.Key elements of our strategy are: •Complete RT002 Injectable Clinical Development and File for Marketing Approval in Frown Lines in the U.S. Followed by Europe. Weannounced positive top-line results for DaxibotulinumtoxinA for Injection (RT002) in alleviating moderate-to-severe glabellar lines in tworandomized, double-blind, placebo-controlled pivotal Phase 39Table of Contentstrials that evaluated the safety and efficacy of a single administration of RT002 for the treatment of moderate-to-severe glabellar lines in adults.The SAKURA 1 and SAKURA 2 trials enrolled a total of 609 patients at 30 sites in the United States and Canada. We plan to complete ourSAKURA Phase 3 program of RT002 injectable for the treatment of glabellar lines in the second half of 2018. In the first half of 2019, we plan tofile a Biologics License Application in the United States to gain marketing approval, followed by filings in other counties.•Advance RT002 Injectable Clinical Development for Therapeutic Indications. We reported Phase 2 results for cervical dystonia in November2017 and Phase 2a results for plantar fasciitis in January 2018. We plan to initiate our Phase 3 program for the treatment of cervical dystonia inthe second quarter of 2018. We are evaluating future development of RT002 injectable in other indications where longer-duration, providesenhanced patient care.•Build Our Own Sales and Marketing Capabilities To Commercialize RT002 Injectable in North America. We have expanded our pre-commercial activities in anticipation of approval of RT002 in glabellar lines. If RT002 injectable is approved for the treatment of glabellar linesby the FDA, we intend to expand our own commercial organization in North America. Specifically, we plan to build a specialty sales force totarget key physicians who perform the majority of aesthetic procedures, including dermatologists, plastic surgeons, facial plastic surgeons, andoculoplastic surgeons.•Expand the Global Opportunity for Botulinum Toxin Products. We believe RT002 injectable has the ability to expand the botulinum toxinopportunity by appealing to patients who seek a long-lasting effect. We also believe our topical product candidate and other possible doseforms can expand the overall botulinum toxin opportunity beyond the current patient base by bringing in new patients who would prefer aneedle-free approach to treatment and a more tolerable procedure.•Establish Selective Strategic Partnerships to Maximize the Commercial Potential of our Product Candidates and our Proprietary PeptideTechnology. Outside of North America, we plan to evaluate whether to commercialize our product candidates on our own or in collaborationwith potential partners and distributors. Specifically, assuming regulatory approval of RT002 injectable outside of the United States, we willevaluate whether to build in-house commercial capabilities in one or more countries outside of the U.S. and Canada or to seekcommercialization partners to maximize the profitability of RT002 injectable. Additionally, our proprietary peptide technology can be used formolecules other than botulinum toxin. We plan to partner or license the peptide technology opportunistically to monetize our technologyplatform.•Maximize the Value of our Botulinum Toxin Cell Line and Manufacturing Assets. We have developed an integrated manufacturing, analytics,research and development facility that is capable of producing proprietary forms of botulinum toxin for Revance and for potential futurepartners.Manufacturing and OperationsWe have established capabilities for the production of botulinum toxin type A, including bulk drug substance and injectable finished drug product.Botulinum toxin is regulated as a Select Agent under authority of the Centers for Disease Control and Prevention, or CDC, and as such requires that weperform our operations in compliance with CDC regulations. We are in good standing under our Select Agent license with the CDC. We have assembled ateam of experienced individuals in the technical disciplines of chemistry, biology and engineering and have appropriately equipped laboratory space tosupport ongoing research and development efforts in our botulinum toxin product development platform. We have the ability to manufacture our ownbotulinum toxin bulk drug substance to support our clinical trial programs and eventually, our commercial production. We believe that having direct controlover our manufacturing processes will enable us to develop additional pharmaceutical product configurations effectively and with a competitive coststructure. In March 2017, Revance entered into a Technology Transfer, Validation and Commercial Fill/Finish Services Agreement with Ajinomoto Althea,Inc., a contract development and manufacturing organization, to provide us with expanded capacity and a second source for drug product manufacturing tosupport a global launch of DaxibotulinumtoxinA for Injection (RT002). The Services Agreement also mitigates supply chain risk by giving us a differentmanufacturing location and reduces future capital and operating expenditures required in our primary manufacturing facility by outsourcing to anexperienced partner.We manufacture and perform testing for both bulk drug substance and finished dosage forms of drug product to support our RT002 injectablecandidate. The additional components required for our product lines and the peptide for RT002 injectable are manufactured by third parties under contractwith us. See the section entitled “Outsourced Components” below for additional information.10Table of ContentsDrug SubstanceManufacture of the drug substance for RT002 injectable is based on microbial fermentation followed by product recovery and purification steps. Theprocess is entirely free of animal and human-derived materials and depends on standard raw materials available commercially. The process is already scaledto support all future commercial demands. Bulk drug substance is stable when stored for extended periods, which allows us to establish reserves of drugsubstance and allows periodic drug substance production to replenish inventories as needed.Drug ProductManufacture of topical and injectable dose forms to support the RT002 injectable and topical development programs is currently performed at our fill-finish facility. The manufacturing process consists of bulk compounding, liquid fill and freeze-drying to support acceptable shelf-life duration. We plan toperform further scale-up of RT002 injectable drug product manufacturing to meet anticipated commercial demand and may utilize internal capacity, a third-party manufacturer such as Ajinomoto Althea, or a combination of both.Outsourced ComponentsWe contract with third parties for the manufacture of our botulinum toxin and the additional components required for our products, which includes themanufacture of bulk peptide.Our agreement with List Biological Laboratories, Inc., or List Laboratories, a developer of botulinum toxin, includes certain milestone payments relatedto the clinical development of our botulinum toxin products and the toxin manufacturing process. There is a royalty with an effective rate ranging from low-to-mid single-digit percentages of future sales of botulinum toxin. Our agreement with List Laboratories will remain in effect until expiration of our royaltyobligations and may be terminated earlier on mutual agreement or because of a material breach by either party.Our agreement with American Peptide includes development, manufacture and supply of peptide in accordance with certain specifications. Thisagreement also includes certain quality control and inspection provisions through which we can ensure the satisfactory quality of our peptide. Our agreementwith American Peptide will remain in effect until 2020 and may be terminated earlier by either party following advance notice or a material breach by eitherparty. American Peptide was acquired by Bachem.Our agreement with Ajinomoto Althea includes manufacture and supply of drug product in accordance with certain specifications. This agreement alsoincludes certain quality control and inspection provisions through which we can ensure the satisfactory quality of our drug product. Our agreement withAjinomoto Althea will remain in effect for seven years and may be terminated earlier by either party following advance notice or a material breach by eitherparty.CompetitionWe expect to enter highly competitive pharmaceutical and medical device markets. Successful competitors in the pharmaceutical and medical devicemarkets have the ability to effectively discover, develop, test and obtain regulatory approvals for products, as well as the ability to effectively commercialize,market and promote approved products, including communicating the effectiveness, safety and value of products to actual and prospective customers andmedical staff. Numerous companies are engaged in the development, manufacture and marketing of healthcare products competitive with those that we aredeveloping.Many of our competitors have substantially greater manufacturing, financial, research and development, personnel and marketing resources than we do.Our competitors may also have more experience and expertise in obtaining marketing approvals from the FDA and other regulatory authorities. In addition toproduct development, testing, approval and promotion, other competitive factors in the pharmaceutical and medical device industries include productquality and price, product technology, reputation, customer service and access to technical information. Our competitors may be able to develop competingor superior technologies and processes, and compete more aggressively and sustain that competition over a longer period of time than we could. Ourtechnologies and products may be rendered obsolete or uneconomical by technological advances or entirely different approaches developed by one or moreof our competitors. As more companies develop new intellectual property in our markets, the possibility of a competitor acquiring patent or other rights thatmay limit our products or potential products increases, which could lead to litigation.11Table of ContentsUpon marketing approval, the first expected uses of our products will be to treat glabellar lines, cervical dystonia and plantar fasciitis, followed bypotential use to treat other aesthetic and therapeutic conditions. The technologies with which we expect to compete directly are injectable and topicalneuromodulators.Injectable and Topical NeuromodulatorsOur primary competitors for RT002 in the pharmaceutical market are expected to be companies offering injectable dose forms of botulinum toxin,including: •BOTOX® and BOTOX Cosmetic®, marketed by Allergan, Inc., since its original approval by the FDA in 1989, has been approved for multipleindications, including glabellar lines, forehead lines, crow’s feet, axillary hyperhidrosis, upper and lower limb spasticity, cervical dystonia,strabismus, blepharospasm, chronic migraine, incontinence, and overactive bladder. Allergan is a leading global pharmaceutical company withsignificant research, discovery, and delivery capabilities.•Dysport®, an injectable botulinum toxin for the treatment of cervical dystonia, glabellar lines and upper and lower limb spasticity, is marketedby Ipsen Ltd., or Ipsen, and Galderma, a Nestle company. Galderma has rights to market the product in the United States and Canada. Dysport®was approved by the FDA in 2009. Ipsen received marketing authorization for a cosmetic indication for Dysport® in Germany. Ipsen grantedGalderma an exclusive development and marketing license for Dysport® for cosmetic indications in the European Union, Russia, EasternEurope and the Middle East, and first rights of negotiation for other countries around the world, except the United States, Canada and Japan.Galderma is Ipsen’s sole distributor for Dysport® in Brazil, Argentina and Paraguay. The health authorities of 15 European Union countrieshave also approved Dysport® for glabellar lines under the trade name Azzalure®. Ipsen and Syntaxin are engaged in a research collaborationagreement to develop native and engineered formats of botulinum toxin.•Myobloc®, a neuromodulator currently marketed by US WorldMeds and approved by the FDA in 2000 for the treatment of cervical dystonia.•Xeomin®, an injectable botulinum toxin for the treatment of cervical dystonia, glabellar lines, blepharospasm, and upper limb spasticity, ismarketed by Merz Pharma, or Merz. Xeomin is approved by the FDA for cervical dystonia and blepharospasm in adults, glabellar lines, and thetreatment of upper limb spasticity. Xeomin® is also currently approved for glabellar lines in Korea, Argentina and Mexico, and therapeuticindications in most countries in the European Union as well as Canada and certain countries in Latin America and Asia. Bocouture® (rebrandedfrom Xeomin®), marketed by Merz, has approval for glabellar lines in Germany and the European Union.We are aware of competing botulinum toxins currently being developed or commercialized in the U.S., Asia, South America and other markets. Some ofthese markets may or may not require adherence to the FDA’s cGMPs or the regulatory requirements of the European Medicines Agency or other regulatoryagencies in countries that are members of the Organization for Economic Cooperation and Development. While some of these products may not meet U.S.regulatory standards, the companies operating in these markets may be able to produce products at a lower cost than United States and Europeanmanufacturers. In addition to the injectable botulinum toxin dose forms, we are aware that other companies are developing topical botulinum toxins forcosmetic and therapeutics indications and are conducting clinical trials for acne and facial aesthetic and hyperhidrosis.Aesthetic MedicineProfessional facial aesthetic medicine includes neuromodulators and dermal fillers, as well as polymer-based injectables. These and other productsexperience competition from procedures, such as laser treatments, face lifts, chemical peels, fat injections and cold therapy. In the United States, dermal fillerproducts, including Allergan’s Juvéderm family of fillers including Juvéderm VoLUMA® XC, compete with Galderma’s products Restylane® and Perlane™.The FDA has approved Allergan’s Juvéderm® Ultra XC and Ultra Plus XC products containing lidocaine as well as new formulations of Galderma'sRestylane® and Perlane™, also containing lidocaine, and Restylane® without lidocaine for lips. Allergan also has FDA approval for Juvéderm Volbella®XC, created specifically for lips for and longer-lasting results. Galderma has FDA approval for Restylane Refyne for the treatment of moderate to severe facialwrinkles and folds, and Restylane Defyne for the treatment of moderate to severe, deep facial wrinkles and folds. Additional competitors in the filler categoryinclude Radiesse®, a calcium hydroxylapatite from BioForm, acquired by Merz, Sculptra® from Galderma, and Belotero Balance® from Merz.Internationally, competitive products include Q-Med’s range of Restylane® and Perlane™ products, as well as products from Anteis, Filoraga, Teoxane,Galderma and a large number of other hyaluronic acid, bioceramic, protein and other polymer-based12Table of Contentsdermal fillers. All new generation fillers now last at least 6 months. We believe a neuromodulator with a six month duration would allow physicians tocoordinate treatments with fillers.Sales and MarketingWe currently have limited marketing capabilities and no sales organization. Assuming successful completion of clinical trials and receipt of marketingapproval for RT002 injectable for treatment of glabellar lines by the FDA, we plan to launch in North America with our own commercial organization.Specifically, we would access the North American market by hiring a focused, specialized sales force that targets the core physicians (dermatologists, plasticsurgeons, facial plastic surgeons and oculo-plastic surgeons) who perform the majority of the cosmetic procedures. Assuming approval to market in theUnited States, we will focus our initial marketing of RT002 injectable on these core specialties.Strategic PartneringWe plan to focus our efforts on developing and commercializing RT002 injectable in North America. We intend to market on our own and seekcollaborative relationships outside of North America to maximize the commercial potential of our product candidates and delivery technology.We also plan to leverage our proprietary peptide technology outside of our core focus in botulinum toxin by partnering with other companies.Intellectual PropertyOur success depends in large part on our ability to obtain and maintain intellectual property protection for our drug candidates, novel biologicaldiscoveries, and drug development technology and other know-how, to operate without infringing on the proprietary or intellectual property rights of othersand to prevent others from infringing our proprietary and intellectual property rights. We seek to protect our proprietary position by, among other methods,filing U.S. and foreign patent applications related to our proprietary technology, inventions and improvements that are important to the development andimplementation of our business. We also rely on know-how, copyright, trademarks and trade secret laws, continuing technological innovation and potentialin-licensing opportunities to develop and maintain our proprietary position. Such protection is also maintained using confidential disclosure agreements.Protection of our technologies is important for us to offer our customers proprietary services and products unavailable from our competitors, and to excludeour competitors from using technology that we have developed. If competitors in our industry have access to the same technology, our competitive positionmay be adversely affected.It is possible that our current patents, or patents which we may later acquire or develop, may be successfully challenged or invalidated in whole or inpart. It is also possible that we may not obtain issued patents from our pending patent applications or other inventions we seek to protect. Due touncertainties inherent in prosecuting patent applications, sometimes patent applications are rejected and we subsequently abandon them. It is also possiblethat we may develop proprietary products or technologies in the future that are not patentable or that the patents of others will limit or altogether precludeour ability to do business. In addition, any patent issued to us, or any of our pending patent applications, may provide us with little or no competitiveadvantage, in which case we may abandon such patent, or patent applications, or license them to another entity. For more information, please see “Item 1A.Risk Factors — Risks Related to our Intellectual Property.”On June 2, 2016, we entered into the Asset Purchase Agreement, or the Purchase Agreement, with Botulinum Toxin Research Associates, Inc., or BTRX.Under the Purchase Agreement, we acquired all rights, title and interest in a portfolio of botulinum toxin-related patents and patent applications from BTRXand were granted the right of first negotiation and of right of first refusal with respect to other botulinum toxin-related patents owned or controlled by BTRX.As of February 6, 2018, we held approximately 298 issued patents and approximately 95 pending patent applications, including foreign counterparts ofU.S. patents and applications. Thirty-one of our patents are issued in the United States, with the rest issued in Australia, Canada, China, various countries inEurope, Hong Kong, Israel, Japan, Malaysia, Mexico, New Zealand, Singapore and South Africa. In addition, we have pending patent applications in theUnited States as well as in Australia, Brazil, Canada, China, Europe, Hong Kong, Israel, India, Japan, Korea, Mexico, and Singapore. The earliest that any ofour patents will expire is December 10, 2019 for U. S. Patent No. 6,429,189.We will continue to pursue additional patent protection as well as take appropriate measures to obtain and maintain proprietary protection for ourinnovative technologies.13Table of ContentsOur registered and pending U.S. trademarks include REVANCE®, TransMTS®, MOTISTE®, "Remarkable Science Changes Everything®",MEYESMILE, Relastin®, "Remarkable Science. Enduring Performance®", and R Logo.Government RegulationProduct Approval Process in the United StatesIn the United States, the FDA regulates drugs and biologic products under the Federal Food, Drug and Cosmetic Act, or FDCA, its implementingregulations, and other laws, including, in the case of biologics, the Public Health Service Act. Our product candidates, RT002 injectable and our topicalproduct candidate, are subject to regulation by the FDA as a biologic. Biologics require the submission of a BLA to the FDA and approval of the BLA by theFDA before marketing in the United States.The process of obtaining regulatory approvals for commercial sale and distribution and the subsequent compliance with applicable federal, state, localand foreign statutes and regulations require the expenditure of substantial time and financial resources. Failure to comply with the applicable U. S.requirements at any time during the product development process, approval process or after approval, may subject an applicant to administrative or judicialcivil or criminal sanctions. These sanctions could include the FDA’s refusal to approve pending applications, license suspension or revocation, withdrawal ofan approval, imposition of a clinical hold on clinical trials, warning letters, product recalls, product seizures, total or partial suspension of production ordistribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties. The process required by the FDAbefore a biologic may be marketed in the United States generally involves the following: •completion of preclinical laboratory tests, animal studies and formulation studies performed in accordance with the FDA’s current goodlaboratory practices, or GLP regulations;•submission to the FDA of an IND which must become effective before human clinical trials in the United States may begin;•approval by an institutional review board, or IRB, at each clinical trial site before each trial may be initiated;•performance of adequate and well-controlled human clinical trials in accordance with the FDA’s current good clinical practices, or GCPregulations to establish the safety and efficacy of the product candidate for its intended use;•submission to the FDA of a BLA;•satisfactory completion of an FDA inspection, if the FDA deems it as a requirement, of the manufacturing facility or facilities where the productis produced to assess compliance with the FDA’s current good manufacturing practice standards, or cGMP regulations to assure that thefacilities, methods and controls are adequate to preserve the product’s identity, strength, potency, quality and purity, as well as compliance withapplicable Quality System Regulations, or QSR, for devices;•potential inspections by the FDA of the nonclinical and clinical trial sites that generated the data in support of the BLA;•potential review of the BLA by an external advisory committee to the FDA, whose recommendations are not binding on the FDA; and•FDA review and approval of the BLA prior to any commercial marketing or sale.Preclinical StudiesBefore testing any compounds with potential therapeutic value in humans, the product candidate enters the preclinical testing stage. Preclinical testsinclude laboratory evaluations of product chemistry, stability and formulation, as well as animal studies to assess the potential toxicity and activity of theproduct candidate. The conduct of the preclinical tests must comply with federal regulations and requirements including GLPs. The sponsor must submit theresults of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and a proposed clinicalprotocol, to the FDA as part of the IND. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA raises concerns orquestions about the conduct of the clinical trial, including concerns that human research subjects will be exposed to unreasonable health risks. In such a case,the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. The FDA may also impose clinical holds on a productcandidate at any time before or during clinical trials due to safety concerns or non-compliance, or for other reasons.14Table of ContentsClinical TrialsClinical trials involve the administration of the product candidate to human patients under the supervision of qualified investigators, generallyphysicians not employed by or under the clinical trial sponsor’s control. Clinical trials are conducted under protocols detailing, among other things, theobjectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor subject safety andeffectiveness. Each protocol must be submitted to the FDA as part of the IND. Clinical trials must be conducted in accordance with GCPs. Further, eachclinical trial must be reviewed and approved by an IRB at or servicing each institution at which the clinical trial will be conducted. An IRB is charged withprotecting the welfare and rights of clinical trial participants and considers such items as whether the risks to individuals participating in the clinical trials areminimized and are reasonable in relation to anticipated benefits. The IRB also approves the form and content of the informed consent that must be signed byeach clinical trial subject or his or her legal representative and must monitor the clinical trial until completed. Human clinical trials are typically conductedin three sequential phases that may overlap or be combined: •Phase 1. The product candidate is initially introduced into a limited population of healthy human subjects and tested for safety, dosagetolerance, absorption, metabolism, distribution and excretion. In the case of some products for some diseases, or when the product may be tooinherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients with the disease orcondition for which the product candidate is intended to gain an early indication of its effectiveness.•Phase 2. The product candidate is evaluated in a limited patient population, but larger than in Phase 1, to identify possible adverse events andsafety risks, to preliminarily evaluate the efficacy of the product for specific targeted indications and to assess dosage tolerance, optimal dosageand dosing schedule.•Phase 3. Clinical trials are undertaken to further evaluate dosage, and provide substantial evidence of clinical efficacy and safety in anexpanded patient population, such as several hundred to several thousand, at geographically dispersed clinical trial sites. Phase 3 clinical trialsare typically conducted when Phase 2 clinical trials demonstrate that a dose range of the product candidate is effective and has an acceptablesafety profile. These trials typically have at least 2 groups of patients who, in a blinded fashion, receive either the product or a placebo. Phase 3clinical trials are intended to establish the overall risk/benefit ratio of the product and provide an adequate basis for product labeling. Generally,two adequate and well-controlled Phase 3 clinical trials are required by the FDA for approval of a BLA.Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These trials are used to gainadditional experience from the treatment of patients in the intended therapeutic indication to further assess the biologic’s safety and effectiveness after BLAapproval. Phase 4 trials can be initiated by the drug sponsor or as a condition of BLA approval by the FDA.Annual progress reports detailing the results of the clinical trials must be submitted to the FDA and written IND safety reports must be promptlysubmitted to the FDA and the investigators for serious and unexpected adverse events or any finding from tests in laboratory animals that suggests asignificant risk for human subjects.Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about thechemistry and physical characteristics of the biologic and finalize a process for manufacturing the product in commercial quantities in accordance withcGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things,must develop methods for testing the identity, strength, quality and purity of the final biologic product. Additionally, appropriate packaging must beselected and tested and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over itsshelf life.U.S. Review and Approval ProcessesThe results of product development, preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests,proposed labeling and other relevant information are submitted to the FDA in the form of a BLA requesting approval to market the product for one or morespecified indications. The submission of a BLA is subject to the payment of substantial user fees.Once the FDA receives a BLA, it has 60 days to review the BLA to determine if it is substantially complete and the data are readable, before it acceptsthe BLA for filing. Once the submission is accepted for filing, the FDA begins an in-depth review of the BLA. Under the goals and policies agreed to by theFDA under the Prescription Drug User Fee Act, or PDUFA, the FDA has twelve months from submission in which to complete its initial review of a standardBLA and make a decision on15Table of Contentsthe application, and eight months from submission for a priority BLA, and such deadline is referred to as the PDUFA date. The FDA does not always meet itsPDUFA dates for either standard or priority BLAs. The review process and the PDUFA date may be extended by three months if the FDA requests or the BLAsponsor otherwise provides additional information or clarification regarding information already provided in the submission within the last three monthsbefore the PDUFA date.After the BLA submission is accepted for filing, the FDA reviews the BLA to determine, among other things, whether the proposed product is safe andeffective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength,potency, quality and purity. The FDA may refer applications for novel drug or biological products or drug or biological products which present difficultquestions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and arecommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisorycommittee, but it considers such recommendations carefully when making decisions. During the approval process, the FDA also will determine whether aRisk Evaluation and Mitigation Strategies, or REMS, is necessary to assure the safe use of the product. If the FDA concludes a REMS is needed, the sponsorof the BLA must submit a proposed REMS; the FDA will not approve the BLA without an approved REMS, if required. A REMS can substantially increasethe costs of obtaining approval and limit commercial opportunity.Before approving a BLA, the FDA can inspect the facilities at which the product is manufactured. The FDA will not approve the BLA unless itdetermines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of theproduct within required specifications. Additionally, before approving a BLA, the FDA will typically inspect one or more clinical sites to assure that theclinical trials were conducted in compliance with GCP requirements. If the FDA determines that the application, manufacturing process or manufacturingfacilities are not acceptable, it will outline the deficiencies in the submission and often will request additional clinical testing or information before a BLAcan be approved.The FDA will issue a complete response letter if the agency decides not to approve the BLA. The complete response letter describes all of the specificdeficiencies in the BLA identified by the FDA during review. The deficiencies identified may be minor, for example, requiring labeling changes, or major, forexample, requiring additional clinical trials. Additionally, the complete response letter may include recommended actions that the applicant might take toplace the application in a condition for approval. If a complete response letter is issued, the applicant may either resubmit the BLA, addressing all of thedeficiencies identified in the letter, or withdraw the application.If a product receives regulatory approval, the approval may be significantly limited to specific diseases and dosages or the indications for use mayotherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings orprecautions be included in the product labeling. In addition, the FDA may require post marketing studies, sometimes referred to as Phase 4 testing, whichinvolves clinical trials designed to further assess drug safety and effectiveness and may require testing and surveillance programs to monitor the safety ofapproved products that have been commercialized. After approval, certain changes to the approved biologic, such as adding new indications, manufacturingchanges or additional labeling claims, are subject to further FDA review and approval. Depending on the nature of the change proposed, a BLA supplementmust be submitted and approved before the change may be implemented. For many proposed post-approval changes to a BLA, the FDA has up to 180 days toreview the supplement. As with new BLAs, the review process is often significantly extended by the FDA requests for additional information or clarification.Post-Approval RequirementsAny biologic products for which we receive FDA approvals are subject to continuing regulation by the FDA, including, among other things, record-keeping requirements, reporting of adverse experiences with the product, providing the FDA with updated safety and efficacy information, product samplingand distribution requirements, complying with certain electronic records and signature requirements and complying with FDA promotion and advertisingrequirements, which include, among others, restrictions on direct-to-consumer advertising, promoting biologics for uses or in patient populations that are notdescribed in the product’s approved labeling, known as “off-label use,” industry-sponsored scientific and educational activities, and promotional activitiesinvolving the internet. The FDA closely regulates the post-approval marketing and promotion of biologics, and although physicians may prescribe legallyavailable drugs for off-label uses, manufacturers may not market or promote such off-label uses. Failure to comply with these or other FDA requirements cansubject a manufacturer to possible legal or regulatory action, such as warning letters, suspension of manufacturing, seizure of product, injunctive action,mandated corrective advertising or communications with healthcare professionals, possible civil or criminal penalties or other negative consequences,including adverse publicity.16Table of ContentsWe currently manufacture clinical drug supplies using a combination of third-party manufacturers and our own manufacturing facility in order tosupport both of our product candidates and plan to do so on a commercial scale if our product candidates are approved. Our future collaborators may alsoutilize third parties for some or all of a product we are developing with such collaborator. We and our third-party manufacturers are required to comply withapplicable FDA manufacturing requirements contained in the FDA’s cGMP regulations. cGMP regulations require among other things, quality control andquality assurance as well as the corresponding maintenance of records and documentation. Drug manufacturers and other entities involved in the manufactureand distribution of approved biologics are required to register their establishments with the FDA and certain state agencies, and are subject to periodicinspections by the FDA and certain state agencies for compliance with cGMP and other laws. Accordingly, manufacturers must continue to expend time,money, and effort in the area of production and quality control to maintain cGMP compliance.U.S. Patent Term Restoration and Marketing ExclusivityDepending upon the timing, duration and specifics of the FDA approval of our biologic product candidate, some of our U.S. patents may be eligible forlimited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, commonly referred to as the Hatch-WaxmanAmendments. The Hatch-Waxman Amendments permit a patent restoration term of up to five years as compensation for patent term lost during productdevelopment and the FDA regulatory review process. However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14years from the product’s approval date. The patent term restoration period is generally one-half the time between the effective date of an IND and thesubmission date of a BLA plus the time between the submission date of a BLA and the approval of that application. Only one patent applicable to anapproved product is eligible for the extension and the application for the extension must be submitted prior to the expiration of the patent. The U.S. Patentand Trademark Office, in consultation with the FDA, reviews and approves the application for any patent term extension or restoration. In the future, we mayintend to apply for restoration of patent term for one of our currently owned or licensed patents to add patent life beyond its current expiration date,depending on the expected length of the clinical trials and other factors involved in the filing of the relevant BLA.Market exclusivity provisions under the FDCA can also delay the submission or the approval of certain applications of other companies seeking toreference another company’s BLA. Specifically, the Biologics Price Competition and Innovation Act of 2009, or BPCIA, established an abbreviated pathwayfor the approval of biosimilar and interchangeable biological products. Under the BPCIA, an application for a biosimilar product cannot be approved by theFDA until twelve years after the original branded product was approved under a BLA. However, an application may be submitted after four years if it containsa certification of patent invalidity or non-infringement to one of the patents listed with the FDA by the innovator BLA holder.Product Approval Process Outside the United StatesIn addition to regulations in the United States, we will be subject to a variety of foreign regulations governing manufacturing, clinical trials,commercial sales and distribution of our future products. Whether or not we obtain FDA approval for a product candidate, we must obtain approval of theproduct by the comparable regulatory authorities of foreign countries before commencing clinical trials or marketing in those countries. The approval processvaries from country to country, and the time may be longer or shorter than that required for FDA approval. The requirements governing the conduct ofclinical trials, product licensing, pricing and reimbursement vary greatly from country to country.Under European Union regulatory systems, marketing authorizations may be submitted either under a centralized, decentralized or mutual recognitionprocedure. The centralized procedure provides for the grant of a single marketing authorization that is valid for all European Union member states. Thedecentralized procedure includes selecting one “reference member state,” or RMS, and submitting to more than one member state at the same time. The RMSNational Competent Authority conducts a detailed review and prepares an assessment report, to which concerned member states provide comment. Themutual recognition procedure provides for mutual recognition of national approval decisions. Under this procedure, the holder of a national marketingauthorization may submit an application to the remaining member states post-initial approval. Within 90 days of receiving the applications and assessmentreport, each member state must decide whether to recognize approval.Federal and State Fraud and Abuse and Data Privacy and Security Laws and RegulationsIn addition to FDA restrictions on marketing of pharmaceutical products, federal and state fraud and abuse laws restrict certain business practices in thebiotechnology industry. These laws include anti-kickback and false claims statutes. We will be subject to these laws and regulations once we begin todirectly commercialize our products.17Table of ContentsThe federal Anti-Kickback Statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration toinduce, or in return for, purchasing, leasing, ordering or arranging for the purchase, lease or order of any item or service reimbursable under Medicare,Medicaid or other federal healthcare programs. The term “remuneration” has been broadly interpreted to include anything of value, including for example,gifts, discounts, the furnishing of supplies or equipment, credit arrangements, payments of cash, waivers of payment, ownership interests and providinganything at less than its fair market value. The Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturerson one hand prescribers, purchasers and formulary managers on the other. Although there are a number of statutory exemptions and regulatory safe harborsprotecting certain common activities from prosecution, the exemptions and safe harbors are drawn narrowly, and our practices may not in all cases meet all ofthe criteria for statutory exemptions or safe harbor protection. Practices that involve remuneration that may be alleged to be intended to induce prescribing,purchases or recommendations may be subject to scrutiny if they do not qualify for an exemption or safe harbor. Several courts have interpreted the statute’sintent requirement to mean that if any one purpose of an arrangement involving remuneration is to induce referrals of federal healthcare covered business, thestatute has been violated. The reach of the Anti-Kickback Statute was also broadened by the Patient Protection and Affordable Care Act as amended by theHealth Care and Education Reconciliation Act of 2010, or collectively, the ACA, which, among other things, amends the intent requirement of the federalAnti-Kickback Statute. Pursuant to the statutory amendment, a person or entity no longer needs to have actual knowledge of this statute or specific intent toviolate it in order to have committed a violation. In addition, the ACA provides that the government may assert that a claim including items or servicesresulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the civil False Claims Act or the civilmonetary penalties statute, which imposes penalties against any person who is determined to have presented or caused to be presented a claim to a federalhealth program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent. The federaltransparency requirements under ACA require certain manufacturers of drugs, devices, biologics and medical supplies to annually report to the Department ofHealth and Human Services information related to payments and other transfers of value to physicians and teaching hospitals and physician ownership andinvestment interests.The federal False Claims Act prohibits any person from knowingly presenting, or causing to be presented, a false claim for payment to the federalgovernment or knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim to the federalgovernment. Pharmaceutical and other healthcare companies have been prosecuted under these laws for allegedly providing free product to customers withthe expectation that the customers would bill federal programs for the product. Other companies have been prosecuted for causing false claims to besubmitted because of the companies’ marketing of the product for unapproved, and thus non-reimbursable, uses. Also, many states have similar fraud andabuse statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of thepayor.In addition, we may be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business.The Health Insurance Portability and Accountability Act, or HIPAA, as amended by the Health Information Technology and Clinical Health Act, or HITECH,and its implementing regulations, imposes certain requirements relating to the privacy, security and transmission of individually identifiable healthinformation. Among other things, HITECH makes HIPAA’s privacy and security standards directly applicable to “business associates,” those independentcontractors or agents of covered entities that receive or obtain protected health information in connection with providing a service on behalf of a coveredentity. HITECH also increased the civil and criminal penalties that may be imposed against covered entities, business associates and possibly other persons,and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seekattorney’s fees and costs associated with pursuing federal civil actions. In addition, state laws govern the privacy and security of health information in certaincircumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.Because of the breadth of these laws and the narrowness of available statutory and regulatory exemptions, it is possible that some of our businessactivities now and in the future could be subject to challenge under one or more of such laws. If our operations are found to be in violation of any of thefederal and state laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including criminal andsignificant civil monetary penalties, damages, fines, imprisonment, exclusion of products from reimbursement under government programs and thecurtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations. To theextent that any of our products are sold in a foreign country, we may be subject to similar foreign laws and regulations, which may include, for instance,applicable post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and implementation of corporate compliance programs andreporting of payments or transfers of value to healthcare professionals.18Table of ContentsEnvironment, Health and SafetyWe are voluntarily assessing and publicly reporting our greenhouse gas emissions and water usage, and have begun to take action to reduce suchemissions and usage. For example, we have established employee commuter programs, evaluated the energy efficiency of our buildings and installed low-flow water fixtures. Various laws and regulations have been implemented or are under consideration to mitigate the effects of climate change caused bygreenhouse gas emissions. For example, the California Air Resources Board is in the process of drafting regulations to meet state emissions targets. Based oncurrent information and subject to the finalization of the proposed regulations, we believe that our primary risk related to climate change is the risk ofincreased energy costs. However, because we are not an energy-intensive business, we do not anticipate being subject to a cap and trade system or any othermitigation measures that would likely be material to our capital expenditures, results of operations or competitive position.We are also subject to other federal, state and local regulations regarding workplace safety and protection of the environment. We use hazardousmaterials, chemicals, viruses and various compounds in our research and development activities and cannot eliminate the risk of accidental contamination orinjury from these materials. Certain misuse or accidents involving these materials could lead to significant litigation, fines and penalties. We haveimplemented proactive programs to reduce and minimize the risk of hazardous materials incidents.Research and DevelopmentConducting research and development is central to our business model. We have invested and expect to continue to invest significant time and capitalin our research and development operations. Our research and development expenses were $80.4 million, $50.4 million, and $47.5 million during the yearsended December 31, 2017, 2016, and 2015, respectively. We plan to increase our research and development expenses for the foreseeable future to initiate andcomplete additional clinical trials and associated programs related to RT002 injectable for the treatment of glabellar lines and therapeutic indications inareas such as cervical dystonia and plantar fasciitis.EmployeesAs of December 31, 2017, we had 134 employees. Of these employees, 102 employees were engaged in research and development and 32 employeeswere engaged in finance, marketing, human resources, facilities, information technology, general management, and administrative activities. We plan tocontinue to expand our research and development activities. To support this growth, we will need to expand research and development, operations,commercial, finance and other functions. None of our employees are represented by a labor union and we consider our employee relations to be good.Other InformationWe were incorporated in Delaware on August 10, 1999 under the name Essentia Biosystems, Inc. We commenced operations in June 2002 and, in April2005, changed our name to Revance Therapeutics, Inc. Our principal executive offices are located at 7555 Gateway Boulevard, Newark, California 94560,and our telephone number is (510) 742-3400. Our website address is http://www.revance.com. The information contained in, or that can be accessed through,our website is not part of this Form 10-K.We file electronically with the SEC, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements,and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. You may obtain copies of these reports after thedate of this Annual Report directly from us or from the SEC at the SEC’s Public Reference Room at 100 F Street, N.E. Washington, D.C. 20549. In addition,the SEC maintains information for electronic filers (including Revance) at its website at www.sec.gov. The public may obtain information regarding theoperation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. We make available on our website at www.revance.com (under“Investors-Financials & Filings”), free of charge, copies of these reports as soon as reasonably practicable after filing these reports with, or furnishing them to,the SEC.We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. We will remain an emerginggrowth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of our initial public offering in February 2014, (b) inwhich we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, and (2) the date on which wehave issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to "emerging growth company" shall havethe meaning associated with it in the JOBS Act.19Table of Contents20Table of ContentsITEM 1A.RISK FACTORSInvesting in our common stock involves a high degree of risk. You should carefully consider the risks described below, as well as all other informationincluded in this Form 10-K, including our Consolidated Financial Statements, the notes thereto and the section entitled “Management’s Discussion andAnalysis of Financial Condition and Results of Operations,” before you decide to purchase shares of our common stock. If any of the following risksactually occurs, our business, prospects, financial condition and operating results could be materially harmed. As a result, the trading price of our commonstock could decline and you could lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deemimmaterial may also impair our business operations and stock price.Risks Related to Our Business and StrategyWe are substantially dependent on the clinical and commercial success of our injectable product candidate RT002 injectable.To date, we have invested substantial efforts and financial resources in the research and development of botulinum toxin-based product candidates. Oursuccess as a company is substantially dependent on the clinical and commercial success of RT002 injectable.We previously completed topical clinical trials for the treatment of lateral canthal lines (crow’s feet) and primary axillary hyperhidrosis, butdiscontinued further clinical development in 2016 following the results of our REALISE 1 Phase 3 clinical trial using topical to treat crow's feet.We have invested substantial efforts and financial resources in the research and development of RT002 injectable. We are in Phase 3 clinicaldevelopment for RT002 injectable in North America for the treatment of glabellar lines. During the fourth quarter of 2016, we initiated subject dosing in ourSAKURA Phase 3 program. In the first quarter of 2017, we completed patient enrollment in the two pivotal trials of our SAKURA Phase 3 program. InDecember 2017, we announced positive top-line results for DaxibotulinumtoxinA for Injection (RT002) in alleviating moderate-to-severe glabellar lines intwo randomized, double-blind, placebo-controlled pivotal Phase 3 trials to evaluate the safety and efficacy of a single administration of RT002 for thetreatment of moderate-to-severe glabellar lines in adults. The SAKURA 1 and SAKURA 2 trials enrolled more than 600 subjects at 30 sites in the UnitedStates and Canada. In addition to the two planned pivotal trials, the Phase 3 program includes a long-term open-label safety trial (SAKURA 3), which isdesigned to evaluate the long-term safety of RT002 injectable for the treatment of moderate to severe glabellar lines in adults following both single andrepeat treatment administration. The long-term safety trial enrolled more than 2,500 patients at 66 sites in the U.S. and Canada and is expected to becompleted in the second half of 2018. Depending on the number of treatments and duration of follow-up, a subject may be on trial for a maximum of 86weeks. We have designed SAKURA 3 to support a safety database adequate for both domestic and international marketing applications. In 2015, we reportedpositive results from BELMONT, a Phase 2 active comparator clinical trial against BOTOX® Cosmetic. Past results may not be indicative of results fromfuture trials. Assuming successful completion of our SAKURA Phase 3 program in the second half of 2018, we plan to file marketing applications first in theUnited States followed by the European Union, Canada, and certain Latin American and Asian countries.In 2015, we initiated a Phase 2 dose-escalating, open-label clinical study of RT002 injectable for the treatment of cervical dystonia. The Phase 2 studyevaluated the safety, preliminary efficacy, and duration of effect of RT002 injectable in subjects with moderate to severe isolated cervical dystonia. The trialwas designed to enroll 37 subjects following three sequential treatment cohorts for up to a total of 24 weeks after treatment for each cohort. The trial’s firstcohort of 12 subjects received a single dose of up to 200 units of RT002 injectable, the second cohort of 12 subjects received between 200 and 300 units, andthe third cohort of 13 subjects received from 300 to 450 units. In May 2017, we announced positive topline results from the Phase 2 trial. Past results may notbe indicative of results from future trials. In November 2017, we completed our End-of-Phase 2 meeting with the FDA and received Scientific Advice from theEMA regarding RT002 for the treatment of cervical dystonia. Based on the Phase 2 safety and efficacy results and guidance from the FDA and EMA, we planto proceed with a Phase 3 program for cervical dystonia in 2018. In November 2017, the FDA also granted orphan drug status to DaxibotulinumtoxinA forInjection for the treatment of cervical dystonia in adults.In 2016, we also initiated a Phase 2 prospective, randomized, double-blinded, placebo-controlled trial of RT002 injectable in the therapeutic indicationof plantar fasciitis. This study will evaluate the safety and efficacy of a single administration of RT002 injectable in reducing the signs and symptoms ofplantar fasciitis. The study completed enrollment of 59 subjects in the United States in October 2017. The study's primary efficacy endpoint is theimprovement in the American Orthopedic Foot and Ankle Score (AOFAS). In January 2018, we announced interim 8-week results from this study. TheCompany plans to complete the 16-week trial and then expects to conduct another Phase 2 trial with a modified design to demonstrate the ability of RT002to treat plantar fasciitis in the second half of 2018.21Table of ContentsOur near-term prospects, including our ability to finance our company and generate revenue, will depend heavily on the successful development,regulatory approval and commercialization of RT002 injectable. Our longer-term prospects will depend on the successful development, regulatory approvaland commercialization of RT002 injectable, as well as our topical or any future product candidates. The preclinical, clinical and commercial success of ourproduct candidates will depend on a number of factors, including the following: •timely completion of, or need to conduct additional, clinical trials, including our clinical trials for RT002 injectable, topical, and any futureproduct candidates, which may be significantly slower or cost more than we currently anticipate and will depend substantially upon the numberand design of such trials and the accurate and satisfactory performance of third-party contractors;•our ability to demonstrate the effectiveness and differentiation of our products on a consistent basis as compared to existing or future therapies;•our ability to demonstrate to the satisfaction of the FDA, the safety and efficacy of RT002 injectable, our topical product candidate, or anyfuture product candidates through clinical trials;•whether we are required by the FDA or other similar foreign regulatory agencies to conduct additional clinical trials to support the approval ofRT002 injectable, our topical product candidate, or any future product candidates;•our success in educating physicians and patients about the benefits, administration and use of RT002 injectable, our topical product candidate,or any future product candidates, if approved;•the prevalence and severity of adverse events experienced with our product candidates or future approved products;•the timely receipt of necessary marketing approvals from the FDA and similar foreign regulatory authorities;•the ability to raise additional capital on acceptable terms and in the time frames necessary to achieve our goals;•achieving and maintaining compliance with all regulatory requirements applicable to RT002 injectable, our topical product candidate, or anyfuture product candidates or approved products;•the availability, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competing treatments;•the effectiveness of our own or our future potential strategic collaborators’ marketing, sales and distribution strategy and operations;•our ability to manufacture clinical trial supplies of RT002 injectable, our topical product candidate, or any future product candidates and todevelop, validate and maintain a commercially viable manufacturing process that is compliant with current good manufacturing practices, orcGMP;•our ability to successfully commercialize RT002 injectable, our topical product candidate, or any future product candidates, if approved formarketing and sale, whether alone or in collaboration with others;•our ability to enforce our intellectual property rights in and to RT002 injectable, our topical product candidate, or any future productcandidates;•our ability to avoid third-party patent interference or intellectual property infringement claims;•acceptance of RT002 injectable, our topical product candidate, or any future product candidates, if approved, as safe and effective by patientsand the medical community; and•the continued acceptable safety profile of RT002 injectable, our topical product candidate, or any future product candidates followingapproval.If we do not achieve one or more of these factors, many of which are beyond our control, in a timely manner or at all, we could experience significantdelays or an inability to successfully commercialize our product candidates. Accordingly, we cannot assure you that we will be able to generate sufficientrevenue through the sale of RT002 injectable, our topical product candidate, or any future product candidate to continue our business.22Table of ContentsWe may be unable to obtain regulatory approval for RT002 injectable, topical product candidate, or future product candidates under applicableregulatory requirements. The denial or delay of any such approval would delay commercialization and have a material adverse effect on our potentialto generate revenue, our business prospects, and our results of operations.To gain approval to market a biologic product such as RT002 injectable or topical, we must provide the FDA and foreign regulatory authorities withdata that adequately demonstrate the safety, efficacy and quality of the product for the intended indication applied for in the BLA or other respectivemarketing applications. The development of biologic products is a long, expensive and uncertain process, and delay or failure can occur at any stage of anyof our clinical trials. A number of companies in the pharmaceutical industry, including biotechnology companies, have suffered significant setbacks inclinical trials, including in Phase 3 development, even after promising results in earlier preclinical studies or clinical trials. These setbacks have been causedby, among other things, findings made while clinical trials were underway, safety or efficacy observations, including previously unreported adverse events;and the need to conduct further supportive or unanticipated studies, even after initiating Phase 3 trials. Success in preclinical testing and early clinical trialsdoes not ensure that later clinical trials will be successful or that additional supportive studies will not be required, and the results of clinical trials by otherparties may not be indicative of the results in trials we may conduct.Specifically, we completed topical clinical trials for the treatment of lateral canthal lines (crow’s feet) and primary axillary hyperhidrosis, butdiscontinued further clinical development in 2016 following the results from our REALISE 1 Phase 3 clinical trial for crow's feet. In addition, we announcedin January 2018 that we plan to conduct a second Phase 2 study in plantar fasciitis.Our business currently depends substantially on the successful development, regulatory approval and commercialization of our product candidates.Based on discussion with the FDA at a Pre-Phase 3 meeting in the second quarter of 2016 and the minutes received following the meeting, we submitted anIND in the United States and initiated subject dosing in Phase 3 clinical studies of RT002 injectable for the treatment of glabellar lines in 2016. In the firstquarter of 2017, we completed patient enrollment in the two pivotal trials of our SAKURA Phase 3 program and in October 2017, we completed enrollment ofSAKURA 3. In December 2017, we announced positive top-line results from the two pivotal trials. We plan to move forward with studies required forsubmission of a BLA. Such studies may increase the time, expense and uncertainty of our RT002 injectable development program, including, for example,because results of such studies may indicate to us a further need to refine the RT002 injectable product candidate.We currently have no drug or biologic products approved for sale, and we may never obtain regulatory approval to commercialize RT002 injectable, orour topical product candidate. The research, testing, manufacturing, labeling, approval, sale, marketing and distribution of drug and biologic products aresubject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, and such regulations differ from countryto country. We are not permitted to market RT002 injectable in the United States until we receive approval of a BLA from the FDA. We are also not permittedto market RT002 injectable in any foreign countries until we receive the requisite approval from the regulatory authorities of such countries.The FDA or any foreign regulatory body can delay, limit or deny approval of our product candidates, including RT002 injectable, for many reasons,including: •our inability to demonstrate to the satisfaction of the FDA or an applicable foreign regulatory body that RT002 injectable, topical, or any futureproduct candidates are safe and effective for the requested indication;•our inability to demonstrate preclinical proof of concept of topical or other products in future, new indications;•the FDA’s or an applicable foreign regulatory agency’s disagreement with the trial protocol or the interpretation of data from preclinical studiesor clinical trials;•our inability to demonstrate that clinical and other benefits of RT002 injectable, topical, or any future product candidates outweigh any safetyor other perceived risks;•the FDA’s or an applicable foreign regulatory agency’s requirement for additional preclinical or clinical studies;•the FDA’s or an applicable foreign regulatory agency’s non-approval of the formulation, labeling or the specifications of RT002 injectable,topical, or any future product candidates;•the FDA’s or an applicable foreign regulatory agency’s failure to approve our manufacturing processes or facilities, or the manufacturingprocesses or facilities of third-party manufacturers with which we contract; or•the potential for approval policies or regulations of the FDA or an applicable foreign regulatory agency to significantly change in a mannerrendering our clinical data insufficient for approval.23Table of ContentsOf the large number of drugs, including biologics, in development, only a small percentage successfully complete the FDA or other regulatory approvalprocesses and are commercialized.Even if we eventually complete clinical testing and receive approval of any regulatory filing for RT002 injectable, topical, or any future productcandidates, the FDA or the applicable foreign regulatory agency may grant approval contingent on the performance of costly additional post-approvalclinical trials. The FDA or the applicable foreign regulatory agency also may approve RT002 injectable, our topical product candidate, or any future productcandidates for a more limited indication or a narrower patient population than we originally requested, and the FDA or applicable foreign regulatory agencymay not approve the labeling that we believe is necessary or desirable for the successful commercialization of our product candidates. Any delay inobtaining, or inability to obtain, applicable regulatory approval for any of our product candidates, and RT002 injectable in particular, would delay orprevent commercialization of RT002 injectable and would materially adversely impact our business, results of operations and prospects.We will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed on acceptable terms, orat all, could force us to delay, limit, reduce or terminate our product development, other operations or commercialization efforts.Since our inception, most of our resources have been dedicated to the research and preclinical and clinical development of our botulinum toxin productcandidates, RT002 injectable and topical. In particular, our clinical programs for RT002 injectable and topical will require substantial additional funds tocomplete. We had an accumulated deficit through December 31, 2017 of $542.2 million and a working capital surplus of $264.3 million as of December 31,2017, primarily as a result of our November 2015 and December 2017 follow-on public offerings, and at-the-market, or ATM, offerings in 2015 and 2017. Ourrecorded net losses were $120.6 million, $89.3 million and $73.5 million, for the years ended December 31, 2017, 2016, and 2015, respectively. We havefunded our operations primarily through the sale and issuance of convertible preferred stock, common stock, notes payable and convertible notes. As ofDecember 31, 2017, we had capital resources consisting of cash and cash equivalents of $282.9 million. We raised aggregate net proceeds of $126.2 millionand $156.9 million in our follow-on public offerings in November 2015 and December 2017, respectively. In addition, we raised net proceeds ofapproximately $10.0 million by selling an aggregate of 352,544 shares of our common stock under the 2015 ATM agreement, which was effectivelyterminated on March 7, 2016. On March 7, 2016, we entered into the 2016 ATM Agreement with Cowen, under which we may offer and sell shares of ourcommon stock having aggregate gross proceeds of up to $75 million through Cowen as our sales agent. In 2017, we sold 1,802,651 shares of our commonstock under the 2016 ATM Agreement at a weighted average price of $22.17 per share resulting in net proceeds of $38.2 million, after underwritingdiscounts, commissions and other offering expenses. In December 2017, we sold 5,389,515 shares of common stock in a follow-on offering at a price of$31.00 per share resulting in net proceeds of $156.9 million, after underwriting discounts, commissions and other offering expenses. We believe that we willcontinue to expend substantial resources for the foreseeable future for the clinical development of RT002 injectable, topical, and development of any otherindications and product candidates that we may choose to pursue. These expenditures will include costs associated with research and development,conducting preclinical studies and clinical trials, and manufacturing and supply as well as marketing and selling any products approved for sale. In addition,other unanticipated costs may arise. Because the outcome of any clinical trial is highly uncertain, we cannot reasonably estimate the actual amountsnecessary to successfully complete the development and commercialization of RT002 injectable and any future product candidates.We believe that our existing cash, cash equivalents, and investments including the net proceeds from our IPO, follow-on public offerings, and ATMofferings will allow us to fund our operations for at least 12 months following the filing of this Form 10-K. However, our operating plan may change as aresult of many factors currently unknown to us, and we may need to seek additional capital sooner than planned, through public or private equity or debtfinancings or other sources, such as strategic collaborations. Such financings may result in dilution to stockholders, imposition of debt covenants andrepayment obligations or other restrictions that may affect our business. In addition, we may seek additional capital due to favorable market conditions orstrategic considerations even if we believe that we have sufficient funds for our current or future operating plans.Our future capital requirements depend on many factors, including: •the results of our clinical trials for RT002 injectable and preclinical trials of our topical product candidate or any future product candidates;•the timing of, and the costs involved in, obtaining regulatory approvals for RT002 injectable, or any future product candidates includingtopical;•the number and characteristics of any additional product candidates we develop or acquire;24Table of Contents•the scope, progress, results and costs of researching and developing and conducting preclinical and clinical trials of RT002 injectable, topical,or any future product candidates;•the cost of commercialization activities if RT002 injectable or any future product candidates including topical are approved for sale, includingmarketing, sales and distribution costs;•the cost of manufacturing RT002 injectable, topical, or any future product candidates and any products we successfully commercialize andmaintaining our related facilities;•our ability to establish and maintain strategic collaborations, licensing or other arrangements and the terms of and timing such arrangements;•the degree and rate of market acceptance of any future approved products;•the emergence, approval, availability, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competingproducts or treatments;•any product liability or other lawsuits related to our products;•the expenses needed to attract and retain skilled personnel;•any litigation, including litigation costs and the outcome of such litigation;•the costs associated with being a public company;•the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims, including litigation costs and theoutcome of such litigation; and•the timing, receipt and amount of sales of, or royalties on, future approved products, if any.Additional capital may not be available when needed, on terms that are acceptable to us or at all. If adequate funds are not available to us on a timelybasis, we may be required to delay, limit, reduce or terminate preclinical studies, clinical trials, research, development, manufacturing, sales, marketing orother commercial activities for RT002 injectable, topical, or any future product candidate.If we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangementswith third parties, we may have to relinquish certain valuable rights to our product candidates, technologies, future revenue streams or research programs orgrant licenses on terms that may not be favorable to us. If we raise additional capital through public or private equity offerings, the ownership interest of ourexisting stockholders will be diluted and the terms of any new equity securities may have a preference over our common stock. If we raise additional capitalthrough debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or makingcapital expenditures or specified financial ratios, any of which could restrict our ability to commercialize our product candidates or operate as a business.Even if our product candidates receive regulatory approval, they may fail to achieve the broad degree of physician adoption and use necessary forcommercial success.The commercial success of RT002 injectable, and any future product candidates including topical, if approved, will depend significantly on the broadadoption and use of the resulting product by physicians for approved indications. The degree and rate of physician adoption of RT002 injectable and anyfuture product candidates, if approved, will depend on a number of factors, including: •the effectiveness and duration of effect of our product as compared to existing therapies;•physician willingness to adopt a new therapy to treat glabellar lines, cervical dystonia, plantar fasciitis or other aesthetic or therapeuticindications;•patient satisfaction with the results and administration of our product and overall treatment experience;•patient demand for the treatment of glabellar lines, cervical dystonia, plantar fasciitis or other aesthetic or therapeutic indications;•the willingness of third-party payors to reimburse physicians or patients for RT002 injectable and any future products we may commercialize fortherapeutic indications; and•the revenue and profitability that our product will offer a physician as compared to alternative therapies.If RT002 injectable or any future product candidates are approved for use but fail to achieve the broad degree of physician adoption necessary forcommercial success, our operating results and financial condition will be adversely affected.25Table of ContentsOur product candidates, if approved, will face significant competition and our failure to effectively compete may prevent us from achieving significantmarket penetration and expansion.We expect to enter highly competitive pharmaceutical and medical device markets. Successful competitors in the pharmaceutical and medical devicemarkets have the ability to effectively discover therapies, obtain patents, develop, test and obtain regulatory approvals for products, and have the ability toeffectively commercialize, market and promote approved products, including communicating the effectiveness, safety and value of products to actual andprospective customers and medical staff. Numerous companies are engaged in the developing, patenting, manufacturing and marketing healthcare productswhich we expect will compete with those that we are developing. Many of these competitors are large, experienced companies that enjoy significantcompetitive advantages, such as substantially greater financial, research and development, manufacturing, personnel and marketing resources, greater brandrecognition and more experience and expertise in obtaining marketing approvals from the FDA and other regulatory authorities.Upon marketing approval, the first expected use of our products will be in aesthetic medicine. Competition in aesthetic products is significant anddynamic, and is characterized by rapid and substantial technological development and product innovations. Numerous competitors have obtained patentsprotecting what they consider to be their intellectual property.In aesthetic medicine, we plan to seek regulatory approval of RT002 injectable for the treatment of glabellar lines. We anticipate that RT002 injectable,if approved, will face significant competition from existing injectable botulinum toxins as well as unapproved and off-label treatments. Further, if approved,in the future we may face competition for RT002 injectable from biosimilar products and products based upon botulinum toxin. To compete successfully, wewill have to demonstrate that the treatment of glabellar lines with RT002 injectable is a worthwhile aesthetic treatment and has advantages over othertherapies. Competition could result in reduced profit margins and limited sales, which would harm our business, financial condition and results of operations.Due to less stringent regulatory requirements, there are many more aesthetic products and procedures available for use in a number of foreign countriesthan are approved for use in the United States. There are also fewer limitations on the claims that our competitors in certain countries can make about theeffectiveness of their products and the manner in which they can market them.We currently make our RT002 injectable clinical drug product exclusively in one internal manufacturing facility. We plan to utilize internal andexternal facilities, including through one or more third-party contractors, in the future to support commercial production if our product candidates areapproved. If these or any future facility or our equipment were damaged or destroyed, or if we experience a significant disruption in our operations forany reason, our ability to continue to operate our business would be materially harmed.We currently manufacture our own clinical drug product to support RT002 injectable development in one internal manufacturing facility. In March2017, we entered into a Technology Transfer, Validation and Commercial Fill/Finish Services Agreement, or the Services Agreement, with Ajinomoto Althea,Inc., or Althea, a contract development and manufacturing organization. Under the Services Agreement, Althea will provide us commercial fill/finish servicesand will serve as a second source of manufacturing for RT002 injectable. We plan to utilize our internal and external Althea facility to support commercialproduction of RT002 injectable, if approved. If these or any future facility were to be damaged, destroyed or otherwise unable to operate, whether due toearthquakes, fire, floods, hurricanes, storms, tornadoes, other natural disasters, employee malfeasance, terrorist acts, power outages or otherwise, or ifperformance of such manufacturing facilities is disrupted for any other reason, such an event could delay our clinical trials or, if our product candidates areapproved, jeopardize our ability to manufacture our products as promptly as our customers expect or possibly at all. If we experience delays in achieving ourdevelopment objectives, or if we are unable to manufacture an approved product within a timeframe that meets our customers’ expectations, our business,prospects, financial results and reputation could be materially harmed.Currently, we maintain insurance coverage totaling $23.0 million against damage to our property, equipment and tenant improvements, $2.0 million ingeneral liability coverage, a $9.0 million umbrella policy, and an additional $45.0 million to cover business interruption and research and developmentrestoration expenses, subject to deductibles and other limitations. If we have underestimated our insurance needs with respect to an interruption, or if aninterruption is not subject to coverage under our insurance policies, we may not be able to cover our losses.26Table of ContentsImpairment in the carrying value of long-lived assets could negatively affect our operating results.We constructed a fill/finish line dedicated to the manufacture of topical and to support our regulatory license applications. We discontinued furtherclinical development of topical for the treatment of crow’s feet and for the treatment of primary axillary hyperhidrosis in June 2016, following the resultsfrom our REALISE 1 Phase 3 clinical trial. During the year ended December 31, 2016 we recorded a loss on impairment of $9.1 million related to certaincomponents of the topical fill/finish line and other long-lived assets. During the year ended December 31, 2017, the Company assessed the topical fill/finishline and these other long-lived assets for impairment indicators and recorded a loss on impairment of $2.9 million. As of December 31, 2017, the fill/finishline and these other long-lived assets had net book values of $2.4 million and $0.1 million, respectively. Under generally accepted accounting principles inthe United States, long-lived assets, such as our fill/finish line, are required to be reviewed for impairment whenever adverse events or changes incircumstances indicate a possible impairment. If business conditions or other factors indicate that the carrying value of the asset may not be recoverable, wemay be required to record additional non-cash impairment charges. Additionally, if the carrying value of our capital equipment exceeds current fair value asdetermined based on the discounted future cash flows of the related product, the capital equipment would be considered impaired and would be reduced tofair value by a non-cash charge to earnings, which could negatively affect our operating results. Events and conditions that could result in impairment in thevalue of our long-lived assets include adverse clinical trial results, changes in operating plans, unfavorable changes in competitive landscape, adversechanges in the regulatory environment, or other factors leading to reduction in expected long-term sales or profitability. We will evaluate the recoverabilityand fair value of our long-lived assets, including those related to other components of the fill/finish line, each reporting period to determine the extent towhich further non-cash charges to earnings are appropriate. Additional impairment in the value of our long-lived assets may materially and negatively impactour operating results.We have incurred significant losses since our inception and we anticipate that we will continue to incur losses for the foreseeable future. Currently, wehave only one product candidate in clinical trials and no commercial sales, which make it difficult to assess our future viability.We are a clinical-stage biotechnology company. Biotechnology product development is a highly speculative undertaking and involves a substantialdegree of risk. We are not profitable and have incurred losses in each year since we commenced operations in 2002. In addition, we have limited experienceand have not yet demonstrated an ability to successfully overcome many of the risks and uncertainties frequently encountered by companies in new andrapidly evolving fields, particularly in the biotechnology industry. To date, we have not obtained any regulatory approvals for any of our product candidatesor generated any revenue from product sales relating to RT002 injectable or our topical product candidate. We continue to incur significant research anddevelopment and other expenses related to our ongoing clinical trials and operations. We had an accumulated deficit through December 31, 2017 of $542.2million and a working capital surplus of $264.3 million as of December 31, 2017, primarily as a result of our November 2015 follow-on public offerings, andsales under our 2015 ATM Agreement and 2016 ATM Agreement. Our recorded net losses were $120.6 million, $89.3 million and $73.5 million, for the yearended December 31, 2017, 2016, and 2015, respectively. The net proceeds from the sale of the shares in our November 2015 and December 2017 follow-onpublic offerings and ATM offerings in 2015 and 2017, after deducting the underwriters’ discount, commissions, and other offering expenses related to therespective offerings, were approximately $126.2 million and $156.9 million, $10.0 million and $38.2 million, respectively. Our capital requirements toimplement our business strategy are substantial, including our capital requirements to develop and commercialize RT002 injectable. We believe that ourcurrently available capital is sufficient to fund our operations through at least the next 12 months following the filing of this Form 10-K.We expect to continue to incur losses for the foreseeable future, and we anticipate that these losses will increase as we continue our development of,seek regulatory approval for and begin to commercialize RT002 injectable. Our ability to achieve revenue and profitability is dependent on our ability tocomplete the development of our product candidates, obtain necessary regulatory approvals and manufacture, market and commercialize our productssuccessfully. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods. Our prior losses, combined withexpected future losses, may adversely affect the market price of our common stock and our ability to raise capital and continue operations.Even if RT002 injectable, topical, or any future product candidates obtain regulatory approval, they may never achieve market acceptance orcommercial success.Even if we obtain FDA or other regulatory approvals, RT002 injectable, topical, or any future product candidates may not achieve market acceptanceamong physicians and patients, and may not be commercially successful.The degree and rate of market acceptance of RT002 injectable, topical, or any future product candidates for which we receive approval depends on anumber of factors, including:•the safety and efficacy of the product as demonstrated in clinical trials;27Table of Contents•the clinical indications for which the product is approved;•acceptance by physicians, major operators of clinics and patients of the product as a safe and effective treatment;•the proper training and administration of our products by physicians and medical staff;•the potential and perceived advantages of our products over alternative treatments;•the cost of treatment in relation to alternative treatments and willingness to pay for our products, if approved, on the part of payors and patients;•the willingness of patients to pay for RT002 injectable, our topical product candidate, and other aesthetic treatments in general, relative to otherdiscretionary items, especially during economically challenging times;•the willingness of third-party payors to reimburse physicians or patients for RT002 injectable and any future products we may commercialize fortherapeutic indications;•the relative convenience and ease of administration;•the prevalence and severity of adverse events; and•the effectiveness of our sales and marketing efforts.Any failure by our product candidates that obtain regulatory approval to achieve market acceptance or commercial success would materially adverselyaffect our results of operations and delay, prevent or limit our ability to generate revenue and continue our business.Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and results of earlier studies and trials may not bepredictive of future trial results.Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain. Furthermore, we rely on contract researchorganizations, or CROs, and clinical trial sites to ensure the proper and timely conduct of our clinical trials. While we have agreements governing thecommitted activities of our CROs, we have limited influence over their actual performance. A failure of one or more of our clinical trials can occur at any timeduring the clinical trial process. The results of preclinical studies and clinical trials of our product candidates may not be predictive of the results of later-stage clinical trials. Furthermore, final results may differ from interim results. For example, any positive results generated to date in clinical trials for RT002injectable do not ensure that later clinical trials, including any RT002 injectable clinical trials for the treatment of glabellar lines, will demonstrate similarresults. Product candidates in later stages of clinical trials may fail to show the desired safety profile and efficacy despite having progressed throughpreclinical studies and initial clinical trials.A number of companies in the biotechnology industry have suffered significant setbacks in advanced clinical trials due to a lack of efficacy or adversesafety profiles, notwithstanding promising results in earlier clinical trials. We have suffered similar setbacks with the clinical development of our topicalproduct candidate and we cannot be certain that we will not face other similar setbacks in the future for RT002 injectable or other clinical developmentprograms. Even if our clinical trials are completed, the results may not be sufficient to obtain regulatory approval for our product candidates.We have in the past and may in the future experience delays in our ongoing clinical trials, and we do not know whether future clinical trials, if any, willbegin on time, need to be redesigned, enroll an adequate number of subjects on time or be completed on schedule, if at all. Clinical trials can be delayed oraborted for a variety of reasons, including delay or failure to: •obtain regulatory approval to commence a trial;•reach agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiationand may vary significantly among different CROs and trial sites;•obtain institutional review board, or IRB, approval at each site;•recruit suitable subjects to participate in a trial;•have subjects complete a trial or return for post-treatment follow-up;•ensure clinical sites observe trial protocol or continue to participate in a trial;•address any patient safety concerns that arise during the course of a trial;•address any conflicts with new or existing laws or regulations;•add a sufficient number of clinical trial sites; or•manufacture sufficient quantities of product candidate for use in clinical trials.Subject enrollment is a significant factor in the timing of clinical trials and is affected by many factors, including the size and nature of the patientpopulation, the proximity of patients to clinical sites, the eligibility criteria for the trial, the design of28Table of Contentsthe clinical trial, competing clinical trials and clinicians’ and patients’ perceptions as to the potential advantages of the drug being studied in relation toother available therapies, including any new drugs or treatments that may be approved for the indications we are investigating.We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such trials are beingconducted, by the data safety monitoring board, for such trial or by the FDA or other regulatory authorities. Such authorities may suspend or terminate aclinical trial due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols,failure of inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold,discovery of unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations oradministrative actions or lack of adequate funding to continue the clinical trial.If we experience delays in the completion or termination of any clinical trial of our product candidates, the commercial prospects of our productcandidates may be harmed, and our ability to generate product revenues from any of these product candidates will be delayed. In addition, any delays incompleting our clinical trials will increase our costs, slow down our product candidate development and approval process and jeopardize our ability tocommence product sales and generate revenues. Any of these occurrences may significantly harm our business, financial condition and prospects. In addition,many of the factors that cause or lead to a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatoryapproval of our product candidates.We have no experience manufacturing our product candidates at full commercial scale. If our product candidates are approved, we will face certainrisks associated with scaling up our manufacturing capabilities to support commercial production.We have developed an integrated manufacturing, research and development facility located at our corporate headquarters. We manufacture drugsubstance and finished dose forms of the drug product at this facility that we use for research and development purposes and clinical trials. We do not haveexperience in manufacturing our product candidates at commercial scale. If our product candidates are approved, we may need to expand our manufacturingfacilities, add manufacturing personnel and ensure that validated processes are consistently implemented in our facilities and potentially enter intoadditional relationships with third-party manufacturers. The upgrade and expansion of our facilities will require additional regulatory approvals. In addition,it will be costly and time-consuming to expand our facilities and recruit necessary additional personnel. If we are unable to expand our manufacturingfacilities in compliance with regulatory requirements or to hire additional necessary manufacturing personnel, we may encounter delays or additional costs inachieving our research, development and commercialization objectives, including obtaining regulatory approvals of our product candidates, which couldmaterially damage our business and financial position.We currently contract with third-party manufacturers for certain components and services necessary to produce RT002 injectable and expect tocontinue to do so to support further clinical trials and commercial scale production if RT002 injectable is approved. This increases the risk that we willnot have sufficient quantities of RT002 injectable or be able to obtain such quantities at an acceptable cost, which could delay, prevent or impair ourdevelopment or commercialization efforts.We currently rely on third-party manufacturers for certain components such as bulk peptide and services such as fill/finish services, necessary toproduce RT002 injectable for our clinical trials, and we expect to continue to rely on these or other manufacturers to support our commercial requirements ifRT002 injectable is approved. In particular, in March 2017, we entered into the Services Agreement with Althea, a contract development and manufacturingorganization to provide us commercial fill/finish services and a second source of manufacturing for RT002 injectable. We plan to utilize our internal andexternal Althea facility to support commercial production of RT002 injectable, if approved. Some of our contracts with our manufacturers contain minimumorder and pricing provisions and provide for early termination based on regulatory approval milestones.29Table of ContentsReliance on third-party manufacturers entails additional risks, including the reliance on the third party for regulatory compliance and quality assurance,the possible breach of the manufacturing agreement by the third party, and the possible termination or nonrenewal of the agreement by the third party at atime that is costly or inconvenient for us. In addition, third- party manufacturers may not be able to comply with cGMP or Quality System Regulation, orQSR, or similar regulatory requirements outside the United States. Our failure or the failure of our third-party manufacturers to comply with applicableregulations could result in sanctions being imposed on us, including fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, licenserevocation, seizures or recalls of products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies ofRT002 injectable, or any other product candidates or products that we may develop. Any failure or refusal to supply the components or services for RT002injectable or any other product candidates or products that we may develop could delay, prevent or impair our clinical development or commercializationefforts.We depend on single-source suppliers for the raw materials necessary to produce our product candidates. The loss of these suppliers, or theirfailure to supply us with these raw materials, would materially and adversely affect our business.We and our manufacturers purchase the materials necessary to produce RT002 injectable for our clinical trials from single-source third-party suppliers.There are a limited number of suppliers for the raw materials that we use to manufacture our product candidates, and we may need to assess alternate suppliersto prevent a possible disruption of the manufacture of the materials necessary to produce our product candidates for our clinical trials and, if approved,ultimately for commercial sale. In particular, we outsource the manufacture of bulk peptide through American Peptide Company, Inc., or American Peptide,which was acquired by Bachem. We do not have any control over the process or timing of the acquisition of raw materials by our manufacturers. Although wegenerally do not begin a clinical trial unless we believe that we have a sufficient supply of a product candidate to complete the clinical trial, any significantdelay in the supply of RT002 injectable or any future product candidates, or the raw material components thereof, for an ongoing clinical trial due to theneed to replace a third-party supplier could considerably delay completion of our clinical trials, product testing and potential regulatory approval of RT002injectable or any future product candidates. If we or our manufacturers are unable to purchase these raw materials on acceptable terms and at sufficient qualitylevels or in adequate quantities if at all, the development of RT002 injectable and any future product candidates, or the commercial launch of any approvedproducts, would be delayed or there would be a shortage in supply, which would impair our ability to meet our development objectives for our productcandidates or generate revenues from the sale of any approved products.Furthermore, if there is a disruption to our or our third-party suppliers’ relevant operations, we will have no other means of producing RT002 injectableor any future product candidates until they restore the affected facilities or we or they procure alternative facilities. Additionally, any damage to ordestruction of our or our third party or suppliers’ facilities or equipment may significantly impair our ability to manufacture our product candidates on atimely basis.We currently have limited marketing capabilities and no sales organization. If we are unable to establish sales and marketing capabilities on our ownor through third parties, we will be unable to successfully commercialize RT002 injectable or any other future product candidates, if approved, orgenerate product revenue.We currently have limited marketing capabilities and no sales organization. To commercialize RT002 injectable or any other future productcandidates, if approved, in the United States, Europe and other jurisdictions we seek to enter, we must build our marketing, sales, distribution, managerial andother non-technical capabilities or make arrangements with third parties to perform these services, and we may not be successful in doing so. If RT002injectable receives regulatory approval, we expect to market RT002 injectable as applicable, through our own sales force in North America, and in Europeand other countries through either our own sales force or a combination of our internal sales force and distributors or partners, which may be expensive andtime consuming. We have no prior experience in the marketing, sale and distribution of pharmaceutical products and there are significant risks involved inbuilding and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provideadequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team. Any failure or delay in thedevelopment of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products. We may chooseto collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distributionsystems or in lieu of our own sales force and distribution systems. If we are unable to enter into such arrangements on acceptable terms or at all, we may not beable to successfully commercialize RT002 injectable or any future product candidates. If we are not successful in commercializing RT002 injectable or anyfuture product candidates, either on our own or through collaborations with one or more third parties, our future product revenue will suffer and we wouldincur significant additional losses.30Table of ContentsTo establish our sales and marketing infrastructure and expand our manufacturing capabilities, we will need to increase the size of our organizationand we may experience difficulties in managing this growth.As of December 31, 2017, we had 134 employees. We will need to continue to expand our managerial, operational, and other resources to manage ouroperations and clinical trials, continue our development activities and commercialize RT002 injectable or any other product candidates, if approved. Ourmanagement, personnel, systems and facilities currently in place may not be adequate to support this future growth. Our need to effectively execute ourgrowth strategy requires that we:•manage our clinical trials and manufacturing operations effectively;•identify, recruit, retain, incentivize and integrate additional employees;•manage our internal development efforts effectively while carrying out our contractual obligations to third parties; and•continue to improve our operational, financial and management controls, reporting systems and procedures.Due to our limited financial resources and our limited experience in managing a company with such anticipated growth, we may not be able toeffectively manage the expansion of our operations or recruit and train additional qualified personnel. The physical expansion of our operations may lead tosignificant costs and may divert our management and business development resources. Any inability to manage growth could delay the execution of ourdevelopment and strategic objectives, or disrupt our operations.We or the third parties upon whom we depend may be adversely affected by earthquakes or other natural disasters and our business continuity anddisaster recovery plans may not adequately protect us from a serious disaster.Our corporate headquarters and other facilities, including our internal manufacturing facility, are located in the San Francisco Bay Area, which hasexperienced severe earthquakes. We do not carry earthquake insurance. Earthquakes or other natural disasters could severely disrupt our operations, and havea material adverse effect on our business, results of operations, financial condition and prospects.If a natural disaster, power outage or other event occurred that prevented us from using all or a significant portion of our headquarters, that damagedcritical infrastructure, such as our manufacturing facility, enterprise financial systems or manufacturing resource planning and enterprise quality systems, orthat otherwise disrupted operations, it may be difficult or, in certain cases, impossible for us to continue our business for a substantial period of time. Inparticular, because we manufacture botulinum toxin in our facilities, we would be required to obtain further clearance and approval by state, federal or otherapplicable authorities to continue or resume manufacturing activities. The disaster recovery and business continuity plans we have in place currently arelimited and may not be adequate in the event of a serious disaster or similar event. We may incur substantial expenses as a result of the limited nature of ourdisaster recovery and business continuity plans, which, particularly when taken together with our lack of earthquake insurance, could have a material adverseeffect on our business.Furthermore, integral parties in our supply chain are geographically concentrated and operating from single sites, thereby increasing their vulnerabilityto natural disasters or other sudden, unforeseen and severe adverse events. If such an event were to affect our supply chain, it could have a material adverseeffect on our business.31Table of ContentsWe currently rely on third parties and consultants to conduct all our preclinical studies and clinical trials. If these third parties or consultants do notsuccessfully carry out their contractual duties or meet expected deadlines, we may be unable to obtain regulatory approval for or commercializeRT002 injectable or any future product candidates.We do not have the ability to independently conduct preclinical studies or clinical trials. We rely on medical institutions, clinical investigators,contract laboratories, collaborative partners and other third parties, such as CROs and clinical data management organizations, to conduct clinical trials onour product candidates. The third parties with whom we contract for execution of our clinical trials play a significant role in the conduct of these trials andthe subsequent collection and analysis of data. However, these third parties are not our employees, and except for contractual duties and obligations, we havelimited ability to control the amount or timing of resources that they devote to our programs. Although we rely on these third parties to conduct ourpreclinical studies and clinical trials, we remain responsible for ensuring that each of our preclinical studies and clinical trials is conducted in accordancewith its investigational plan and protocol. Moreover, the FDA and foreign regulatory authorities require us to comply with regulations and standards,commonly referred to as good clinical practices, or GCPs and good laboratory practices or GLPs, for conducting, monitoring, recording and reporting theresults of clinical and preclinical trials to ensure that the data and results are scientifically credible and accurate, and that the trial subjects are adequatelyinformed of the potential risks of participating in clinical trials. We also rely on consultants to assist in the execution, including data collection and analysis,of our clinical trials.In addition, the execution of preclinical studies and clinical trials, and the subsequent compilation and analysis of the data produced, requirescoordination among various parties. In order for these functions to be carried out effectively and efficiently, it is imperative that these parties communicateand coordinate with one another. Moreover, these third parties may also have relationships with other commercial entities, some of which may compete withus. These third parties may terminate their agreements with us upon as little as 30 days’ prior written notice of a material breach by us that is not cured within30 days. Many of these agreements may also be terminated by such third parties under certain other circumstances, including our insolvency or our failure tocomply with applicable laws. In general, these agreements require such third parties to reasonably cooperate with us at our expense for an orderly windingdown of services of such third parties under the agreements. If the third parties or consultants conducting our clinical trials do not perform their contractualduties or obligations, experience work stoppages, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the qualityor accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical trial protocols or GCP, or for any other reason, we mayneed to conduct additional clinical trials or enter into new arrangements, which could be difficult, costly or impossible, and our clinical trials may beextended, delayed or terminated or may need to be repeated. We may be unable to recover unused funds from these third-parties. If any of the foregoing wereto occur, we may not be able to obtain, or may be delayed in obtaining, regulatory approval for, and will not be able to, or may be delayed in our efforts to,successfully commercialize the product candidate being tested in such trials.If RT002 injectable is approved for marketing, and we are found to have improperly promoted off-label uses, or if physicians misuse our products oruse our products off-label, we may become subject to prohibitions on the sale or marketing of our products, significant fines, penalties, and sanctions,product liability claims, and our image and reputation within the industry and marketplace could be harmed.The FDA and other regulatory agencies strictly regulate the marketing and promotional claims that are made about drug products, such as RT002injectable, if approved. In particular, a product may not be promoted for uses or indications that are not approved by the FDA or such other regulatoryagencies as reflected in the product’s approved labeling. If we are found to have promoted such off-label uses, we may receive warning letters and becomesubject to significant liability, which would materially harm our business. The federal government has levied large civil and criminal fines against companiesfor alleged improper promotion and has enjoined several companies from engaging in off-label promotion. If we become the target of such an investigation orprosecution based on our marketing and promotional practices, we could face similar sanctions, which would materially harm our business. In addition,management’s attention could be diverted from our business operations, significant legal expenses could be incurred, and our reputation could be damaged.The FDA has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed orcurtailed. If we are deemed by the FDA to have engaged in the promotion of our products for off-label use, we could be subject to FDA prohibitions on thesale or marketing of our products or significant fines and penalties, and the imposition of these sanctions could also affect our reputation and position withinthe industry.32Table of ContentsPhysicians may also misuse our products or use improper techniques, potentially leading to adverse results, side effects or injury, which may lead toproduct liability claims. If our products are misused or used with improper technique, we may become subject to costly litigation by our customers or theirpatients. Product liability claims could divert management’s attention from our core business, be expensive to defend, and result in sizable damage awardsagainst us that may not be covered by insurance. Furthermore, the use of our products for indications other than those cleared by the FDA may not effectivelytreat such conditions, which could harm our reputation in the marketplace among physicians and patients.Any of these events could harm our business and results of operations and cause our stock price to decline.Even if RT002 injectable or any future product candidate is approved for commercialization, if there is not sufficient patient demand for suchprocedures, our financial results and future prospects will be harmed.Treatment of glabellar lines with RT002 injectable is an elective procedure, the cost of which must be borne by the patient, and we do not expect it tobe reimbursable through government or private health insurance. The decision by a patient to elect to undergo the treatment of glabellar lines with RT002injectable or the treatment of other aesthetic indications we may pursue may be influenced by a number of factors, including: •the success of any sales and marketing programs that we, or any third parties we engage, undertake, and as to which we have limited experience;•the extent to which physicians recommend RT002 injectable to their patients;•the extent to which RT002 injectable satisfies patient expectations;•our ability to properly train physicians in the use of RT002 injectable or such that their patients do not experience excessive discomfort duringtreatment or adverse side effects;•the cost, safety and effectiveness of RT002 injectable versus other aesthetic treatments;•consumer sentiment about the benefits and risks of aesthetic procedures generally and RT002 injectable in particular;•the success of any direct-to-consumer marketing efforts we may initiate; and•general consumer confidence, which may be impacted by general economic and political conditions.Our business, financial results and future prospects will be materially harmed if we cannot generate sufficient demand for RT002 injectable or for anyother future product candidate, once approved.We are subject to uncertainty relating to third-party reimbursement policies which, if not favorable for RT002 injectable or any future productcandidates, could hinder or prevent their commercial success.Our ability to commercialize RT002 injectable or any future product candidates for therapeutic indications such as cervical dystonia or plantar fasciitiswill depend in part on the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors. As athreshold for coverage and reimbursement, third-party payors generally require that drug products have been approved for marketing by the FDA. Third-partypayors also are increasingly challenging the effectiveness of and prices charged for medical products and services. We may not obtain adequate third-partycoverage or reimbursement for RT002 injectable or any future product candidates, or we may be required to sell them at a discount.We expect that private insurers will consider the efficacy, cost effectiveness and safety of RT002 injectable in determining whether to approvereimbursement for RT002 injectable and at what level. Obtaining these approvals can be a time-consuming and expensive process. Our business would bematerially adversely affected if we do not receive approval for reimbursement of RT002 injectable from private insurers on a timely or satisfactory basis. Ourbusiness could also be adversely affected if private insurers, including managed care organizations, the Medicare program or other reimbursing bodies orpayors limit the indications for which RT002 injectable will be reimbursed to a smaller patient set than we believe they are effective in treating.In some foreign countries, particularly Canada and European countries, the pricing of prescription pharmaceuticals is subject to strict governmentalcontrol. In these countries, pricing negotiations with governmental authorities can take six to 12 months or longer after the receipt of regulatory approval andproduct launch. To obtain favorable reimbursement for the indications sought or pricing approval in some countries, we may be required to conduct a clinicaltrial that compares the cost-effectiveness of our products, including RT002 injectable, to other available therapies. If reimbursement for our product isunavailable in any country in which reimbursement is sought, limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could bematerially harmed.33Table of ContentsIf product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of any futureproducts we develop.We face an inherent risk of product liability lawsuits as a result of the clinical testing of our product candidates and we will face an even greater risk ifwe commercialize any products. For example, we may be sued if any product we develop allegedly causes injury or is found to be otherwise unsuitableduring product testing, manufacturing, marketing or sale. Any such product liability claims may include allegations of defects in manufacturing, defects indesign, a failure to warn of dangers inherent in the product, negligence, strict liability and a breach of warranties. Claims could also be asserted under stateconsumer protection acts. If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required tolimit commercialization of our products. Even a successful defense would require significant financial and management resources. Regardless of the merits oreventual outcome, liability claims may result in: •decreased demand for RT002 injectable or any future product candidates or products we develop;•injury to our reputation and significant negative media attention;•withdrawal of clinical trial participants or cancellation of clinical trials;•costs to defend the related litigation;•a diversion of management’s time and our resources;•substantial monetary awards to trial participants or patients;•regulatory investigations, product recalls, withdrawals or labeling, marketing or promotional restrictions;•loss of revenue; and•the inability to commercialize any products we develop.Our inability to obtain and maintain sufficient product liability insurance at an acceptable cost and scope of coverage to protect against potentialproduct liability claims could prevent or inhibit the commercialization of RT002 injectable or any future products we develop. We currently carry productliability insurance covering our clinical trials in the amount of $10.0 million in the aggregate. Although we maintain such insurance, any claim that may bebrought against us could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess ofthe limits of our insurance coverage. Our insurance policies also have various exclusions and deductibles, and we may be subject to a product liability claimfor which we have no coverage. We will have to pay any amounts awarded by a court or negotiated in a settlement that exceed our coverage limitations orthat are not covered by our insurance, and we may not have, or be able to obtain, sufficient capital to pay such amounts. Moreover, in the future, we may notbe able to maintain insurance coverage at a reasonable cost or in sufficient amounts to protect us against losses. If and when we obtain approval for marketingRT002 injectable we intend to expand our insurance coverage to include the sale of RT002 injectable as applicable; however, we may be unable to obtainthis liability insurance on commercially reasonable terms.We have been, and in the future may be, subject to securities class action and shareholder derivative actions. These, and potential similar or relatedlitigation, could result in substantial damages and may divert management’s time and attention from our business.We have been, and may in the future be, the target of securities class actions or shareholder derivative claims. On May 1, 2015, a securities class actioncomplaint was filed on behalf of City of Warren Police and Fire Retirement System against us and certain of our directors and executive officers at the time ofour follow-on public offering, and the investment banking firms that acted as the underwriters in our follow-on public offering. The Court granted finalapproval of the Settlement, as set forth in the Stipulation of Settlement, on July 28, 2017. While the litigation has ended, we may be subject to futuresecurities class action and shareholder derivation actions, which may adversely impact our business, results of operations, financial position or cash flows anddivert management’s time and attention from the business.34Table of ContentsIf we fail to attract and keep senior management and key scientific personnel, we may be unable to successfully develop RT002 injectable, topical, orany future product candidates, conduct our clinical trials and commercialize RT002 injectable, topical, or any future products we develop.Our success depends in part on our continued ability to attract, retain and motivate highly qualified management, clinical and scientific personnel. Webelieve that our future success is highly dependent upon the contributions of our senior management, particularly L. Daniel Browne, our President and ChiefExecutive Officer, Abhay Joshi, Ph.D., our Chief Operating Officer, Lauren P. Silvernail, our Chief Financial Officer and Chief Business Officer, and ToddZavodnick, our Chief Commercial Officer and President, Aesthetics and Therapeutics, as well as our senior scientists and other members of our seniormanagement team. The loss of services of any of these individuals could delay or prevent the successful development of our product pipeline, the completionof our planned clinical trials or the commercialization of RT002 injectable, topical, or any future products we develop.Leadership transitions can be inherently difficult to manage. Resignations of executive officers may cause disruption in our business, strategic andemployee relationships, which may significantly delay or prevent the achievement of our business objectives. Leadership changes may also increase thelikelihood of turnover in other key officers and employees and may cause declines in the productivity of existing employees. The search for a replacementofficer may take many months or more, further exacerbating these factors. Identifying and hiring an experienced and qualified executive officer are typicallydifficult. Periods of transition in senior management leadership are often difficult as the new executives gain detailed knowledge of our operations and mayresult in cultural differences and friction due to changes in strategy and style. During the transition periods, there may be uncertainty among investors,employees, creditors and others concerning our future direction and performance.Although we have not historically experienced unique difficulties attracting and retaining qualified employees, we could experience such problems inthe future. For example, competition for qualified personnel in the biotechnology and pharmaceuticals field is intense and the turnover rate can be high dueto the limited number of individuals who possess the skills and experience required by our industry. We will need to hire additional personnel as we expandour clinical development and commercial activities. We may not be able to attract and retain quality personnel on acceptable terms, or at all. In addition, tothe extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited or that they have divulgedproprietary or other confidential information, or that their former employers own their previous research output.If we are not successful in discovering, developing, acquiring and commercializing additional product candidates, our ability to expand our businessand achieve our strategic objectives would be impaired.Although a substantial amount of our effort will focus on the continued clinical testing and potential approval of RT002 injectable, a key element ofour strategy is to discover, develop and commercialize a portfolio of botulinum toxin products to serve both the aesthetic and therapeutic markets. We areseeking to do so through our internal research programs and may explore strategic collaborations for the development or acquisition of new products. WhileRT002 injectable is in the clinical development stage, topical and all of our other potential product candidates remain in the discovery or preclinical stage.Research programs to identify product candidates require substantial technical, financial and human resources, whether or not any product candidates areultimately identified. Our research programs may initially show promise in identifying potential product candidates, yet fail to yield product candidates forclinical development for many reasons, including the following: •the research methodology used may not be successful in identifying potential product candidates;•competitors may develop alternatives that render our product candidates obsolete or less attractive;•product candidates we develop may nevertheless be covered by third parties’ patents or other exclusive rights;•a product candidate may on further study be shown to have harmful side effects or other characteristics that indicate it is unlikely to be effectiveor otherwise does not meet applicable regulatory criteria;•a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or at all;•a product candidate may not be accepted as safe and effective by patients, the medical community or third-party payors, if applicable; and•intellectual property rights of third parties may potentially block our entry into certain markets or make such entry economically impracticable.35Table of ContentsIf we fail to develop and successfully commercialize other product candidates, our business and future prospects may be harmed and our business willbe more vulnerable to problems that we encounter in developing and commercializing RT002 injectable.The requirements of being a public company may strain our resources, divert management's attention and affect our ability to attract and retainqualified members of our board of directors.We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the Dodd-Frank Act, the Nasdaqlisting rules and other applicable securities rules and regulations. Compliance with these rules and regulations has increased and will continue to increase ourlegal and financial compliance costs, make some activities more difficult, time-consuming or costly, and increase demand on our systems and resources. TheSarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.In order to maintain and, if required, improve our disclosure controls and procedures and internal control over financial reporting to meet this standard,significant resources and management oversight may be required. As a result, management's attention may be diverted from other business concerns, whichcould harm our business and operating results. Although we have hired additional employees to comply with these requirements, we may need to hire moreemployees in the future, which will increase our costs and expenses.In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for publiccompanies, increasing legal and financial compliance costs and making some activities more time-consuming. These laws, regulations and standards aresubject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as newguidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costsnecessitated by ongoing revisions to disclosure and governance practices. We intend to invest resources to comply with evolving laws, regulations andstandards, and this investment may result in increased general and administrative expenses and a diversion of management's time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new laws, regulations and standards differ from the activities intended byregulatory or governing bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us and our business maybe harmed.As a public company that is subject to these rules and regulations we may find it is more expensive for us to obtain director and officer liabilityinsurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it moredifficult for us to attract and retain qualified members of our board of directors and qualified executive officers.Our business involves the use of hazardous materials and we and our third-party manufacturers and suppliers must comply with environmental lawsand regulations, which can be expensive and restrict how we do business.Our research and development and manufacturing activities and our third-party manufacturers’ and suppliers’ activities involve the controlled storage,use and disposal of hazardous materials owned by us, including botulinum toxin type A, a key component of our product candidates, and other hazardouscompounds. We and our manufacturers and suppliers are subject to laws and regulations governing the use, manufacture, storage, handling and disposal ofthese hazardous materials. We are licensed with the Centers for Disease Control and Prevention, or CDC and with the California Department of Health, Foodand Drug Branch for use of botulinum toxin and to manufacture both the active pharmaceutical ingredient, or API, and the finished product in topical andinjectable dose forms. In some cases, these hazardous materials and various wastes resulting from their use are stored at our and our manufacturers’ facilitiespending their use and disposal. We cannot eliminate the risk of contamination, which could cause an interruption of our commercialization efforts, researchand development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulationsgoverning the use, storage, handling and disposal of these materials and specified waste products. Although we believe that the safety procedures utilized byus and our third-party manufacturers for handling and disposing of these materials generally comply with the standards prescribed by these laws andregulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or injury from these materials. In such an event, wemay be held liable for any resulting damages and such liability could exceed our resources and state or federal or other applicable authorities may curtail ouruse of certain materials and interrupt our business operations. Furthermore, environmental laws and regulations are complex, change frequently and havetended to become more stringent. We cannot predict the impact of such changes and cannot be certain of our future compliance.We may use third-party collaborators to help us develop, validate or commercialize any new products, and our ability to commercialize such productscould be impaired or delayed if these collaborations are unsuccessful.36Table of ContentsWe may license or selectively pursue strategic collaborations for the development, validation and commercialization of RT002 injectable, topical, andany future product candidates. In any third-party collaboration, we would be dependent upon the success of the collaborators to perform their responsibilitieswith continued cooperation. Our collaborators may not cooperate with us or perform their obligations under our agreements with them. We cannot control theamount and timing of our collaborators’ resources that will be devoted to performing their responsibilities under our agreements with them. Our collaboratorsmay choose to pursue alternative technologies in preference to those being developed in collaboration with us. The development, validation andcommercialization of our product candidates will be delayed if collaborators fail to conduct their responsibilities in a timely manner or in accordance withapplicable regulatory requirements or if they breach or terminate their collaboration agreements with us. Disputes with our collaborators could also impairour reputation or result in development delays, decreased revenues and litigation expenses.Unfavorable global economic conditions could adversely affect our business, financial condition or results of operations.Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets. Furthermore, themarket for aesthetic medical procedures may be particularly vulnerable to unfavorable economic conditions. We do not expect sales of RT002 injectable forthe treatment of glabellar lines to be reimbursed by any government or third-party payor and, as a result, demand for the first indications of each of ourproduct candidates will be tied to discretionary spending levels of our targeted patient population. Future global financial crises may cause extremevolatility and disruptions in capital and credit markets. A severe or prolonged economic downturn could result in a variety of risks to our business, includingweakened demand for RT002 injectable, topical, or any future product candidates, if approved, and our ability to raise additional capital when needed onacceptable terms, if at all. A weak or declining economy could also strain our suppliers, possibly resulting in supply disruption, or cause our customers todelay making payments for our services. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current or futureeconomic climate and financial market conditions could adversely impact our business.Adverse tax laws or regulations could be enacted or existing laws could be applied to us or our customers, which could increase the costs of our servicesand adversely impact our business.The application of federal, state, local and international tax laws to services provided electronically is evolving. New income, sales, use or other tax laws,statutes, rules, regulations or ordinances could be enacted at any time (possibly with retroactive effect), and could be applied solely or disproportionately toservices provided over the internet. These enactments could adversely affect our sales activity due to the inherent cost increase the taxes would represent andultimately result in a negative impact on our operating results and cash flows.In addition, existing tax laws, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us (possibly withretroactive effect), which could require us or our customers to pay additional tax amounts, as well as require us or our customers to pay fines or penalties andinterest for past amounts. If we are unsuccessful in collecting such taxes from our customers, we could be held liable for such costs, thereby adverselyimpacting our operating results and cash flows.Further, we have undertaken certain transactions to realize potential tax efficiencies in support of our expected global business expansion. Thesetransactions are meant to align the global economic ownership of our intellectual property rights with our current and future business operations. We areuncertain as to whether the tax efficiencies sought by this alignment will materialize and may choose to unwind these transactions in the future.On December 22, 2017, new legislation that significantly revises the Internal Revenue Code of 1986, as amended, was signed into law. The newlyenacted federal income tax law, among other things, contains significant changes to corporate taxation, including reduction of the corporate tax rate from atop marginal rate of 35% to a flat rate of 21%, limitation of the tax deduction for interest expense to 30% of adjusted earnings (except for certain smallbusinesses), limitation of the deduction for net operating losses to 80% of current year taxable income and elimination of net operating loss carrybacks, onetime taxation of offshore earnings at reduced rates regardless of whether they are repatriated, elimination of U.S. tax on foreign earnings (subject to certainimportant exceptions), immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying orrepealing many business deductions and credits. Notwithstanding the reduction in the corporate income tax rate, the overall impact of the new federal taxlaw is uncertain and our business and financial condition could be adversely affected. In addition, it is uncertain if and to what extent various states willconform to the newly enacted federal tax law. The impact of this tax reform on holders of our common stock is also uncertain and could be adverse. We urgeour stockholders to consult with their legal and tax advisors with respect to this legislation and the potential tax consequences of investing in or holding ourcommon stock.37Table of ContentsRisks Related to Our Intellectual PropertyIf our efforts to protect our intellectual property related to RT002 injectable, or any future product candidates, including topical, are not adequate, wemay not be able to compete effectively in our market.We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to RT002injectable, topical, and our development programs. Any disclosure to or misappropriation by third parties of our confidential proprietary information couldenable competitors to quickly duplicate or surpass our technological achievements, thereby eroding our competitive position in our market.The strength of patents in the biotechnology and pharmaceutical field involves complex legal and scientific questions and can be uncertain. Thisuncertainty includes changes to the patent laws through either legislative action to change statutory patent law or court action that may reinterpret existinglaw in ways affecting the scope or validity of issued patents. The patent applications that we own or license may fail to result in issued patents in the UnitedStates or foreign countries. Competitors in the field of cosmetics, pharmaceuticals, and botulinum toxin have created a substantial amount of prior art,including scientific publications, patents and patent applications. Our ability to obtain and maintain valid and enforceable patents depends on whether thedifferences between our technology and the prior art allow our technology to be patentable over the prior art. Even if the patents do successfully issue, thirdparties may challenge the validity, enforceability or scope of such issued patents or any other issued patents we own or license, which may result in suchpatents being narrowed, invalidated or held unenforceable. For example, patents granted by the European Patent Office may be opposed by any person withinnine months from the publication of their grant. Furthermore, even if they are unchallenged, our patents and patent applications may not adequately protectour intellectual property or prevent others from designing around our claims. In addition, recent changes to the patent laws of the United States provideadditional procedures for third parties to challenge the validity of issued patents. Patents issued from applications filed after March 15, 2013 may bechallenged by third parties using the post-grant review procedure which allows challenges for a number of reasons, including prior art, sufficiency ofdisclosure, and subject matter eligibility.Under the inter partes review procedure, any third party may challenge the validity of any issued U.S. Patent in the United States Patent and TrademarkOffice, or USPTO, on the basis of prior art. Because of a lower evidentiary standard necessary to invalidate a patent claim in USPTO proceedings as comparedto the evidentiary standard relied on in U.S. federal court, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTOto hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action. Accordingly, athird party may attempt to use the USPTO procedures to invalidate our patent claims that would not have been invalidated if first challenged by the thirdparty as a defendant in a district court action. If the breadth or strength of protection provided by the patents and patent applications we hold or pursue withrespect to RT002 injectable, topical, or any future product candidates is challenged, then it could threaten our ability to commercialize RT002 injectable,topical, or any future product candidates, and could threaten our ability to prevent competitive products from being marketed. Further, if we encounter delaysin our clinical trials, the period of time during which we could market RT002 injectable, or any future product candidates under patent protection would bereduced. The results of our REALISE 1 Phase 3 clinical trial may be relevant to our patent strategy for our topical program.Since patent applications in the United States and most other countries are confidential for a period of time after filing, we cannot be certain that wewere the first to either (i) file any patent application related to our product candidates or (ii) invent any of the inventions claimed in our patents or patentapplications. Furthermore, for applications filed before March 16, 2013, or patents issuing from such applications, an interference proceeding can beprovoked by a third party, or instituted by the USPTO to determine who was the first to invent any of the subject matter covered by the patent claims of ourapplications and patents. As of March 16, 2013, the United States transitioned to a “first-to-file” system for deciding which party should be granted a patentwhen two or more patent applications are filed by different parties claiming the same invention. A third party that files a patent application in the USPTObefore us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by the third party. Thechange to “first-to-file” from “first-to-invent” is one of the changes to the patent laws of the United States resulting from the Leahy-Smith America InventsAct signed into law on September 16, 2011. Among some of the other changes to the patent laws are changes that limit where a patentee may file a patentinfringement suit and providing opportunities for third parties to challenge any issued patent in the USPTO.Even where laws provide protection, costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietaryrights, and the outcome of such litigation would be uncertain. Moreover, any actions we may bring38Table of Contentsto enforce our intellectual property against our competitors could provoke them to bring counterclaims against us, and some of our competitors havesubstantially greater intellectual property portfolios and financial resources than we have.We also rely on trade secret protection and confidentiality agreements to protect proprietary know-how that may not be patentable, processes for whichpatents may be difficult to obtain or enforce and any other elements of our product development processes that involve proprietary know-how, information ortechnology that is not covered by patents.In an effort to protect our trade secrets and other confidential information, we require our employees, consultants, collaborators and advisors to executeconfidentiality agreements upon the commencement of their relationships with us. These agreements require that all confidential information developed bythe individual or made known to the individual by us during the course of the individual’s relationship with us be kept confidential and not disclosed tothird parties. These agreements, however, may not provide us with adequate protection against improper use or disclosure of confidential information, andthese agreements may be breached. Adequate remedies may not exist in the event of unauthorized use or disclosure of our confidential information. A breachof confidentiality could significantly affect our competitive position. In addition, in some situations, these agreements may conflict with, or be subject to, therights of third parties with whom our employees, consultants, collaborators or advisors have previous employment or consulting relationships. To the extentthat our employees, consultants or contractors use any intellectual property owned by others in their work for us, disputes may arise as to the rights in anyrelated or resulting know-how and inventions. Also, others may independently develop substantially equivalent proprietary information and techniques orotherwise gain access to our trade secrets and other confidential information.If we infringe or are alleged to infringe intellectual property rights of third parties, our business could be harmed.Our research, development and commercialization activities may infringe or otherwise violate or be claimed to infringe or otherwise violate patentsowned or controlled by other parties. Competitors in the field of cosmetics, pharmaceuticals and botulinum toxin have developed large portfolios of patentsand patent applications in fields relating to our business. For example, there are patents held by third parties that relate to the treatment with botulinum toxin-based products for indications we are currently developing. There may also be patent applications that have been filed but not published that, when issued aspatents, could be asserted against us. These third parties could bring claims against us that would cause us to incur substantial expenses and, if successfulagainst us, could cause us to pay substantial damages. Further, if a patent infringement suit were brought against us, we could be forced to stop or delayresearch, development, manufacturing or sales of the product or product candidate that is the subject of the suit.As a result of patent infringement claims, or to avoid potential claims, we may choose or be required to seek licenses from third parties. These licensesmay not be available on acceptable terms, or at all. Even if we are able to obtain a license, the license would likely obligate us to pay license fees or royaltiesor both, and the rights granted to us might be nonexclusive, which could result in our competitors gaining access to the same intellectual property.Ultimately, we could be prevented from commercializing a product based on our current or future indications, or be forced to cease some aspect of ourbusiness operations, if, as a result of actual or threatened patent infringement claims, we are unable to enter into licenses on acceptable terms.There has been substantial litigation and other proceedings regarding patent and other intellectual property rights in the pharmaceutical industry. Inaddition to infringement claims against us, we may become a party to other patent litigation and other proceedings, including interference, derivation orpost-grant proceedings declared or granted by the USPTO and similar proceedings in foreign countries, regarding intellectual property rights with respect toour current or future products. The cost to us of any patent litigation or other proceeding, even if resolved in our favor, could be substantial. Some of ourcompetitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their substantially greater financialresources. Patent litigation and other proceedings may also absorb significant management time. Uncertainties resulting from the initiation and continuationof patent litigation or other proceedings could impair our ability to compete in the marketplace. The occurrence of any of the foregoing could have a materialadverse effect on our business, financial condition or results of operations.39Table of ContentsWe may become involved in lawsuits to protect or enforce our patents or other intellectual property or the patents of our licensors, which could beexpensive and time-consuming.Competitors may infringe upon our intellectual property, including our patents or the patents of our licensors. As a result, we may be required to fileinfringement claims to stop third-party infringement or unauthorized use. This can be expensive, particularly for a company of our size, and time-consuming.In addition, in an infringement proceeding, a court may decide that a patent of ours is not valid or is unenforceable, or may refuse to stop the other party fromusing the technology at issue on the grounds that our patent claims do not cover its technology or that the factors necessary to grant an injunction against aninfringer are not satisfied.An adverse determination of any litigation or other proceedings could put one or more of our patents at risk of being invalidated or interpretednarrowly and could put our patent applications at risk of not issuing.Interference, derivation, inter partes review, post-grant review or other proceedings brought at the USPTO may be necessary to determine the priority orpatentability of inventions with respect to our patents or patent applications or those of our licensors or collaborators. Litigation or USPTO proceedingsbrought by us may fail or may be invoked against us by third parties. Even if we are successful, domestic or foreign litigation or USPTO or foreign patentoffice proceedings may result in substantial costs and distraction to our management. We may not be able, either alone or with our licensors or collaborators,to prevent misappropriation of our proprietary rights, particularly in countries where the laws may not protect such rights as fully as in the United States.Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation or other proceedings, there is arisk that some of our confidential information could be compromised by disclosure during this type of litigation or proceedings. In addition, during thecourse of this kind of litigation or proceedings, there could be public announcements of the results of hearings, motions or other interim proceedings ordevelopments or public access to related documents. If investors perceive these results to be negative, the market price for our common stock could besignificantly harmed.We may not be able to protect our intellectual property rights throughout the world.Filing, prosecuting and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and ourintellectual property rights in some countries outside the United States can be less extensive than those in the United States. In addition, the laws of someforeign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States and in some cases may even forceus to grant a compulsory license to competitors or other third parties. Consequently, we may not be able to prevent third parties from practicing ourinventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or otherjurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and further,may export otherwise infringing products to territories where we have patent protection, but where enforcement is not as strong as that in the United States.These products may compete with our products and our patents or other intellectual property rights may not be effective or sufficient to prevent them fromcompeting.Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legalsystems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection,particularly those relating to biotechnology, which could make it difficult for us to stop the infringement of our patents or marketing of competing productsin violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert ourefforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applicationsat risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate and the damages or otherremedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may beinadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.In addition, our ability to protect and enforce our intellectual property rights may be adversely affected by unforeseen changes in domestic and foreignintellectual property laws.40Table of ContentsRisks Related to Government RegulationOur business and products are subject to extensive government regulation.We are subject to extensive, complex, costly and evolving regulation by federal and state governmental authorities in the United States, principally bythe FDA, the U.S. Drug Enforcement Administration, or DEA, the CDC, and foreign regulatory authorities. Failure to comply with all applicable regulatoryrequirements, including those promulgated under the Federal Food, Drug, and Cosmetic Act, or FFDCA, the Public Health Service Act, or PHSA, andControlled Substances Act, may subject us to operating restrictions and criminal prosecution, monetary penalties and other disciplinary actions, including,sanctions, warning letters, product seizures, recalls, fines, injunctions, suspension, revocation of approvals, or exclusion from future participation in theMedicare and Medicaid programs.After our products receive regulatory approval or clearance, we, and our direct and indirect suppliers, remain subject to the periodic inspection of ourplants and facilities, review of production processes, and testing of our products to confirm that we are in compliance with all applicable regulations. Adversefindings during regulatory inspections may result in the implementation of Risk Evaluation and Mitigation Strategies (REMS) programs, completion ofgovernment mandated clinical trials, and government enforcement action relating to labeling, advertising, marketing and promotion, as well as regulationsgoverning manufacturing controls noted above.The regulatory approval process is highly uncertain and we may not obtain regulatory approval for the commercialization of RT002 injectable or anyfuture product candidates.The research, testing, manufacturing, labeling, approval, selling, import, export, marketing and distribution of drug and biologic products are subject toextensive regulation by the FDA and other regulatory authorities in the United States and other countries, which regulations differ from country to country.Neither we nor any collaboration partner are permitted to market RT002 injectable or any future product candidates in the United States until we receiveapproval of a BLA from the FDA. We have not submitted an application or obtained marketing approval for RT002 injectable anywhere in the world. Afterwe submit a BLA for RT002 injectable, the FDA may refuse to file the application if it determines that the application is not sufficiently complete to permitsubstantive review. Even if filed by FDA, our BLA may receive a Complete Response Letter identifying deficiencies that must be addressed, rather than anapproval. Obtaining regulatory approval of a BLA can be a lengthy, expensive and uncertain process. In addition, failure to comply with FDA and otherapplicable U.S. and foreign regulatory requirements may subject us to administrative or judicially imposed sanctions or other actions, including: •warning letters;•civil and criminal penalties;•injunctions;•withdrawal of approved products;•product seizure or detention;•product recalls;•total or partial suspension of production; and•refusal to approve pending BLAs or supplements to approved BLAs.Prior to obtaining approval to commercialize a product candidate in the United States or abroad, we or our collaborators must demonstrate withsubstantial evidence from well controlled clinical trials, and to the satisfaction of the FDA or other foreign regulatory agencies, that such product candidatesare safe and effective for their intended uses. Results from preclinical studies and clinical trials can be interpreted in different ways. Even if we believe thepreclinical and clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatoryauthorities. Administering product candidates to humans may produce undesirable side effects, which could interrupt, delay or halt clinical trials and result inthe FDA or other regulatory authorities denying approval of a product candidate for any or all targeted indications.Regulatory approval of a BLA or BLA supplement is not guaranteed, and the approval process is expensive and may take several years. The FDA alsohas substantial discretion in the approval process. Despite the time and expense expended, failure can occur at any stage, and we could encounter problemsthat cause us to abandon or repeat clinical trials, or perform additional preclinical studies and clinical trials. The number of preclinical studies and clinicaltrials that will be required for FDA approval varies depending on the product candidate, the disease or the condition that the product candidate is designed toaddress and the regulations applicable to any particular product candidate. The FDA can delay, limit or deny approval of a product candidate for manyreasons, including the following:41Table of Contents •a product candidate may not be deemed safe, effective, or of required quality;•FDA officials may not find the data from preclinical studies and clinical trials sufficient;•the FDA might not approve our third-party manufacturers’ processes or facilities; or•the FDA may change its approval policies or adopt new regulations.If RT002 injectable or any future product candidates fail to demonstrate safety and efficacy in clinical trials or do not gain approval, our business andresults of operations will be materially and adversely harmed.Even if we receive regulatory approval for RT002 injectable or any future product candidates, we will be subject to ongoing regulatory obligations andcontinued regulatory review, which may result in significant additional expense, may limit or delay regulatory approval and may subject us topenalties if we fail to comply with applicable regulatory requirements.Once regulatory approval has been granted, RT002 injectable or any approved product will be subject to continual regulatory review by the FDAand/or non-U.S. regulatory authorities. Additionally, any product candidates, if approved, will be subject to extensive and ongoing regulatory requirements,including labeling and other restrictions and market withdrawal and we may be subject to penalties if we fail to comply with regulatory requirements orexperience unanticipated problems with our products.Any regulatory approvals that we or our collaborators receive for RT002 injectable or any future product candidates may also be subject to limitationson the approved indications for which the product may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including Phase 4 clinical trials, and surveillance to monitor the safety and efficacy of the product candidate. In addition, if the applicableregulatory agency approves RT002 injectable or any future product candidates, the manufacturing processes, labeling, packaging, distribution, adverse eventreporting, storage, advertising, promotion and recordkeeping for the product will be subject to extensive and ongoing regulatory requirements. Theserequirements include submissions of safety and other post-marketing information and reports, registration, as well as continued compliance with cGMP andcGCP for any clinical trials that we conduct post-approval. Later discovery of previously unknown problems with RT002 injectable or any future productcandidates, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure tocomply with regulatory requirements, may result in, among other things: •restrictions on the marketing or manufacturing of the product, withdrawal of the product from the market, or voluntary or mandatory productrecalls;•fines, warning letters or holds on clinical trials;•refusal by the FDA to approve pending applications or supplements to approved applications submitted by us or our strategic collaborators, orsuspension or revocation of product license approvals;•product seizure or detention, or refusal to permit the import or export of products; and•injunctions or the imposition of civil or criminal penalties.Our ongoing regulatory requirements may also change from time to time, potentially harming or making costlier our commercialization efforts. Wecannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the UnitedStates or other countries. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are notable to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability,which would adversely affect our business.If we fail to obtain regulatory approvals in foreign jurisdictions for RT002 injectable, or any future product candidates including topical, we will beunable to market our products outside of the United States.In addition to regulations in the United States, we will be subject to a variety of foreign regulations governing manufacturing, clinical trials,commercial sales and distribution of our future products. Whether or not we obtain FDA approval for a product candidate, we must obtain approval of theproduct by the comparable regulatory authorities of foreign countries before commencing clinical trials or marketing in those countries. The approvalprocedures vary among countries and can involve additional clinical testing, or the time required to obtain approval may differ from that required to obtainFDA approval. Clinical trials conducted in one country may not be accepted by regulatory authorities in other countries. Approval by the FDA does notensure approval by regulatory authorities in other countries, and approval by one or more foreign regulatory42Table of Contentsauthorities does not ensure approval by regulatory authorities in other foreign countries or by the FDA. The foreign regulatory approval process may includeall of the risks associated with obtaining FDA approval. We may not be able to file for regulatory approvals or to do so on a timely basis, and even if we dofile, we may not receive the necessary approvals to commercialize our products in markets outside of the United States.If approved, RT002 injectable or any other products may cause or contribute to adverse medical events that we are required to report to regulatoryagencies and if we fail to do so, we could be subject to sanctions that would materially harm our business.Some participants in our clinical trials have reported adverse events after being treated with RT002 injectable. If we are successful in commercializingRT002 injectable, or any other products including our topical product candidate, the FDA and foreign regulatory agency regulations require that we reportcertain information about adverse medical events if those products may have caused or contributed to those adverse events. The timing of our obligation toreport would be triggered by the date we become aware of the adverse event as well as the nature of the event. We may fail to report adverse events webecome aware of within the prescribed timeframe. We may also fail to appreciate that we have become aware of a reportable adverse event, especially if it isnot reported to us as an adverse event or if it is an adverse event that is unexpected or removed in time from the use of our products. If we fail to comply withour reporting obligations, the FDA or a foreign regulatory agency could take action including criminal prosecution, the imposition of civil monetarypenalties, seizure of our products, or delay in approval or clearance of future products.We may in the future be subject to various U.S. federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback, self-referral,false claims and fraud laws, and any violations by us of such laws could result in fines or other penalties.While we do not expect that RT002 injectable, if approved for the treatment of glabellar lines, will subject us to the various U.S. federal and state lawsintended to prevent healthcare fraud and abuse, we may in the future become subject to such laws for treatment of other indications. The federal anti-kickback statute prohibits the offer, receipt, or payment of remuneration in exchange for or to induce the referral of patients or the use of products or servicesthat would be paid for in whole or part by Medicare, Medicaid or other federal healthcare programs. Remuneration has been broadly defined to includeanything of value, including cash, improper discounts, and free or reduced price items and services. Many states have similar laws that apply to their statehealthcare programs as well as private payors. Violations of the anti-kickback laws can result in exclusion from federal healthcare programs and the levyingof substantial civil and criminal penalties.The federal False Claims Act, or FCA, imposes liability on persons who, among other things, present or cause to be presented false or fraudulent claimsfor payment by a federal healthcare program. The FCA has been used to prosecute persons submitting claims for payment that are inaccurate or fraudulent, forservices not provided as claimed, or for services that are not medically necessary. The FCA includes a whistleblower provision that allows individuals tobring actions on behalf of the federal government and share a portion of the recovery of successful claims. If our marketing or other arrangements weredetermined to violate anti-kickback or related laws, including the FCA, then our revenues could be adversely affected, which would likely harm our business,financial condition, and results of operations.State and federal authorities have aggressively targeted medical technology companies for alleged violations of these anti-fraud statutes, based onimproper research or consulting contracts with doctors, certain marketing arrangements that rely on volume-based pricing, off-label marketing schemes, andother improper promotional practices. Companies targeted in such prosecutions have paid substantial fines in the hundreds of millions of dollars or more,have been forced to implement extensive corrective action plans, and have often become subject to consent decrees severely restricting the manner in whichthey conduct business. If we become the target of such an investigation or prosecution based on our contractual relationships with providers or institutions,or our marketing and promotional practices, we could face similar sanctions, which would materially harm our business.Also, the U.S. Foreign Corrupt Practices Act and similar worldwide anti-bribery laws generally prohibit companies and their intermediaries from makingimproper payments to non-U.S. officials for the purpose of obtaining or retaining business. We cannot assure you that our internal control policies andprocedures will protect us from reckless or negligent acts committed by our employees, future distributors, partners, collaborators or agents. Violations ofthese laws, or allegations of such violations, could result in fines, penalties or prosecution and have a negative impact on our business, results of operationsand reputation.43Table of ContentsLegislative or regulatory healthcare reforms in the United States may make it more difficult and costly for us to obtain regulatory clearance orapproval of RT002 injectable, topical, or any future product candidates and to produce, market, and distribute our products after clearance orapproval is obtained.From time to time, legislation is drafted and introduced in Congress that could significantly change the statutory provisions governing the regulatoryclearance or approval, manufacture, and marketing of regulated products or the reimbursement thereof. In addition, FDA regulations and guidance are oftenrevised or reinterpreted by the FDA in ways that may significantly affect our business and our products. Any new regulations or revisions or reinterpretationsof existing regulations may impose additional costs or lengthen review times of RT002 injectable, or any future product candidates including our topicalproduct candidate. We cannot determine what effect changes in regulations, statutes, legal interpretation or policies, when and if promulgated, enacted oradopted may have on our business in the future. Such changes could require, among other things: •changes to manufacturing methods;•recall, replacement, or discontinuance of one or more of our products; and•additional recordkeeping.Each of these would likely entail substantial time and cost and could materially harm our business and our financial results. In addition, delays inreceipt of or failure to receive regulatory clearances or approvals for any future products would harm our business, financial condition, and results ofoperations.Risks Related to the Ownership of Our Common StockThe trading price of our common stock is volatile, and purchasers of our common stock could incur substantial losses.The trading price of our common stock is highly volatile and could be subject to wide fluctuations in response to various factors, some of which arebeyond our control. The stock markets in general and the markets for pharmaceutical biopharmaceutical and biotechnology stocks in particular haveexperienced extreme volatility that may have been for reasons that are related or unrelated to the operating performance of the issuer. The market price for ourcommon stock may be influenced by many factors, including: •regulatory or legal developments in the United States and foreign countries;•results from or delays in clinical trials of our product candidates, including our ongoing SAKURA Phase 3 clinical program in glabellar linesand our Phase 2 program in plantar fasciitis as well as our Phase 3 clinical program in cervical dystonia, all with RT002 injectable;•announcements of regulatory approval or disapproval of RT002 injectable or any future product candidates;•FDA or other U.S. or foreign regulatory actions or guidance affecting us or our industry;•introductions and announcements of new products by us, any commercialization partners or our competitors, and the timing of theseintroductions and announcements;•variations in our financial results or those of companies that are perceived to be similar to us;•changes in the structure of healthcare payment systems;•announcements by us or our competitors of significant acquisitions, licenses, strategic partnerships, joint ventures or capital commitments;•market conditions in the pharmaceutical and biotechnology sectors and issuance of securities analysts’ reports or recommendations;•quarterly variations in our results of operations or those of our future competitors;•changes in financial estimates or guidance, including our ability to meet our future revenue and operating profit or loss estimates or guidance;•sales of substantial amounts of our stock by insiders and large stockholders, or the expectation that such sales might occur;•general economic, industry and market conditions;•additions or departures of key personnel;•intellectual property, product liability or other litigation against us;•expiration or termination of our potential relationships with customers and strategic partners; and•other factors described in this “Risk Factors” section.44Table of ContentsThese broad market fluctuations may adversely affect the trading price or liquidity of our common stock. In addition, in the past, stockholders haveinitiated class actions against pharmaceutical companies, including us, following periods of volatility in their stock prices. Such litigation instituted againstus could cause us to incur substantial costs and divert management’s attention and resources.If securities or industry analysts do not publish research or publish unfavorable research about our business, our stock price and trading volume coulddecline.As a smaller company, it may be difficult for us to attract or retain the interest of equity research analysts. A lack of research coverage may adverselyaffect the liquidity and market price of our common stock. We will not have any control of the equity research analysts or the content and opinions includedin their reports. The price of our stock could decline if one or more equity research analysts downgrade our stock or issue other unfavorable commentary orresearch. If one or more equity research analysts ceases coverage of our company, or fails to publish reports on us regularly, demand for our stock coulddecrease, which in turn could cause our stock price or trading volume to decline.Sales of substantial amounts of our common stock in the public markets, or the perception that such sales might occur, could cause the market price ofour common stock to drop significantly, even if our business is doing well.Sales of a substantial number of shares of our common stock in the public market could occur at any time. On March 7, 2016, we entered into an ATMagreement, or the 2016 ATM Agreement, with Cowen, under which we may offer and sell shares of our common stock having aggregate gross proceeds of upto $75.0 million through Cowen as our sales agent. In 2017, we sold 1,802,651 shares of our common stock under the 2016 ATM Agreement at a weightedaverage price of $22.17 per share resulting in net proceeds of $38.2 million, after underwriting discounts, commissions and other offering expenses. InDecember 2017, we sold 5,389,515 shares of the Company’s common stock pursuant to the Company's effective shelf registration statement on Form S-3ASR (Registration No. 333-221911), at a price to the public of $31.00 per share, resulting in net proceeds to the Company of $156.9 million, afterunderwriting discounts, commissions and other offering expenses.If our stockholders sell, or the market perceives that our stockholders intend to sell, substantial amounts of our common stock in the public market, themarket price of our common stock could decline significantly. Any sales of securities by stockholders could have a material adverse effect on the tradingprice of our common stock.Provisions in our corporate charter documents and under Delaware law could discourage takeover attempts and lead to management entrenchment,and the market price of our common stock may be lower as a result.Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws may make it difficult for a third party toacquire, or attempt to acquire, control of our company, even if a change in control was considered favorable by you and other stockholders. For example, ourboard of directors has the authority to issue up to 5,000,000 shares of preferred stock. Our board of directors can fix the price, rights, preferences, privileges,and restrictions of the preferred stock without any further vote or action by our stockholders. The issuance of shares of preferred stock may delay or prevent achange in control transaction. As a result, the market price of our common stock and the voting and other rights of our stockholders may be adverselyaffected. An issuance of shares of preferred stock may result in the loss of voting control to other stockholders.Our charter documents also contain other provisions that could have an anti-takeover effect, including: •only one of our three classes of directors will be elected each year;•no cumulative voting in the election of directors;•the ability of our board of directors to issues shares of preferred stock and determine the price and other terms of those shares, includingpreferences and voting rights, without stockholder approval;•the exclusive right of our board of directors to elect a director to fill a vacancy or newly created directorship;•stockholders will not be permitted to take actions by written consent;•stockholders cannot call a special meeting of stockholders;•stockholders must give advance notice to nominate directors or submit proposals for consideration at stockholder meetings;•the ability of our board of directors, by a majority vote, to amend the bylaws; and•the requirement for the affirmative vote of at least 66 2/3% or more of the outstanding common stock to amend many of the provisionsdescribed above.45Table of ContentsIn addition, we are subject to the anti-takeover provisions of Section 203 of the Delaware General Corporation Law, which regulates corporateacquisitions. These provisions could discourage potential acquisition proposals and could delay or prevent a change in control transaction. They could alsohave the effect of discouraging others from making tender offers for our common stock, including transactions that may be in your best interests. Theseprovisions may also prevent changes in our management or limit the price that certain investors are willing to pay for our stock.Our amended and restated certificate of incorporation also provides that the Court of Chancery of the State of Delaware will be the exclusive forum forsubstantially all disputes between us and our stockholders.A relatively small number of existing stockholders have substantial control over us, which could limit your ability to influence the outcome of keytransactions, including a change of control.As of December 31, 2017, our directors, executive officers and each of our stockholders who own greater than 5% of our outstanding common stock andtheir affiliates, in the aggregate, beneficially owned approximately 62.4% of our common stock. As a result, these stockholders, if acting together, would beable to influence or control matters requiring approval by our stockholders, including the election of directors and the approval of mergers, acquisitions orother extraordinary transactions. They may have interests that differ from yours and may vote in a way with which you disagree and that may be adverse toyour interests. This concentration of ownership may have the effect of delaying, preventing or deterring a change of control of our company, could depriveour stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company and might affect the market price of ourcommon stock.Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and mayreduce the amount of money available to us.Our amended and restated certificate of incorporation and amended and restated bylaws provide that we will indemnify our directors and officers, ineach case to the fullest extent permitted by Delaware law.In addition, as permitted by Section 145 of the Delaware General Corporation Law, our amended and restated bylaws and our indemnificationagreements that we have entered into with our directors and officers provide that: •We will indemnify our directors and officers for serving us in those capacities, or for serving other business enterprises at our request, to thefullest extent permitted by Delaware law. Delaware law provides that a corporation may indemnify such person if such person acted in goodfaith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to anycriminal proceeding, had no reasonable cause to believe such person’s conduct was unlawful.•We may, in our discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law.•We are required to advance expenses, as incurred, to our directors and officers in connection with defending a proceeding, except that suchdirectors or officers shall undertake to repay such advances if it is ultimately determined that such person is not entitled to indemnification.•We will not be obligated pursuant to our amended and restated bylaws to indemnify a person with respect to proceedings initiated by thatperson against us or our other indemnitees, except with respect to proceedings authorized by our board of directors or brought to enforce a rightto indemnification.•The rights conferred in our amended and restated bylaws are not exclusive, and we are authorized to enter into indemnification agreements withour directors, officers, employees and agents and to obtain insurance to indemnify such persons.•We may not retroactively amend our amended and restated bylaw provisions to reduce our indemnification obligations to directors, officers,employees and agents.Because we do not anticipate paying any cash dividends on our common stock in the foreseeable future, capital appreciation, if any, will be your solesource of gains.We have not declared or paid cash dividends on our common stock to date. We currently intend to retain our future earnings, if any, to fund thedevelopment and growth of our business. In addition, the terms of any existing or future debt agreements may preclude us from paying dividends. As a result,capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future.46Table of ContentsWe are an “emerging growth company,” and if we decide to comply only with reduced disclosure requirements applicable to emerging growthcompanies, our common stock could be less attractive to investors.We are an “emerging growth company,” as defined in the JOBS Act and, for as long as we continue to be an “emerging growth company,” we maychoose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to “emerging growth companies,”including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosureobligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbindingadvisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We will remain an“emerging growth company” until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of our IPO, (b) in which wehave total annual gross revenues of over $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of ourcommon stock held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. We cannot predict if investors will find our common stock less attractive if we choose to rely on theseexemptions. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active tradingmarket for our common stock and our stock price may be more volatile.Under the JOBS Act, emerging growth companies that become public can delay adopting new or revised accounting standards until such time as thosestandards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and,therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.47Table of ContentsITEM 1B.UNRESOLVED STAFF COMMENTSNone.48Table of ContentsITEM 2.PROPERTIESOur headquarters is located in Newark, California, where we occupy approximately 90,000 square feet of office, laboratory and manufacturing space.The current term of our lease expires in January 2025. We have an option to extend the lease for two additional terms of seven years, which would extend ourlease through January 2039. We believe that our current facilities are adequate for our needs and for the immediate future and that, should it be needed,additional space can be leased to accommodate any future growth.49Table of ContentsITEM 3.LEGAL PROCEEDINGSFrom time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. From May 2015 until July2017, the Company and certain of its directors and executive officers were subject to a securities class action complaint, pending in the Superior Court for theCounty of Santa Clara, captioned City of Warren Police and Fire Retirement System v. Revance Therapeutics Inc., et al., Case No. 15-CV-287794 (previouslyassigned Case No. CIV 533635 prior to transfer from San Mateo Superior Court). On October 31, 2016, the parties executed a stipulation of settlement (the"Stipulation"), pursuant to which, in exchange for a release of all claims by the plaintiff class, the Company agreed to settle the litigation for $6.4 million incash, of which $5.9 million was covered by its insurance policies. The Stipulation maintained that the defendants, including the Company, deny allwrongdoing and liability related to the litigation. On July 28, 2017, the Court granted final approval of the Settlement, as set forth in the Stipulation, andentered a Judgment dismissing the action with prejudice, thereby ending the litigation. This litigation did not have a material adverse effect on our business,results of operations, financial position or cash flows.Except as provided above, we are not currently involved in any material legal proceedings.50Table of ContentsITEM 4.MINE SAFETY DISCLOSURESNot applicable.51Table of ContentsPART IIITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OFEQUITY SECURITIESOur common stock has been trading on The Nasdaq Global Market under the symbol “RVNC” since our IPO on February 6, 2014. Prior to this date,there was no public market for our common stock. On February 23, 2018, the closing price of our common stock as reported on the Nasdaq Global Market was$30.50 per share. The following table sets forth the high and low sales prices per share of our common stock on the Nasdaq Global Market for the quarterlyperiods indicated. High Low2017 First Quarter$24.30 $18.00Second Quarter$28.30 $18.42Third Quarter$28.70 $22.05Fourth Quarter$37.20 $24.50 2016 First Quarter$34.55 $15.63Second Quarter$20.95 $12.62Third Quarter$17.94 $12.54Fourth Quarter$21.85 $12.35Holders of RecordAs of February 23, 2018, there were approximately 30 holders of record of our common stock.Dividend PolicyWe have never declared or paid any cash dividend on our common stock. We currently anticipate that we will retain future earnings for thedevelopment, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Anydetermination to pay dividends in the future will be at the discretion of our board of directors and will be dependent on a number of factors, including ourearnings, capital requirements, overall financial conditions, business prospects, contractual restrictions and other factors our board of directors may deemrelevant.52Table of ContentsStock Price Performance GraphThis performance graph shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or incorporated by reference into any of our filingsunder the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. This graph compares, for the period ended December 31, 2017, the cumulative total return on our common stock, the Nasdaq Biotechnology Index(NBI) and the Nasdaq Composite Index (CCMP). The graph assumes $100 was invested on February 6, 2014, in our common stock, the NBI and CCMP, andassumes the reinvestment of any dividends. The stock price performance on the following graph is not necessarily indicative of future stock priceperformance.Company/Index2/6/20143/31/20146/30/20149/30/201412/31/20143/31/20156/30/20159/30/201512/31/2015Revance Therapeutics, Inc.$100.00$196.88$212.50$120.81$105.88$129.56$199.88$186.00$213.50Nasdaq Biotechnology Index$100.00$99.80$108.67$115.72$128.67$145.74$156.71$128.61$143.81Nasdaq Composite Index$100.00$103.67$109.18$111.62$117.98$122.45$124.94$116.08$126.20 Company/Index3/31/20166/30/20169/30/201612/31/20163/31/20176/30/20179/30/201712/31/2017 Revance Therapeutics, Inc.$109.13$85.00$101.31$129.38$130.00$165.00$172.19$223.44 Nasdaq Biotechnology Index$110.90$109.66$123.36$113.11$125.37$132.73$143.00$137.58 Nasdaq Composite Index$123.13$122.84$135.15$137.39$151.30$157.60$167.16$178.11 Recent Sales of Unregistered SecuritiesOn December 26, 2017, Essex Capital Corporation net exercised warrants to purchase 7,482 shares into 490 shares of common stock at an exerciseprice of $31.50.53Table of ContentsOn July 12, 2017, Essex Capital Corporation net exercised warrants to purchase 20,000 shares into 9,388 shares of common stock at an exerciseprice of $14.40. The issuance of the security described in the above paragraphs were deemed to be exempt from registration under the Securities Act in reliance onSection 4(2) of the Securities Act or Regulation D promulgated thereunder as transactions by an issuer not involving a public offering. The recipient of thesecurity acquired it for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were affixed tothe security. The recipient of the security was an accredited or sophisticated person and had adequate access, through employment, business or otherrelationships, to information about us.Issuer Purchases of Equity SecuritiesWe have not and do not currently intend to retire or repurchase any of our shares other than providing our employees with the option to withhold sharesto satisfy tax withholding amounts due from employees upon the vesting of restricted stock awards in connection with our 2014 Equity Incentive Plan.PeriodTotal Number ofSharesPurchased (i) Weighted-Average PricePaid per Share(ii) Total Number of SharePurchased as Part ofPublicly Announced Plan orPrograms Approximate Dollar Value of Sharesthat May Yet Be Purchased Underthe Plan or Programs (in thousands)October 1 through October 31, 2017366 $26.53 — —November 1 through November 30, 20171,175 25.02 — —December 1 through December 31, 20173,229 32.15 — —Total4,770 $29.94 — $—(i) Consists solely of shares that were withheld to satisfy tax withholding amounts due from employees upon the vesting of previously issued restricted stock awards.(ii) The weighted-average price paid per share is the weighted-average of the fair market prices at which we calculated the number of shares withheld to cover taxwithholdings for the employees.54Table of ContentsITEM 6.SELECTED FINANCIAL DATAThe information set forth below for the five years ended December 31, 2017 is not necessarily indicative of results of future operations, and should beread in conjunction with Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated FinancialStatements and related notes thereto included in Item 8, Consolidated Financial Statements and Supplementary Data, of this Form 10-K to fully understandthe factors that may affect the comparability of the information presented below.SELECTED CONSOLIDATED FINANCIAL DATA(In thousands, except share and per share data) Year Ended December 31, 2017 2016 2015 2014 2013Consolidated Statements of Operations Data: Revenue$262 $300 $300 $383 $617Total operating expenses$120,686 $88,515 $72,617 $52,433 $38,842Loss from operations$(120,424) $(88,215) $(72,317) $(52,050) $(38,225)Interest expense$(457) $(1,082) $(1,190) $(10,672) $(15,164)Net loss$(120,587) $(89,270) $(73,476) $(62,917) $(52,448)Net income (loss) attributable to common stockholders: Basic(1)$(120,587) $(89,270) $(73,476) $(62,917) $258Diluted(1)$(120,587) $(89,270) $(73,476) $(62,917) $1,083Net income (loss) per share attributable to common stockholders: Basic(1)$(4.01) $(3.18) $(3.02) $(3.24) $1.17Diluted(1)$(4.01) $(3.18) $(3.02) $(3.24) $1.05Weighted-average number of shares used in computing netincome (loss) per share attributable to common stockholders: Basic(1)30,101,125 28,114,784 24,340,466 19,391,523 220,220Diluted(1)30,101,125 28,114,784 24,340,466 19,391,523 1,029,150(1)For all periods presented these amounts reflect the one-for-fifteen reverse stock split effected on February 3, 2014. As of December 31, 2017 2016 2015 2014 2013Consolidated Balance Sheet Data: Cash and cash equivalents$282,896 $63,502 $201,615 $171,032 $3,914Investments$— $122,026 $52,439 $— $—Working capital surplus (deficit)$264,309 $173,048 $241,926 $162,495 $(42,747)Total assets$295,699 $204,360 $275,822 $192,469 $22,645Note payable, net of current portion$— $— $— $— $2,632Financing obligation, net of current portion$— $1,872 $5,346 $598 $—Convertible preferred stock$— $— $— $— $123,982Accumulated deficit$(542,167) $(421,543) $(332,273) $(258,797) $(195,880)55Table of ContentsITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to help the readerunderstand our results of operations and financial condition. MD&A is provided as a supplement to, and should be read in conjunction with, our auditedConsolidated Financial Statements and the accompanying notes to the Consolidated Financial Statements and other disclosures included in this AnnualReport on this Form 10-K (including the disclosures under “Item 1A. Risk Factors”). Our Consolidated Financial Statements have been prepared inaccordance with U.S. generally accepted accounting principles and are presented in U.S. dollars.OverviewRevance Therapeutics, Inc. is a clinical-stage biotechnology company focused on the development, manufacturing, and commercialization of novelbotulinum toxin products for multiple aesthetic and therapeutic indications. We are leveraging our proprietary portfolio of botulinum toxin type Acompounds, formulated with our patented and proprietary peptide technology, to address unmet needs in large and growing neuromodulator markets. Ourproprietary peptide technology enables delivery of botulinum toxin type A through two investigational drug product candidates, DaxibotulinumtoxinA forInjection (RT002), or RT002 injectable, and DaxibotulinumtoxinA Topical ("topical" or "our topical product candidate"). We are pursuing clinicaldevelopment for RT002 injectable and planning to conduct additional preclinical development for topical. Neither formulation of our product candidatescontains albumin or any other animal or human-derived materials. We believe this reduces the risk of the transmission of certain viral diseases. We holdworldwide rights for all indications of RT002 injectable and topical, and the pharmaceutical rights to our proprietary peptide technology.DaxibotulinumtoxinA for Injection (RT002 or RT002 Injectable)RT002 injectable is a novel, injectable formulation of botulinum toxin type A designed to be a targeted and long-acting treatment. We believe RT002injectable may provide delivery of botulinum toxin to intended treatment sites, while potentially reducing the unwanted spread of botulinum toxin toadjacent areas. We believe, and our preclinical and clinical studies indicate, that this delivery, enabled by our proprietary peptide technology, may result inhigh response rates and long duration of effect. We are studying RT002 injectable for aesthetic indications, such as glabellar (frown) lines and therapeuticindications, such as cervical dystonia and plantar fasciitis. We believe RT002 injectable has the potential to expand into additional aesthetic and therapeuticindications in the future.Glabellar LinesGlabellar, or frown lines, are the result of the gathering of the tissue between the eyebrows into a fold. They are caused by the repeated action ofunderlying muscles associated with facial expression. Years of squinting and frowning tend to leave deep wrinkles in the skin between the eyebrows and onthe bridge of the nose, across the forehead and at the corners of the eyes. On many people, frown lines produce an angry or sad look that detracts from apleasant facial appearance. Physical, emotional and social reasons for treating frown lines and forehead furrows include improved appearance and enhancedself-esteem.We are in Phase 3 clinical development for RT002 injectable for the treatment of glabellar lines. During the fourth quarter of 2016, we initiated subjectdosing in our SAKURA Phase 3 program. In December 2017, we announced top-line results for the SAKURA 1 and SAKURA 2 pivotal trials:Primary Endpoint. Both SAKURA 1 and SAKURA 2 met the primary composite endpoint by delivering highly statistically significant improvementagainst placebo in reducing the severity of glabellar lines. The percentage of RT002-treated patients who had none or mild wrinkles and achieved at leasta two-point improvement from baseline on both validated physician and patient assessments was 73.6 percent in SAKURA 1 and 74.0 percent in SAKURA 2compared to placebo (p<0.0001) at Week 4. Also, at that time point, 88 percent of RT002-treated patients in SAKURA 1 and 91 percent of RT002 patients inSAKURA 2 said they were very satisfied or satisfied with their treatment experience.Secondary Duration Endpoints. There were several secondary endpoints used to evaluate duration of effect, including the proportion of patientsachieving none or mild response on IGA-FWS compared to placebo, median duration for time to loss of none or mild wrinkle severity on both IGA-FWS andPFWS, and median duration for time to return to baseline on both IGA-56Table of ContentsFWS and PFWS. The percentage of RT002-treated patients who achieved a none or mild response on IGA-FWS was 35.3 percent in SAKURA 1 and 29.4percent at SAKURA 2 compared to placebo (p<0.0001) at Week 24. The median duration for time to loss of none or mild wrinkle severity on both IGA-FWSand PFWS for RT002-treated patients was 24.0 weeks for SAKURA 1 and 23.9 weeks for SAKURA 2. The median duration for time to return to baselinewrinkle severity on both IGA-FWS and PFWS for RT002-treated patients was 27.7 weeks for SAKURA 1 and 26.0 weeks for SAKURA 2. For comparison, anadditional exploratory duration endpoint was evaluated, which mirrors the duration measure used in the BELMONT Phase 2 study. This endpoint, was themedian duration of greater or equal to 1 point improvement from baseline on IGA-FWS for RT002-treated patients, and the results were 24.1 weeks for bothSAKURA 1 and SAKURA 2, and 23.6 weeks for BELMONT.In addition to SAKURA 1 and SAKURA 2, the SAKURA Phase 3 program includes a long-term, open-label safety trial (SAKURA 3), which is designedto evaluate the long-term safety of RT002 injectable for the treatment of moderate to severe glabellar lines in adults following both single and repeattreatment administration. In the fourth quarter of 2017, we completed enrollment of more than 2,500 subjects at 66 sites in the U.S. and Canada for SAKURA3. Depending on the number of treatments and duration of follow-up, a subject may be on trial for a maximum of 86 weeks. We have designed SAKURA 3 tosupport a safety database adequate for both domestic and international marketing applications. Assuming successful completion of our SAKURA Phase 3program in the second half of 2018, we plan to file marketing applications first in the United States followed by the European Union, Canada, and certainLatin American and Asian countries. If approved, we believe RT002 injectable has the potential to address significant unmet needs in these markets.In October 2015, we reported results from BELMONT, a Phase 2 active comparator, placebo-controlled clinical trial for the treatment of glabellar linesagainst the market leader BOTOX® Cosmetic. The 24-week data, which we reported in October 2015, showed that RT002 injectable achieved its primaryefficacy measurement at four weeks for all doses of RT002 injectable and that such efficacy was highly statistically significant as compared to placebo. Inaddition, the 40 Unit dose of RT002 injectable demonstrated a 23.6-week median duration versus BOTOX® Cosmetic with an 18.8-week median duration.Across all cohorts, RT002 injectable appeared to be generally safe and well-tolerated.Cervical DystoniaWe have also been developing RT002 for the treatment of cervical dystonia, a muscle movement disorder. Muscle movement disorders, such as cervicaldystonia, are neurological conditions that affect a person's ability to control muscle activity in one or more areas of the body. In 2015, we initiated a Phase 2dose-escalating, open-label clinical study of RT002 injectable for the treatment of cervical dystonia. The Phase 2 study evaluated the safety, preliminaryefficacy, and duration of effect of RT002 injectable in subjects with moderate to severe isolated cervical dystonia. The trial enrolled 37 subjects and followedthree sequential treatment cohorts for up to a total of 24 weeks after treatment for each cohort. The trial’s first cohort of 12 subjects received a single dose ofup to 200 units of RT002 injectable, the second cohort of 12 subjects received between 200 and 300 units, and the third cohort of 13 subjects received from300 to 450 units.In May 2017, we announced positive 24 week topline results in all three cohorts from the Phase 2 trial. The topline data demonstrated a medianduration of at least 24 weeks for each of all three cohorts. Duration of effect was defined as the number of weeks from treatment until the return of signs andsymptoms that warrant retreatment, based on subjects reaching their target Toronto Western Spasmodic Torticollis Rating Scale (TWSTRS) score. The toplinedata also displayed clinically significant impact on cervical dystonia signs and symptoms. At Week 4, RT002 injectable showed a clinically significant meanreduction of 38% from baseline across all three cohorts. This reduction continued to increase to 50% at Week 6 for all subjects, was 42% at Week 12 and wasmaintained at or above 30% through Week 24. The topline data also showed that RT002 injectable appeared to be generally safe and well-tolerated throughWeek 24 in all three cohorts. There were no serious adverse events and no dose-dependent increase in adverse events. The treatment-related adverse eventswere generally transient and mild to moderate in severity, with one case of neck pain reported as severe. The most common adverse events were dysphagia, ordifficulty in swallowing (14%), of which all cases were mild in severity, injection site redness (8%), injection site bruising (5%), injection site pain (5%),muscle tightness (5%) and muscle weakness (5%). In November 2017, we completed our End-of-Phase 2 meeting with the FDA and received Scientific Advice from the EMA regarding RT002 for thetreatment of cervical dystonia. Based on the Phase 2 safety and efficacy results and guidance from the FDA and EMA, we plan to initiate our Phase 3 programfor cervical dystonia in the second quarter of 2018. In November 2017, the FDA also granted orphan drug status to DaxibotulinumtoxinA for Injection for thetreatment of cervical dystonia in adults.57Table of ContentsPlantar FasciitisWe are also developing RT002 for the treatment of plantar fasciitis. Plantar fasciitis is a painful affliction caused by inflammation of the ligamentrunning along the bottom of the foot and is the most common cause of heel pain for patients who visit podiatrists and orthopedic foot and ankle surgeons. In2016, we initiated a Phase 2 prospective, randomized, double-blinded, placebo-controlled trial of RT002 injectable in the therapeutic indication of plantarfasciitis. This study is evaluating the safety and efficacy of a single administration of RT002 injectable in reducing the signs and symptoms of plantarfasciitis. In April 2017, we expanded our plantar fasciitis Phase 2 program from a single-site study to a multi-center study with protocol updates. The primaryefficacy endpoint is the reduction in the visual analog scale (VAS) for pain in the foot at eight weeks and subjects will be followed for 16 weeks followingtreatment. In October 2017, we completed patient enrollment. In January 2018, we announced the interim 8-week Phase 2a results for the plantar fasciitis trial.The trial’s primary endpoint, the reduction in the patient-reported visual analog scale (VAS) for pain at Week 8, showed a robust impact on pain, with agreater than 50% reduction for patients treated with RT002. In the intent-to-treat population, a mean reduction in the VAS score of 54.2% from baseline wasachieved with RT002, compared with a 42.6% reduction in the placebo group, which upon further subgroup analysis, was driven primarily by a strongplacebo response in the control group at three of the five study sites. While the results are not statistically significant (p=0.39) , RT002 provided patients withconsiderable pain relief. Similar numeric trends were seen in the secondary and exploratory endpoints. RT002 appeared to be generally safe and well-tolerated through Week 8. The majority of adverse events in both treatment groups were mild in severity. There were no treatment-related serious adverseevents. The most common treatment-related adverse events for RT002 and placebo were injection site pain (10.0 percent and 10.3 percent) and muscleweakness (3.3 percent and 3.4 percent), both respectively, all of which were classified as mild in severity. The Company plans to complete the 16-week trialand then expects to conduct another Phase 2 trial with a modified design to demonstrate the ability of RT002 to treat plantar fasciitis in the second half of2018.DaxibotulinumtoxinA TopicalOur topical product candidate presents several advantages, including painless topical administration, no bruising, ease of use and limited dependenceon administration technique by physicians and medical staff. We believe these potential advantages may improve the experience of patients undergoingbotulinum toxin procedures and could make our topical product candidate suitable for multiple indications in the future.We discontinued clinical development of our topical product candidate in 2016 and are planning to conduct additional preclinical work for topical intherapeutic and aesthetic applications where botulinum toxin has shown efficacy and are particularly well suited for needle-free treatments.Since commencing operations in 2002, we have devoted substantially all our efforts to identifying and developing our product candidates for theaesthetic and therapeutic markets, recruiting personnel, raising capital, and preclinical and clinical development of, and manufacturing capabilities for,RT002 injectable and our topical product candidate. We have retained all worldwide rights to develop and commercialize RT002 injectable and our topicalproduct candidate. We have not filed for approval with the FDA for the commercialization of RT002 injectable or our topical product candidate to treat anyindication, and we have not generated any revenue from product sales for RT002 injectable or our topical product candidate.Results of OperationsRevenueDuring the years ended December 31, 2017, 2016 and 2015, we recognized revenue from a royalty agreement and did not have any product revenueduring those same years. The following table presents our revenue for the periods indicated and related changes from the prior period: Years Ended December 31, 2017 vs. 2016 2016 vs. 2015 2017 2016 2015 % % (In thousands, except percentages)Relastin Royalty262 300 300 (13)% —%Total revenue$262 $300 $300 (13)% —%Our total revenue for the year ended December 31, 2017 decreased, compared to the same period in 2016 and 2015, due to termination of the royaltyrevenue agreement related to the Relastin product (over the counter skin cream) in November 2017. The Company will no longer receive any future royaltyrevenue from Relastin.58Table of ContentsWe recognized royalty revenue during the years ended December 31, 2017, 2016, and 2015 related to the Relastin asset purchase and royaltyagreement. In August 2011, we entered into the Relastin asset purchase and royalty agreement to sell the business related to our Relastin product line, toPrecision Dermatology, Inc., or PDI. The Relastin asset purchase and royalty agreement provided for a minimum royalty payment of $0.3 million per year, tobe paid quarterly for up to 15 years from the execution date. PDI was subsequently acquired by Valeant Pharmaceuticals International, Inc., or Valeant, inJuly 2014. On April 23, 2015, we received notice from Valeant terminating the asset purchase and royalty agreement effective as of July 23, 2015. TheCompany was entitled to the minimum royalty payment until Valeant returns the Relastin® intellectual property rights to the Company. In November 2017,Revance and Valeant entered into an Asset Transfer Agreement to finalize the termination of the asset purchase and royalty agreement and Valeant returnedthe Relastin® intellectual property rights to the Company. The Company does not have any current plans for future developments of Relastin® and its focusis primarily on the development of RT002 injectable.Operating ExpensesOur operating expenses consist of research and development expenses and general and administrative expenses. The largest component of ouroperating expenses is our personnel costs including stock-based compensation. We expect our expenses to increase in the near term as we initiate andcomplete additional clinical trials and associated programs related to RT002 injectable for the treatment of glabellar lines and indications in musclemovement and other disorders, such as cervical dystonia and plantar fasciitis.Research and Development ExpensesWe recognize research and development expenses as they are incurred. Since our inception, we have focused on our clinical development programs andthe related research and development. We have been developing RT002 injectable and our topical product candidates since 2002 and we have typicallyshared our employees, consultants and infrastructure resources across both programs. Our research and development expenses consist primarily of: •salaries and related expenses for personnel in research and development functions, including stock-based compensation;•expenses related to the initiation and completion of clinical trials for RT002 injectable and our topical product candidate, including expensesrelated to production of clinical supplies;•fees paid to clinical consultants, clinical trial sites, clinical research organizations (CROs) and other vendors, including all related fees forinvestigator grants, patient screening fees, laboratory work and statistical compilation and analysis;•other consulting fees paid to third parties;•expenses related to establishment and maintenance of our own manufacturing facilities;•expenses related to the manufacture of drug substance and drug product supplies for ongoing and future preclinical and clinical trials;•expenses to support our product development and establish manufacturing capabilities to support potential future commercialization of anyproducts for which we may obtain regulatory approval;•expenses related to license fees and milestone payments under in-licensing agreements;•expenses related to compliance with drug development regulatory requirements in the United States, the European Union and other foreignjurisdictions; and•depreciation and other allocated expenses.Our research and development expenditures are subject to numerous uncertainties primarily related to the timing and cost needed to complete ourrespective projects. Further, the development timelines, probability of success and development expenses can differ materially from expectations and thecompletion of clinical trials may take several years or more depending on the type, complexity, novelty and intended use of a product candidate.Accordingly, the cost of clinical trials may vary significantly over the life of a project as a result of differences arising during clinical development. Weexpect our research and development expenses to increase as we continue our clinical development of RT002 injectable for the treatment of glabellar lines,cervical dystonia, plantar fasciitis and any future new indications, or if the FDA requires us to conduct additional clinical trials for approval.Our research and development expenses fluctuate as projects transition from one development phase to the next. Depending on the stage of completionand level of effort related to each development phase undertaken, we may reflect59Table of Contentsvariations in our research and development expense. We expense both internal and external research and development expenses as they are incurred. Wetypically share employees, consultants and infrastructure resources between the RT002 injectable and our topical programs. We believe that the strictallocation of costs by product candidate would not be meaningful. As such, we generally do not track these costs by product candidate.Our research and development expenses are summarized as follows: Year Ended December 31, 2017 vs. 2016 2016 vs. 2015 2017 2016 2015 % %Clinical and regulatory43,915 15,060 14,921 192 % 1 %Manufacturing and quality21,545 19,956 18,534 8 % 8 %Research8,514 7,064 7,563 21 % (7)%Stock-based compensation5,902 5,557 6,511 6 % (15)%Other research and development expenses485 2,744 — (82)% 100 %Total research and development expenses80,361 50,381 47,529 60 % 6 %Clinical and regulatory costsClinical expenses include personnel and occupancy costs, and external clinical trial costs for clinical sites, clinical research organizations, centrallaboratories, data management, contractors and regulatory activities associated with the development of RT002 injectable and our topical, including clinicaltrials of RT002 injectable for the improvement of glabellar lines, cervical dystonia and plantar fasciitis, and clinical trials of our topical product candidate forthe treatment of crow’s feet during 2015 and 2016. For the years ended December 31, 2017, 2016, and 2015, clinical and regulatory costs totaled $43.9million, or 55%, $15.1 million, or 30%, $14.9 million, or 31% of research and development expenses in 2017, 2016, and 2015, respectively.Clinical and regulatory costs for the year ended December 31, 2017 increased by 192%, compared to the same period in 2016, primarily due to theongoing clinical trials for RT002 for the treatment of glabellar lines, cervical dystonia, and plantar fasciitis. We expect our clinical and regulatory costs tocontinue to increase in the near term as we initiate and complete clinical trials and other associated programs related to RT002 for the treatment of glabellarlines, cervical dystonia, plantar fasciitis and other indications, and the Company's anticipated BLA submission upon the completion and success of theclinical trials for the RT002 glabellar lines indication.Manufacturing and quality effortsManufacturing and quality efforts include personnel and occupancy expenses, external contract manufacturing costs and pre-approval manufacturingof drug product used in research and our development of RT002 injectable and our topical product candidate. Manufacturing and quality efforts also includeraw materials, lab supplies, and storage and shipment of our product candidates to support quality control and assurance activities. These costs do not includeclinical costs associated with the development of RT002 injectable and our topical. For the years ended December 31, 2017, 2016, and 2015, costs associatedwith our manufacturing and quality efforts for both RT002 injectable and topical development totaled $21.5 million, or 27%, $20.0 million, or 40%, and$18.5 million, or 39% of research and development expenses in 2017, 2016, and 2015, respectively.Manufacturing and quality efforts for the year ended December 31, 2017 increased by 8%, compared to the same period in 2016, primarily due toincreased costs related to hiring additional personnel as well as an increase in outside services and consulting for compliance requirements. Manufacturingand quality efforts for the year ended December 31, 2016 increased by 8%, compared to the same period in 2015, primarily due to increased costs related toconsulting and outside services offset by a decrease in personnel costs. We expect our manufacturing and quality efforts to continue to increase as theCompany approaches commercialization.Research costsResearch costs include expenses for personnel and occupancy, contract research organizations, consultants, raw materials, and lab supplies used toconduct preclinical research and development of RT002 injectable and our topical product candidate. For the years end December 31, 2017, 2016, and 2015,costs associated with our preclinical development totaled, $8.5 million,60Table of Contentsor 11%, $7.1 million, or 14%, $7.6 million, or 16% of research and development expenses in 2017, 2016, and 2015, respectively.Research expenses for the year ended December 31, 2017 increased by 21%, compared to the same period in 2016, primarily due to increased costsrelated to personnel and consulting on research projects. Research expenses for the year ended December 31, 2016 decreased by 7%, compared to the sameperiod in 2015, primarily due decreased costs related to preclinical personnel involved with our topical Phase 2 study for the treatment of hyperhidrosis. Weexpect our preclinical costs to continue to increase as the Company expands into other indications.Stock-based compensationStock-based compensation for research and development for the year ended December 31, 2017 increased by $0.3 million, compared to the same periodin 2016, primarily due to an increase in employee headcount and an increase in stock price. Stock-based compensation for research and development for theyear ended December 31, 2016 decreased by $1.0 million, compared to the same period in 2015, primarily due to equity award modifications and offset by anincrease in employee headcount.Other research and development expensesOther research and development expenses for the years ended December 31, 2017 and 2016 includes license fees for BioSentinel, Inc.'s technology andexpertise for research and development and manufacturing purposes and, in 2016, a milestone of $2.0 million to Botulinum Toxin Research Associates, Inc.("BTRX") to acquired a portfolio of patents. For the years ended December 31, 2017 and 2016, other research and development expenses represented $0.5million, or 1%, and $2.7 million, or 5%, of research and development expenses in 2017 and 2016, respectively. There were no expenses classified as otherresearch and development expenses for the year ended December 31, 2015.General and Administrative ExpensesWe expect that our general and administrative expenses will increase with the continued development of, and if approved, the commercialization ofRT002 injectable. The following table presents our general and administration expenses for the periods indicated and related changes from the prior period: Year Ended December 31, 2017 vs. 2016 2016 vs. 2015 2017 2016 2015 % % (In thousands, except percentages)Finance and administration23,084 19,790 17,396 17% 14%Commercial6,986 2,889 1,815 142% 59%Stock-based compensation7,328 6,396 5,877 15% 9%Total general and administrative expenses37,398 29,075 25,088 29% 16%Finance and administrationFinance and administration expenses consist primarily of personnel and consulting costs, for employees in our finance, information technology,investor relations, legal, human resources and other administrative functions. Other significant expenses include professional fees for accounting and legalservices, including legal services associated with obtaining and maintaining patents and litigation. Finance and administration expenses for the year endedDecember 31, 2017 increased by 17%, compared to the same period in 2016, primarily due to increased costs related to personnel and consulting costs tosupport the Company's infrastructure.Finance and administration expenses for the year ended December 31, 2016 increased by 14%, compared to the same period in 2015, primarily due toincreased costs related to personnel and legal fees related to the legal matter described in Note 10, offset by a decrease in professional fees.CommercialCommercial expenses consist primarily of market research, public relations, promotion and advertising costs. Commercial expenses increased by 142%compared to the same period in 2016, due to increased costs related to personnel, consulting costs,61Table of Contentsand pre-commercial initiatives to support our future product launch following the Company's anticipated BLA submission upon the completion and successof the clinical trials for the RT002 glabellar lines indication.Commercial expenses increased by 59% compared to the same period in 2015, due to increased costs related to personnel, consulting costs, andmarketing initiatives to prepare for launch of RT002 upon its approval.Stock-based compensationStock-based compensation for selling, general and administrative expenses increased for the periods presented primarily due to an increase in employeeheadcount and an increase in stock price.Loss on ImpairmentThe following table presents our loss on impairment for the periods indicated and related changes from the prior period: Year Ended December 31, 2017 vs. 2016 2016 vs. 2015 2017 2016 2015 % % (In thousands, except percentages)Loss on impairment$2,927 $9,059 $— (68)% —%We constructed a large capacity fill/finish line dedicated to the manufacture of our topical product candidate and to support our regulatory licenseapplications. We discontinued clinical development of our topical product candidate for the treatment of crow’s feet and axillary hyperhidrosis in June 2016,following results from our REALISE 1 Phase 3 clinical trial to treat crow's feet.Under generally accepted accounting principles in the United States, long-lived assets, such as our topical fill/finish line, are required to be reviewedfor impairment whenever adverse events or changes in circumstances indicate a possible impairment. If business conditions or other factors indicate that thecarrying value of the asset may not be recoverable, we may be required to record additional non-cash impairment charges. Additionally, if the carrying valueof our capital equipment exceeds current fair value as determined based on the discounted future cash flows of the related product, the capital equipmentwould be considered impaired and would be reduced to fair value by a non-cash charge to earnings, which could negatively affect our operatingresults. During the years ended December 31, 2017 and 2016, we recorded a loss on impairment of $2.9 million and $9.1 million, respectively, related to ourtopical fill/finish line and certain other assets. We did not identify any indicators of impairment during the year ended December 31, 2015.Net Non-Operating ExpenseInterest IncomeInterest income consists primarily of interest income earned on our cash, cash equivalents, money market fund, and investment balances. We expectinterest income to vary each reporting period depending on our average cash, cash equivalents, money market fund, and investment balances during theperiod and market interest rates.Interest ExpenseInterest expense primarily consists of the interest charges associated with our notes payable, financing obligations, and capitalized interest. Notespayable under our term loan agreement with Hercules, which matured and was fully paid off in March 2015, bore interest at a rate which is the greater of(i) 9.85% per annum or (ii) 9.85% per annum plus the difference of the prime rate less 3.25%. Interest expense, includes cash and non-cash components withthe non-cash components consisting of (i) interest recognized from the amortization of debt issuance costs, which were capitalized on the ConsolidatedBalance Sheets, that are generally derived from cash payments related to the issuance of notes payable, (ii) interest recognized from the amortization of debtdiscounts, which were capitalized on the Consolidated Balance Sheets, derived from the issuance of warrants and derivatives issued in conjunction withnotes payable, (iii) interest capitalized for assets constructed for use in operations, and (iv) effective interest recognized on the financing obligation. Thecapitalized amounts related to the debt issuance costs and debt discounts are generally amortized to interest expense over the term of the related debtinstruments.62Table of ContentsChange in Fair Value of Derivative Liabilities Associated with the Medicis SettlementIn October 2012, we entered into a settlement and termination agreement with Medicis. The terms of the settlement provided for the reacquisition of therights related to all territories of RT002 injectable and RT001 topical from Medicis and for consideration payable by us to Medicis of up to $25.0 million,comprised of (i) an upfront payment of $7.0 million, which was paid in 2012, (ii) a proceeds sharing arrangement payment of $14.0 million of which $6.9million was paid in 2013 and the remaining $7.1 million was paid in 2014, and (iii) $4.0 million to be paid upon the achievement of regulatory approval ofRT002 injectable or RT001 topical.We determined that the settlement provisions related to (ii) and (iii) above were derivative instruments that required fair value accounting at the time ofsettlement and fair value remeasurements on a periodic basis going forward. Accordingly, we recorded derivative liabilities on the balance sheet based ontheir respective fair values on the settlement date.Our outstanding derivative liability associated with the Medicis settlement is classified as a liability on our Consolidated Balance Sheet. Theremaining liability will be remeasured to fair value at each balance sheet date with the corresponding gain or loss from the adjustment recorded in theConsolidated Statement of Operations and Comprehensive Loss. We will continue to record adjustments to the fair value of the Medicis settlement derivativeliability until the Product Approval Payment has been paid.Other Expense, netOther expense, net is comprised of miscellaneous tax and other expense items.The following table presents our other income and expense for the periods indicated and related changes from the prior period: Years Ended December 31, 2017 vs. 2016 2016 vs. 2015 2017 2016 2015 % % (In thousands, except percentages)Interest income$1,410 $1,170 $231 21% 406%Interest expense(457) (1,082) (1,190) (58)% (9)%Change in fair value of derivative liabilities associated with theMedicis settlement(591) (608) 127 (3)% (579)%Other expense, net(525) (535) (327) (2)% 64 %Total net non-operating expenses$(163) $(1,055) $(1,159) (85)% (9)%Our total net non-operating expense for the year ended December 31, 2017 decreased by 85%, compared to the same period in 2016, primarily due tolower interest expense resulting from the declining principal balance on the Essex Capital Facility, which is described below, offset by an increase in theinterest income from a stronger investment portfolio.Our total net non-operating expense for the year ended December 31, 2016 decreased by 9%, compared to the same period in 2015, primarily due to adecrease in interest expense which is described below, offset by an increase in the fair value of the Medicis derivative liabilities and other taxes and fees.Interest expense for the year ended December 31, 2017 decreased by 58%, compared to the same period in 2016, primarily due to the lower interestresulting from the declining principal balance on the Essex Capital Facility offset by an increase in capitalized interest associated with construction inprogress. Interest expense for the year ended December 31, 2016 decreased by 9%, compared to the same period in 2015, primarily due to the lower interestresulting from the declining principal balance on the Essex Capital Facility. Income TaxesSince inception, we have incurred net losses and have not recorded any U.S. federal or state income tax and the tax benefits of our operating losses havebeen fully offset by valuation allowances.There was no provision or benefit from income taxes during the years ended December 31, 2017, 2016 and 2015.63Table of ContentsOn December 22, 2017, the U.S. government enacted a comprehensive tax reform legislation, commonly referred to as the Tax Cuts and Jobs Act (the“Tax Reform Act”). The Tax Reform Act makes broad and complex changes to the US tax code including but not limited to, (1) reducing the U.S. federalcorporate tax rate from 35% to 21%; (2) requiring companies to pay a one-time transition tax on certain repatriated earnings of foreign subsidiaries, which hasno impact to the Company; (3) generally eliminating US federal income taxes on dividends from foreign subsidiaries; (4) requiring a current inclusion in USfederal income of certain earnings of controlled foreign corporations; (5) creating a new limitation on deductible interest expense; and (6) changing rulesrelated to the uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017.On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the tax effectsof the Tax Reform Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Reform Act enactment date forcompanies to complete the accounting under ASC 740, Income Taxes. In accordance with SAB 118, a company must reflect the income tax effects of thoseaspects of the Tax Reform Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effectsof the Tax Reform Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If acompany cannot determine a provisional estimate, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effectimmediately before the enactment of the Tax Reform Act.Effect of Tax Reform Act and SAB 118 - The Tax Reform Act reduces the corporate tax rate to 21 percent, effective January 1, 2018. In addition, theCompany’s accounting for the tax effects of enactment of the Tax Reform Act is incomplete; however, in certain cases, as described below, we have made areasonable estimate of the effects on our existing deferred tax balances and valuation allowance. In certain aspects, we have not been able to make areasonable estimate and continue to account for those items based on our existing accounting under ASC 740, Income Taxes, and the provisions of the taxlaws that were in effect immediately prior to enactment. The Company has determined that the $62.9 million recorded in connection with the re-measurementof certain deferred tax assets and liabilities, and corresponding valuation allowance was a provisional amount and a reasonable estimate at December 31,2017. We have not completed our accounting with regard to the tax effects associated with an intra-entity transfer of certain intellectual property rights withthe enactment of Tax Reform Act. Our accounting for the intra-entity transfer reflects the utilization of net operating losses on the basis of the laws in effectbefore the Tax Reform Act. The Company is evaluating the impact under Tax Reform Act on the Company's global business structure. In all aspects, theCompany will continue to make and refine calculations as additional analysis is completed. The Company expects to complete the accounting assessmentduring the one year measurement period provided by SAB 118.The Company follows the provisions of the FASB’s guidance for accounting for uncertain tax positions. The guidance indicates a comprehensivemodel for the recognition, measurement, presentation and disclosure in financial statements of any uncertain tax positions that have been taken or expectedto be taken on a tax return. No liability related to uncertain tax positions is recorded in the financial statements due to the fact the liabilities have been nettedagainst deferred attribute carryovers. It is the Company’s policy to include penalties and interest related to income tax matters in income tax expense.Liquidity and Capital ResourcesOur financial condition is summarized as follows: Year Ended December 31, Increase (Decrease) 2017 2016 2017Cash, cash equivalents, and investments$282,896 $185,528 $97,368Financing obligations1,872 5,347 (3,475)Working Capital264,309 173,048 91,261Stockholders' Equity268,845 177,071 91,774Sources and Uses of CashOur cash, cash equivalents and investments totaled $282.9 million at December 31, 2017 compared to $185.5 million at December 31, 2016,representing an increase of $97.4 million. We hold our cash, cash equivalents, and investments in a variety of non-interest bearing bank accounts andinterest-bearing instruments subject to investment guidelines allowing for64Table of Contentsholdings in U.S. government and agency securities and money market accounts. Our investment portfolio is structured to provide for investment maturitiesand access to cash to fund our anticipated working capital needs.The increase in cash, cash equivalents and investments of $97.4 million was primarily due to the receipt of $200.0 million of net cash proceeds from thefollow-on public and at-the-market offerings, stock option exercises, employee stock plan purchases, and royalty revenue. These increases were primarilyoffset by cash used in operations, purchases of property and equipment of $2.5 million, and equipment lease payments on our financing obligations of $3.6million.Through December 31, 2017, we have funded substantially all of our operations through the sale and issuance of our common stock, preferred stock,venture debt, and convertible debt. Due to our substantial research and development expenditures, we have generated significant operating losses since ourinception. Our expenditures are primarily related to research and development activities. We expect to continue to incur net operating losses for at least thenext several years as we advance RT002 injectable through clinical development, seek regulatory approval, prepare for and, if approved, proceed tocommercialization. As a result, we will need additional capital to fund our operations which we may obtain from additional financings, public offerings, orother sources. As of December 31, 2017, we had available cash and cash equivalents of $282.9 million.We derived the following summary of our Consolidated Cash Flows for the periods indicated from our audited Consolidated Financial Statementsincluded elsewhere in this Form 10-K (in thousands): Year Ended December 31, 2017 2016 2015Net cash provided by (used in): Operating activities$(95,342) $(59,827) $(55,669)Investing activities118,792 (75,499) (56,415)Financing activities195,944 (2,642) 142,592Cash Flows from Operating ActivitiesOur cash used in operating activities is primarily driven by personnel, manufacturing costs, clinical development, and facility related expenditures. Thechanges in net cash used in operating activities are primarily related to our net loss, working capital fluctuations and changes in our non-cash expenses, allwhich are highly variable. Our cash flows from operating activities will continue to be affected principally by our working capital requirements and theextent to which we increase spending on personnel and research and development activities as our business grows.Net cash used in operating activities for the year ended December 31, 2017 of $95.3 million was primarily due to clinical spend of more than $30million to advance the Company's clinical programs toward commercialization; investing in our personnel and talent retention, which representsapproximately $25 million; and professional services and consulting of more than $15 million. The remaining balance of operating activities relatedprimarily to rent, utilities, and other supplies.Net cash used in operating activities of $59.8 million in the year ended December 31, 2016 was largely due to ongoing clinical trial activities for ourRT002 injectable program and our topical product candidate, including more than $10 million for payments to clinical trial vendors; investing in ourpersonnel, including those that support the clinical programs, and talent retention, which represents more than $20 million; and professional services andconsulting of more than $10 million. The remaining balance of operating activities related primarily to rent, utilities, and other supplies.Net cash used in operating activities was $55.7 million in the year ended December 31, 2015 was primarily due to increased costs associated with beinga public company, including fees for professional services, consultants, and ongoing clinical trial activities for our topical product candidate and our RT002injectable program, which included more than $20 million for payments to clinical trial vendors, consultants, and other professional service providers. In2015, we also invested in building our workforce to support our clinical development programs and the operations of a public company, which representedmore than $15 million of our operating activities. The remaining balance of operating activities related primarily to rent, utilities, and other supplies.65Table of ContentsCash Flows from Investing ActivitiesNet cash provided by or used in investing activities for the years ended December 31, 2017, 2016 and 2015 was primarily due to purchases of propertyand equipment, costs related to purchasing the BTRX patent portfolio in 2016, and fluctuations in the timing of maturities and sales of investments. As ofDecember 31, 2017, all of our investments had matured. We intend to reinvest a substantial portion of our cash and cash equivalents in short-terminvestments in 2018.Cash Flows from Financing ActivitiesIncreases in our cash flows from financing activities are primarily driven by proceeds from the issuance of our common stock in connection with follow-on offerings (as described below), ATM offerings (as described below), stock option exercises and employee stock plan purchases. In 2015, the Company alsoreceived proceeds of $9.8 million for the sale/leaseback of equipment from Essex Capital. Decreases in our cash flows from financing activities are primarilydue to principal payments on the aforementioned equipment lease with Essex Capital, principal payments on notes payable in 2015, and payments to settleemployee tax obligations resulting from net settlement of restricted stock awards.Follow-On Public OfferingsIn November 2015, the Company completed a follow-on public offering, or the 2015 follow-on offering, pursuant to which the Company issued3,737,500 shares of common stock at $36.00 per share, including the exercise of the underwriters’ over-allotment option to purchase 487,500 additionalshares of common stock, for net proceeds of $126.2 million, after underwriting discounts, commissions and other offering expenses.In December 2017, the Company completed a follow-on public offering, or the 2017 follow-on offering, pursuant to which the Company issued5,389,515 shares of common stock at $31.00 per share, including the exercise of the underwriters' over-allotment option to purchase 550,806 additionalshares of common stock, for net proceeds of $156.9 million, after underwriting discounts, commissions and other offering expenses.At-The-Market OfferingIn March 2015, the Company entered into an At-The-Market Issuance Sales Agreement, or the 2015 ATM agreement, with Cowen and Company, LLC,or Cowen, under which the Company could offer and sell common stock having aggregate proceeds of up to $50.0 million from time to time through Cowenas our sales agent. During the year ended December 31, 2015, the Company sold 352,544 shares of common stock under the ATM agreement at a weightedaverage price of $30.76 per share resulting in gross proceeds of $10.8 million, and net proceeds of $10.0 million, after underwriting discounts, commissions,and other offering expenses.In March 2016, the Company entered into an At-The-Market Issuance Sales Agreement, or the 2016 ATM agreement, with Cowen and Company, LLC,or Cowen, under which the Company may offer and sell common stock having aggregate proceeds of up to $75.0 million from time to time through Cowen asour sales agent. During the year ended December 31, 2017, the Company sold 1,802,651 shares of common stock under the 2016 ATM Agreement at aweighted average price of $22.17 per share resulting in gross proceeds of $40.0 million, and net proceeds of $38.2 million, after underwriting discounts,commissions, and offering expenses. As of February 28, 2018, approximately $35.0 million remains available to us under the 2016 ATM agreement.Operating and Capital Expenditure RequirementsWe have not achieved profitability on a quarterly or annual basis since our inception and we expect to continue to incur net losses for the foreseeablefuture. We expect to make additional capital outlays to increase operating expenditures over the next several years to support the completion of the clinicaltrials and other associated programs relating to RT002 injectable for the treatment of glabellar lines, cervical dystonia, plantar fasciitis and other indications,seek regulatory approval, prepare for and, if approved, proceed to commercialization. We believe that our existing capital resources, the net proceeds fromour follow-on public and ATM offerings will be sufficient to fund our operations for at least the next 12 months. However, we anticipate that we will need toraise substantial additional financing in the future to fund our operations. In order to meet these additional cash requirements, we may seek to sell additionalequity or issue debt, convertible debt or other securities that may result in dilution to our stockholders. If we raise additional funds through the issuance ofdebt or convertible debt securities, these securities could have rights senior to those of our common stock and could contain covenants that restrict ouroperations. There can be no assurance that we will be able to obtain additional equity or debt financing on terms acceptable to us, if at all. Debt financing, ifavailable, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to takespecific actions such as incurring debt, making capital expenditures or66Table of Contentsdeclaring dividends. Our failure to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on our business, results ofoperations, and financial condition.If adequate funds are not available to us on a timely basis, or at all, we may be required to terminate or delay clinical trials or other developmentactivities for RT002 injectable, and our topical product candidate, and any future product candidates, or delay our establishment of sales and marketingcapabilities or other activities that may be necessary to commercialize our product candidates, if we obtain marketing approval. We may elect to raiseadditional funds even before we need them if the conditions for raising capital are favorable. Our future capital requirements depend on many factors,including: •the results of our clinical trials for RT002 injectable and preclinical trials of our topical product candidate or any future product candidates;•the timing of, and the costs involved in, obtaining regulatory approvals for RT002 injectable, or any future product candidates including topical;•the number and characteristics of any additional product candidates we develop or acquire;•the scope, progress, results and costs of researching and developing and conducting preclinical and clinical trials of RT002 injectable, topical, orany future product candidates;•the cost of commercialization activities if RT002 injectable or any future product candidates including topical are approved for sale, includingmarketing, sales and distribution costs;•the cost of manufacturing RT002 injectable, topical, or any future product candidates and any products we successfully commercialize andmaintaining our related facilities;•our ability to establish and maintain strategic collaborations, licensing or other arrangements and the terms of and timing such arrangements;•the degree and rate of market acceptance of any future approved products;•the emergence, approval, availability, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competingproducts or treatments;•any product liability or other lawsuits related to our products;•the expenses needed to attract and retain skilled personnel;•any litigation, including litigation costs and the outcome of such litigation;•the costs associated with being a public company;•the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims, including litigation costs and the outcomeof such litigation; and•the timing, receipt and amount of sales of, or royalties on, future approved products, if any.Please see “Item 1A. Risk Factors” for additional risks associated with our substantial capital requirements.We have not generated product revenue from RT002 injectable or our topical product candidate, and we do not know when, or if, we will generate suchrevenue. We do not expect to generate significant revenue unless or until we obtain marketing approval of, and commercialize RT002 injectable or ourtopical product candidate. We expect our continuing operating losses to result in increases in cash used in operations over the next several years.We have based our estimates of future capital requirements on a number of assumptions that may prove to be wrong, and changing circumstancesbeyond our control may cause us to consume capital more rapidly than we currently anticipate. For example, our ongoing clinical trials of RT002 injectablemay encounter technical or other difficulties that could increase our development costs more than we currently expect or the FDA or EMA may require us toconduct additional clinical trials prior to approving RT002 injectable or future products we may develop. Because of the numerous risks and uncertaintiesassociated with the development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital outlays andoperating expenditures associated with our current and anticipated clinical trials beyond 2018.Critical Accounting Policies and EstimatesOur Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles in the United States. The preparationof these Consolidated Financial Statements requires our management to make estimates, assumptions and judgments that affect the reported amounts of assetsand liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements, and the reported amounts of revenueand expenses during the applicable periods. We base our estimates, assumptions and judgments on historical experience and on various other factors that67Table of Contentswe believe to be reasonable under the circumstances. Different assumptions and judgments would change the estimates used in the preparation of ourConsolidated Financial Statements, which, in turn, could change the results from those reported. We evaluate our estimates, assumptions and judgments onan ongoing basis.The critical accounting estimates, assumptions and judgments that we believe have the most significant impact on our Consolidated FinancialStatements are described below.Clinical Trial AccrualsClinical trial costs are charged to research and development expense as incurred. We accrue for expenses resulting from contracts with clinical researchorganizations, or CROs, investigators and consultants, and under certain other agreements in connection with conducting clinical trials. The financial termsof these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over whichmaterials or services are provided. Our objective is to reflect the appropriate trial expense in the Consolidated Financial Statements by matching theappropriate expenses with the period in which services and efforts are expended. In the event advance payments are made to a CRO, the payments will berecorded as a prepaid asset, which will be amortized as services are rendered.The CRO contracts generally include pass-through fees including, but not limited to, regulatory expenses, investigator fees, travel costs and othermiscellaneous costs, including shipping and printing fees. We estimate our clinical accruals based on reports from and discussion with clinical personnel andoutside services providers as to the progress or state of completion of trials, or the services completed. We estimate accrued expenses as of each balance sheetdate based on the facts and circumstances known at that time. Our clinical trial accrual is dependent, in part, upon the receipt of timely and accurate reportingfrom the CROs and other third-party vendors. As of December 31, 2017, there have not been any material adjustments to our estimated accrued clinicalexpenses.Stock-Based CompensationWe recognize compensation costs related to stock options granted to employees and non-employee directors based on the estimated fair value of theawards on the date of grant, using the Black-Scholes option-pricing model. The grant date fair value of the stock-based awards is recognized over therequisite service period, which is generally the vesting period of the respective awards. Stock-based compensation expenses are classified in the ConsolidatedStatements of Operations and Comprehensive Loss based on the functional area to which the related recipients belong.The estimated grant date fair values of the option awards granted to employees and non-employee directors during the years ended December 31, 2017,2016, and 2015 were calculated using the Black-Scholes option-pricing model with the following weighted-average assumptions: Year Ended December 31, 2017 2016 2015Expected term (in years)6.0 6.0 6.0Expected volatility67.7% 61.9% 62.2%Risk-free interest rate2.1% 1.4% 1.6%Dividend rate0.0% 0.0% 0.0%The Black-Scholes option-pricing model requires the use of highly subjective and complex assumptions that determine the fair value of options. Theseassumptions are as follows: •Expected term — The expected term represents the period that our options are expected to be outstanding and is calculated using the simplifiedmethod. We qualify for the simplified method as our stock options have the following characteristics: (i) granted at-the-money; (ii) exercisabilityis conditioned upon service through the vesting date; (iii) termination of service prior to vesting results in forfeiture; (iv) limited exercise periodfollowing termination of service; and (v) options are non-transferable and non-hedgeable, or “plain vanilla” options, and we have limited historyof exercise data.•Expected volatility — Beginning on January 1, 2017, the expected volatility is based on the historical volatility of a group of similar entitiescombined with the historical volatility of the Company, whereas prior to 2017, the68Table of Contentsexpected volatility was based solely on the historical volatility of a group of similar entities. In evaluating similarity, the Company consideredfactors such as industry, stage of life cycle, capital structure, and size.•Risk-free interest rate — The risk-free interest rate is based on the U.S. Treasury constant maturity rates with terms similar to the option’sexpected term.•Dividend rate — The expected dividend was assumed to be zero as we have never paid dividends and have no current plans to do so.As of January 1, 2017, we began accounting for forfeitures as they occur, which was an acceptable change in accordance with ASU 2016-09. Inconnection with changing the forfeiture rate methodology, we recorded a cumulative charge of less than $0.1 million to the Accumulated Deficit balance asof January 1, 2017.We will continue to use judgment in evaluating the expected term and expected volatility related to our stock-based compensation calculations on aprospective basis. As we continue to accumulate additional data related to our common stock, we may make refinements to the estimates of our expectedterms and expected volatility that could materially impact our future stock-based compensation.Derivative Liabilities Associated with the Medicis Settlement In October 2012, we entered into a settlement and termination agreement with Medicis. The terms of the settlement provided for the reacquisition of therights related to all territories of RT002 injectable and RT001 topical from Medicis and for consideration payable by us to Medicis of up to $25.0 million,comprised of (i) an upfront payment of $7.0 million, which was paid in 2012, (ii) a Proceeds Sharing Arrangement Payment of $14.0 million of which $6.9million was paid in 2013 and the remaining $7.1 million was paid in 2014, and (iii) $4.0 million to be paid upon the achievement of regulatory approval ofRT002 injectable or RT001 topical, or Product Approval Payment.We determined that the settlement provisions related to (ii) and (iii) above were derivative instruments that should be measured at fair value at the timeof settlement and remeasured to fair value at each reporting period going forward. Accordingly, we recorded derivative liabilities on the balance sheet basedon their respective fair values on the settlement date. These derivative liabilities will be reduced as the related payments are made under the settlementagreement. The remaining liabilities will be subsequently remeasured to fair value as of each balance sheet date with the related remeasurement adjustmentsrecognized in the Consolidated Statements of Operations and Comprehensive Loss.The fair value of the Product Approval Payment derivative was determined by estimating the timing and probability of the related approval andmultiplying the payment amount by this probability percentage then applying a discount factor. As of December 31, 2016, we determined the fair value ofthe liability for the Product Approval Payment was $2.0 million, which was measured by assuming a term of 3.25 years, a risk-free rate of 1.5% and a creditrisk adjustment of 9.0%. As of December 31, 2017, we determined the fair value of the liability for the Product Approval Payment was $2.6 million, whichwas measured by assuming a term of 2.5 years, a risk-free rate of 2.0% and a credit risk adjustment of 6.5%. Our assumption for the expected term as ofDecember 31, 2017 is based on an expected Biologics License Application, or BLA, approval for RT002 in the first half of 2020. The primary drivers of anyfair value movements for the Product Approval Payment derivative are the estimated probability of the related approval and the credit risk adjustment. If theprobability estimate increases (decreases) and the credit risk adjustment decreases (increases), the fair value of the derivative will increase (decrease).We will record adjustments to the fair value of the derivative liabilities associated with the Medicis settlement until the Product Approval Payment hasbeen paid. At that time, the Product Approval Payment derivative will be adjusted to fair value one last time immediately prior to settlement.69Table of ContentsImpairment of Long-Lived AssetsWe assess the impairment of long-lived assets, such as property and equipment subject to depreciation and amortization, when events or changes incircumstances indicate that their carrying amount may not be recoverable. Among the factors and circumstances we considered in determining recoverabilityare: (i) a significant adverse change in the extent to which, or manner in which, a long-lived asset is being used or in its physical condition; (ii) a significantadverse change in legal factors or in the business climate that could affect the value of a long-lived asset, including an adverse action or assessment by aregulator; (iii) an accumulation of costs significantly in excess of the amount originally expected for the acquisition; (iv) current-period operating or cashflow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of along-lived asset; and (v) current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end ofits previously estimated useful life. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to theestimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, animpairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.We constructed a fill/finish line for the future commercial manufacturing of its topical product candidate and to support its clinical trials and regulatorylicense applications. In 2016, following the results of the REALISE 1 Phase 3 clinical trial for crow's feet, we discontinued its topical clinical developmentprograms for the treatment of crow’s feet and for the treatment of primary axillary hyperhidrosis. We performed an impairment analysis of the topicalfill/finish line and other fixed assets to determine fair value based on highest and best use. We concluded that only certain equipment comprising the topicalfill/finish line would be repurposed for commercial-scale manufacturing of RT002 injectable. As a result, we determined fair value based on its highest andbest use and that for certain components of the fill/finish line and other fixed assets, the carrying value of the assets was not entirely recoverable and the fairvalue, which was calculated using the market or cost approach depending on the specific asset, was lower than the carrying value. Accordingly, during theyear ended December 31, 2016, we recorded a loss on impairment of $9.1 million. As of December 31, 2016, the fill/finish line and other fixed assets had netbook values of $5.1 million and $0.2 million, respectively.During the three months ended December 31, 2017, we identified an additional indicator of impairment, an adverse change in the market valueresulting from further negotiations with a potential buyer during the quarter, for the topical fill/finish line and other fixed assets. We continue to believe thatcertain equipment comprising the topical fill/finish line with a net book value of $2.4 million will be repurposed for commercial-scale manufacturing ofRT002 injectable. As a result, we determined fair value based on its highest and best use and that for certain components of the fill/finish line and other fixedassets, the carrying value of the assets was not entirely recoverable and the fair value, which was calculated using the market or cost approach depending onthe specific asset, was lower than the carrying value. Accordingly, we recorded a loss on impairment of $2.9 million, during the year ended December 31,2017. Nonetheless, it is reasonably possible that our estimate of the recoverability of the equipment's carrying value could change, and may result in the needto write down the assets to fair value. As of December 31, 2017, the fill/finish line and other fixed assets had net book values of $2.4 million and $0.1 million,respectively.Income TaxesWe are subject to income taxes in the United States, and we use estimates in determining our provision for income taxes. We use the asset and liabilitymethod of accounting for income taxes. Under this method, we calculate deferred tax asset or liability account balances at the balance sheet date usingcurrent tax laws and rates in effect for the year in which the differences are expected to affect our taxable income.We estimate actual current tax exposure together with assessing temporary differences resulting from differences in accounting for reporting purposesand tax purposes for certain items, such as accruals and allowances not currently deductible for tax purposes. These temporary differences result in deferredtax assets and liabilities, which are included in our Consolidated Balance Sheets. In general, deferred tax assets represent future tax benefits to be receivedwhen certain expenses previously recognized in our Consolidated Statements of Operations and Comprehensive Loss become deductible expenses underapplicable income tax laws or when net operating loss or credit carryforwards are utilized. Accordingly, realization of our deferred tax assets is dependent onfuture taxable income against which these deductions, losses and credit carryforwards can be utilized.We must assess the likelihood that our deferred tax assets will be recovered from future taxable income, and to the extent we believe that recovery is notlikely, establish a valuation allowance.70Table of ContentsAs of December 31, 2017, we had net operating loss carryforwards available to reduce future taxable income, if any, for federal, California, and NewJersey income tax purposes of $453.1 million, $160.2 million, and $378.7 million, respectively. If not utilized, the federal net operating loss carryforwardbegin expiring in 2020, the California net operating loss carryforwards began expiring in 2010, and the New Jersey state net operating loss carryforwardsbegin expiring in 2030.As of December 31, 2017, we also had research and development credit carryforwards of $4.3 million and $6.1 million available to reduce future taxableincome, if any, for federal and California state income tax purposes, respectively. If not utilized, the federal credit carryforwards will begin expiring in 2023and the California credit carryforwards have no expiration date.In general, if the Company experiences a greater than 50 percentage point aggregate change in ownership over a 3-year period (a Section 382ownership change), utilization of its pre-change NOL carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code(California and New Jersey have similar laws). The annual limitation generally is determined by multiplying the value of the Company’s stock at the time ofsuch ownership change (subject to certain adjustments) by the applicable long-term tax-exempt rate. Such limitations may result in expiration of a portion ofthe NOL carryforwards before utilization. The Company determined that an ownership change occurred on April 7, 2004 but that all carryforwards can beutilized prior to the expiration. The Company also determined that an ownership change occurred in February 2014. As a result of the 2014 change, theCompany reduced the deferred tax assets and the corresponding valuation allowance to account for this limitation. Since the R&D credits for California carryover indefinitely, there was no change to the California R&D credits. The Company has reviewed its IRC §382 limitation through December 31, 2017 andhave not identified any ownership changes resulting in a limitation.JOBS ActWe are an "emerging growth company," as defined in the JOBS Act and, for as long as we continue to be an "emerging growth company," we maychoose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to "emerging growth companies,"including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosureobligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbindingadvisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We will remain an"emerging growth company" until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of our IPO on February 6,2014, (b) in which we have total annual gross revenues of over $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means themarket value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than$1.0 billion in non-convertible debt during the prior three-year period.Under the JOBS Act, emerging growth companies that become public can delay adopting new or revised accounting standards until such time as thosestandards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and,therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.Contractual ObligationsOur contractual commitments will have an impact on our future liquidity. The following table, which summarizes our contractual obligations as ofDecember 31, 2017, represents material expected or contractually committed future obligations, with terms in excess of one year. We believe that we will beable to fund these obligations through cash generated funding activities and from our existing cash balances. Payments Due by PeriodContractual Obligations:Total Year 1 Years 2 to 3 Years 4 to 5 More than5 Years (In thousands)Operating lease obligations(1)$38,121 $5,628 $11,808 $10,815 $9,870Financing obligations reflected on our balance sheetunder GAAP(2)1,932 1,932 — — —Total$40,053 $7,560 $11,808 $10,815 $9,87071Table of Contents (1)Operating lease agreements represent our obligations to make payments under non-cancelable lease agreements for our facilities and leasedequipment.(2)Financing obligations reflected on our balance sheet under GAAP represents our obligation to make lease payments and the purchase price of theleased equipment under the Loan and Lease Agreement with Essex Capital.This table does not include any milestone or royalty payments, which may become payable to third parties under agreements, as the timing andlikelihood of such payments are not known.•We are obligated to pay milestone and royalties to List Laboratories on future sales of botulinum toxin products.•We also have one remaining future milestone payment of $4.0 million due and payable to Valeant Pharmaceuticals International, Inc. upon theachievement of regulatory approval for RT002 injectable or RT001 topical.•In 2016, we entered into an asset purchase agreement with Botulinum Toxin Research Associates, Inc., or BTRX (the "BTRX Purchase Agreement")in which we agreed to pay up to an additional $16.0 million in aggregate upon the satisfaction of specified milestones relating to our sales revenue,intellectual property, and clinical and regulatory events. In exchange, the Company acquired all rights, title and interest in a portfolio of botulinumtoxin-related patents and patent applications from BTRX and was granted the right of first negotiation and first refusal with respect to otherbotulinum toxin-related patents owned or controlled by BTRX.•On April 11, 2016, we entered into an agreement with BioSentinel, Inc. to in-license their technology and expertise for research and developmentand manufacturing purposes. In addition to minimum quarterly use fees, we are obligated to make a one-time future milestone payment of $0.3million payable to BioSentinel, Inc. upon the achievement of regulatory approval.•On March 14, 2017, the Company entered into a Technology Transfer, Validation and Commercial Fill/Finish Services Agreement (the “ServicesAgreement”) and Statement of Work ("SoW") with Ajinomoto Althea, Inc., a contract development and manufacturing organization (“Althea”).Under the Services Agreement, Althea has agreed, among other things, to provide the Company with a future source of commercial fill/finishservices for the Company’s neuromodulator products. The Services Agreement has an initial term that will expire in seven years, unless terminatedsooner by either party. In accordance with the Services Agreement, the Company will have minimum purchase obligations based on its productionforecasts. As of December 31, 2017, the Company made non-refundable advanced payments of $1.2 million in accordance with the terms of thearrangement. The remaining services are cancellable at any time, with the Company required to pay costs incurred through the cancellation date.This table does not include a liability for unrecognized tax benefits related to various federal and state income tax matters of $2.6 million atDecember 31, 2017. The timing of the settlement of these amounts was not reasonably estimable at December 31, 2017. We do not expect payment ofamounts related to the unrecognized tax benefits within the next twelve months.Off-Balance Sheet ArrangementsAs of December 31, 2017, we did not have any off-balance sheet arrangements or any relationships with any entities or financial partnerships, such asentities often referred to as structured finance or special purpose entities that would have been established for the purpose of facilitating off-balance sheetarrangements or other contractually narrow or limited purposes.Recent Accounting PronouncementsRefer to "Recent Accounting Pronouncements" in Note 2 to our Consolidated Financial Statements included elsewhere in this Form 10-K.72Table of ContentsITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKWe are exposed to market risk in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position dueto adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of fluctuations in foreign currency exchange rates andinterest rates. We do not hold or issue financial instruments for trading purposes.Interest Rate SensitivityOur exposure to market risk for changes in interest rates relates primarily to our cash, cash equivalents, and investments. We had cash, cash equivalents,and investments of $282.9 million and $185.5 million as of December 31, 2017 and 2016, respectively. As of December 31, 2017, our cash and cashequivalents were held in deposit and money market fund accounts. Our primary exposure to market risk is interest income sensitivity, which is affected bychanges in the general level of the interest rates in the United States. A hypothetical 10% movement in interest rates would not be expected to have a materialimpact on our Consolidated Financial Statements. We mitigate market risk for changes in interest rates by holding our investments in money market fundaccounts.Foreign ExchangeOur operations are primarily conducted in the United States using the U.S. Dollar. However, we conduct limited operations in foreign countries,primarily for clinical and regulatory services, whereby settlement of our obligations are denominated in the local currency. Transactional exposure ariseswhen transactions occur in currencies other than the U.S. Dollar. Transactions denominated in foreign currencies are recorded at the exchange rate prevailingat the date of the transaction with the resulting liabilities being translated into the U.S. Dollar at exchange rates prevailing at the balance sheet date. Theresulting gains and losses, which were insignificant for the years ended December 31, 2017, 2016 and 2015, are included in other expense in theConsolidated Statements of Operations and Comprehensive Loss. We do not use currency forward exchange contracts to offset the related effect on theunderlying transactions denominated in a foreign currency.73Table of ContentsITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATAThe financial statements required by this item are set forth beginning on page F-3 of this Annual Report on this Form 10-K and are incorporated hereinby reference.74Table of ContentsITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURENone.75Table of ContentsITEM 9A.CONTROLS AND PROCEDURES(a) Evaluation of Disclosure Controls and ProceduresWe are responsible for maintaining disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Disclosurecontrols and procedures are controls and other procedures designed to ensure that the information required to be disclosed by us in the reports that we file orsubmit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosurecontrols and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reportsthat we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and ourprincipal financial officer, as appropriate to allow timely decisions regarding required disclosure.Based on our management’s evaluation (with the participation of our principal executive officer and our principal financial officer) of our disclosurecontrols and procedures as required by Rule 13a-15 under the Exchange Act, our principal executive officer and our principal financial officer haveconcluded that our disclosure controls and procedures were effective to achieve their stated purpose as of December 31, 2017, the end of the period coveredby this report.(b) Management’s Report on Internal Control Over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accountingprinciples, or GAAP. Our internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of our assets, (ii) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordancewith authorizations of our management and directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorizedacquisition, use or disposition of our assets that could have a material effect on our financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of anyevaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degreeof compliance with the policies or procedures may deteriorate.Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conductedan evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2017 based on the criteria established in Internal Control- Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. Based on our evaluation under thecriteria set forth in Internal Control - Integrated Framework (2013) issued by the COSO, our management concluded our internal control over financialreporting was effective as of December 31, 2017.(c) Changes in Internal Control over Financial ReportingThere were no changes in our internal control over financial reporting during the quarter ended December 31, 2017 that have materially affected, or arereasonably likely to materially affect, our internal control over financial reporting.76Table of ContentsITEM 9B.OTHER INFORMATIONOn February 28, 2018, Revance Therapeutics, Inc. (“Revance” or “the Company”) and Mylan Ireland Limited, a wholly-owned indirect subsidiary ofMylan N.V. (“Mylan”), entered into a collaboration agreement (the “Agreement”) pursuant to which Revance and Mylan will collaborate exclusively, on aworld-wide basis (excluding Japan), to develop, manufacture and commercialize a biosimilar to the branded biologic product (onabotulinumtoxinA)marketed as BOTOX®.Under the Agreement, Revance will be primarily responsible for (a) non-clinical development activities, (b) clinical development activities in NorthAmerica, and (c) manufacturing and supply of clinical drug substance and drug product; and Mylan will be primarily responsible for (a) clinical developmentactivities outside of North America (excluding Japan) (the “ex-U.S. Mylan territories”), (b) regulatory activities, and (c) commercialization for any approvedproduct. Revance will be solely responsible for an initial portion of non-clinical development costs. The remaining portion of any non-clinical developmentcosts and clinical development costs for obtaining approval in the U.S. and Europe will be shared equally between the parties, and Mylan will be responsiblefor all other clinical development costs and commercialization expenses. Revance and Mylan will form a joint steering committee, consisting of an equalnumber of members from Revance and Mylan, to oversee and manage the development, manufacture and commercialization of the biosimilar. The partieswill also enter into a separate agreement, within six months, covering supply of drug substance and drug product. In addition, Mylan may elect to have thedrug product manufactured by another party, including a third-party contract manufacturing organization or a Mylan affiliate.Revance has granted Mylan an exclusive, world-wide license (excluding Japan) to the Company’s intellectual property rights for the developmentand commercialization of the biosimilar under the Agreement. Revance has retained all rights in Japan and has retained rights in the U.S. and ex-U.S. Mylanterritories to develop and manufacture the biosimilar for Mylan to commercialize.Mylan has agreed to pay Revance a non-refundable upfront payment of $25 million with contingent payments of up to $100 million, in theaggregate, upon the achievement of specified clinical and regulatory (i.e. biosimilar biological pathway) milestones and of specified, tiered sales milestonesof up to $225 million. In addition, Mylan will pay Revance royalties on sales of the biosimilar in the Mylan territories. With respect to royalties on sales ofthe biosimilar in the Mylan territories, Mylan would pay Revance low to mid double digit royalties on any sales of the biosimilar in the U.S., mid doubledigit royalties on any sales in Europe, and high single digit royalties on any sales in other ex-U.S. Mylan territories. However, Revance has agreed to waiveroyalties for U.S. sales, up to a limit of $50 million in annual sales, during the first approximately four years after commercialization to defray launch costs.The term of the collaboration will continue, on a country-by-country basis, in perpetuity until terminated by either party pursuant to the terms of theAgreement. Either party may terminate the agreement for breach by, or bankruptcy of, the other party. Mylan may terminate the Agreement in its entirety oron a region-by-region basis, and may also terminate if a biosimilar development pathway is not deemed viable, with such determination only occurring afteran FDA advisory meeting. All rights, including licenses, and obligations terminate in the country or countries for which termination applies, with limitedexceptions for royalty-bearing licenses to certain intellectual property rights, and rights to certain data, for the continued development and sale of thebiosimilar in the country or countries for which termination applies.The Agreement contains various representations and warranties, covenants and other provisions that are customary for a transaction of this nature.The representations, warranties and covenants contained in the Agreement were made only for purposes of the Agreement and as of specific dates, were solelyfor the benefit of the parties to the Agreement, and may be subject to limitations agreed upon by the parties. The representations and warranties may havebeen made for the purposes of allocating contractual risk between the parties to the Agreement instead of establishing these matters as facts.The foregoing is a summary of the terms of the Agreement and is qualified in its entirety by reference to the Agreement, a copy of which will be filedas an exhibit to a future amendment of this Current Report on Form 8-K or as exhibits to the Company’s Quarterly Report on Form 10-Q for the quarterending March 31, 2018.BOTOX® is a registered trademark of Allergan plc.77Table of ContentsPART III ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCEBoard of DirectorsOur board of directors currently consists of eight members. In accordance with our amended and restated certificate of incorporation, our board ofdirectors is divided into three classes with staggered three-year terms. At each annual general meeting of stockholders, the successors to directors whose termsthen expire will be elected to serve from the time of election and qualification until the third annual meeting following election. The term of Class I directorswill expire at the annual meeting of stockholders to be held in 2018; the term of the Class II director will expire at the annual meeting of stockholders to beheld in 2019; and the term of Class III directors will expire at the annual meeting of stockholders to be held in 2020.Our amended and restated certificate of incorporation and amended and restated bylaws provide that the authorized number of directors may bechanged only by resolution approved by a majority of our board of directors. Any additional directorships resulting from an increase in the number ofdirectors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. The division of ourboard of directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change in control.The following is a brief biography of each member of our board of directors, as of December 31, 2017, with each biography including informationregarding the experiences, qualifications, attributes or skills that caused our board of directors to determine that each member of our board of directors shouldserve as a director as of the date of this Form 10-K.Class I DirectorsAngus C. Russell, age 62, has served as a director and Chairman of the Board of our company since March 2014. Mr. Russell was Chief ExecutiveOfficer of Shire plc, or Shire, a biopharmaceutical company, from June 2008 until April 2013, and a member of its board of directors from 1999 until 2013.From December 1999 to June 2008, Mr. Russell served as Chief Financial Officer of Shire. Prior to joining Shire, Mr. Russell served at AstraZeneca plc, apharmaceutical and biologics company, most recently as VP of Corporate Finance. Mr. Russell is a former Non-Executive Director of the City of LondonInvestment Trust plc. Mr. Russell is a Chartered Accountant and is a Fellow of the Association of Corporate Treasurers. Mr. Russell has served on the board ofdirectors at Mallinckrodt plc, a pharmaceuticals company, since August 2014, BioTime, Inc., a biotechnology company, since December 2014 andTherapeuticsMD, Inc., a pharmaceutical company, since March 2015. Our board of directors believes that Mr. Russell’s financial expertise, experience atmultiple public pharmaceutical companies and his expertise in the development and commercialization of specialty pharmaceutical products make himqualified to serve on our board of directors.Phyllis Gardner, M.D., age 67, has served as a director of our Company since December 2006. Dr. Gardner has spent over 35 years in academia,medicine and industry. She served at Essex Woodlands, a growth equity firm that focuses on the healthcare industry, from June 1999 to 2014, in variouscapacities including as an adjunct Partner. Dr. Gardner has served on the board of directors of several public and private companies, including CoriumInternational, Inc. since November 2007. She began her academic medical career at Stanford University, where she has held several positions includingSenior Associate Dean for Education and Student Affairs and remains today as Professor of Medicine. From 1994 to 1998, she took a leave of absence fromStanford University to serve as Principal Scientist, Vice President of Research and Head of ALZA Technology Institute, a major drug delivery company.Dr. Gardner holds a B.S. from the University of Illinois and an M.D. from Harvard University. Our board of directors believes that Dr. Gardner’s medical,healthcare and private equity experience, operating experience and significant experience serving as a director of our company and other healthcarecompanies make her qualified to serve on our board of directors.Julian S. Gangolli, age 60, has served as a director since July 2016. He is President, North America of GW Pharmaceuticals Inc. and President ofGreenwich Biosciences, Inc., the U.S. subsidiary of GW Pharmaceuticals, spearheading the buildout of the company’s U.S. commercial infrastructure inadvance of the potential launch of its lead therapeutic candidate, Epidiolex® (cannabidiol or CBD), which is in late-stage development for a number ofchild-onset epilepsy syndromes. Prior to joining GW Pharma, Mr. Gangolli served as President of the North American Pharmaceutical division of AllerganInc. for 11 years. Prior to that, he served as Senior Vice President, U.S. Eye Care at Allergan. Prior to Allergan, Mr. Gangolli served in sales and marketingpositions at VIVUS, Inc., Syntex Pharmaceuticals, Inc., and Ortho-Cilag Pharmaceuticals Ltd in the United Kingdom. Our board of directors believes that Mr.Gangolli’s operating experience in the78Table of Contentsbiopharmaceutical industry, experience at multiple public pharmaceutical companies and his expertise in the development and commercialization ofspecialty pharmaceutical products make him qualified to serve on our board of directors.Class II DirectorMark J. Foley, age 52, has served as a director of our company since September 2017. Mr. Foley has more than 25 years of operational and investmentexperience in the healthcare arena. He is currently Managing Director of RWI Ventures, a venture capital firm focused on life sciences, networking,semiconductor and software investments. Previously, Mr. Foley was Chairman, President and CEO of ZELTIQ Aesthetics (ZLTQ), serving from 2012 throughthe company’s acquisition in 2017 by Allergan (AGN). Prior to ZELTIQ, Mr. Foley held a variety of senior operating roles in large public companies andventure-backed startups, including U.S. Surgical Corporation, Guidant Corporation, Devices for Vascular Intervention (acquired by Eli Lilly), Perclose(acquired by Abbott) and Ventrica (acquired by Medtronic) where he was the founder and CEO. He is a board member at Glaukos (GKOS) and also serves asChairman of ULab, HintMD and Arrinex. Mr. Foley received a Bachelor of Arts degree from the University of Notre Dame. Our board of directors believes thatMr. Foley’s financial expertise, experience at multiple public pharmaceutical companies and his expertise with the development and commercialization inmedical device and biotechnology industries make him qualified to serve on our board of directors.Class III DirectorsL. Daniel Browne, age 56, is one of our co-founders and has served as our President and Chief Executive Officer and a member of our board of directorssince we commenced operations in 2002. Mr. Browne served as President and Chief Executive Officer of Neomend, Inc., a medical technology andbiomaterials company, from 2001 to 2003. From 1997 through 2000, Mr. Browne served as President of Prograft Medical Inc., a medical technologycompany. Previously, Mr. Browne served for more than 16 years in leadership positions in product development, sales and marketing and businessdevelopment in the Gore Medical Products Division of W.L. Gore & Associates, Inc., a global technology company, lastly as Business Leader in the MedicalProducts Division. Mr. Browne holds a B.S. from the University of Hawaii in Cell and Molecular Biology and an M.B.A. from Pepperdine University. Ourboard of directors believes that Mr. Browne is qualified to serve on our board of directors based on such experience and leadership roles, and his managementperspective of the company, including our strategic opportunities and challenges and his track record of new product development, sales and marketing andvalue creation, each of which relates to our commercial opportunities.Robert Byrnes, age 73, has served as a director of our company since August 2004. Mr. Byrnes has spent over forty years in the medical device andbiotechnology industries. From October 1997 until October 2002, and from January 2005 to the present, Mr. Byrnes has served as the President and ChiefExecutive Officer of Roan Advisors, Inc., an advisory service for healthcare organizations. From November 2002 to January 2005, he served as the Presidentand Chief Executive Officer of Thermage, Inc., a medical device company focused on non-invasive tissue tightening. Mr. Byrnes has also served as Chairmanand Chief Executive Officer of Tokos Medical Corporation, a healthcare services company, President of Caremark, Inc., a home healthcare service company,and Vice President of Marketing and Business Development for Genentech, Inc., a biotechnology company. He currently serves on the board of directors ofAllego Ophthalmics, LLC. Mr. Byrnes holds a B.S. in Pharmacy from Ferris State University and an M.B.A degree in Marketing and Finance from LoyolaUniversity, Chicago. Our board of directors believes that Mr. Byrnes’s operating experience in the medical device and biotechnology industries, combinedwith his prior board positions, make him qualified to serve on our board of directors.Philip J. Vickers, Ph.D., age 58, has served as a director of our company since February 2015. Dr. Vickers has over 25 years in the pharmaceuticalindustry experience. Since November 2017, he has been serving as the Chief Executive Officer and a member of the board of directors of Northern BiologicsInc. From 2011 until June 2017, Dr. Vickers served as Global Head of Research and Development and a member of the Executive Committee of Shire Plc, orShire, a biotechnology company focused on the development of therapies for the treatment of rare and specialty conditions. Under Dr. Vickers’ leadershipShire’s pipeline had approximately 40 programs in clinical development in the areas of Genetic Disease, GI disease, Hematology, Immunology,Neuroscience, Ophthalmology and Oncology. Prior to Shire, Dr. Vickers held positions of increasing responsibility in Research and Development at Merck,Pfizer, Boehringer-Ingelheim and Resolvyx Pharmaceuticals. Dr. Vickers obtained his PhD in Biochemistry from the University of Toronto, which wasfollowed by postdoctoral research in mechanisms of multidrug resistance in breast cancer at the National Cancer Institute in Bethesda, Maryland. Our boardof directors believes that Dr. Vickers' experience at multiple pharmaceutical companies and his expertise in the development and commercialization ofpharmaceutical products make him qualified to serve on our board of directors.79Table of ContentsExecutive OfficersThe following table sets forth information concerning our executive officers as of December 31, 2017: NameAgePosition(s)Executive Officers L. Daniel Browne56President, Chief Executive Officer and DirectorAbhay Joshi, Ph.D.55Chief Operating OfficerTodd E. Zavodnick46Chief Commercial Officer and President, Aesthetics & TherapeuticsLauren P. Silvernail59Chief Financial Officer and Chief Business OfficerL. Daniel Browne. Mr. Browne’s biography is included above under the section titled “Board of Directors — Class III Directors.”Abhay Joshi, Ph.D. has served our Chief Operating Officer since December 2015. Dr. Joshi brings over twenty-five years of global experience as apharmaceutical and biotechnology executive. From March of 2007 to December 2015, Dr. Joshi served as the President and Chief Executive Officer of AlvinePharmaceuticals, Inc., a pharmaceutical company developing therapeutic products for the treatment of autoimmune and inflammatory diseases, where he wasresponsible for overseeing all aspects of the company's business. Prior to Alvine Pharmaceuticals, he served as an Executive Vice President, Chief TechnicalOfficer and member of the Executive Committee at CoTherix, Inc., which was acquired by Actelion Ltd in 2007. Prior to CoTherix, Dr. Joshi was the VicePresident of Global Technical Operations, Specialty Pharmaceuticals at Allergan, Inc., where he was responsible for the company’s global biologicsmanufacturing operations for BOTOX® and its Latin America and Asia Pacific pharmaceutical operations, and held a series of senior management positions.Dr. Joshi currently serves on the board of directors of Genyous Biomed International and Sira Pharmaceuticals, Inc. Dr. Joshi received his BTech in ChemicalEngineering from the Indian Institute of Technology, New Delhi, an MSE and a Ph.D. in Chemical Engineering from the University of Michigan, Ann Arbor,and an MBA from the University of California, Irvine.Todd E. Zavodnick has served as our Chief Commercial Officer and President, Aesthetics & Therapeutics since September 2017. Mr. Zavodnick joinedRevance from ZELTIQ Aesthetics, Inc., developer and marketer of the #1 non-invasive fat-reduction procedure known as CoolSculpting, where he wasPresident of International prior to the company’s acquisition by Allergan plc on April 28, 2017. Previously, he served in leadership roles at GaldermaLaboratories, most recently as President and General Manager, North America. Prior to this, Mr. Zavodnick managed a successful 14-year career at AlconLaboratories in a series of ascending sales and marketing positions both domestically and internationally, ultimately serving as President of Alcon China andMongolia. He serves on the board of directors for NovaBay Pharmaceuticals (NYSE: NBY), Inc., Allurion Technologies, and the Children’s Skin DiseaseFoundation. Mr. Zavodnick holds a M.B.A. from The University of Texas at Dallas and a B.S. in Pharmacy from Rutgers University.Lauren P. Silvernail has served as our Chief Financial Officer and Chief Business Officer since December 2015 and Chief Financial Officer andExecutive Vice President, Corporate Development from March 2013 to December 2015. From 2003 to 2012, Mrs. Silvernail was Chief Financial Officer andVice President of Corporate Development at ISTA Pharmaceuticals, Inc., a pharmaceutical research and development company. During her tenure at ISTA,revenues grew to more than $160 million and headcount increased to more than 340 employees by the time ISTA was purchased by Bausch & Lomb in June2012. From 1995 to 2003, Mrs. Silvernail served in various operating and corporate development positions with Allergan, Inc., a pharmaceutical company,including Vice President, Business Development. Prior to joining Allergan, Inc., Mrs. Silvernail worked at Glenwood Ventures, an investment firm, as aGeneral Partner. She currently serves on the board of directors and the audit committee of Nicox S.A. Mrs. Silvernail holds a B.A. in Biophysics from theUniversity of California, Berkeley and an M.B.A. from the Anderson Graduate School of Management at the University of California, Los Angeles.Governance and Board CompositionBoard Committees. Our board of directors has an audit committee, a compensation committee, a nominating and corporate governance committee and ascience and technology committee. Our board of directors may establish other committees to facilitate the management of our business. Members serve onthese committees until their resignation or until otherwise determined by our board of directors.Audit Committee. Our audit committee currently consists of Mr. Foley, Mr. Byrnes, and Mr. Gangolli. Our board of directors has determined that allcurrent members of our audit committee satisfy the independence requirements under the80Table of ContentsNasdaq listing rules and Rule 10A-3(b)(1) of the Exchange Act. Each member of the audit committee meets the requirements for financial literacy under theapplicable rules and regulations of the SEC and Nasdaq. The chair of our audit committee is Mark J. Foley. Our board of directors has determined that each ofMessrs. Byrnes and Foley is an “audit committee financial expert” within the meaning of the SEC regulations. Our board of directors has determined that thecomposition of our audit committee meets the criteria for independence under, and the functioning of our audit committee complies with, the applicablerequirements of the Sarbanes-Oxley Act, applicable requirements of the Nasdaq listing rules and SEC rules and regulations. We intend to continue to evaluatethe requirements applicable to us and comply with future requirements to the extent that they become applicable to our audit committee. The principal dutiesand responsibilities of our audit committee include: •appointing and retaining an independent registered public accounting firm to serve as independent auditor to audit our Consolidated FinancialStatements, overseeing the independent auditor’s work and determining the independent auditor’s compensation;•approving in advance all audit services and non-audit services to be provided to us by our independent auditor;•establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls,auditing or compliance matters, as well as for the confidential, anonymous submission by our employees of concerns regarding questionableaccounting or auditing matters;•reviewing and discussing with management and our independent auditor the results of the annual audit and the independent auditor’s review ofour quarterly Consolidated Financial Statements; and•conferring with management and our independent auditor about the scope, adequacy and effectiveness of our internal accounting controls, theobjectivity of our financial reporting and our accounting policies and practices.Director Nominations. The nominating and corporate governance committee of the board of directors, to date, has not adopted a formal policy withregard to the consideration of director candidates recommended by stockholders and will consider director candidates recommended by stockholders on acase-by-case basis, as appropriate. Stockholders wishing to recommend individuals for consideration by the nominating and corporate governance committeemay do so by delivering a written recommendation to our Secretary at 7555 Gateway Boulevard, Newark, California 94560 and providing the candidate’sname, biographical data and qualifications and a document indicating the candidate’s willingness to serve if elected. The nominating and corporategovernance committee does not intend to alter the manner in which it evaluates candidates based on whether the candidate was recommended by astockholder or not. To date, the nominating and corporate governance committee has not received any such nominations nor has it rejected a directornominee from a stockholder or stockholders holding more than 5% of our voting stock.Code of Business Conduct. Our board of directors adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers,including our principal executive officer, principal financial officer and principal accounting officer or controller, or persons performing similar functionsand agents and representatives, including directors and consultants. The full text of our Code of Business Conduct and Ethics is posted on our website atwww.revance.com. We intend to disclose future amendments to certain provisions of our Code of Business Conduct and Ethics, or waivers of such provisionsapplicable to any principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions,and our directors, on our website identified above.Section 16(a) Beneficial Ownership Reporting ComplianceSection 16(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires our directors and executive officers, and persons whoown more than ten percent of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership ofcommon stock and other equity securities of our company. Officers, directors and greater than ten percent stockholders are required by SEC regulation tofurnish us with copies of all Section 16(a) forms they file.To the best of our knowledge, based solely on a review of the copies of such reports furnished to us and written representations that no other reportswere required, during the fiscal year ended December 31, 2017, all of our officers, directors and greater than ten percent beneficial owners complied with allSection 16(a) filing requirements applicable to them.81Table of ContentsITEM 11.EXECUTIVE COMPENSATIONOur named executive officers, or NEOs, consisting of our principal executive officer and the next two most highly compensated executive officersduring 2017, are: •L. Daniel Browne, President and Chief Executive Officer;•Todd E. Zavodnick, Chief Commercial Officer and President, Aesthetics & Therapeutics•Abhay Joshi, Ph.D., Chief Operating Officer.Summary Compensation TableThe following table sets forth all of the compensation awarded to, earned by or paid to our NEOs during 2017 and 2016. Name and PrincipalPositionYearSalary($) Bonus($) Stock AwardsOptionAwards($)(2)Nonequity IncentivePlan Compensation(1)All OtherCompensation($) Total($)L. Daniel Browne2017$525,300 $— $508,260$1,905,694$466,038$— $3,405,292President and ChiefExecutive Officer2016$510,000 $— $428,000$1,689,835$273,488$— $2,901,323Todd E. Zavodnick2017$116,667(3) $— $2,318,000$520,282$103,846$22,244(4) $3,081,039Chief Commercial Officerand President, Aesthetics& Therapeutics2016$— $— $—$—$—$—$—Abhay Joshi, Ph.D.2017$453,200 $— $258,070$971,289$344,728$— $2,027,287Chief Operating Officer2016$440,000$200,000 $606,600$—$160,875$— $1,407,475 (1)Amounts shown in this column represent cash bonus awards granted to our NEOs under our annual incentive plan. Such bonuses are tied toachievement against clinical and financial goals that are set in the first quarter of the applicable fiscal year, with payouts determined after the closeof the year and primarily based on our level of achievement against those goals. (2)The dollar amounts in this column represent the aggregate grant date fair value of all option awards granted during the indicated year. Theseamounts have been calculated in accordance with FASB ASC Topic 718, or ASC 718, using the Black-Scholes option-pricing model. For adiscussion of valuation assumptions, see Note 11 to our financial statements and the discussion under “Management’s Discussion and Analysis ofFinancial Condition and Results of Operations — Critical Accounting Policies and Estimates — Stock-Based Compensation” included elsewhere inthis Form 10-K. These amounts do not necessarily correspond to the actual value that may be recognized from the option awards by the NEOs.(3)Mr. Zavodnick's annual base salary for 2017 was $400,000. The amount shown reflects the salary earned from his date of hire on September 18, 2017through December 31, 2017.(4)Represents taxable fringe benefits for housing and travel.82Table of ContentsOutstanding Equity Awards at December 31, 2017The following table provides information regarding outstanding equity awards held by each of our NEOs as of December 31, 2017. Option AwardsStock Awards Number ofSecuritiesUnderlyingUnexercisedOptions (#)Exercisable Number ofSecuritiesUnderlyingUnexercisedOptions (#)Unexercisable OptionExercisePrice ($)OptionExpirationDateNumber ofShares thatHave NotVested Market Value ofShares That HaveNot VestedL. Daniel Browne20,000 — $2.554/29/2018— — 10,990 — $2.557/20/2020— — 298,750— $8.705/26/2023— — 99,583— $9.1512/16/2023— — 264,987(1)30,813 $32.225/18/2024— — 179,739(2)66,761 $16.231/27/2025— — 80,208(7)94,792 $17.122/8/2026— — 35,520(9)119,480 $19.701/25/2027—— — — $——14,500(3)$518,375 — — $——16,667(8)$595,845 — — $——25,800(10)$922,350Todd E. Zavodnick—(11)35,000 $24.409/17/2027— — — — $——95,000(12)$3,396,250Abhay Joshi, Ph.D.666 — $4.204/28/2019— — 666 — $2.554/29/2018— — 103,124(4)103,126 $36.3212/13/2025— — 18,104(9)60,896 $19.701/25/2027— — — — $——17,187(5)$614,435 — — $——36,000(6)$1,287,000 — — $——13,100(10)$468,325(1)This option was granted on May 19, 2014. The shares subject to the stock option vest over a four year period, with one-forty-eighth of the sharesvesting each month, subject to providing continued service to us through each vesting date.(2)This restricted stock award was granted on January 28, 2015. The shares subject to the stock option vest over a four year period, with one-forty-eighth of the shares vesting each month, subject to providing continued service to us through each vesting date.(3)This restricted stock award was granted on January 28, 2015. The shares subject to the stock award vest over a three year period, with one-third of theshares vesting each year, subject to providing continued service to us through each vesting date.(4)This option was granted on December 14, 2015. The shares subject to the stock option vest over a four year period, with 25% vesting on December14, 2016 and the balance vesting each month over the remaining three-year period, subject to providing continued service to us through eachvesting date.(5)This restricted stock award was granted on December 14, 2015. The shares subject to the stock award vest over a four year period, with one-fourth ofthe shares vesting each year, subject to providing continued service to us through each vesting date.(6)This restricted stock award was granted on December 15, 2016. The shares subject to the stock award vest over a three year period, with one-third ofthe shares vesting each year, subject to providing continued service to us through each vesting date.(7)This option was granted on February 9, 2016. The shares subject to the stock option vest over a four year period, with one-forty-eighth of the sharesvesting each month, subject to providing continued service to us through each vesting date.83Table of Contents(8)This restricted stock award was granted on February 9, 2016. The shares subject to the stock award vest over a three year period, with one-third of theshares vesting each year, subject to providing continued service to us through each vesting date.(9)This option was granted on January 26, 2017. The shares subject to the stock option vest over a four year period, with one-forty-eighth of the sharesvesting each month, subject to providing continued service to us through each vesting date.(10)This restricted stock award was granted on January 26, 2017. The shares subject to the stock award vest over a three year period, with one-third of theshares vesting each year, subject to providing continued service to us through each vesting date.(11)This option was granted on September 18, 2017. The shares subject to the stock option vest over a four year period, with 25% vesting on September18, 2018, and the balance vesting each month over the remaining three-year period, subject to providing continued service to us through eachvesting date.(12)This restricted stock award was granted on September 18, 2017. The shares subject to the stock award vest over a four year period, with one-fourth ofthe shares vesting each year beginning on October 15, 2018, subject to providing continued service to us through each vesting date.Executive Employment ArrangementsWe have entered into employment agreements with each of our named executive officers; these agreements have no specific term of employment andprovide for at-will employment. Each employment agreement provides the NEO with an annual base salary and target bonus opportunity, eligibility foremployee benefits offered to our other employees, as well as eligibility under our Executive Severance Plan, described below. The target annual bonusopportunity (expressed as a percentage of base salary) for Mr. Browne was 66% for 2017 and 2018; for Mr. Zavodnick was 75% for 2017 and 2018; and forDr. Joshi was 45% for 2017 and 2018.Severance and Change of Control BenefitsEach of our NEOs is eligible for our Executive Severance Plan, which provides severance benefits in the event of certain qualifying terminations ofemployment, subject to the executive’s execution of a waiver and release of claims in favor of the company.Under the Severance Plan, upon an involuntary termination of a participant other than for cause, and where such termination is not within 12 monthsfollowing a change of control, the benefits provided under the Severance Plan consist of: (i) salary continuation payments for 15 months in the case of ourchief executive officer, and for nine months in the case of the other NEOs; and (ii) payment by us of COBRA premiums for the participant and his eligibledependents for a period of up to 15 months in the case of our chief executive officer, and up to nine months in the case of the other NEOs.For a period of 12 months following a change in control, if we involuntarily terminate a participant for any reason other than cause, or the participantresigns for “good reason” (each as defined in the Severance Plan), then the benefits provided by the Severance Plan will consist of: (i) a lump sum paymentequal to the sum of the participant’s monthly base salary and monthly annual target bonus, multiplied by 21 in the case of our chief executive officer, and by12 in the case of the other NEOs; (ii) payment of COBRA premiums for the named executive officer and his eligible dependents for a period of up to21 months in the case of our chief executive officer, and up to 12 months in the case of the other NEOs; and (iii) accelerated vesting of all unvested stockoptions then held by the NEO.Under the Severance Plan, a “change of control” is defined the same way it is under our 2014 Equity Incentive Plan.If any of the benefits provided under the Severance Plan would constitute a “parachute payment” within the meaning of Section 280G of the InternalRevenue Code of 1986, as amended, or the Code, such that the payments would become subject to the excise tax imposed by Section 4999 of the Code, thenthe payments will either be paid in full to the participant, or reduced so that a smaller amount or no portion of such benefits will be subject to the excise tax,whichever provides the greater after-tax benefit to the participant.84Table of ContentsEmployee Benefit Plans401(k) PlanWe sponsor a 401(k) retirement plan in which our named executive officers participate on the same basis as our other U.S. employees. During the yearended December 31, 2017, the Company made contributions to the plan of approximately $0.2 million.Pension BenefitsWe do not maintain a defined benefit pension plan for any of our employees.Nonqualified Deferred CompensationWe do not maintain a plan providing nonqualified deferred compensation for any of our employees.2017 Director Compensation TableThe compensation provided to our non-employee directors in 2017 is enumerated in the table below. Mr. Browne, who is also one of our employees,did not and will not receive any compensation for his services as a director.The following table sets forth a summary of the compensation received during the year ended December 31, 2017: NameFees Earned ($)StockOptions andAwards($)* Total ($)Robert Byrnes67,777135,513(1)203,290Ronald W. Eastman (2)30,011135,513165,524Mark J. Foley (3)19,079318,733(4)337,812Julian S. Gangolli47,000135,513(5)182,513Phyllis Gardner, M.D.49,500135,513(6)185,013Mark A. Prygocki (7)21,577—21,577Angus C. Russell83,581135,513(8)219,094Philip Vickers51,750135,513(9)187,263 *The dollar amounts in this column represent the grant date fair value of the stock option award. These amounts have been calculated in accordancewith ASC 718 using the Black-Scholes option-pricing model. For a discussion of valuation assumptions, see Note 11 to our financial statements andthe discussion under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical AccountingPolicies and Estimates — Stock-Based Compensation” included elsewhere in this Form 10-K. These amounts do not necessarily correspond to theactual value that may be recognized from the option and awards by the applicable directors.(1)As of December 31, 2017, Mr. Byrnes had options to purchase 53,333 shares of our common stock and restricted stock awards of 3,000 shares.(2)Mr. Eastman resigned from our Board effective September 5, 2017.(3)Mr. Foley joined our Board effective September 5, 2017.(4)As of December 31, 2017, Mr. Foley had options to purchase 12,000 shares of our common stock and restricted stock awards of 6,000 shares.(5)As of December 31, 2017, Mr. Gangolli had options to purchase 24,000 shares of our common stock and restricted stock awards of 3,000 shares.(6)As of December 31, 2017, Dr. Gardner had options to purchase 35,333 shares of our common stock and restricted stock awards of 3,000 shares.(7)Mr. Prygocki resigned from our Board effective May 11, 2017.(8)As of December 31, 2017, Mr. Russell had options to purchase 40,000 shares of our common stock and restricted stock awards of 3,000 shares.(9)As of December 31, 2017, Dr. Vickers had options to purchase 40,000 shares of our common stock and restricted stock awards of 3,000 shares.85Table of ContentsNon-employee Director CompensationIn December 2013, our board of directors approved a non-employee director compensation policy that became effective upon the completion of ourIPO, which was subsequently amended effective as of July 30, 2015, January 1, 2016 and February 16, 2017.Under this policy, we pay each of our non-employee directors a cash retainer for service on the board of directors and for service on each committee onwhich the director is a member. The chairman of each committee receives a higher retainer for such service. These retainers are payable in arrears in four equalquarterly installments on the last day of each quarter, provided that the amount of such payment will be prorated for any portion of such quarter that thedirector is not serving on our board of directors. The retainers paid to non-employee directors for service on the board of directors and for service on eachcommittee of the board of directors on which the director is a member are as follows: MemberAnnual ServiceRetainer Chairman AdditionalAnnual ServiceRetainerBoard of Directors$39,500 $34,500Audit Committee7,500 12,500Compensation Committee5,000 7,250Nominating and Corporate Governance Committee4,500 3,500Science & Technology Committee5,000 7,250In addition, on the date of each annual meeting of stockholders held, each non-employee director that continues to serve as a non-employee member onour board of directors will receive an option to purchase 6,000 shares of our common stock and 3,000 shares of restricted stock. The exercise price of theseoptions will equal the fair market value of our common stock on the date of grant, and these options will vest on the one-year anniversary of the grant date,subject to the director’s continued service as a director. This policy is intended to provide a total compensation package that enables us to attract and retainqualified and experienced individuals to serve as directors and to align our directors’ interests with those of our stockholders.Directors have been and will continue to be reimbursed for expenses directly related to their activities as directors, including attendance at board andcommittee meetings. Directors are also entitled to the protection provided by their indemnification agreements and the indemnification provisions in ourcertificate of incorporation and bylaws.Compensation Committee Interlocks and Insider ParticipationDuring the fiscal year ended December 31, 2017, Mr. Byrnes and Dr. Gardner served on the compensation committee, with Mr. Byrnes serving as itschair. Neither Mr. Byrnes nor Dr. Gardner are currently nor have been at any time one of our employees. None of our executive officers currently serves, or hasserved during the last year, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as amember of our board of directors or compensation committee.86Table of ContentsITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERMATTERSEquity Compensation Plan InformationThe following table provides certain information with respect to our equity compensation plans in effect as of December 31, 2017. Plan CategoryNumber of securities to beissued upon exerciseof outstanding options,warrants and rights(a) Weighted-average exerciseprice of outstanding options,warrants and rights(b)(3) Number of securitiesremaining availablefor issuance underequity compensation plans(excludingsecurities reflected in column(a))(c)Equity compensation plans approved by securityholders:(1)2,837,150 $19.29 1,819,883(4) Equity compensation plans not approved bysecurity holders:(2)373,250 28.96 292,096 Total3,210,400 $20.41 2,111,979 (1)Includes securities issuable under the 2002 Equity Incentive Plan, the 2012 Equity Incentive Plan, the 2014 Equity Incentive Plan, or the 2014 plan,and the 2014 Employee Stock Purchase Plan, or the 2014 ESPP.(2)Includes securities issuable under the 2014 Inducement Plan adopted exclusively for grants of awards to individuals that were not previously ouremployees or directors, as an inducement material to the individual’s entry into employment with us within the meaning of Rule 5635(c)(4) of theNasdaq Listing Rules. (3)The weighted average exercise price excludes restricted stock awards, which have no exercise price.(4)Includes (i) 903,049 shares of common stock available for issuance under our 2014 plan and (ii) 916,834 shares of common stock available forissuance under our 2014 ESPP. The number of shares of our common stock reserved for issuance under the 2014 plan automatically increases onJanuary 1st of each year, starting on January 1, 2015 and continuing through January 1, 2024, by 4% of the total number of shares of our commonstock outstanding on December 31 of the preceding calendar year, or such lesser number of shares of common stock as determined by our Board ofDirectors. The maximum number of shares that may be issued pursuant to the exercise of incentive stock options under the 2014 plan is 2,000,000shares. The number of shares of our common stock reserved under the 2014 ESPP for issuance automatically increases on January 1st each year,starting January 1, 2015 and continuing through January 1, 2024, in an amount equal to the lower of (i) 1% of the total number of shares of ourcommon stock outstanding on December 31 of the preceding calendar year, and (ii) 300,000 shares of common stock, or such lesser number of sharesof common stock as determined by our Board of Directors. If a purchase right granted under our 2014 ESPP terminates without having beenexercised, the shares of our common stock not purchased under such purchase right will be available for issuance under our 2014 ESPP.Security Ownership of Certain Beneficial Owners and ManagementThe following table sets forth certain information regarding the ownership of our common stock as of January 15, 2018 by: (i) each director; (ii) eachnamed executive officer; (iii) all of our executive officers and directors as a group; and (iv) all those known by us to be beneficial owners of more than fivepercent of our common stock. We are aware that one or more institutional investors purchased a number of shares of our common stock in amountsrepresenting in excess of five percent of our common stock as of January 15, 2018, and as a result, one or more of such institutional investors may continue tobeneficially own in excess of five percent of our common stock as of January 15, 2018. However, as of the date of this Form 10-K, other than as disclosedbelow, we are not aware of any filings made with the SEC with respect to the beneficial ownership of our common stock by such institutional investors andwe were otherwise unable to verify the beneficial ownership of our common stock by any such institutional investor as of the date of this Form 10-K.Beneficial ownership is determined in accordance with the rules of the SEC and generally includes any shares over which a person exercises sole orshared voting or investment power. Shares of common stock issuable under options or warrants that are exercisable within 60 days after January 15, 2018, aredeemed beneficially owned and such shares are used in computing the percentage ownership of the person holding the options or warrants but are notdeemed outstanding for the purpose of87Table of Contentscomputing the percentage ownership of any other person. The percentage of beneficial ownership is based on 36,502,409 shares of our common stockoutstanding as of January 15, 2018.The information contained in the following table is not necessarily indicative of beneficial ownership for any other purpose and the inclusion of anyshares in the table does not constitute an admission of beneficial ownership of those shares.Unless otherwise indicated below, to our knowledge, all persons named in the table have sole voting and dispositive power with respect to their sharesof common stock, except to the extent authority is shared by spouses under community property laws. Unless otherwise indicated below, the address of eachbeneficial owner listed in the table below is c/o Revance Therapeutics, Inc., 7555 Gateway Blvd., Newark, CA 94560. Beneficial OwnershipName of Beneficial OwnerNumber ofSharesPercentageof TotalNamed Executive Officers and Directors: L. Daniel Browne(1)1,163,4913.10%Abhay Joshi (2)212,098*Todd E. Zavodnick(16)95,000*Robert Byrnes(3)63,998*Mark J. Foley(17)26,000*Phyllis Gardner, M.D.(4)32,333*Angus C. Russell(5)37,000*Philip J. Vickers, Ph.D.(6)37,000*Julian S. Gangolli(7)21,000*Directors and officers as a group (total of 10 persons)(8)1,920,3955.05%Greater than 5% Stockholders: Entities affiliated with Essex VIII(9)3,842,04710.53%Entities affiliated with NovaQuest(10)3,096,6508.48%Entities affiliated with Franklin Resources, Inc.(11)3,394,2029.30%Entities affiliated with JPMorgan Chase & Co. (12)3,561,6799.76%Entities affiliated with The Bank of New York Mellon Corporation(13)2,144,6695.88%Entities affiliated with BlackRock, Inc.(14)2,168,2115.94%Entities affiliated with Wellington Management Group LLP(15)3,573,1509.79% * Represents beneficial ownership of less than 1% of the outstanding common stock(1)Consists of 133,315 shares of common stock and 1,029,767 shares of common stock underlying options that are vested and exercisable within 60days of January 15, 2018 and 409 shares of common stock held by the Dan and Brenda Browne Living Trust. Mr. Browne is a Trustee of the Dan andBrenda Browne Living Trust.(2)Consists of 73,356 shares of common stock and 138,742 shares of common stock underlying options that are vested and exercisable within 60 daysof January 15, 2018(3)Consists of 3,000 shares of common stock and 47,333 shares of common stock underlying options that are vested and exercisable within 60 days ofJanuary 15, 2018, and 13,665 shares of common stock held by the Byrnes Family Trust. Mr. Byrnes is a Trustee of the Byrnes Family Trust.(4)Consists of 3,000 shares of common stock and 29,333 shares of common stock underlying options that are vested and exercisable within 60 days ofJanuary 15, 2018.(5)Consists of 3,000 shares of common stock and 34,000 shares of common stock underlying options that are vested and exercisable within 60 days ofJanuary 15, 2018.(6)Consists of 3,000 shares of common stock and 34,000 shares of common stock underlying options that are vested and exercisable within 60 days ofJanuary 15, 2018.(7)Consists of 3,000 shares of common stock and 18,000 shares of common stock underlying options that are vested and exercisable withn 60 days ofJanuary 15, 2018.(8)Includes shares beneficially owned by all current executive officers and directors of the company. Consists of 423,700 shares of common stock and1,496,695 shares of common stock underlying options that are vested and exercisable within 60 days of January 15, 2018.88Table of Contents(9)Consists of 3,067,607 shares of common stock held by Essex Woodlands Health Ventures Fund VIII, L.P. (“Essex Fund VIII”), 457,085 shares ofcommon stock held by Essex Woodlands Health Ventures Fund V, L.P. (“Essex Fund V”), 221,197 shares of common stock held by EssexWoodlands Health Ventures Fund VIII-A, L.P. (“Essex Fund VIII-A”) and 96,158 shares of common stock held by Essex Woodlands Health VenturesFund VIII-B, L.P. (“Essex Fund VIII-B”). Essex Woodlands Health Ventures VIII, LLC, the general partner of Essex Fund VIII, Essex Fund V, EssexFund VIII-A and Essex Fund VIII-B, may be deemed to have sole power to vote and sole power to dispose of shares directly owned by Essex FundVIII, Essex Fund V, Essex Fund VIII-A and Essex Fund VIII-B. The address for Essex Fund VIII is 21 Waterway Avenue, Suite 225, The Woodlands,Texas 77380.(10)The indicated ownership is based on Schedule 13G/A filed with the SEC by the reporting persons on February 9, 2016, reporting beneficialownership as of December 31, 2016. According to the Schedule 13G/A, the reporting persons beneficially own 3,096,650 shares of common stockheld by NovaQuest Pharma Opportunities Fund III, L.P. (“NovaQuest”), NQ HCIF General Partner, L.P., and NQ HCIF GP, Ltd.. The address for eachof the foregoing persons and entities is 4208 Six Forks Road, Suite 920, Raleigh, North Carolina 27609.(11)The indicated ownership is based on a Schedule 13G/A filed with the SEC by the reporting persons on February 7, 2018, reporting beneficialownership as of December 31, 2017. According to the Schedule 13G/A, the reporting persons beneficially own a total of shares of 3,370,402common Stock held by Franklin Advisors, Inc. and 23,800 shares of Common Stock held by Fiduciary Trust Company International. The address foreach of the foregoing persons and entities is One Franklin Parkway, San Mateo, CA 94403.(12)The indicated ownership is based on a Schedule 13G/A filed with the SEC by the reporting persons on January 25, 2018, reporting beneficialownership as of December 29, 2017. According to the Schedule 13G/A, the reporting persons beneficially own a total of 3,561,679 shares ofCommon Stock held by JPMorgan Chase & Co. and its wholly owned subsidiaries JPMorgan Chase Bank, National Association, J.P. MorganInvestment Management Inc., and JPMorgan Asset Management (UK) Limited. The address for each of the foregoing persons and entities is 270 ParkAve. New York, NY 10017.(13)The indicated ownership is based on a Schedule 13G/A filed with the SEC by the reporting persons on February 7, 2018, reporting beneficialownership as of December 31, 2017. According to the Schedule 13G/A, the reporting persons beneficially own a total of 2,144,669 shares ofCommon Stock held by The Bank of New York Mellon Corporation and its following affiliates: The Bank of New York Mellon, The BostonCompany Asset Management LLC, The Dreyfus Corporation (parent holding company of MBSC Securities Corporation), Mellon CapitalManagement Corporation, MAM (MA) Holding Trust (parent holding company of Standish Mellon Asset Management Company LLC; The BostonCompany Asset Management LLC) and MBC Investments Corporation (parent holding company of Mellon Capital Management Corporation; BNYMellon Investment Management (Jersey) Ltd.). The address for each of the foregoing persons and entities is 225 Liberty Street, New York, NY10286.(14)The indicated ownership is based on a Schedule 13G filed with the SEC by the reporting persons on January 23, 2018, reporting beneficialownership as of December 31, 2017. According to the Schedule 13G, the reporting persons beneficially own a total of 2,168,211 shares of CommonStock held by BlackRock Inc. and its subsidiaries BlackRock Advisors, LLC, BlackRock Asset Management Canada Limited, BlackRock AssetManagement Ireland Limited, BlackRock Asset Management Schweiz AG, BlackRock Fund Advisors, BlackRock Institutional Trust Company,N.A. and BlackRock Investment Management, LLC. The address for each of the foregoing persons and entities is 55 East 52nd Street, New York, NY10055.(15)The indicated ownership is based on a Schedule 13G filed with the SEC by the reporting persons on February 8, 2018, reporting beneficialownership as of December 29, 2017. According to the Schedule 13G, the reporting persons beneficially own a total of 3,573,150 shares of CommonStock held by Wellington Management Group LLP and its following affiliates: Wellington Management Group LLP, Wellington Group HoldingsLLP, Wellington Investment Advisors Holdings LLP, and Wellington Management Company LLP. The address for each of the foregoing personsand entities is 280 Congress Street, Boston, MA 02210.(16)Consists of 95,000 shares of common stock.(17)Consists of 6,000 shares of common stock, and 20,000 shares of common stock held by the Mark J Foley Living Trust. Mr. Foley is a Trustee of theMark J Foley Living Trust.89Table of ContentsITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCEThe following is a summary of transactions since January 1, 2017 in which (i) we have been a participant, (ii) the amount involved exceeded or willexceed $120,000, and (iii) any of our directors, executive officers or holders of more than 5% of our capital stock, or any member of their immediate family orperson sharing their household, had or will have a direct or indirect material interest, other than indemnification agreements, which are described below, andcompensation arrangements, which are described under “Item 11. Executive Compensation.”Of the Company's total cash, cash equivalents, and short-term investments of $282.9 million as of December 31, 2017, the Company held cashequivalents and short-term investments with a total fair value of $150.7 million in an investment account with a related party, J.P. Morgan Securities LLC. Asof December 31, 2017, JPMorgan Chase & Co. and its wholly owned subsidiaries JPMorgan Chase Bank, National Association (NA), J.P. Morgan InvestmentManagement Inc., and JPMorgan Asset Management (UK) Limited held 3,561,679 shares of the Company's common stock, which represents approximately9.75% of the Company's outstanding common stock. J.P. Morgan Securities LLC, who acts as a custodian and trustee for certain Company investments, is anaffiliate of JPMorgan Chase Bank, NA.Indemnification Agreements. We have entered, or will enter, into an indemnification agreement with each of our directors and executive officers. Theindemnification agreements and our certificate of incorporation and bylaws require us to indemnify our directors and officers to the fullest extent permittedby Delaware law. For a description of these indemnification agreements, see the section entitled “Executive Compensation — Limitations on Liability andIndemnification Matters.”Policies and Procedures for Related Party Transactions. All transactions between us and our officers, directors, principal stockholders and theiraffiliates are subject to approval by the audit committee, or a similar committee consisting of entirely independent directors, according to the terms of ourwritten Related-Person Transactions Policy and Code of Business Conduct and Ethics.Director IndependenceOur board of directors undertook a review of the independence of the directors and considered whether any director has a material relationship with usthat could compromise his ability to exercise independent judgment in carrying out his responsibilities. As a result of this review, our board of directorsdetermined that all of our directors except for Mr. Browne, our President and Chief Executive Officer, representing seven of our eight directors, are“independent directors” as defined under Nasdaq listing rules and the independence requirements of Rule 10A-3 under the Securities Exchange Act of 1934,as amended, or the Exchange Act.90Table of ContentsITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICESFees Paid to the Independent Registered Public Accounting FirmThe following table presents fees for professional audit services and other services rendered to our company by PricewaterhouseCoopers, or PwC, forthe fiscal years ended December 31, 2017 and 2016. 2017 2016Audit Fees(1)$752,645 $792,598Audit Related Fees281,000 178,000Total$1,033,645 $970,598 (1)Audit Fees consist of professional services rendered in connection with the audit of our Consolidated Financial Statements and review of ourquarterly Consolidated Financial Statements.(2)Audit Related Fees consists of fees associated with our follow-on and At-The Market offerings completed in 2017, which included delivery ofcomfort letters, consents and review of documents filed with the SEC.Auditor IndependenceIn 2017, there were no other professional services provided by PwC that would have required the audit committee to consider their compatibility withmaintaining the independence of PwC.Audit Committee Policy on Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting FirmConsistent with requirements of the SEC and the Public Company Oversight Board, or PCAOB, regarding auditor independence, our audit committee isresponsible for the appointment, compensation and oversight of the work of our independent registered public accounting firm. In recognition of thisresponsibility, our audit committee has established a policy for the pre-approval of all audit and permissible non-audit services provided by the independentregistered public accounting firm. These services may include audit services, audit-related services, tax services and other services.Before engagement of the independent registered public accounting firm for the next year’s audit, the independent registered public accounting firmsubmits a detailed description of services expected to be rendered during that year for each of the following categories of services to the audit committee forapproval: •Audit services. Audit services include work performed for the audit of our financial statements and the review of financial statements included inour quarterly reports, as well as work that is normally provided by the independent registered public accounting firm in connection withstatutory and regulatory filings.•Audit-related services. Audit-related services are for assurance and related services that are reasonably related to the performance of the audit orreview of our financial statements and are not covered above under “audit services.”•Tax services. Tax services include all services performed by the independent registered public accounting firm’s tax personnel for taxcompliance, tax advice and tax planning.•Other services. Other services are those services not described in the other categories.The audit committee pre-approves particular services or categories of services on a case-by-case basis. The fees are budgeted, and the audit committeerequires the independent registered public accounting firm and management to report actual fees versus budgeted fees periodically throughout the year bycategory of service. During the year, circumstances may arise when it may become necessary to engage the independent registered public accounting firm foradditional services not contemplated in the original pre-approval. In those instances, the services must be pre-approved by the audit committee before theindependent registered public accounting firm is engaged.91Table of ContentsPART IV ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES(a) The following documents are filed as part of this Annual Report on this Form 10-K:(1) Financial Statements. The financial statements required by this item are set forth beginning at F-1 of this Annual Report on this Form 10-K andare incorporated herein by reference.(2) Financial Statement Schedules. None. Financial statement schedules have been omitted because they are not applicable.(b) Exhibits. The following exhibits are included herein or incorporated herein by reference: ExhibitNumber Exhibit Description Form File No. IncorporatedbyReference Exhibit Filing Date FiledHerewith3.1 Amended and Restated Certificate of Incorporation 8-K 001-36297 3.1 February 11, 2014 3.2 Amended and Restated Bylaws S-1 333-193154 3.4 December 31, 2013 4.1 Amended and Restated Investor Rights Agreement,effective as of February 5, 2014, among RevanceTherapeutics, Inc. and certain of its stockholders S-1/A 333-193154 4.3 January 27, 2014 4.2 Form of Common Stock Certificate S-1/A 333-193154 4.4 February 3, 2014 10.1 * Revance Therapeutics, Inc. 2002 Equity Incentive Plan S-1 333-193154 10.1 December 31, 2013 10.2 * Form of Stock Option Agreement and Option GrantNotice for Revance Therapeutics, Inc. 2002 EquityIncentive Plan S-1 333-193154 10.2 December 31, 2013 10.3 * Revance Therapeutics, Inc. Amended and Restated2012 Equity Incentive Plan S-1 333-193154 10.3 December 31, 2013 10.4 * Form of Stock Option Agreement and Option GrantNotice for Revance Therapeutics, Inc. Amended andRestated 2012 Equity Incentive Plan S-1 333-193154 10.4 December 31, 2013 10.5 * Revance Therapeutics, Inc. 2014 Equity Incentive Plan S-1/A 333-193154 10.5 January 27, 2014 10.6 * Form of Restricted Stock Unit Award Agreement andGrant Notice for Revance Therapeutics, Inc. 2014Equity Incentive Plan 10-K 001-36297 10.6 March 4, 2016 10.7* Form of Stock Option Agreement and Grant Notice forRevance Therapeutics, Inc. 2014 Equity Incentive Plan 10-Q 001-36297 10.4 November 10, 2015 10.8* Form of Restricted Stock Bonus Agreement and GrantNotice for Revance Therapeutics, Inc. 2014 EquityIncentive Plan 10-K 001-36297 10.8 March 4, 2016 10.9* Revance Therapeutics, Inc. 2014 Employee StockPurchase Plan S-1/A 333-193154 10.7 January 27, 2014 10.10* Form of Indemnity Agreement by and between RevanceTherapeutics, Inc. and each of its officers and directors S-1/A 333-193154 10.8 January 27, 2014 10.11 Lease Agreement dated March 31, 2008 by and betweenRevance Therapeutics, Inc. and BMR-GatewayBoulevard LLC S-1 333-193154 10.9 December 31, 2013 92Table of Contents10.12 First Amendment to Office Lease dated April 7, 2008 byand between Revance Therapeutics, Inc. and BMR-Gateway Boulevard LLC S-1 333-193154 10.10 December 31, 2013 10.13 Second Amendment to Office Lease and Lease datedMay 17, 2010 by and between Revance Therapeutics,Inc. and BMR-Gateway Boulevard LLC S-1 333-193154 10.11 December 31, 2013 10.14 Third Amendment to Lease, dated February 26, 2014 byand between Revance Therapeutics, Inc. and BMR-Gateway Boulevard LLC 8-K 001-36297 10.35 March 4, 2014 10.15+ License and Service Agreement dated February 8, 2007between Revance Therapeutics, Inc. and List BiologicalLaboratories, Inc. S-1 333-193154 10.15 December 31, 2013 10.16+ First Addendum to the License and Service Agreementdated April 21, 2009 between Revance Therapeutics,Inc. and List Biological Laboratories, Inc. S-1 333-193154 10.16 December 31, 2013 10.17+ Development and Supply Agreement dated December11, 2009 between Revance Therapeutics, Inc. andHospira Worldwide, Inc. S-1 333-193154 10.18 December 31, 2013 10.18+ First Amendment to Development and SupplyAgreement dated May 29, 2013 between RevanceTherapeutics, Inc. and Hospira Worldwide, Inc S-1 333-193154 10.20 December 31, 2013 10.19+ Second Amendment to Development and SupplyAgreement dated August 31, 2015 between RevanceTherapeutics, Inc. and Hospira Worldwide, Inc. 10-Q 001-36297 10.1 November 10, 2015 10.20+ Manufacture and Development Agreement dated May20, 2013 between Revance Therapeutics, Inc. andAmerican Peptide Company, Inc. S-1 333-193154 10.19 December 31, 2013 10.21 Loan and Lease Agreement dated as of December 20,2013 by and between Revance Therapeutics, Inc. andEssex Capital Corporation S-1 333-193154 10.21 December 31, 2013 10.22 First Amendment to Loan and Lease Agreement, datedDecember 17, 2014, by and between RevanceTherapeutics, Inc. and Essex Capital Corporation 8-K 001-36297 10.1 December 22, 2014 10.23 Second Amendment to Loan and Lease Agreement,dated February 26, 2015, by and between RevanceTherapeutics, Inc. and Essex Capital Corporation 10-K 001-36297 10.25 March 4, 2015 10.24* Revance Therapeutics, Inc. Third Amended andRestated Executive Severance Benefit Plan X10.25* Revance Therapeutics, Inc. Amended and RestatedNon-Employee Director Compensation Policy 10-Q 001-36297 10.2 May 9, 2017 10.26* Revance Therapeutics, Inc. 2018 Management BonusPlan X10.27* Revance Therapeutics, Inc. Amended and Restated2014 Inducement Plan 8-K 001-36297 99.1 December 14, 2015 10.28* Form of Stock Option Agreement and Grant Noticeunder Amended and Restated Revance Therapeutics,Inc. 2014 Inducement Plan 10-Q 001-36297 10.5 November 10, 2015 93Table of Contents10.29* Form of Restricted Stock Agreement and Grant Noticeunder Amended and Restated Revance Therapeutics,Inc. 2014 Inducement Plan 10-K 001-36297 10.5 March 4, 2016 10.30* Executive Employment Agreement dated December30, 2013 by and between Revance Therapeutics, Inc.and L. Daniel Browne S-1/A 333-193154 10.25 January 27, 2014 10.31* Executive Employment Agreement dated December31, 2013 by and between Revance Therapeutics, Inc.and Lauren Silvernail S-1/A 333-193154 10.27 January 27, 2014 10.32* Executive Employment Agreement dated December14, 2015 by and between Revance Therapeutics, Inc.and Abhay Joshi. 10-K 001-36297 10.34 March 4, 2016 10.33* Executive Employment Agreement dated September18, 2017 by and between Revance Therapeutics, Inc.and Todd Zavodnick. 10-Q 001-36297 10.1 November 3, 2017 10.34 Sales Agreement, dated March 4, 2016, by andbetween Revance Therapeutics, Inc. and Cowen andCompany, LLC 8-K 001-36297 10.1 March 7, 2016 10.35 Technology Transfer, Validation and CommercialFill/Finish Services Agreement dated March 14, 2017between Revance Therapeutics, Inc. and AjinomotoAlthea, Inc. 10-Q 001-36297 10.4 May 9, 2017 21.1 List of Subsidiaries of the Registrant X23.1 Consent of Independent Registered PublicAccounting Firm X24.1 Power of Attorney (contained in the signature page tothis Annual Report on Form 10-K) X31.1 Certification of Principal Executive Officer pursuantto Rule 13a-14(a) and 15d-14(a) promulgated underthe Exchange Act X31.2 Certification of Principal Financial Officer pursuantto Rule 13a-14(a) and 15d-14(a) promulgated underthe Exchange Act X32.1† Certification of the Chief Executive Officer pursuantto18 U.S.C. Section 1350 as adopted pursuant toSection 906 of the Sarbanes-Oxley Act of 2002. X32.2† Certification of the Chief Financial Officer pursuantto 18 U.S.C. Section 1350, as adopted pursuant toSection 906 of the Sarbanes-Oxley Act of 2002 X101.INS** XBRL Instance Document X101.SCH** XBRL Taxonomy Extension Schema Document X101.CAL** XBRL Taxonomy Extension Calculation LinkbaseDocument X101.DEF** XBRL Taxonomy Extension Definition LinkbaseDocument X101.LAB** XBRL Taxonomy Extension Labels LinkbaseDocument X101.PRE** XBRL Taxonomy Extension Presentation LinkbaseDocument X*Indicates a management contract or compensatory plan or arrangement.+Confidential treatment has been granted for portions of this exhibit. Omitted portions have been filed separately with the Securities and ExchangeCommission.94Table of Contents†The certifications attached as Exhibit 32.1 and 32.2 that accompany this Annual Report on Form 10-K are not deemed filed with the Securities andExchange Commission and are not to be incorporated by reference into any filing of Revance Therapeutics, Inc. under the Securities Act of 1933, asamended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-K, irrespective of any generalincorporation language contained in such filing.**Users of this data are advised that, pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registrationstatement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 andotherwise are not subject to liability under these sections.ITEM 16.FORM 10-K SUMMARYNone.95Table of ContentsREVANCE THERAPEUTICS, INC.INDEX TO CONSOLIDATED FINANCIAL STATEMENTS PageReport of Independent Registered Public Accounting FirmF-2Consolidated Financial Statements: Consolidated Balance SheetsF-3Consolidated Statements of Operations and Comprehensive LossF-4Consolidated Statements of Stockholders’ EquityF-5Consolidated Statements of Cash FlowsF-6Notes to Consolidated Financial StatementsF-14F-1Table of ContentsReport of Independent Registered Public Accounting FirmTo the Board of Directors and Stockholders of Revance Therapeutics, Inc.:Opinion on the Financial StatementsWe have audited the accompanying consolidated balance sheets of Revance Therapeutics, Inc. and its subsidiaries as of December 31, 2017 and December31, 2016, and the related Consolidated Statements of Operations and Comprehensive Loss, of Stockholders’ Equity and of Cash Flows for each of the threeyears in the period ended December 31, 2017, including the related notes (collectively referred to as the “consolidated financial statements”). In our opinion,the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and December 31,2016, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2017 in conformity with accountingprinciples generally accepted in the United States of America.Basis for OpinionThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’sconsolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB.We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan andperform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error orfraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits weare required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness ofthe Company's internal control over financial reporting. Accordingly, we express no such opinion.Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud,and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosuresin the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management,as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion./s/ PricewaterhouseCoopers LLPSan Jose, CaliforniaMarch 2, 2018 We have served as the Company's auditor since 2005.F-2Table of ContentsREVANCE THERAPEUTICS, INC.Consolidated Balance Sheets(In thousands, except share and per share amounts) As of December 31, 2017 2016ASSETSCURRENT ASSETS Cash and cash equivalents$282,896 $63,502Short-term investments— 122,026Prepaid expenses and other current assets2,315 7,167Total current assets285,211 192,695Property and equipment, net9,250 10,585Restricted cash580 580Other non-current assets658 500TOTAL ASSETS$295,699 $204,360LIABILITIES AND STOCKHOLDERS’ EQUITYCURRENT LIABILITIES Accounts payable$6,805 $3,754Accruals and other current liabilities12,225 12,418Financing obligations, current portion1,872 3,475Total current liabilities20,902 19,647Financing obligations, net of current portion— 1,872Derivative liabilities associated with Medicis settlement2,613 2,022Deferred rent3,339 3,648Other non-current liabilities— 100TOTAL LIABILITIES26,854 27,289Commitments and Contingencies (Note 10) STOCKHOLDERS’ EQUITY Common stock, par value $0.001 per share — 95,000,000 shares authorized both as of December 31, 2017 and2016; 36,516,075 and 28,648,954 shares issued and outstanding as of December 31, 2017 and 2016,respectively37 29Additional paid-in capital810,975 598,630Accumulated other comprehensive loss— (45)Accumulated deficit(542,167) (421,543)TOTAL STOCKHOLDERS’ EQUITY268,845 177,071TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$295,699 $204,360The accompanying notes are an integral part of these Consolidated Financial Statements.F-3Table of ContentsREVANCE THERAPEUTICS, INC.Consolidated Statements of Operations and Comprehensive Loss(In thousands, except share and per share amounts) Year Ended December 31, 2017 2016 2015Revenue$262 $300 $300Operating expenses: Research and development80,361 50,381 47,529General and administrative37,398 29,075 25,088Loss on impairment2,927 9,059 —Total operating expenses120,686 88,515 72,617Loss from operations(120,424) (88,215) (72,317)Interest income1,410 1,170 231Interest expense(457) (1,082) (1,190)Changes in fair value of derivative liabilities associated with the Medicis settlement(591) (608) 127Other expense, net(525) (535) (327)Net loss(120,587) (89,270) (73,476)Unrealized gain (loss) and adjustment on securities included in net loss45 (5) (40)Comprehensive loss$(120,542) $(89,275) $(73,516)Basic and Diluted net loss attributable to common stockholders$(120,587) $(89,270) $(73,476)Basic and Diluted net loss per share attributable to common stockholders$(4.01) $(3.18) $(3.02)Basic and Diluted weighted-average number of shares used in computing net loss per shareattributable to common stockholders30,101,125 28,114,784 24,340,466The accompanying notes are an integral part of these Consolidated Financial Statements.F-4REVANCE THERAPEUTICS, INC.Consolidated Statements of Stockholders’ Equity(In thousands, except share and per share amounts) Common Stock AdditionalPaid-InCapital OtherAccumulated ComprehensiveLoss AccumulatedDeficit TotalStockholders’Equity Shares Amount Balance — December 31, 201423,774,465 24 435,142 — (258,797) 176,369Issuance of common stock relating to employee stock purchaseplan15,745 — 318 — — 318Stock-based compensation expense— — 12,388 — — 12,388Issuance of common stock in connection with At-The-Marketoffering, net of issuance costs of $500352,544 — 10,021 — — 10,021Issuance of common stock in connection with the 2015 follow-onoffering, net of issuance costs of $2473,737,500 4 126,226 — — 126,230Issuance of common stock upon net exercise of warrants68,993 — — — — —Issuance of common stock upon exercise of stock options205,735 — 2,435 — — 2,435Issuance of restricted stock awards, net of repurchase169,562 — — — — —Net settlement of restricted stock awards to settle employee taxes(36,080) — (993) — — (993)Unrealized gain (loss) and adjustment on securities included innet loss— — — (40) — (40)Net loss— — — — (73,476) (73,476)Balance — December 31, 201528,288,464 28 585,537 (40) (332,273) 253,252Issuance of common stock relating to employee stock purchaseplan21,064 — 243 — — 243Stock-based compensation expense— — 11,953 — — 11,953Issuance of common stock upon exercise of stock options131,752 — 1,405 — — 1,405Issuance of restricted stock awards, net of repurchase234,567 1 (1) — — —Net settlement of restricted stock awards to settle employee taxes(26,893) — (507) — — (507)Unrealized gain (loss) and adjustment on securities included innet loss— — — (5) — (5)Net loss— — — — (89,270) (89,270)Balance — December 31, 201628,648,954 $29 $598,630 $(45) $(421,543) $177,071Cumulative-effect adjustment from adoption of ASU 2016-09— — 37 (37) —Issuance of common stock relating to employee stock purchaseplan28,135 — 583 — — 583Stock-based compensation expense— — 13,230 — — 13,230Issuance of common stock in connection with At-The-Marketoffering, net of issuance costs of $6031,802,651 2 38,155 — — 38,157Issuance of common stock in connection with the 2017 follow-onoffering, net of issuance costs of $5355,389,515 5 156,928 — — 156,933Issuance of common stock upon net exercise of warrants9,878 — — — — —Issuance of common stock upon exercise of stock options309,341 1 3,985 — — 3,986Issuance of restricted stock awards, net of repurchase353,620 — — — — —Net settlement of restricted stock awards to settle employee taxes(26,019) — (573) — — (573)Unrealized gain (loss) and adjustment on securities included innet loss— — — 45 — 45Net loss— — — — (120,587) (120,587)Balance — December 31, 201736,516,075 $37 $810,975 $— $(542,167) $268,845The accompanying notes are an integral part of these Consolidated Financial Statements.F-5REVANCE THERAPEUTICS, INC.Consolidated Statements of Cash Flows(In thousands) Year EndedDecember 31, 2017 2016 2015CASH FLOWS FROM OPERATING ACTIVITIES Net loss$(120,587) $(89,270) $(73,476)Adjustments to reconcile net loss to net cash used in operating activities: Depreciation1,468 1,445 1,995Amortization of premium on investments410 1,212 601Change in fair value of derivative liabilities associated with the Medicis settlement591 608 (127)Stock-based compensation expense (see Note 11)13,230 11,953 12,388Capitalized interest(113) — —Effective interest on financing obligations271 406 344 Impairment of long-lived assets2,927 9,059 —Acquisition of in-process research and development— 2,000 —Other non-cash operating activities18 (1) 82Changes in operating assets and liabilities: Prepaid expenses and other current assets4,929 (5,591) (192)Other non-current assets(403) (151) 29Accounts payable2,607 953 (692)Accruals and other current liabilities(565) 7,502 3,179Deferred rent(125) 48 200Net cash used in operating activities(95,342) (59,827) (55,669)CASH FLOWS FROM INVESTING ACTIVITIES Purchases of property and equipment(2,525) (1,670) (3,328)Proceeds from maturities of investments157,445 207,650 1,000Sales of short-term investments— 1,000 —Proceeds from sale of property and equipment— 2 —Purchases of investments(36,028) (280,681) (54,087)Payment for acquisition of in-process research and development(100) (1,800) —Net cash provided by (used in) investing activities118,792 (75,499) (56,415)CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common stock in connection with the 2017 follow-on offering, net of commissionsand discount157,468 — —Proceeds from issuance of common stock in connection with the At-The-Market offering, net of commissions38,760 — 10,021Proceeds from issuance of common stock in connection with the 2015 follow-on offering, net of deferredoffering costs— — 126,230Proceeds from the exercise of stock options and common stock warrants, and purchases under the employeestock purchase plan4,569 1,649 2,753Net settlement of restricted stock awards to settle employee taxes(573) (507) (993)Payment of offering costs(644) (243) —Principal payments made on financing obligations(3,636) (3,541) (2,598)Principal payments made on notes payable— — (2,652)Proceeds from failed sale-leaseback financings— — 9,831Net cash provided by (used in) financing activities195,944 (2,642) 142,592NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH219,394 (137,968) 30,508CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — Beginning of period64,082 202,050 171,542CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — End of period$283,476 $64,082 $202,050 Year EndedDecember 31, 2017 2016 2015SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid for interest$299 $676 $802SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING INFORMATION: Deferred follow-on public offering costs$251 $134 $—Property and equipment purchases included in accounts payable and accruals and other current liabilities$718 $200 $487Holdback related to acquisition of in-process research and development$— $200 $—The accompanying notes are an integral part of these Consolidated Financial Statements.F-6Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements1. The Company and Basis of PresentationRevance Therapeutics, Inc., or the Company, was incorporated in Delaware on August 10, 1999 under the name Essentia Biosystems, Inc. TheCompany commenced operations in June 2002 and on April 19, 2005, changed its name to Revance Therapeutics, Inc. The Company is a clinical-stagebiotechnology company focused on the development, manufacturing and commercialization of novel botulinum toxin products for multiple aesthetic andtherapeutic indications. The Company is leveraging its proprietary portfolio of botulinum toxin type A compounds, formulated with its proprietary peptidetechnology, to address unmet needs in large and growing neuromodulator markets. The Company's proprietary peptide technology enables delivery ofbotulinum toxin type A through two investigational drug product candidates, DaxibotulinumtoxinA for Injection (RT002), or RT002 injectable, andDaxibotulinumtoxinA Topical ("topical" or "our topical product candidate"). The Company is pursuing clinical development for RT002 injectable in a broadspectrum of aesthetic and therapeutic indications and is planning to conduct preclinical development of its topical product candidate. The Company holdsworldwide rights for all indications of RT002 injectable and the pharmaceutical uses of its proprietary peptide technology.Since commencing operations in 2002, the Company has devoted substantially all of its efforts to identifying and developing product candidates forthe aesthetic and therapeutic pharmaceutical markets, recruiting personnel and raising capital and preclinical and clinical development of, andmanufacturing development for, RT002 injectable and topical. The Company has never been profitable and has not yet commenced commercial operations.Since the Company's inception, the Company has incurred losses and negative cash flows from operations. The Company has not generated significantrevenue from product sales to date and will continue to incur significant research and development and other expenses related to its ongoing operations. TheCompany has recorded net losses of $120.6 million, $89.3 million and $73.5 million for the years ended December 31, 2017, 2016 and 2015. As ofDecember 31, 2017, the Company had a working capital surplus of $264.3 million and an accumulated deficit of $542.2 million. The Company has fundedits operations primarily through the sale and issuance of common stock, convertible preferred stock, notes payable, and convertible notes. As of December 31,2017, the Company had capital resources consisting of cash, cash equivalents, and investments of $282.9 million. The Company believes that its existingcash and cash equivalents will allow the Company to fund its operating plan through at least the next 12 months following the issuance of this Form 10-K.Follow-On Public OfferingsIn November 2015, the Company completed a follow-on public offering, or the 2015 follow-on offering, pursuant to which the Company issued3,737,500 shares of common stock at $36.00 per share, including the exercise of the underwriters’ over-allotment option to purchase 487,500 additionalshares of common stock, for net proceeds of $126.2 million, after underwriting discounts, commissions and other offering expenses.In December 2017, the Company completed a follow-on public offering, or the 2017 follow-on offering, pursuant to which the Company issued5,389,515 shares of common stock at $31.00 per share, including the exercise of the underwriters' over-allotment option to purchase 550,806 additionalshares of common stock, for net proceeds of $156.9 million, after underwriting discounts, commissions and other offering expenses.At-The-Market OfferingsIn March 2015, the Company entered into an At-The-Market Issuance Sales Agreement, or the 2015 ATM agreement, with Cowen and Company, LLC,or Cowen, under which the Company could offer and sell common stock having aggregate proceeds of up to $50.0 million from time to time through Cowen,our sales agent. The Company agreed to pay Cowen a commission of up to 3.0% of the gross sales proceeds of any common stock sold through Cowen underthe ATM agreement. During the third quarter of 2015, the Company sold 352,544 shares of common stock under the ATM agreement at a weighted averageprice of $30.76 per share resulting in net proceeds of $10.0 million, after underwriting discounts, commissions, and other offering expenses.In March 2016, the Company entered into an At-The-Market Issuance Sales Agreement, or the 2016 ATM agreement, with Cowen and Company, LLC,or Cowen, under which the Company may offer and sell common stock having aggregate proceeds of up to $75.0 million from time to time through Cowen,our sales agent. On March 25, 2016, the effective date of the registration statement on Form S-3 filed with the SEC on March 7, 2016, the 2015 ATMAgreement was effectively terminated and superseded by the 2016 ATM Agreement. Sales of common stock through Cowen under the 2016 ATM agreementwill beF-7Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)made by means of ordinary brokers’ transactions on the Nasdaq Global Market or otherwise at market prices prevailing at the time of sale, in blocktransactions, or as otherwise agreed upon by the Company and Cowen. Cowen will sell the common stock from time to time, based upon instructions from theCompany (including any price, time or size limits or other customary parameters or conditions we may impose). The Company agreed to pay Cowen acommission of up to 3.0% of the gross sales proceeds of any common stock sold through Cowen under the ATM agreement. During the year ended December31, 2017, the Company sold 1,802,651 shares of common stock under the 2016 ATM Agreement at a weighted average price of $22.17 per share resulting innet proceeds of $38.2 million, which was comprised of $38.8 million in proceeds after underwriting discounts and commissions and net of offering expensesof $0.6 million, of which $0.2 million was paid in 2016 and $0.4 million was paid in 2017.Basis of PresentationThe Consolidated Financial Statements of the Company include the Company’s accounts and those of its wholly-owned subsidiaries, RevanceTherapeutics Limited and Revance International Limited, and have been prepared in conformity with accounting principles generally accepted in the UnitedStates of America, or US GAAP. In October 2017, the Company created a wholly owned subsidiary, Revance International Limited. The Company operates inone segment.2. Summary of Significant Accounting PoliciesPrinciples of consolidationThe Consolidated Financial Statements include the accounts of the company and its wholly-owned subsidiaries. All intercompany transactions havebeen eliminated.Use of EstimatesThe preparation of Consolidated Financial Statements in conformity with US GAAP requires management to make estimates and assumptions thataffect the amounts reported in the Consolidated Financial Statements and accompanying notes. Such management estimates include accruals, stock-basedcompensation, fair value of derivative liability, impairment of long-lived assets and the valuation of deferred tax assets. The Company bases its estimates onhistorical experience and also on assumptions that it believes are reasonable, however, actual results could significantly differ from those estimates.Risks and UncertaintiesThe product candidates developed by the Company require approvals from the U.S. Food and Drug Administration (FDA) or foreign regulatoryagencies prior to commercial sales. There can be no assurance that the Company’s current and future product candidates will meet desired efficacy and safetyrequirements to obtain the necessary approvals. If approval is denied or delayed, it may have a material adverse impact on the Company’s business and itsConsolidated Financial Statements.The Company is subject to risks common to companies in the development stage including, but not limited to, dependency on the clinical andcommercial success of its product candidates, ability to obtain regulatory approval of its product candidates, the need for substantial additional financing toachieve its goals, uncertainty of broad adoption of its approved products, if any, by physicians and consumers, significant competition and untestedmanufacturing capabilities.Concentration of Credit RiskFinancial instruments that potentially subject the Company to a concentration of credit risk consist of short and long-term investments. Under theCompany's Investment Policy, the Company limits its credit exposure by investing in highly liquid funds and debt obligations of the U.S. government and itsagencies with high credit quality. The Company’s cash, cash equivalents, and investments are held in the United States of America. Such deposits may, attimes, exceed federally insured limits. The Company has not experienced any significant losses on its deposits of cash, cash equivalents, and investments.F-8Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)Cash and Cash EquivalentsThe Company considers all highly liquid investment securities with remaining maturities at the date of purchase of three months or less to be cashequivalents. Cash and cash equivalents may include deposit, money market funds, and debt securities.Restricted CashAs of December 31, 2017 and 2016, a deposit totaling $580,275 was restricted from withdrawal. The Company has a deposit balance of $400,000 thatrelates to the restriction on securing the Company’s facility lease and will remain until the end of the lease. The remaining $180,275 deposit balance relatesto a letter of credit. These balances are included in restricted cash on the accompanying Consolidated Balance Sheets and within the cash, cash equivalents,and restricted cash balance on the Consolidated Statement of Cash Flows.InvestmentsShort-term investments generally consist of securities with original maturities greater than three months and remaining maturities of less than one year, whilelong-term investments generally consist of securities with remaining maturities greater than one year. The Company determines the appropriate classificationof its investments at the time of purchase and reevaluates such determination at each balance sheet date. All of its investments are classified as available-for-sale and carried at fair value, with the change in unrealized gains and losses reported as a separate component of other comprehensive income (loss) on theConsolidated Statements of Operations and Comprehensive Loss and accumulated as a separate component of stockholders' equity on the ConsolidatedBalance Sheets. Interest income, net includes interest, dividends, amortization of purchase premiums and discounts, realized gains and losses on sales ofsecurities and other-than-temporary declines in the fair value of investments, if any. The cost of securities sold is based on the specific-identification method.The Company monitors its investment portfolio for potential impairment on a quarterly basis. If the carrying amount of an investment in debt securitiesexceeds its fair value and the decline in value is determined to be other-than-temporary, the carrying amount of the security is reduced to fair value and a lossis recognized in operating results for the amount of such decline. In order to determine whether a decline in value is other-than-temporary, the Companyevaluates, among other factors, the cause of the decline in value, including the creditworthiness of the security issuers, the number of securities in anunrealized loss position, the severity and duration of the unrealized losses, and its intent and ability to hold the security to maturity or forecasted recovery.The Company mitigates its credit risk by investing in money market funds, U.S. treasury securities, and U.S. government agency obligations which limits theamount of investment exposure as to credit quality and maturity.Of the Company's total cash, cash equivalents, and short-term investments of $282.9 million and $185.5 million as of December 31, 2017 and 2016,respectively, the Company held cash, cash equivalents, and short-term investments with a total fair value of $150.7 million and $86.0 million as of December31, 2017 and 2016, respectively, in an investment account with a related party, J.P. Morgan Securities LLC. As of December 31, 2017 and 2016, JPMorganChase & Co. and its wholly owned subsidiaries JPMorgan Chase Bank, National Association (NA), J.P. Morgan Investment Management Inc., and JPMorganAsset Management (UK) Limited held approximately 3.6 million shares and 3.4 million shares of the Company's common stock, which representsapproximately 9.75% and 11.95% of the Company's outstanding common stock, respectively. J.P. Morgan Securities LLC, who acts as a custodian andtrustee for certain Company investments, is an affiliate of JPMorgan Chase Bank, NA.Fair Value of Financial InstrumentsThe Company uses fair value measurements to record fair value adjustments to certain financial and non-financial assets and liabilities to determine fairvalue disclosures. The accounting standards define fair value, establish a framework for measuring fair value, and require disclosures about fair valuemeasurements. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction betweenmarket participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, theprincipal or most advantageous market in which the Company would transact are considered along with assumptions that market participants would usewhen pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. The accounting standard for fair value establishes afair value hierarchy based on three levels of inputs, the first two of which are considered observable and the last unobservable, that requires an entity tomaximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorizationwithin the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.F-9Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The three levels of inputs that may be used to measure fair value are as follows: Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or otherinputs that are observable or can be corroborated by observable market data for substantially the full term ofthe assets or liabilities. Level 3—Valuations based on unobservable inputs to the valuation methodology and including data about assumptionsmarket participants would use in pricing the asset or liability based on the best information available under thecircumstances.Property and Equipment, NetProperty and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimateduseful lives of the assets. Computer equipment, lab equipment and furniture and fixtures, and manufacturing equipment is depreciated over 3, 5, and 7 years,respectively. Repairs and maintenance that do not extend the life or improve an asset are expensed in the period incurred. Leasehold improvements are amortized over the lesser of 15 years or the term of the lease. Repairs and maintenance are charged to operations asincurred. When assets are retired or otherwise disposed of, the costs and accumulated depreciation are removed from the Consolidated Balance Sheets andany resulting gain or loss is reflected in the Consolidated Statements of Operations and Comprehensive Loss in the period realized.Impairment of Long-Lived AssetsThe Company evaluates its long-lived assets for indications of possible impairment whenever events or changes in circumstances indicate that thecarrying amount of an asset may not be recoverable. Recoverability of assets is measured by a comparison of the carrying amount of the asset to the estimatedundiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated future cash flows, animpairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. The Company determines thefair value of its long-lived assets using the market approach, cost approach or income approach.Clinical Trial AccrualsClinical trial costs are charged to research and development expense as incurred. The Company accrues for expenses resulting from contracts withclinical research organizations (CROs), consultants, and clinical site agreements in connection with conducting clinical trials. The financial terms of thesecontracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over whichmaterials or services are provided to the Company under such contracts. The Company’s objective is to reflect the appropriate expense in the ConsolidatedFinancial Statements by matching the appropriate expenses with the period in which services and efforts are expended. In the event advance payments aremade to a CRO, the payments will be recorded as a prepaid expense, which will be amortized as services are rendered.The CRO contracts generally include pass-through fees including, but not limited to, regulatory expenses, investigator fees, travel costs and othermiscellaneous costs, including shipping and printing fees. The Company determines accrual estimates through reports from and discussion with clinicalpersonnel and outside services providers as to the progress or state of completion of trials, or the services completed. The Company estimates accruedexpenses as of each balance sheet date based on the facts and circumstances known to the Company at that time. The Company’s clinical trial accrual isdependent, in part, upon the receipt of timely and accurate reporting from the CROs and other third-party vendors. F-10Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)RevenueWe recognize revenue when the following criteria are met: persuasive evidence of a sales arrangement exists; delivery has occurred; the price is fixed ordeterminable; and collectability is reasonably assured. During the years ended December 31, 2017, 2016, and 2015, we received revenue from a royaltyagreement.Revenue from royalty payments is contingent on sales activities by our licensees. As a result, we recognize royalty revenue when all revenuerecognition criteria have been satisfied.We recognize revenue for milestone payments upon the achievement of specified milestones if (1) the milestone is substantive in nature, and theachievement of the milestone was not reasonably assured at the inception of the agreement, (2) the achievement relates to past performance, and (3) the feesare nonrefundable. Milestone payments received in excess of amounts earned are classified as deferred revenue until earned.Research and Development ExpendituresResearch and development costs are charged to operations as incurred. Research and development costs include, but are not limited to, personnelexpenses, clinical trial supplies, fees for clinical trial services, manufacturing costs, consulting costs and allocated overhead, including rent, equipment,depreciation and utilities.Income TaxesThe Company accounts for income taxes under the asset and liability method. The Company estimates actual current tax exposure together withassessing temporary differences resulting from differences in accounting for reporting purposes and tax purposes for certain items, such as accruals andallowances not currently deductible for tax purposes. These temporary differences result in deferred tax assets and liabilities, which are included in theCompany’s Consolidated Balance Sheets. In general, deferred tax assets represent future tax benefits to be received when certain expenses previouslyrecognized in the Company’s Consolidated Statements of Operations and comprehensive loss become deductible expenses under applicable income tax lawsor when net operating loss or credit carryforwards are utilized. Accordingly, realization of the Company’s deferred tax assets is dependent on future taxableincome against which these deductions, losses and credits can be utilized.The Company must assess the likelihood that the Company’s deferred tax assets will be recovered from future taxable income, and to the extent theCompany believes that recovery is not likely, the Company establishes a valuation allowance. Based on the available evidence, the Company is unable, atthis time, to support the determination that it is more likely than not that its deferred tax assets will be utilized in the future. Accordingly, the Companyrecorded a full valuation allowance as of December 31, 2017 and 2016. The Company intends to maintain valuation allowances until sufficient evidenceexists to support its reversal.Stock-Based CompensationThe Company has equity incentive plans under which various types of equity-based awards including, but not limited to, incentive stock options, non-qualified stock options, and restricted stock awards, may be granted to employees, non-employee directors, and non-employee consultants. The Companyalso has an inducement plan under which various types of equity-based awards, including non-qualified stock options and restricted stock awards, may begranted to new employees.For stock options granted to employees and directors, the Company recognizes compensation expense for all stock-based awards based on theestimated grant-date fair values. For restricted stock awards to employees, the fair value is based on the closing price of the Company's common stock on thedate of grant. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service period. Thefair value of stock options is determined using the Black-Scholes option pricing model. As of January 1, 2017, the Company adopted the forfeiture ratemethodology change in accordance with ASC 2016-09 to account for forfeitures as they occur. Prior to the adoption of ASC 2016-09, the Company wasrequired to estimate forfeitures at the time of grant and revised those estimates in subsequent periods if actual forfeitures differed from those estimates. TheCompany used historical data to estimate pre-vesting option forfeitures and record stock-based compensation expense only for those awards that wereexpected to vest. To the extent actual forfeitures differed from the estimates, the difference was recorded as a cumulative adjustment in the period that theestimates were revised.F-11Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)Stock-based compensation expense related to stock options granted to non-employees is recognized based on the fair value of the stock options,determined using the Black-Scholes option pricing model, as they are earned. The awards vest over the time period the Company expects to receive servicesfrom the non-employee.WarrantsThe Company has issued freestanding warrants to purchase shares of common stock in connection with certain debt and lease transactions. The warrantsare recorded at fair value using the Black-Scholes option pricing model. Common stock warrants classified as equity at inception are recorded to additionalpaid-in capital at fair value upon issuance.Derivative LiabilitiesThe Company bifurcated and separately accounted for derivative instruments related to payment provisions underlying the Medicis settlement. Thesederivatives are accounted for as liabilities, which will be remeasured to fair value as of each balance sheet date, with changes in fair value recognized in theConsolidated Statements of Operations and Comprehensive Loss. The Company will continue to record adjustments to the fair value of the derivativeliabilities associated with the Medicis settlement until the remaining settlement payment has been paid.ContingenciesFrom time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company evaluates thelikelihood of an unfavorable outcome in legal or regulatory proceedings to which it is a party and records a loss contingency on an undiscounted basis whenit is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These judgments are subjective and based on thestatus of such legal or regulatory proceedings, the merits of the Company's defenses, and consultation with legal counsel. Actual outcomes of these legal andregulatory proceedings may differ materially from the Company's estimates. The Company estimates accruals for legal expenses when incurred as of eachbalance sheet date based on the facts and circumstances known to the Company at that time.Comprehensive LossComprehensive loss is defined as a change in equity of a business enterprise during a period, resulting from transactions from non-owner sources.During the year ended December 31, 2017, the Company reclassified the net gain of less than $0.1 million from the sale of available for sale securities fromother comprehensive loss to other income. During the years ended December 31, 2016 and 2015, the Company had unrealized losses for investments, whichqualified as other comprehensive loss and, therefore have been reflected in the Consolidated Statements of Operations and Comprehensive Loss.Net Loss per Share Attributable to Common StockholdersThe Company’s basic net loss per share attributable to common stockholders is calculated by dividing the net loss by the weighted average number ofshares of common stock outstanding for the period, which includes vested restricted stock awards. The diluted net loss per share attributable to commonstockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. The diluted net loss per shareattributable to common stockholders also includes vested restricted stock awards and, if the effect is not anti-dilutive, unvested restricted stock awards. Forpurposes of this calculation, options to purchase common stock, unvested restricted stock, and common stock warrants are considered common stockequivalents.The following common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because includingthem would have been antidilutive: F-12Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) As of December 31, 2017 2016 2015Stock options3,210,400 2,790,646 2,420,105Common stock warrants34,113 61,595 61,595Unvested restricted stock awards639,287 416,229 315,600Interest ExpenseInterest expense, includes cash and non-cash components with the non-cash components consisting of (i) interest recognized from the amortization ofdebt issuance costs, which were capitalized on the Consolidated Balance Sheets, that are generally derived from cash payments related to the issuance ofnotes payable, (ii) interest recognized from the amortization of debt discounts, which were capitalized on the Consolidated Balance Sheets, derived from theissuance of warrants and derivatives issued in conjunction with notes payable, (iii) interest capitalized for assets constructed for use in operations, and (iv)effective interest recognized on the financing obligation. The capitalized amounts related to the debt issuance costs and debt discounts are generallyamortized to interest expense over the term of the related debt instruments.Recently Adopted Accounting PronouncementsIn January 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-01, Business Combinations(Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business and assists entities with evaluating whether transactionsshould be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for annual periods beginning after December 15, 2017,however early adoption is permitted. Effective October 1, 2017, the Company early adopted this update on a prospective basis. The adoption of thepronouncement did not have a material impact on the Company's Consolidated Financial Statements.On March 30, 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting (Topic 718). The amendments inASU 2016-09 affect all entities that issue share-based payment awards to their employees and involve multiple aspects of the accounting for share-basedpayment transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statements of cashflows. The ASU is effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. As of January 1, 2017,the Company adopted ASU 2016-09 on a modified retrospective basis for the income statement impact of forfeitures and income taxes. Accordingly, theCompany recognized a cumulative charge of less than $0.1 million to the Company's Accumulated Deficit balance as of January 1, 2017 from a change in theforfeiture rate methodology to account for forfeitures as they occur. The Company also adopted the accounting methodology related to stock-basedcompensation for deferred tax assets and liabilities balances; however, given the Company has a full valuation allowance, it did not have a impact on theCompany's Consolidated Financial Statements. In the current year, the Company increased the net operating losses disclosed by $8 million to account forprevious benefits not recognized from employee stock option exercises. The new guidance had no classification impact to the Consolidated Statements ofCash Flows.On January 5, 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of FinancialAssets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Theupdated standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and early adoption is not permitted.The Company adopted this standard and determined it has no impact to the Company's Consolidated Financial Statements.Recent Accounting PronouncementsIn February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain TaxEffects from Accumulated Other Comprehensive Income, to address specific consequences of the Tax Reform Act. The update allows a reclassification fromaccumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Reform Act. The accounting update is effectiveJanuary 1, 2019, with early adoption permitted, and is to be applied either in the period of adoption or retrospectively to each period in which the effect ofthe change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company is currently evaluating the impact of the new standard onthe Company's Consolidated Financial Statements.F-13Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)In May 2017, the FASB issued ASU No. 2017-09, Scope of Modification Accounting (Topic 718) ("ASU 2017-09"), which amends the scope ofmodification accounting for share-based payment arrangements. The amendment provides guidance about which changes to the terms or conditions of ashare-based payment award require an entity to apply modification accounting. ASU 2017-09 is effective for fiscal years beginning after December 15, 2017,with early adoption permitted. The Company anticipates this standard will have no impact on its Consolidated Financial Statements.In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory, which requires entities torecognize income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments in ASU 2016-16 areeffective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods andrequires a modified retrospective method of adoption. Early adoption is permitted, but for public companies generally only in the first quarter of an entity’sannual fiscal year. The Company is currently evaluating the impact this standard will have on the Company's Consolidated Financial Statements but sincethe Company has a full valuation allowance, the ASU is not expected to have financial statement impact.On February 25, 2016, the FASB issued ASU 2016-02 Leases (Topic 842) which requires an entity to recognize assets and liabilities arising from a leasefor both financing and operating leases with terms greater than 12 months. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, withearly adoption permitted. The Company is currently evaluating the effect these lease and revenue recognition standards will have on its ConsolidatedFinancial Statements; however, the Company anticipates recognizing assets and liabilities arising from any leases that meet the requirements under ASU2016-02 on the adoption date and including qualitative and quantitative disclosures in the Company’s Notes to the Consolidated Financial Statements.In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which sets forth a single, comprehensive revenuerecognition model for all contracts with customers to improve comparability. Subsequently, the FASB issued several standards related to ASU 2014-09 (collectively, the “New Revenue Standard”), including the most recent ASU, ASU 2017-14, Income Statement - Reporting Comprehensive Income (Topic220), and Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606),which was issued in November 2017. The New RevenueStandard requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration that the entityexpects to receive in exchange for those goods or services. In addition, the New Revenue Standard requires expanded disclosures. This New RevenueStandard permits the use of either the retrospective or cumulative effect transition method when adopted. The New Revenue Standard becomes effective forthe Company in the first quarter of fiscal year 2018.The Company will adopt the New Revenue Standard in the first quarter of fiscal year 2018. The Company is still evaluating the effect on prior reportedrevenue; however, it anticipates that adoption of the New Revenue Standard will not have a material impact on the Company's Consolidated FinancialStatements.3. Revenue AgreementsIn August 2011, the Company entered into an asset purchase and royalty agreement for the sale of the Relastin® product line for $0.05 million androyalties on future sales of Relastin®. Accordingly, under the Relastin® asset purchase and royalty agreement, the Company recognized royalty revenue of$0.3 million during each of the years ended December 31, 2017, 2016, and 2015. On April 23, 2015, the Company received notice from Valeant terminatingthe asset purchase and royalty agreement effective as of July 23, 2015. The Company was entitled to the minimum royalty payment until Valeant returns theRelastin® intellectual property rights to the Company. In November 2017, Revance and Valeant entered into an Asset Transfer Agreement to finalize thetermination of the asset purchase and royalty agreement and Valeant returned the Relastin® intellectual property rights to the Company. There was no impacton the Company’s Consolidated Financial Statements as the Company does not have any current plans for future developments of Relastin® and its focus isprimarily on the development of RT002 injectable.4. In-Process Research and DevelopmentOn June 2, 2016, the Company entered into an asset purchase agreement with Botulinum Toxin Research Associates, Inc., or BTRX (the "BTRXPurchase Agreement"). Under the BTRX Purchase Agreement, the Company acquired all rights, title and interest in a portfolio of botulinum toxin-relatedpatents and patent applications from BTRX and was granted the right of first negotiation and first refusal with respect to other botulinum toxin-relatedpatents owned or controlled by BTRX. In exchange, the Company agreed to an upfront expenditure of $2.0 million of which $1.8 million was paidimmediately, $0.1 million wasF-14Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)paid in June 2017, and the remaining $0.1 million, which is recorded in accruals and other current liabilities on the Consolidated Balance Sheet as ofDecember 31, 2017, is payable in June 2018. The Company also agreed to pay up to an additional $16.0 million in aggregate upon satisfaction of milestonesrelating to the Company’s product revenue, intellectual property, and clinical and regulatory events. As of December 31, 2017, the Company had notrecorded a liability in connection with the BTRX milestone payments. The Company accrues for contractual milestones when it is probable that a milestonewill be met.Pursuant to the guidance prescribed in Accounting Standards Codification Topic 805, Business Combinations, the Company concluded that the BTRXPurchase Agreement did not meet the criteria of a business combination . During 2016, the Company accounted for the initial $2.0 million expenditure asresearch and development expense, as future alternative use of the acquired assets was deemed contingent upon the successful outcome of existing researchand development activities as of the transaction date.5. Medicis SettlementIn July 2009, the Company and Medicis Pharmaceutical Corporation, or Medicis, entered into a license agreement granting Medicis worldwideaesthetic and dermatological rights to the Company’s investigational, injectable botulinum toxin type A product candidate. In October 2012, the Companyentered into a settlement and termination agreement with Medicis. The terms of the settlement provided for the reacquisition of the rights related to allterritories of RT002 injectable and RT001 topical from Medicis and for consideration payable by the Company to Medicis of up to $25.0 million, comprisedof (i) an upfront payment of $7.0 million, which was paid in 2012, (ii) a Proceeds Sharing Arrangement Payment of $14.0 million due upon specified capitalraising achievements by the Company, of which $6.9 million was paid in 2013 and $7.1 million in 2014, and (iii) a Product Approval Payment of $4.0million to be paid upon the achievement of regulatory approval for RT002 injectable or RT001 topical by the Company. Medicis was subsequently acquiredby Valeant Pharmaceuticals International, Inc. in December 2012.The Company determined that the settlement provisions related to the Proceeds Sharing Arrangement Payment in (ii) above and Product ApprovalPayment in (iii) above were derivative instruments that require fair value accounting as a liability and periodic fair value remeasurements until settled.As of December 31, 2016, the fair value of the Product Approval Payment derivative of $2.0 million was determined by updating the timing andprobability estimate of the related approval and applying a discount factor assuming a term of 3.25 years, a risk-free rate of 1.5% and a credit risk adjustmentof 9.0%. As of December 31, 2017, the Company determined the fair value of its liability for the Product Approval Payment was $2.6 million, which wasmeasured by assuming a term of 2.5 years, a risk-free rate of 2.0% and a credit risk adjustment of 6.5%. The Company’s assumption for the expected term isbased on an expected Biologics License Application, or BLA, approval in 2020. The Company did not make any payments under the Product ApprovalPayment during the year ended December 31, 2017.As a result of the fair value remeasurements during the years ended December 31, 2017, 2016, and 2015, the Company recognized an aggregate loss of$0.6 million, an aggregate loss $0.6 million, and an aggregate gain of $0.1 million, respectively.F-15Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)6. Cash Equivalents and InvestmentsThe Company's cash equivalents and investments consist of money market funds, U.S. treasury securities, and U.S. government agency obligations,which are classified as available-for-sale securities.The following table is a summary of amortized cost, unrealized gain and loss, and fair value (in thousands): December 31, 2017 December 31, 2016 Cost Unrealized Fair Value Cost Unrealized Fair Value Gains Losses Gains Losses Money market funds$236,744 $— $— $236,744 $60,639 $— $— $60,639U.S. treasury securities— — — — 81,103 4 (28) 81,079U.S. government agencyobligations— — — — 40,968 1 (22) 40,947Total cash equivalents andavailable-for-sale securities$236,744 $— $— $236,744 $182,710 $5 $(50) $182,665 Classified as: Cash equivalents $236,744 $60,639Short-term investments — 122,026Total cash equivalents andavailable-for-sale securities $236,744 $182,665There have been no significant realized gains or losses on available-for-sale securities for the periods presented. There were no available-for-salesecurities held as of December 31, 2017. The Company's investments in any unrealized loss position are held until maturity or until the cost basis of theinvestment are recovered. The Company has no other-than-temporary impairments on its securities as it did not sell these securities before the recovery oftheir amortized cost basis. To date, the Company has not recorded any impairment charges on marketable securities related to other-than-temporary declinesin fair value.As of December 31, 2016, the Company's marketable securities of $122.0 million were due within one year.7. Fair Value MeasurementsThe Company measures and reports certain financial instruments as assets and liabilities at fair value on a recurring basis. The fair value of theseinstruments was as follows (in thousands): As of December 31, 2017 Fair Value Level 1 Level 2 Level 3Assets Money market funds$236,744 $236,744 $— $—Total assets measured at fair value$236,744 $236,744 $— $— Liabilities Derivative liabilities associated with the Medicis settlement$2,613 $— $— $2,613Total liabilities measured at fair value$2,613 $— $— $2,613F-16Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) As of December 31, 2016 Fair Value Level 1 Level 2 Level 3Assets Money market funds$60,639 $60,639 $— $—U.S. treasury securities81,079 81,079 — —U.S. government agency obligations40,947 — 40,947 —Total assets measured at fair value$182,665 $141,718 $40,947 $— Liabilities Derivative liabilities associated with the Medicis settlement$2,022 $— $— $2,022Total liabilities measured at fair value$2,022 $— $— $2,022The Company did not transfer any assets or liabilities measured at fair value on a recurring basis to or from Level 1 and Level 2 during the years endedDecember 31, 2017 and 2016.The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments as follows (in thousands): DerivativeLiabilityAssociated withthe MedicisSettlementFair value as of December 31, 2016 $2,022Change in fair value 591Fair value as of December 31, 2017 $2,613 Level 3 instruments consist of the Company’s derivative liability related to the Medicis settlement. The fair value of the remaining derivative liabilityresulting from the Medicis litigation settlement, specifically the derivative related to the Product Approval Payment (Note 5), was determined by estimatingthe timing and probability of the related regulatory approval and multiplying the payment amount by this probability percentage and a discount factor basedprimarily on the estimated timing of the payment and a credit risk adjustment (Note 5). Generally, increases or decreases in these unobservable inputs wouldresult in a directionally similar impact to the fair value measurement of this derivative instrument. The significant unobservable inputs used in the fair valuemeasurement of the Product Approval Payment derivative are the expected timing and probability of the payments at the valuation date and the credit riskadjustment.8. Balance Sheet ComponentsProperty and Equipment, netProperty and equipment, net consists of the following (in thousands): F-17Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) As of December 31, 2017 2016Manufacturing equipment$11,989 $12,268Computer equipment1,567 701Furniture and fixtures635 610Leasehold improvements4,255 4,214Construction in progress4,335 4,950Total property and equipment22,781 22,743Less: Accumulated depreciation and amortization(13,531) (12,158)Property and equipment, net$9,250 $10,585Depreciation expense was $1.5 million, $1.4 million, and $2.0 million for the years ended December 31, 2017, 2016 and 2015, respectively.As of December 31, 2017, the Company had obligations to make future payments to certain vendors that become due and payable during theconstruction of its manufacturing facilities in Newark, California. The arrangement was accounted for as construction-in-progress and the outstandingobligations as of December 31, 2017 were $0.2 million, and there were no outstanding obligations for the same period in 2016. The Company capitalizedinterest costs in the amount of $0.1 million within construction-in-progress during the year ended December 31, 2017. The Company did not capitalizeinterest costs during the year ended December 31, 2016.Loss on ImpairmentThe Company evaluates its long-lived assets for indications of possible impairment whenever events or changes in circumstances indicate that thecarrying amount of an asset may not be recoverable. Recoverability of assets is measured by a comparison of the carrying amount of the asset to the estimatedundiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated future cash flows, animpairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. The Company determines thefair value of its long-lived assets using the market approach, cost approach or income approach.The Company constructed a fill/finish line for the future commercial manufacturing of its topical product candidate and to support its clinical trials andregulatory license applications. In 2016, following the results of the REALISE 1 Phase 3 clinical trial for crow's feet, the Company discontinued its topicalclinical development programs for the treatment of crow’s feet and for the treatment of primary axillary hyperhidrosis. The Company performed animpairment analysis of the topical fill/finish line and other fixed assets to determine fair value based on highest and best use. The Company concluded thatonly certain equipment comprising the topical fill/finish line would be repurposed for commercial-scale manufacturing of RT002 injectable. As a result, theCompany determined fair value based on its highest and best use and that for certain components of the fill/finish line and other fixed assets, the carryingvalue of the assets was not entirely recoverable and the fair value, which was calculated using the market or cost approach depending on the specific asset,was lower than the carrying value. Accordingly, during the year ended December 31, 2016, the Company recorded a loss on impairment of $9.1 million. As ofDecember 31, 2016, the fill/finish line and other fixed assets had net book values of $5.1 million and $0.2 million, respectively.During the three months ended December 31, 2017, the Company identified a subsequent indicator of impairment, an adverse change in the marketvalue resulting from further negotiations with a potential buyer during the quarter, for the topical fill/finish line and other fixed assets. The Companycontinues to believe that certain equipment comprising the topical fill/finish line with a net book value of $2.4 million will be repurposed for commercial-scale manufacturing of RT002 injectable. As a result, the Company determined fair value based on its highest and best use and that for certain components ofthe fill/finish line and other fixed assets, the carrying value of the assets was not entirely recoverable and the fair value, which was calculated using themarket or cost approach depending on the specific asset, was lower than the carrying value. Accordingly, the Company recorded a loss on impairment of $2.9million during the year ended December 31, 2017. Nonetheless, it is reasonably possible that our estimate of the recoverability of the equipment's carryingvalue could change, and may result in the need to further write down the assets to fair value. As of December 31, 2017, the fill/finish line and other fixedassets had net book values of $2.4 million and $0.1 million, respectively.F-18Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)Prepaid Expenses and Other Current AssetsPrepaid expenses and other current assets consist of the following (in thousands): As of December 31, 2017 2016Prepaid expenses$1,823 $978Accounts and other receivables48 128Litigation settlement receivable due from insurance (Note 10)— 5,898Other prepaid and current assets444 163Total prepaid expenses and other current assets$2,315 $7,167 Accruals and Other Current LiabilitiesAccruals and other current liabilities consist of the following (in thousands): As of December 31, 2017 2016Accruals related to: Compensation$5,763 $3,121Litigation settlement (Note 10)— 6,400Professional service fees1,773 720Manufacturing and quality control costs488 188Clinical trial expenses3,189 1,271Fixed assets and construction-in-progress obligations302 57Other current liabilities710 661Total accruals and other current liabilities$12,225 $12,4189. Notes PayableEssex Capital NotesOn December 20, 2013, the Company signed a Loan and Lease Agreement (Original Agreement) to borrow up to $10.8 million in the form of SecuredPromissory Notes from Essex Capital, or the Essex Notes, to finance the completion and installation of the Company’s topical commercial fill/finish line, orthe Fill/Finish Line. In December 2013 and January 2014, the Company withdrew a total of $5.0 million under the terms of the Original Agreement. In May2014, pursuant to the terms of the Original Agreement, the Company sold equipment to Essex Capital, resulting in partial settlement of the outstanding loanbalance of $1.1 million, and leased the equipment back for fixed monthly payments to be paid over 3 years.On December 17, 2014, the Company entered into the First Amendment to the Loan and Lease Agreement (First Amendment) with Essex Capital. Underthe terms of the First Amendment, the Company agreed to repay the outstanding debt balance of $3.9 million and issued a warrant to purchase 44,753 sharesof common stock.In February 2015, the Company executed the Second Amendment to the Loan and Lease Agreement, under which the term of the facility was extendedto April 15, 2015 and the purchase price for the remainder of the equipment was increased by $0.1 million to approximately $9.8 million. Concurrently withthis sale, the Company leased the equipment back from Essex Capital for a fixed monthly payment to be paid monthly over 3 years.None of the leases qualified for sale-leaseback accounting due to the Company’s continuing involvement in the equipment. Therefore, the Companyaccounted for these transactions as financing obligations using the effective interest rate method.F-19Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The leases provide for the option to purchase the leased equipment for 10% of the original purchase amount and, in June 2015, the Company exercisedits option to purchase the remainder of the equipment sold and leased back from Essex Capital for 10% of the original purchase amount, orapproximately $1.1 million, at the conclusion of the lease terms. In May 2017, the Company paid $0.1 million to purchase the equipment sold and leasedback from Essex Capital in May 2014.As of December 31, 2017, the aggregate total future minimum lease payments under the financing obligation for the year ending December 31, 2018was $0.9 million.Under the financing obligation with Essex Capital, the Company recorded interest expense of $0.5 million, $1.1 million and $1.2 million for the yearsended December 31, 2017, 2016 and 2015, respectively.10. Commitments and ContingenciesLeasesIn January 2010, the Company entered into a non-cancelable facility lease that requires monthly payments through January 2022. We use this facilityfor research, manufacturing, commercial and administrative functions. In February 2014, the Company extended the term of the lease by thirty-six (36) months to January 2025. As part of this agreement, the lessor providedthe Company with a tenant improvement allowance during 2014 in an amount not to exceed $3.0 million. Under the terms of the lease agreement, theCompany will make total rent payments of $72.8 million for a period of 15 years commencing in January 2010. This lease was determined to be an operatinglease. The payments escalate over the term of the lease with the exception of a decrease in payments at the beginning of 2022, however, the Companyrecognizes the expense on a straight-line basis over the life of the lease. Rent expense was $5.3 million for the years ended December 31, 2017, 2016, and2015, respectively.In November 2017, the Company entered into a non-cancelable equipment operating lease that requires sixty (60) equal monthly payments throughOctober 2022. Lease payments total $0.2 million during the entire lease term.As of December 31, 2017, the aggregate total future minimum lease payments under non-cancelable operating leases were as follows (in thousands): Year Ending December 31, 2018$5,62820195,81220205,99620216,1732022 and thereafter14,512Total payments$38,121Other Milestone-Based CommitmentsThe Company has one remaining future milestone payment to List Laboratories of $2.0 million that becomes due and payable on the achievement of acertain regulatory milestone, whereby the Company is obligated to pay royalties to List Laboratories on future sales of botulinum toxin products. TheCompany also has one remaining future milestone payment of $4.0 million due and payable to Valeant Pharmaceuticals International, Inc. upon theachievement of regulatory approval for RT002 injectable or RT001 topical (Note 5).The Company has obligations to pay BTRX up to a remaining $16.0 million in the aggregate upon the satisfaction of milestones relating to theCompany’s product revenue, intellectual property, and clinical and regulatory events (Note 4).On April 11, 2016, the Company entered into an agreement with BioSentinel, Inc. to in-license their technology and expertise for research anddevelopment and manufacturing purposes. In addition to minimum quarterly use fees, the Company is obligated to make a one-time future milestonepayment of $0.3 million payable to BioSentinel, Inc. upon the achievement ofF-20Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)regulatory approval. The Company accrues for contractual milestones when it is probable that a milestone will be met. The Company expects that regulatoryapproval milestones will only become probable once such regulatory outcome is achieved.Purchase CommitmentsOn March 14, 2017, the Company entered into a Technology Transfer, Validation and Commercial Fill/Finish Services Agreement (the “ServicesAgreement”) and Statement of Work ("SoW") with Ajinomoto Althea, Inc., a contract development and manufacturing organization (“Althea”). Under theServices Agreement, Althea has agreed, among other things, to provide the Company with a future source of commercial fill/finish services for the Company’sneuromodulator products. The Services Agreement has an initial term that will expire in 2024, unless terminated sooner by either party. In accordance withthe Services Agreement, the Company will have minimum purchase obligations based on its production forecasts. As of December 31, 2017, the Companymade non-refundable advanced payments of $1.2 million in accordance with the terms of this arrangement. The remaining services are cancellable at anytime, with the Company required to pay costs incurred through the cancellation date.Other ObligationsThe Company initiated a RT002 injectable Phase 2 trial for the treatment of plantar fasciitis in 2016 and entered into a clinical trial services agreementwith a contract research organization, or CRO, to manage certain aspects of the trial. Under this agreement, the Company agreed to negotiate in good faith fora specified period of time the terms of a business relationship to exploit RT002 and the related study data. The CRO has proposed a material payment or otherterms for its involvement in the development of the Company’s plantar fasciitis program that are unacceptable to the Company. While the Company maycontinue to negotiate in good faith, the Company believes it has satisfied its obligations under the agreement even if it does not reach a mutually acceptablearrangement.ContingenciesFrom time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. During the period from May 2015through July 2017, the Company and certain of its directors and executive officers were subject to a securities class action complaint, pending in the SuperiorCourt for the County of Santa Clara, captioned City of Warren Police and Fire Retirement System v. Revance Therapeutics Inc., et al., Case No. 15-CV-287794 (previously assigned Case No. CIV 533635 prior to transfer from San Mateo Superior Court). On October 31, 2016, the parties executed a stipulationof settlement (the "Stipulation"), pursuant to which, in exchange for a release of all claims by the plaintiff class, the Company agreed to settle the litigationfor $6.4 million in cash, of which $5.9 million was covered by its insurance policies. The Stipulation maintains that the defendants, including the Company,deny all wrongdoing and liability related to the litigation. On July 28, 2017, the Court granted final approval of the Settlement, as set forth in the Stipulation,and entered a Judgment dismissing the action with prejudice, thereby ending the litigation. This litigation did not have a material adverse effect on ourbusiness, results of operations, financial position or cash flows.The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonablyestimated. As a result of the Settlement, as set forth in the Stipulation, the Company began accruing for a loss contingency and recorded an undiscountedliability of $6.4 million in October 2016, which was included in accruals and other current liabilities on the Consolidated Balance Sheet until it was releasedupon the final approval of the Settlement on July 28, 2017. In January 2017, the Company paid $0.5 million, which was recorded in restricted cash until itwas released, and its insurance company paid $5.9 million, which was recorded in prepaid and other current assets until it was released, both of which wereheld in an escrow account until the Court's order granting final approval of the Settlement on July 28, 2017, which authorized distribution of these amountsin accordance with the Stipulation. IndemnificationThe Company enters into standard indemnification agreements in the ordinary course of business. Pursuant to these arrangements, the Companyindemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with anytrade secret, copyright, patent or other intellectual property infringement claim by any third party with respect to its technology. The term of theseindemnification agreements is generally perpetual after the execution of the agreement. The maximum potential amount of future payments the Companycould be required to make under these agreements is not determinable because it involves claims that may be made against the CompanyF-21Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)in the future, but have not yet been made. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnificationagreements.The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify them againstliabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual.No amounts associated with such indemnifications have been recorded to date, except as noted above.11. Stockholders' EquityConvertible Preferred StockThe par value of convertible preferred stock is $0.001 per share. As of December 31, 2017 and 2016, the Company had 5,000,000 shares authorized andno preferred stock issued and outstanding.WarrantsIn 2015, three holders of common stock warrants net exercised warrants to purchase 137,067 shares into 68,993 shares of common stock at exerciseprices ranging from $14.40 to $22.43. There were no warrants exercised in 2016. In 2017, warrants to purchase 27,482 shares were net exercised for 9,878shares of common stock with exercise price per share ranging from $14.40 to $31.50 in accordance with the terms of the warrant agreement. As of December31, 2016, the Company had outstanding warrants to purchase 61,595 shares of common stock at weighted exercise price per share of $16.78. As ofDecember 31, 2017, the Company had outstanding warrants to purchase 34,113 shares of common stock at weighted exercise price per share of $14.95 andexpire in 2020.Stock Option PlanEquity Incentive PlansOn January 23, 2014, the stockholders' approved the adoption of the 2014 Equity Incentive Plan, or 2014 EIP. The number of shares of common stockreserved for issuance under the Company’s 2014 EIP will automatically increase on January 1 of each year, beginning on January 1, 2015, and continuingthrough and including January 1, 2024, by 4% of the total number of shares of the Company’s capital stock outstanding on December 31 of the precedingcalendar year or a lesser number of shares determined by the Company’s Board of Directors. The maximum number of shares that may be issued upon theexercise of ISOs under the Company’s 2014 EIP is 2,000,000 shares. The 2014 EIP provides for the grant of incentive stock options, or ISOs, non-statutorystock options, or NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, and other forms ofequity compensation, all of which may be granted to employees, including officers, non-employee directors and consultants of the Company and itsaffiliates. Additionally, the 2014 EIP provides for the grant of performance cash awards. ISOs may be granted only to employees. All other awards may begranted to employees, including officers, and to non-employee directors and consultants. Under the 2014 EIP, options may be granted with different vestingterms from time to time, but not to exceed 10 years from the date of grant. Upon the effectiveness of the 2014 Plan, the Company ceased granting any equityawards under the 2012 Equity Incentive Plan and any cancelled or forfeited shares under the 2012 and 2002 Equity Incentive Plans will be retired.On January 1, 2017, the number of shares of common stock reserved for issuance under the Company’s 2014 Equity Incentive Plan, or 2014 EIP,automatically increased by 4% of the total number of shares of the Company’s common stock outstanding on December 31, 2016, or 1,145,958 shares.During the year ended December 31, 2017, the Company granted stock options for 925,525 shares of common stock and 340,525 restricted stock awardsunder the 2014 EIP, including a stock option grants for 48,000 shares and restricted stock awards for 24,000 shares to non-employee directors. As ofDecember 31, 2017, there were 903,049 shares available for issuance under the 2014 EIP.2014 Inducement PlanOn August 26, 2014, the Company’s Board of Directors authorized the adoption of the 2014 Inducement Plan, or 2014 IN, which became effectiveimmediately. Stockholder approval of the 2014 IN was not required pursuant to Rule 5635 (c)(4) ofF-22Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)the Nasdaq Listing Rules. The 2014 IN reserves 325,000 shares of common stock and provides for the grant of NSOs that will be used exclusively for grantsto individuals that were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with theCompany. On December 14, 2015, the Company’s Board of Directors authorized an additional 500,000 shares of common stock to be reserved for issuanceunder the 2014 IN. Under the 2014 IN, options may be granted with different vesting terms from time to time, but not to exceed 10 years from the date ofgrant. During the year ended December 31, 2017, the Company granted stock options for 35,000 shares of common stock and 95,000 restricted stock awardsunder the 2014 IN. As of December 31, 2017, there were 292,096 shares available for issuance under the 2014 IN.Under the 2014 EIP and the 2014 IN plan, restricted stock awards typically vest annually over 1, 3, or 4 years, while options typically vest over fouryears, either with 25% of the total grant vesting on the first anniversary of the option grant date and 1/36th of the remaining grant vesting each monththereafter or 1/48th vesting monthly. F-23Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The following summary of stock option and restricted stock award activity, excluding 2014 IN, for the periods presented is as follows: Number ofSharesAvailablefor Grant Number ofSharesUnderlyingOutstandingOptions WeightedAverageExercisePrice PerShare WeightedAverageRemainingContractualLife (inYears) AggregateIntrinsicValue (In thousands)Balance as of December 31, 201491,634 1,886,148 $17.90 Additional shares reserved950,978 — — Options granted(747,338) 747,338 18.94 Restricted stock awards granted(169,336) 169,336 — Options exercised— (205,735) 11.84 Options cancelled/forfeited116,540 (116,540) 21.33 Restricted stock awards forfeited24,306 (24,306) — Restricted stock awards released— (74,755) — Shares cancelled/retired under 2002/2012 plans(19,276) — — Net settlement of restricted stock awards to settleemployee taxes26,440 — — Balance as of December 31, 2015273,948 2,381,486 $18.36 Additional shares reserved1,131,538 — — Options granted(839,800) 839,800 16.72 Restricted stock awards granted(299,900) 299,900 — Options exercised— (131,752) 10.67 Options cancelled/forfeited320,084 (320,084) 21.77 Restricted stock awards forfeited80,333 (80,333) — Restricted stock awards released— (124,344) — Shares cancelled/retired under 2002/2012 plans— (38,829) 8.92 Net settlement of restricted stock awards to settleemployee taxes23,289 — — Balance as of December 31, 2016689,492 2,825,844 $17.92 Additional shares reserved1,145,958 — — Options granted(925,525) 925,525 21.65 Restricted stock awards granted(340,525) 340,525 — Options exercised— (309,341) 12.88 Options cancelled/forfeited230,734 (230,734) 22.81 Restricted stock awards forfeited81,905 (81,905) — Restricted stock awards released— (117,218) — Shares cancelled/retired under 2002/2012 plans— (696) 8.94 Net settlement of restricted stock awards to settleemployee taxes21,010 — — Balance as of December 31, 2017903,049 3,352,000 $19.29 7.28 $46,703Exercisable as of December 31, 2017 1,610,252 $18.28 6.39 $28,127F-24Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The intrinsic values of outstanding and exercisable options were determined by multiplying the number of shares by the difference in exercise price ofthe options and the fair value of the common stock as of December 31, 2017.The total intrinsic values of options exercised as of December 31, 2017, 2016 and 2015 of $7.1 million, $1.3 million, and $4.6 million, respectivelywere determined by multiplying the number of shares by the difference between exercise price of the options and the fair value of the common stock as ofDecember 31, 2017, 2016, and 2015 of $35.75, $20.70 and $34.16 per share, respectively.The following table summarizes the stock option activity for the 2014 IN is as follows: Number ofSharesAvailablefor Grant Number ofSharesUnderlyingOutstandingOptions andAwards WeightedAverageExercisePrice PerShare WeightedAverageRemainingContractualLife (inYears) AggregateIntrinsicValue (In thousands)Balance as of December 31, 2014141,500 183,500 $22.52 Additional shares reserved500,000 Options granted(206,250) 206,250 36.32 Restricted stock awards granted(34,375) 34,375 — Option forfeitures29,531 (29,531) 22.97 Restricted stock award forfeitures9,843 (9,843) — Awards released— (30,532) — Net settlement of restricted stock awards to settleemployee taxes9,640 — — Balance as of December 31, 2015449,889 354,219 $31.46 Options granted(110,000) 110,000 18.37 Restricted stock awards granted(15,000) 15,000 — Option forfeitures88,594 (88,594) 22.97 Restricted stock award forfeitures— — — Restricted stock awards released— (9,594) — Net settlement of restricted stock awards to settleemployee taxes3,604 — — Balance as of December 31, 2016417,087 381,031 $29.43 Options granted(35,000) 35,000 24.40 Restricted stock awards granted(95,000) 95,000 — Restricted stock awards released— (13,344) — Net settlement of restricted stock awards to settleemployee taxes5,009 — — Balance as of December 31, 2017292,096 497,687 $28.96 8.12 $2,653Exercisable as of December 31, 2017 169,124 $29.50 7.89 $1,116F-25Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The following table summarizes information with respect to stock options outstanding and currently exercisable as of December 31, 2017: Options Outstanding OptionsExercisableExercise PriceNumber ofOptions Weighted-AverageRemainingContractual Life(In Years) $0.45 - 4.2047,848 2.3 47,848$8.70358,382 5.4 358,382$9.15 - 16.23586,558 7.2 394,413$16.30 - 17.12328,857 7.7 179,805$17.55 - 19.69177,325 8.3 67,740$19.70436,836 9.1 97,173$19.90 - 23.30340,976 8.7 83,525$23.45 - 31.60322,357 8.2 109,224$31.778,000 7.5 4,832$32.22 - 36.32603,261 6.9 436,434 3,210,400 1,779,376The following table summarizes information with respect to restricted stock awards outstanding as of December 31, 2017: Number ofAwardsAvailablefor Grant Weighted-AverageGrant-Date Fair Value AggregateIntrinsicValue (In thousands)Outstanding as of December 31, 2014251,325 $29.51 $—Granted203,711 21.55 —Vested(105,287) 27.79 —Forfeited(34,149) 22.77 —Outstanding as of December 31, 2015315,600 $25.67 $—Granted314,900 17.16 —Vested(133,938) 26.41 —Forfeited(80,333) 20.35 —Outstanding as of December 31, 2016416,229 $20.02 $—Granted435,525 22.08 —Vested(130,562) 23.25 —Forfeited(81,905) 19.32 —Outstanding as of December 31, 2017639,287 $20.86 $13,332Stock Options Granted to Employees and Non-employee DirectorsDuring the years ended December 31, 2017, 2016 and 2015, the Company granted stock options to employees and non-employee directors to purchaseshares of common stock with a weighted-average grant date fair value of $13.43, $16.91 and $22.70 per share, respectively. As of December 31, 2017, 2016and 2015, there was total unrecognized compensation cost forF-26Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)outstanding stock options and restricted stock awards of $26.5 million, $19.6 million and $21.5 million to be recognized over a period of approximately 2.7years, 2.7 years, and 2.8 years, respectively.The fair value of the employee and non-employee director stock options was estimated using the Black-Scholes option-pricing model with thefollowing weighted-average assumptions: Year Ended December 31, 2017 2016 2015Expected term (in years)6.0 6.0 6.0Expected volatility67.7% 61.9% 62.2%Risk-free interest rate2.1% 1.4% 1.6%Expected dividend rate0.0% 0.0% 0.0%Fair Value of Common Stock. The fair value of the shares of common stock is based on the Company's stock price as quoted by the Nasdaq.Expected Term. The expected term for employees and non-employee directors is based on the simplified method, as the Company’s stock options havethe following characteristics: (i) granted at-the-money; (ii) exercisability is conditioned upon service through the vesting date; (iii) termination of serviceprior to vesting results in forfeiture; (iv) limited exercise period following termination of service; and (v) options are non-transferable and non-hedgeable, or“plain vanilla” options, and the Company has limited history of exercise data. The expected term for non-employees is based on the remaining contractualterm.Expected Volatility. As of January 1, 2017, the expected volatility is based on the historical volatility of a group of similar entities combined with thehistorical volatility of the Company, whereas prior to 2017, the expected volatility was based solely on the historical volatility of a group of similar entities.In evaluating similarity, the Company considered factors such as industry, stage of life cycle, capital structure, and size.Risk-Free Interest Rate. The risk-free interest rate is based on U.S. Treasury constant maturity rates with remaining terms similar to the expected term ofthe options.Expected Dividend Rate. The Company has never paid any dividends and does not plan to pay dividends in the foreseeable future, and, therefore, usedan expected dividend rate of zero in the valuation model.Forfeitures. As of January 1, 2017, the Company adopted the forfeiture rate methodology change in accordance with ASU 2016-09 to account forforfeitures as they occur (Note 2). Prior to the adoption of ASU 2016-09, the Company was required to estimate forfeitures at the time of grant and revisedthose estimates in subsequent periods if actual forfeitures differed from those estimates. The Company used historical data to estimate pre-vesting optionforfeitures and record stock-based compensation expense only for those awards that were expected to vest. To the extent actual forfeitures differed from theestimates, the difference was recorded as a cumulative adjustment in the period that the estimates were revised.Stock Options Granted to ConsultantsIn 2017, 2 employees converted to non-employee consultants and the individuals' options and awards continued to vest in accordance with the 2014EIP. In addition, during the three months ended December 31, 2017, the Company granted options to purchase 5,000 shares of common stock with aweighted-average exercise price of $25.45 per share and restricted stock awards of 4,000 shares to a non-employee consultant. The Company did not grantoptions to purchase shares of common stock to non-employee consultants during the years ended December 31, 2016 and 2015, however, the non-employeeconsultant options outstanding for the years then ended related to employees who had converted to non-employee consultants.Stock-based compensation expense related to stock options granted to consultants is recognized as the stock options are earned. The Companybelieves that the fair value of the stock options is more reliably measurable than the fair value of services received. The fair value of the stock options vestedis calculated at each reporting date using the Black-Scholes option pricing model with the following weighted-average assumptions: F-27Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) Year Ended December 31, 2017 2016 2015Expected term (in years)8.9 7.3 8.2Expected volatility67.9% 68.9% 73.0%Risk-free interest rate2.3% 1.7% 2.0%Expected dividend rate0.0% 0.0% 0.0% 2014 Employee Stock Purchase PlanOn January 22, 2014, the Company’s Board of Directors authorized the adoption of the 2014 Employee Stock Purchase Plan, or 2014 ESPP, whichbecame effective after adoption and approval by the Company’s stockholders on January 23, 2014. The maximum number of shares of common stock thatmay be issued under the Company’s 2014 ESPP was initially 200,000 shares. The number of shares of common stock reserved for issuance under theCompany’s 2014 ESPP will automatically increase on January 1 of each year, beginning on January 1, 2015 and ending on and including January 1, 2024,by the lesser of (i) 1% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, (ii) 300,000 shares ofcommon stock or (iii) such lesser number of shares of common stock as determined by the Company’s Board of Directors. Shares subject to purchase rightsgranted under the Company’s 2014 ESPP that terminate without having been exercised in full will return to the 2014 ESPP reserve and will not reduce thenumber of shares available for issuance under the Company’s 2014 ESPP. The 2014 ESPP is intended to qualify as an “employee stock purchase plan,” orESPP, under Section 423 of the Internal Revenue Code of 1986 with the purpose of providing employees with an opportunity to purchase the Company’scommon stock through accumulated payroll deductions.On January 1, 2017, the number of shares of common stock reserved for issuance under the Company’s 2014 Employee Stock Purchase Plan, or 2014ESPP, automatically increased by 1% of the total number of shares of the Company’s capital stock outstanding on December 31, 2016, or 237,744 shares. Asof December 31, 2017, there were 916,834 shares available for issuance under the 2014 ESPP. For the year ended December 31, 2017, the Company recordedstock-based compensation expense of $0.2 million and issued 28,135 shares of common stock to employees under the 2014 ESPP.The fair value of the option component of the shares purchased under the 2014 ESPP was estimated using the Black-Scholes option-pricing model withthe following weighted-average assumptions: Year Ended December 31, 2017 2016 2015Expected term (in years)0.5 0.5 0.5Expected volatility59.2% 72.0% 63.4%Risk-free interest rate0.9% 0.4% 0.2%Expected dividend rate—% —% —%Fair Value of Common Stock. The fair value of the shares of common stock is based on the Company’s stock price.Expected Term. The expected term is based on the term of the purchase period under the 2014 ESPP.Expected Volatility. As of January 1, 2017 the expected volatility is based on the historical volatility of the Company's common stock. Prior to January1, 2017, the expected volatility was based on volatility of a group of similar entities. In evaluating similarity, the Company considered factors such asindustry, stage of life cycle, capital structure, and size.Risk-Free Interest Rate. The risk-free interest rate is based on U.S. Treasury constant maturity rates with remaining terms similar to the expected term.Expected Dividend Rate. The Company has never paid any dividends and does not plan to pay dividends in the foreseeable future, and, therefore, usedan expected dividend rate of zero in the valuation model.Total Stock-Based CompensationTotal stock-based compensation expense related to options and awards for employees and non-employees and shares purchased under the 2014 ESPPby employees, was allocated as follows (in thousands):F-28Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) Year Ended December 31,2017 2016 2015Research and development$5,902 $5,557 $6,511General and administrative7,328 6,396 5,877Total stock-based compensation expense$13,230 $11,953 $12,388There were no capitalized stock-based compensation costs or recognized stock-based compensation tax benefits during the years ended December 31,2017, 2016, and 2015.During 2017, 2016 and 2015, the Company modified certain equity awards, resulting in an acceleration of vesting for a portion of such awards as aresult of termination of service. The acceleration in vesting of the unvested awards resulted in a Type III modification, which occurs when there is a changefrom an improbable to probable vesting condition. The Company recognized the incremental fair value, which was equal to the fair value of the awards onthe modification date, and recognized the stock-based compensation over the remaining requisite service period. During the years ended December 31, 2017,2016 and 2015, the Company recorded $0.1 million, $0.2 million and $2.4 million, respectively, of stock-based compensation expense in connection withthese modifications.Common StockAs of December 31, 2017 and 2016, the Company was authorized to issue up to 95,000,000 shares of par value $0.001 per share common stock.As of December 31, 2017 and 2016, the Company had no shares of common stock subject to repurchase. Common stockholders are entitled todividends when and if declared by the Board of Directors subject to the prior rights of the preferred stockholders. The holder of each share of common stock isentitled to one vote. The common stockholders voting as a class are entitled to elect one member to the Company’s Board of Directors. As of December 31,2017, no dividends have been declared.The Company had reserved shares of common stock, on an as if converted basis, for issuance as follows: December 31, 2017Issuances under stock incentive plans903,049Issuances upon exercise of common stock warrants34,113Issuances under employee stock purchase plan916,834Issuances under inducement plan292,096 2,146,09212. Income TaxesFrom inception through 2017, the Company has only generated pretax losses in the United States and has not generated any pretax income or lossoutside of the United States. As a result of the Company's transfer of the economic rights to certain intellectual property to the Company's wholly ownedsubsidiary, Revance International Limited, the Company will begin to have operations outside of the U.S. The Company did not record a provision (benefit)for income taxes for the years ended December 31, 2017, 2016, and 2015.The domestic and foreign components of loss before provision for income taxes were as follows (in thousands):F-29Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) Years ended December 31, 2017 2016 2015Domestic$(118,331) $(89,270) $(73,476)Foreign(2,256) — —Loss before provision for income taxes$(120,587) $(89,270) $(73,476)Significant components of the Company’s deferred tax assets as of December 31, 2017 and 2016 consist of the following (in thousands): Year Ended December 31, 2017 2016Deferred tax assets: Net operating loss carryforward$106,338 $139,647Accruals and reserves2,591 2,433Stock based compensation5,400 4,805Tax credits6,779 4,053Fixed and intangible assets7,221 8,209Valuation Allowance(128,329) (159,147)Net deferred tax assets$— $—Reconciliations of the statutory federal income tax (benefit) to the Company’s effective tax for the years ended December 31, 2017, 2016, and 2015 areas follows (in thousands): Year Ended December 31, 2017 2016 2015Tax (benefit) at statutory federal rate$(40,999) $(30,352) $(24,982)Foreign rate differential and withholding taxes767 — —Nondeductible/nontaxable items738 832 224Impact of the Tax Reform Act62,903 — —Sale of Intellectual Property(1)14,008 — —Research and development credits(1,858) (544) (516)Other224 11 607Change in valuation allowance$(35,783) $30,053 $24,667Provision for taxes$— $— $—(1)This represents the tax effect of an inter-entity sale which was eliminated for financial reporting purposes. The valuation allowance is determined using an assessment of both positive and negative evidence. Based on the available objective evidence and theCompany’s history of losses management believes it is more likely than not that the net deferred tax assets will not be realized. The Company has establisheda valuation allowance to offset deferred tax assets as of December 31, 2017 and 2016 due to the uncertainty of realizing future tax benefits from its netoperating loss carryforwards and other deferred tax assets. The valuation allowance decreased by $30.8 million and increased by $29.2 million during theyears ended December 31, 2017 and 2016, respectively. The valuation allowance decreased primarily due to the impact of the Tax Reform Act.As of December 31, 2017, the Company had net operating loss carryforwards available to reduce future taxable income, if any, for Federal, California,and New Jersey income tax purposes of $453.1 million, $160.2 million, and $378.7 million, respectively. If not utilized, the Federal net operating losscarryforward begin expiring in 2020, the California net operating lossF-30Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)carryforwards began expiring in 2010, and the New Jersey state net operating loss carryforwards begin expiring in 2030. The Company recognizes excess taxbenefits associated with the exercise of stock options directly to stockholders’ equity only when realized.As of December 31, 2017, the Company also had research and development credit carryforwards of $4.3 million and $6.1 million available to reducefuture taxable income, if any, for Federal and California state income tax purposes, respectively. If not utilized, the Federal credit carryforwards will beginexpiring in 2023 and the California credit carryforwards have no expiration date.In general, if the Company experiences a greater than 50 percentage point aggregate change in ownership over a 3-year period (a Section 382ownership change), utilization of its pre-change NOL carryforwards are subject to an annual limitation under Section 382 of the Internal Revenue Code(California and New Jersey have similar laws). The annual limitation generally is determined by multiplying the value of the Company’s stock at the time ofsuch ownership change (subject to certain adjustments) by the applicable long-term tax-exempt rate. Such limitations may result in expiration of a portion ofthe NOL carryforwards before utilization. The Company determined that an ownership change occurred on April 7, 2004 but that all carryforwards can beutilized prior to the expiration. The Company also determined that an ownership change occurred in February 2014. As a result of the 2014 change, theCompany reduced the deferred tax assets and the corresponding valuation allowance to account for this limitation. Since the R&D credits for California carryover indefinitely, there was no change to the California R&D credits. The Company has reviewed its IRC §382 limitation through December 31, 2017 andhave not identified any ownership changes resulting in a limitation.The ability of the Company to use its remaining NOL carryforwards may be further limited if the Company experiences a Section 382 ownershipchange as a result of future changes in its stock ownership.On December 22, 2017, the U.S. government enacted a comprehensive tax reform legislation, commonly referred to as the Tax Cuts and Jobs Act (the“Tax Reform Act”). The Tax Reform Act makes broad and complex changes to the US tax code including but not limited to, (1) reducing the U.S. federalcorporate tax rate from 35% to 21%; (2) requiring companies to pay a one-time transition tax on certain repatriated earnings of foreign subsidiaries, which hasno impact to the Company; (3) generally eliminating US federal income taxes on dividends from foreign subsidiaries; (4) requiring a current inclusion in USfederal income of certain earnings of controlled foreign corporations; (5) creating a new limitation on deductible interest expense; and (6) changing rulesrelated to the uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017.On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the tax effectsof the Tax Reform Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Reform Act enactment date forcompanies to complete the accounting under ASC 740, Income Taxes. In accordance with SAB 118, a company must reflect the income tax effects of thoseaspects of the Tax Reform Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effectsof the Tax Reform Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If acompany cannot determine a provisional estimate, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effectimmediately before the enactment of the Tax Reform Act.Effect of Tax Reform Act and SAB 118 - The Tax Reform Act reduces the corporate tax rate to 21 percent, effective January 1, 2018. In addition, theCompany’s accounting for the tax effects of enactment of the Tax Reform Act is incomplete; however, in certain cases, as described below, we have made areasonable estimate of the effects on our existing deferred tax balances and valuation allowance. In certain aspects, we have not been able to make areasonable estimate and continue to account for those items based on our existing accounting under ASC 740, Income Taxes, and the provisions of the taxlaws that were in effect immediately prior to enactment. The Company has determined that the $62.9 million recorded in connection with the re-measurementof certain deferred tax assets and liabilities, and corresponding valuation allowance was a provisional amount and a reasonable estimate at December 31,2017. The Company has not completed the accounting with regard to the tax effects associated with an intra-entity transfer of certain intellectual propertyrights with the enactment of Tax Reform Act. Our accounting for the intra-entity transfer reflects the utilization of net operating losses on the basis of the lawsin effect before the Tax Reform Act. The Company is evaluating the impact under Tax Reform Act on the Company's global business structure. In all aspects,the Company will continue to make and refine calculations as additional analysis is completed. The Company expects to complete the accountingassessment during the one year measurement period provided by SAB 118.F-31Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)The Company follows the provisions of the FASB’s guidance for accounting for uncertain tax positions. The guidance indicates a comprehensivemodel for the recognition, measurement, presentation and disclosure in financial statements of any uncertain tax positions that have been taken or expectedto be taken on a tax return. No liability related to uncertain tax positions is recorded in the financial statements due to the fact the liabilities have been nettedagainst deferred attribute carryovers. It is the Company’s policy to include penalties and interest related to income tax matters in income tax expense.The unrecognized tax benefit was $2.6 million and $1.8 million at December 31, 2017 and December 31, 2016, respectively. The Company does notexpect that its uncertain tax positions will materially change in the next twelve months. No liability related to uncertain tax positions is recorded on thefinancial statements. During the year ending December 31, 2017, the amount of unrecognized tax benefits increased due to additional research anddevelopment credits generated for prior periods. The additional uncertain tax benefits would not impact the Company’s effective tax rate to the extent thatthe Company continues to maintain a full valuation allowance against its deferred tax assets.The unrecognized tax benefit was as follows (in thousands): Unrecognized taxbenefitsBalance as of December 31, 20141,268Additions for prior tax positions10Additions for current tax positions259Balance as of December 31, 20151,537Additions for prior tax positions9Additions for current tax positions273Balance as of December 31, 20161,819Additions for prior tax positions—Additions for current tax positions758Balance as of December 31, 20172,577The Company files income tax returns in the United States, California, and other states. The Company is not currently under examination by incometax authorities in federal, state or other jurisdictions. All tax returns will remain open for examination by the federal and state authorities for three and fouryears, respectively, from the date of utilization of any net operating loss or tax credits.13. Defined Contribution PlanThe Company sponsors a defined contribution plan under Section 401(k) of the Internal Revenue Code covering substantially all employees over theage of 18 years. Contributions made by the Company are voluntary and are determined annually by the Board of Directors on an individual basis subject tothe maximum allowable amount under federal tax regulations. During the year ended December 31, 2017, the Company made contributions to the plan ofapproximately $0.2 million. The Company made no contributions for the years ended December 31, 2016 and 2015.14. Subsequent Events2014 EIP Stock Option and Awards GrantsIn February 2018, the Company granted 557,050 stock options and 201,750 restricted stock awards under the 2014 EIP to existing employees. Theaggregate grant date fair value is estimated to be $16.0 million.F-32Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued)Collaboration and License AgreementOn February 28, 2018, Revance Therapeutics, Inc. (“Revance” or “the Company”) and Mylan Ireland Limited, a wholly-owned indirect subsidiary ofMylan N.V. (“Mylan”), entered into a collaboration agreement (the “Agreement”) pursuant to which Revance and Mylan will collaborate exclusively, on aworld-wide basis (excluding Japan), to develop, manufacture and commercialize a biosimilar to the branded biologic product (onabotulinumtoxinA)marketed as BOTOX®.Under the Agreement, Revance will be primarily responsible for (a) non-clinical development activities, (b) clinical development activities in NorthAmerica, and (c) manufacturing and supply of clinical drug substance and drug product; and Mylan will be primarily responsible for (a) clinical developmentactivities outside of North America (excluding Japan) (the “ex-U.S. Mylan territories”), (b) regulatory activities, and (c) commercialization for any approvedproduct. Revance will be solely responsible for an initial portion of non-clinical development costs. The remaining portion of any non-clinical developmentcosts and clinical development costs for obtaining approval in the U.S. and Europe will be shared equally between the parties, and Mylan will be responsiblefor all other clinical development costs and commercialization expenses. Revance and Mylan will form a joint steering committee, consisting of an equalnumber of members from Revance and Mylan, to oversee and manage the development, manufacture and commercialization of the biosimilar. The partieswill also enter into a separate agreement, within six months, covering supply of drug substance and drug product. In addition, Mylan may elect to have thedrug product manufactured by another party, including a third-party contract manufacturing organization or a Mylan affiliate.Revance has granted Mylan an exclusive, world-wide license (excluding Japan) to the Company’s intellectual property rights for the developmentand commercialization of the biosimilar under the Agreement. Revance has retained all rights in Japan and has retained rights in the U.S. and ex-U.S. Mylanterritories to develop and manufacture the biosimilar for Mylan to commercialize.Mylan has agreed to pay Revance a non-refundable upfront payment of $25 million with contingent payments of up to $100 million, in theaggregate, upon the achievement of specified clinical and regulatory (i.e. biosimilar biological pathway) milestones and of specified, tiered sales milestonesof up to $225 million. In addition, Mylan will pay Revance royalties on sales of the biosimilar in the Mylan territories. With respect to royalties on sales ofthe biosimilar in the Mylan territories, Mylan would pay Revance low to mid double digit royalties on any sales of the biosimilar in the U.S., mid doubledigit royalties on any sales in Europe, and high single digit royalties on any sales in other ex-U.S. Mylan territories. However, Revance has agreed to waiveroyalties for U.S. sales, up to a limit of $50 million in annual sales, during the first approximately four years after commercialization to defray launch costs.The term of the collaboration will continue, on a country-by-country basis, in perpetuity until terminated by either party pursuant to the terms of theAgreement. Either party may terminate the agreement for breach by, or bankruptcy of, the other party. Mylan may terminate the Agreement in its entirety oron a region-by-region basis, and may also terminate if a biosimilar development pathway is not deemed viable, with such determination only occurring afteran FDA advisory meeting. All rights, including licenses, and obligations terminate in the country or countries for which termination applies, with limitedexceptions for royalty-bearing licenses to certain intellectual property rights, and rights to certain data, for the continued development and sale of thebiosimilar in the country or countries for which termination applies.The Company is currently evaluating the impact this agreement will have on the Company's Consolidated Financial Statements.15. Quarterly Results of Operations (Unaudited)The following amounts are in thousands, except per share amounts: F-33Table of ContentsREVANCE THERAPEUTICS, INC.Notes to Consolidated Financial Statements — (Continued) For the Quarters Ended December 31, September 30, June 30, March 31, 2017Revenue$37 $75 $75 $75Loss on Impairment$(2,927) $— $— $—Net loss$(35,906) $(30,651) $(26,874) $(27,156)Basic and Diluted net loss attributable to commonstockholders$(35,906) $(30,651) $(26,874) $(27,156)Basic and Diluted net loss per share attributable tocommon stockholders(1)$(1.14) $(1.01) $(0.90) $(0.94) 2016Revenue$75 $75 $75 $75Loss on Impairment$(7,111) $— $(1,949) $—Net loss$(26,802) $(17,978) $(24,602) $(19,888)Basic and Diluted net loss attributable to commonstockholders$(26,802) $(17,978) $(24,602) $(19,888)Basic and Diluted net loss per share attributable tocommon stockholders$(0.95) $(0.64) $(0.88) $(0.71)(1) Net loss per share amounts are calculated discretely and therefore may not add up to the total due to rounding. F-34Table of ContentsSIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed onits behalf by the undersigned, thereunto duly authorized, in the City of Newark, State of California on the 2nd day of March, 2018. REVANCE THERAPEUTICS, INC. By: /s/ L. Daniel Browne L. Daniel Browne President and Chief Executive OfficerPOWER OF ATTORNEYKNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints L. Daniel Browne and LaurenP. Silvernail, and each of them, as his or her true and lawful attorneys-in-fact and agents, with full power of substitution for him or her, and in his or her namein any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and otherdocuments in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, fullpower and authority to do and perform each and every act and thing requisite and necessary to be done therewith, as fully to all intents and purposes as he orshe might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, and any of them, his or her substitute orsubstitutes, may lawfully do or cause to be done by virtue hereof.Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons onbehalf of the Registrant and in the capacities and on the dates indicated. SignaturesTitleDate /s/ L. Daniel BrownePresident, Chief ExecutiveMarch 2, 2018L. Daniel BrowneOfficer and Director (Principal Executive Officer) /s/ Lauren P. SilvernailChief Financial Officer andMarch 2, 2018Lauren P. SilvernailChief Business Officer (Principal Financial and Accounting Officer) /s/ Angus C. RussellDirector, ChairmanMarch 2, 2018Angus C. Russell /s/ Robert ByrnesDirectorMarch 2, 2018Robert Byrnes /s/ Mark FoleyDirectorMarch 2, 2018Mark Foley /s/ Julian S. GangolliDirectorMarch 1, 2018Julian S. Gangolli /s/ Phyllis GardnerDirectorMarch 2, 2018Phyllis Gardner, M.D. /s/ Philip J. VickersDirectorMarch 1, 2018Philip J. Vickers, Ph.D. Exhibit 10.24 REVANCE THERAPEUTICS, INC.Third Amended and RestatedEXECUTIVE SEVERANCE BENEFIT PLAN1. INTRODUCTION. This Revance Therapeutics, Inc. Third Amended and Restated Executive Severance Benefit Plan (the “Plan”) is established byRevance Therapeutics, Inc. (the “Company”). The Plan was originally adopted by the Board on December 17, 2013; became effective without further actionon the IPO Date (as defined below)(the “Effective Date”); and was amended on May 7, 2015, February 16, 2017 and November 16, 2017.The Plan provides for severance benefits to the Chief Executive Officer, other executive officers, senior vice presidents and vice presidents, and keyemployees of the Company designated by the Board. This document constitutes the Summary Plan Description for the Plan.2. DEFINITIONS. For purposes of the Plan, the following terms are defined as follows:(a) “Accrued Amounts” means any unpaid annual base salary accrued through the date of a Participant’s Qualifying Termination and any accruedbut unpaid vacation pay.(b) “Annual Bonus” means the annual cash bonus that a Participant is eligible to earn, if any, pursuant to the Participant’s Executive EmploymentAgreement with the Company, as it may be amended from time to time.(c) “Annual Bonus Target” means a Participant’s Annual Bonus with respect to performance for the year in which the Qualifying Terminationoccurs, calculated assuming the Participant achieves the maximum possible annual target bonus percentage for that year.(d) “Board” means the Board of Directors of the Company.(e) “Cause”, as determined by the Board in its sole discretion, means: (i) such Participant’s commission of any felony or any crime involving fraud,dishonesty or moral turpitude under the laws of the United States or any state thereof; (ii) such Participant’s attempted commission of, or participation in, afraud or act of dishonesty against the Company; (iii) such Participant’s intentional, material violation of any contract or agreement between the Participantand the Company or of any statutory duty owed to the Company; (iv) such Participant’s unauthorized use or disclosure of the Company’s confidentialinformation or trade secrets; or (v) such Participant’s gross misconduct.(f) “Change in Control” shall have the meaning set forth in the Company’s 2014 Equity Incentive Plan. The definition of Change in Control isintended to conform to the definitions of “change in ownership of a corporation” and “change in ownership of a substantial portion of a corporation’s assets”provided in Treasury Regulation Sections 1.409A-3(i)(5)(v) and (vii).(g) “Change in Control Termination” means (i) a Participant’s dismissal or discharge by the Company for a reason other than death, disability, orCause, or (ii) a Resignation for Good Reason, either of which occurs in connection with or within twelve (12) months following the effective date of a Changein Control, provided that any such termination is a Separation from Service. In no event will a Participant’s Separation from Service due to death, disability orCause, or a resignation by a Participant without Good Reason, constitute a Change in Control Termination.(h) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended and any analogous provisions of applicable statelaw.(i) “Code” means the Internal Revenue Code of 1986, as amended.(j) “Common Stock” means the common stock of the Company.(k) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. (l) “IPO Date” means the date of the underwriting agreement between the Company and the underwriter(s) managing the initial public offering ofthe Common Stock, pursuant to which the Common Stock is priced for the initial public offering.(m) “Monthly Annual Bonus Target” means a Participant’s Annual Bonus Target, divided by 12.(n) “Monthly Base Salary” means the Participant’s annual base salary, ignoring any decrease in annual base salary that forms the basis for aResignation for Good Reason, as in effect on the date of the Qualifying Termination, divided by 12.(o) “Non-Change in Control Termination” means a Participant’s dismissal or discharge by the Company resulting in a Separation from Service, for areason other than death, disability, or Cause, other than in connection with or within twelve (12) months following the effective date of a Change in Control.In no event will a Participant’s Separation from Service due to death, disability or Cause, or a resignation by a Participant for any reason, constitute a Non-Change in Control Termination.(p) “Participant” means each individual who (i) is employed by the Company as an executive officer, senior vice president, vice president, or keyemployee designated by the Board, and (ii) has received and returned a signed Participation Notice.(q) “Participation Notice” means the latest notice delivered by the Company to a Participant informing the Participant that he or she is eligible toparticipate in the Plan, in substantially the form of EXHIBIT A to the Plan.(r) “Plan Administrator” means the Board or any committee of the Board duly authorized to administer the Plan. The Plan Administrator may be,but is not required to be, the Compensation Committee of the Board. The Board may at any time administer the Plan, in whole or in part, notwithstanding thatthe Board has previously appointed a committee to act as the Plan Administrator.(s) “Qualifying Termination” means either a Change in Control Termination or a Non-Change in Control Termination.(t) “Resignation for Good Reason” means a Participant’s resignation from all positions the Participant then holds with the Company, resulting in aSeparation from Service, within ninety (90) days after the expiration of the cure period set forth below, provided the Participant has given the Board writtennotice of the occurrence of any of the following events taken without the Participant’s written consent within thirty (30) days after the first occurrence of suchevent and the Company has not cured such event, to the extent curable, within thirty (30) days thereafter:(i) A material reduction in the Participant’s annual base salary, which the Participant and the Company agree is a reduction of at least fifteen percent(15%) of the Participant’s annual base salary (unless pursuant to a salary reduction program applicable generally to the Company’s similarly situatedemployees);(ii) A material reduction in the Participant’s duties (including responsibilities and/or authorities), provided, however, that, other than with respect tothe Company’s then acting Chief Executive Officer and Chief Financial Officer, a change in job position (including a change in title) shall not be deemed a“material reduction” in and of itself unless the Participant’s new duties are materially reduced from the prior duties;(iii) Relocation of the Participant’s principal place of employment to a place that increases the Participant’s one-way commute by more than thirty-five (35) miles as compared to the Participant’s then-current principal place of employment immediately prior to such relocation;(iv) any failure by the Company to comply with any material provision of this Plan or any material written contractual obligation to Participant,which (in either case) adversely affects the Participant;(v) the failure of any successor-in-interest to assume a material obligation of the Company under this Plan or material written contractual obligationto Participant, which (in either case) adversely affects the Participant.(u) “Separation from Service” means a “separation from service” within the meaning of Treasury Regulations Section 1.409A-1(h), without regard toany alternative definition thereunder.(v) “Severance Multiplier” means:(i) for a Participant who is the Chief Executive Officer of the Company at the time of the Qualifying Termination, (A) fifteen (15), for a Non-Changein Control Termination, and (B) twenty-one (21), for a Change in Control Termination;(ii) for a Participant who is an executive officer of the Company (but not the Chief Executive Officer) or, as applicable, a key employee designatedby the Board, (A) nine (9), for a Non-Change in Control Termination, and (B) twelve (12), for a Change in Control Termination; and(iii) for a Participant who is a senior vice president or vice president of the Company at the time of the Qualifying Termination or, as applicable, akey employee designated by the Board, (A) six (6), for a Non-Change in Control Termination, and (B) nine (9) or twelve (12), as designated at the discretionof the Chief Executive Officer, for a Change in Control Termination; and(w) “Severance Period” means a period of months commencing on the date of a Participant’s Qualifying Termination, with the number of monthsbeing equal to a Participant’s applicable Severance Multiplier.(x) “Stock Awards” means outstanding stock awards for shares of the Company’s common stock granted to a Participant by the governing plandocuments, grant notices and award agreements, including without limitation stock options, restricted stock awards and restricted stock units.3. ELIGIBILITY FOR BENEFITS.(a) Eligibility; Exceptions to Benefits. Subject to the terms and conditions of the Plan, the Company will provide the benefits described in Section 4to the affected Participant. A Participant will not receive benefits under the Plan in the following circumstances, as determined by the Plan Administrator, inits sole discretion:(i) The Plan does not provide for duplication (in whole or in part) of benefits with any other agreement or plan. By signing a ParticipationNotice, a Participant is waiving his or her rights under, and terminating those provisions of, any employment agreement or severance agreement with theCompany that provide for benefits on a Qualifying Termination in existence as of the date that the Participant signs such Participation Notice.(ii) The Participant’s employment is terminated by either the Company or the Participant for any reason other than a QualifyingTermination.(iii) The Participant has not entered into the Employee Proprietary Information and Inventions Agreement or any similar or successordocument (the “Proprietary Information Agreement”).(iv) The Participant has failed to execute and allow to become effective the Release (as defined and described below) within sixty (60) daysfollowing the Participant’s Separation from Service.(v) The Participant has failed to return all Company Property. For this purpose, “Company Property” means all paper and electronicCompany documents (and all copies thereof) created and/or received by the Participant during his or her period of employment with the Company and otherCompany materials and property that the Participant has in his or her possession or control, including, without limitation, Company files, correspondence,emails, memoranda, notes, notebooks, drawings, records, plans, forecasts, reports, studies, analyses, proposals, agreements, financial information, research anddevelopment information, sales and marketing information, operational and personnel information, specifications, code, software, databases, computer-recorded information, tangible property and equipment (including, without limitation, leased vehicles, computers, computer equipment, software programs,facsimile machines, mobile telephones, servers), credit and calling cards, entry cards, identification badges and keys, and any materials of any kind thatcontain or embody any proprietary or confidential information of the Company (and all reproductions thereof, in whole or in part). As a condition toreceiving benefits under the Plan, a Participant must not make or retain copies, reproductions or summaries of any such Company documents, materials orproperty and must make a diligent search to locate any such documents, property and information. If the Participant has used any personally ownedcomputer, server, or e-mail system to receive, store, review, prepare or transmit any Company confidential or proprietary data, materials or information, thenwithin ten (10) business days after the Separation from Service, the Participant must provide the Company with a computer-useable copy of all suchinformation and then permanently delete and expunge such confidential or proprietary information from those systems. However, a Participant is not requiredto return his or her personal copies of documents evidencing the Participant’s hire, termination, compensation, benefits and stock awards and any otherdocumentation received as a stockholder of the Company. A Participant’s failure to return Company Property that is neither confidential nor material, such asan identification badge or calling card, will not, in and of itself, disqualify such Participant from receiving benefits under the Plan; provided, that any suchitems of Company Propertyare subsequently returned to the Company upon request.(vi) The Participant has failed to cooperate fully with the Company in connection with its actual or contemplated defense, prosecution, orinvestigation of any existing or future litigation, arbitrations, mediations, claims, demands, audits, government or regulatory inquiries, or other mattersarising from events, acts, or failures to act that occurred during the time period in which the Participant was employed by the Company (including any periodof employment with an entity acquired by the Company). Such cooperation includes, without limitation, being available upon reasonable notice, withoutsubpoena, to provide accurate and complete advice, assistance and information to the Company, including offering and explaining evidence, providingtruthful and accurate sworn statements, and participating in discovery and trial preparation and testimony. As a condition of receiving benefits under thePlan, the Participant must also promptly send the Company copies of all correspondence (for example, but not limited to, subpoenas) received by theParticipant in connection with any such legal proceedings, unless the Participant is expressly prohibited by law from so doing. The Company will reimbursethe Participant for reasonable out-of-pocket expenses incurred in connection with any such cooperation (excluding foregone wages, salary, or othercompensation) within thirty (30) days after the Participant’s timely presentation of appropriate documentation thereof, in accordance with the Company’sstandard reimbursement policies and procedures, and will make reasonable efforts to accommodate the Participant’s scheduling needs.(b) Termination of Benefits. A Participant’s right to receive benefits under the Plan will terminate immediately if, at any time prior to or during theperiod for which the Participant is receiving benefits under the Plan, the Participant, without the prior written approval of the Plan Administrator:(i) willfully breaches a material provision of the Participant’s Proprietary Information Agreement and/or any obligations of confidentiality,non-solicitation, non-disparagement, no conflicts or non-competition provision set forth in any other agreement between the Company and a Participant(including, without limitation, the Participant’s employment agreement or offer letter) or under applicable law;(ii) encourages or solicits any of the Company’s then current employees to leave the Company’s employ for any reason or interferes in anyother manner with employment relationships at the time existing between the Company and its then current employees; or(iii) induces any of the Company’s then current clients, customers, suppliers, vendors, distributors, licensors, licensees, or other third partyto terminate their existing business relationship with the Company or interferes in any other manner with any existing business relationship between theCompany and any then current client, customer, supplier, vendor, distributor, licensor, licensee, or other third party.4. PAYMENTS & BENEFITS. Except as may otherwise be provided in a Participant’s Participation Notice, in the event of a Qualifying Termination, theCompany will pay the Participant the Accrued Amounts, if any, on the date of such Qualifying Termination. In addition, subject to Sections 5 and 6 and aParticipant’s continued compliance with the provisions of any agreement with the Company, including, without limitation, the Participant’s ProprietaryInformation Agreement, in the event of a Qualifying Termination, the Participant shall be entitled to the payments and benefits described in this Section 4,subject to the terms and conditions of the Plan.(a) Cash Severance.(i) Change in Control Termination. Upon a Change in Control Termination, the Participant will receive as severance an amount equal tothe product of (i) the sum of the Participant’s Monthly Base Salary and Monthly Annual Bonus Target, and (ii) the Participant’s applicable SeveranceMultiplier (the “Change in Control Cash Severance”). The Change in Control Cash Severance will be paid in a single lump sum, less all applicablewithholdings and deductions; provided, however, that no payments will be made prior to the first business day to occur on or after the 60th day following thedate of the Participant’s Qualifying Termination.(ii) Non-Change in Control Termination. Upon a Non-Change in Control Termination, the Participant will receive as severance an amountequal to the product of (i) the Participant’s Monthly Base Salary, and (ii) the Participant’s applicable Severance Multiplier (the “Non-Change in ControlCash Severance”). The Non-Change in Control Cash Severance will be paid in equal installments on the Company’s regular payroll schedule over theSeverance Period, less all applicable withholdings and deductions; provided, however, that no payments will be made prior to the first business day to occuron or after the 60th day following the date of the Participant’s Qualifying Termination. On the first business day to occur on or after the 60th day followingthe date of the Participant’s Qualifying Termination, the Company will pay the Participant in a lump sum the Non-Change in Control Cash Severance that theParticipant would have received on or prior to such date under theoriginal schedule but for the delay while waiting for the 60th day in compliance with Section 409A of the Code and the effectiveness of the Releasereferenced in Section 5(a) below, with the balance of the Non-Change in Control Cash Severance being paid as originally scheduled. (b) COBRA Benefits.(i) If the Participant is eligible and has made the necessary elections for continuation coverage pursuant to COBRA under a health, dental,or vision plan sponsored by the Company, the Company will pay, as and when due directly to the COBRA carrier, the COBRA premiums necessary tocontinue the COBRA coverage for the Participant and his or her eligible dependents until the earliest to occur of (i) the end of the applicable SeverancePeriod, (ii) the date on which the Participant becomes eligible for coverage under the group health insurance plans of a subsequent employer, and (iii) thedate on which the Participant is no longer eligible for continuation coverage under COBRA (such period from the date of the Qualifying Terminationthrough the earliest of (i) through (iii), the “COBRA Payment Period”).(ii) Notwithstanding the foregoing, if at any time the Company determines, in its sole discretion, that the payment of COBRA premiumshereunder is likely to result in a violation of the nondiscrimination rules of Section 105(h)(2) of the Code or any statute or regulation of similar effect(including, without limitation, the 2010 Patient Protection and Affordable Care Act, as amended by the 2010 Health Care and Education Reconciliation Act),then in lieu of providing the COBRA premiums, the Company will instead pay the Participant, on the first day of each month of the remainder of the COBRAPayment Period, a fully taxable cash payment equal to the COBRA premiums for that month, subject to applicable tax withholdings and deductions. To theextent applicable, on the first business day to occur on or after the 60th day following the date of the Participant’s Qualifying Termination, the Company willmake the first payment under this Section 4(b)(ii) in a lump sum equal to the aggregate amount of payments that the Company would have paid through suchdate had such payments commenced on the Separation from Service through such 60th day, with the balance of the payments paid thereafter on the originalschedule. The Participant may, but is not obligated to, use such payments toward the cost of COBRA premiums.(iii) If the Participant becomes eligible for coverage under another employer’s group health plan or otherwise ceases to be eligible forCOBRA during the applicable Severance Period, the Participant must immediately notify the Company of such event, and all payments and obligationsunder this section 4(b) will cease. For purposes of this Section 4(b), references to COBRA also refer to analogous provisions of state law. Any applicableinsurance premiums that are paid by the Company will not include any amounts payable by the Participant under a Code Section 125 health carereimbursement plan, which are the sole responsibility of the Participant.(C) Accelerated Vesting. Upon a Change in Control Termination, the vesting and exercisability (if applicable) of all outstanding and unvestedStock Awards that are held by the Participant on the effective date of the Change in Control Termination will, as of the date of the Change in ControlTermination, accelerate in full as to one hundred percent (100%) of the shares subject to the Stock Awards.5. CONDITIONS AND LIMITATIONS ON BENEFITS.(a) Release. To be eligible to receive any benefits under the Plan, a Participant must sign a general waiver and release in substantially the formattached hereto as EXHIBIT B, EXHIBIT C, or EXHIBIT D, as appropriate (the “Release”), and such release must become effective in accordance with itsterms, in each case within sixty (60) days following the Qualifying Termination. The Plan Administrator, in its sole discretion, may modify the form of therequired Release to comply with applicable law, and any such Release may be incorporated into a termination agreement or other agreement with theParticipant.(b) Prior Agreements; Certain Reductions. The Plan Administrator will reduce a Participant’s benefits under the Plan by any other statutoryseverance obligations or contractual severance benefits, obligations for pay in lieu of notice, and any other similar benefits payable to the Participant by theCompany that are due in connection with the Participant’s Qualifying Termination and that are in the same form as the benefits provided under the Plan (e.g.,equity award vesting credit). Without limitation, this reduction includes a reduction for any benefits required pursuant to (i) any applicable legalrequirement, including, without limitation, the Worker Adjustment and Retraining Notification Act (the “WARN Act”), (ii) a written employment, severanceor equity award agreement with the Company, (iii) any Company policy or practice providing for the Participant to remain on the payroll for a limited periodof time after being given notice of the termination of the Participant’s employment, and (iv) any required salary continuation, notice pay, statutory severancepayment, or other payments either required by local law, or owed pursuant to a collective labor agreement, as a result of the termination of the Participant’semployment. The benefits provided under the Plan are intended to satisfy, to the greatest extent possible, and not to provide benefits duplicative of, any andall statutory, contractual and collective agreement obligations of the Company inrespect of the form of benefits provided under the Plan that may arise out of a Qualifying Termination, and the Plan Administrator will so construe andimplement the terms of the Plan. Reductions may be applied on a retroactive basis, with benefits previously provided being recharacterized as benefitspursuant to the Company’s statutory or other contractual obligations. The payments pursuant to the Plan are in addition to, and not in lieu of, any unpaidsalary, bonuses or employee welfare benefits to which a Participant may be entitled for the period ending with the Participant’s Qualifying Termination. (c) Mitigation. Except as otherwise specifically provided in the Plan, a Participant will not be required to mitigate damages or the amount of anypayment provided under the Plan by seeking other employment or otherwise, nor will the amount of any payment provided for under the Plan be reduced byany compensation earned by a Participant as a result of employment by another employer or any retirement benefits received by such Participant after thedate of the Participant’s termination of employment with the Company (except as provided for in Section 5(b)).(d) Indebtedness of Participants. To the extent permitted under applicable law, if a Participant is indebted to the Company on the effective date of aParticipant’s Qualifying Termination, the Company reserves the right to offset the payment of any benefits under the Plan by the amount of suchindebtedness. Such offset will be made in accordance with all applicable laws. The Participant’s execution of the Participation Notice constitutes knowingwritten consent to the foregoing.(e) Parachute Payments.(i) Except as otherwise expressly provided in an agreement between a Participant and the Company, if any payment or benefit theParticipant would receive in connection with a Change in Control from the Company or otherwise (a “Payment”) would (i) constitute a “parachute payment”within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “ExciseTax”), then such Payment will be equal to the Reduced Amount. The “Reduced Amount” will be either (A) the largest portion of the Payment that wouldresult in no portion of the Payment being subject to the Excise Tax, or (B) the largest portion, up to and including the total, of the Payment, whicheveramount ((A) or (B)), after taking into account all applicable federal, state, provincial, foreign, and local employment taxes, income taxes, and the Excise Tax(all computed at the highest applicable marginal rate), results in the Participant’s receipt, on an after-tax basis, of the greatest economic benefitnotwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachutepayments” is necessary so that the Payment equals the Reduced Amount, reduction will occur in the following order: (1) reduction of cash payments; (2)cancellation of accelerated vesting of stock awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction ofother benefits paid to the Participant. Within any such category of Payments (that is, (1), (2), (3) or (4)), a reduction will occur first with respect to amountsthat are not “deferred compensation” within the meaning of Section 409A of the Code and then with respect to amounts that are “deferred compensation.” Inthe event that acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting will be cancelled in the reverse order of thedate of grant of the Participant’s applicable type of stock award (i.e., earliest granted stock awards are cancelled last). If Section 409A of the Code is notapplicable by law to a Participant, the Company will determine whether any similar law in the Participant’s jurisdiction applies and should be taken intoaccount.(ii) The professional firm engaged by the Company for general tax purposes as of the day prior to the effective date of the Change inControl shall make all determinations required to be made under this Section 5(e). If the professional firm so engaged by the Company is serving as anaccountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall appoint a nationally recognized independentregistered public accounting firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations bysuch professional firm required to be made hereunder. Any good faith determinations of the professional firm made hereunder shall be final, binding andconclusive upon the Company and the Participant.6. TAX MATTERS.(a) Application of Code Section 409A. Notwithstanding anything herein to the contrary, (i) if at the time of Participant’s termination of employmentwith the Company, the Participant is a “specified employee” as defined in Section 409A of the Code and the applicable guidance and regulations thereunder(collectively, “Section 409A”), and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of suchtermination of employment is necessary in order to prevent any accelerated or additional tax under Section 409A, then the Company will defer thecommencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or providedto Participant) until the first business day to occur following the date that is six (6) months following Participant’s termination of employment with theCompany (or the earliest date as is permitted under Section 409A); and (ii) if any other payments of money or other benefits due to Participant hereundercould cause the application of anaccelerated or additional tax under Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefitscompliant under Section 409A, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined by theBoard, that does not cause such an accelerated or additional tax. In the event that payments under the Plan are deferred pursuant to this Section 6 in order toprevent any accelerated tax or additional tax under Section 409A, then such payments shall be paid at the time specified under this Section 6 without anyinterest thereon. The Company shall consult with Participant in good faith regarding the implementation of this Section 6; provided, that neither theCompany nor any of its employees or representatives shall have any liability to Participant with respect thereto. Notwithstanding anything to the contrary herein, to the extent required by Section 409A, a termination of employment shall not be deemed to have occurredfor purposes of any provision of the Plan providing for the payment of amounts or benefits upon or following a termination of employment unless suchtermination is also a “separation from service” within the meaning of Section 409A and, for purposes of any such provision of this Agreement, references to a“resignation,” “termination,” “termination of employment” or like terms shall mean separation from service. For purposes of Section 409A, each paymentmade under the Plan shall be designated as a “separate payment” within the meaning of the Section 409A. Notwithstanding anything to the contrary herein,except to the extent any expense, reimbursement or in-kind benefit provided pursuant to the Plan does not constitute a “deferral of compensation” within themeaning of Section 409A, (A) the amount of expenses eligible for reimbursement or in-kind benefits provided to a Participant during any calendar year willnot affect the amount of expenses eligible for reimbursement or in-kind benefits provided to a Participant in any other calendar year; (B) the reimbursementsfor expenses for which a Participant is entitled to be reimbursed shall be made on or before the last day of the calendar year following the calendar year inwhich the applicable expense is incurred; and (C) the right to payment or reimbursement or in-kind benefits hereunder may not be liquidated or exchangedfor any other benefit.(b) Withholding. All payments and benefits under the Plan will be subject to all applicable deductions and withholdings, including, withoutlimitation, obligations to withhold for federal, state, provincial, foreign and local income and employment taxes.(c) Tax Advice. By becoming a Participant in the Plan, the Participant agrees to review with the Participant’s own tax advisors the federal, state,provincial, local, and foreign tax consequences of participation in the Plan. The Participant will rely solely on such advisors and not on any statements orrepresentations of the Company or any of its agents. The Participant understands that Participant (and not the Company) will be responsible for his or her owntax liability that may arise as a result of becoming a Participant in the Plan.7. REEMPLOYMENT. In the event of a Participant’s reemployment by the Company during the period of time in respect of which severance benefits havebeen provided (that is, benefits as a result of a Qualifying Termination), the Company, in its sole and absolute discretion, may require such Participant torepay to the Company all or a portion of such severance benefits as a condition of reemployment.8. CLAWBACK; RECOVERY. All payments and severance benefits provided under the Plan will be subject to recoupment in accordance with anyclawback policy that the Company is required to adopt pursuant to the listing standards of any national securities exchange or association on which theCompany’s securities are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection Act or other applicable law. Inaddition, the Board may impose such other clawback, recovery or recoupment provisions in the Participation Notice, as the Board determines necessary orappropriate, including but not limited to a reacquisition right in respect of previously acquired shares of Common Stock or other cash or property upon theoccurrence of Cause. No recovery of compensation under such a clawback policy will be an event giving rise to Resignation for Good Reason, constructivetermination, or any similar term under any plan of or agreement with the Company.9. RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION.(a) Exclusive Discretion. The Plan Administrator will have the exclusive discretion and authority to establish rules, forms, and procedures for theadministration of the Plan and to construe and interpret the Plan and to decide any and all questions of fact, interpretation, definition, computation oradministration arising in connection with the operation of the Plan, including, without limitation, the eligibility to participate in the Plan, the amount ofbenefits paid under the Plan and any adjustments that need to be made in accordance with the laws applicable to a Participant. The rules, interpretations,computations and other actions of the Plan Administrator will be binding and conclusive on all persons.(b) Amendment or Termination. The Company reserves the right to amend or terminate the Plan, any Participation Notice issued pursuant to thePlan or the benefits provided hereunder at any time; provided, however, that no such amendmentor termination will apply to any Participant who would be adversely affected by such amendment or termination unless such Participant consents in writingto such amendment or termination. Any action amending or terminating the Plan or any Participation Notice will be in writing and executed by a dulyauthorized officer of the Company.10. NO IMPLIED EMPLOYMENT CONTRACT. The Plan will not be deemed (i) to give any employee or other person any right to be retained in theemploy of the Company, or (ii) to interfere with the right of the Company to discharge any employee or other person at any time, with or without Cause, andwith or without advance notice, which right is hereby reserved. 11. LEGAL CONSTRUCTION. The Plan will be governed by and construed under the laws of the State of California (without regard to principles of conflictof laws), except to the extent preempted by ERISA.12. CLAIMS, INQUIRIES AND APPEALS.(A) Applications for Benefits and Inquiries. Any application for benefits, inquiries about the Plan or inquiries about present or future rights underthe Plan must be submitted to the Plan Administrator in writing by an applicant (or his or her authorized representative). The Plan Administrator is set forth inSection 14(d).(b) Denial of Claims. In the event that any application for benefits is denied in whole or in part, the Plan Administrator must provide the applicantwith written or electronic notice of the denial of the application, and of the applicant’s right to review the denial. Any electronic notice will comply with theregulations of the U.S. Department of Labor. The notice of denial will be set forth in a manner designed to be understood by the applicant and will includethe following:(1) the specific reason or reasons for the denial;(2) references to the specific Plan provisions upon which the denial is based;(3) a description of any additional information or material that the Plan Administrator needs to complete the review and an explanation ofwhy such information or material is necessary; and(4) an explanation of the Plan’s review procedures and the time limits applicable to such procedures, including a statement of theapplicant’s right to bring a civil action under Section 502(a) of ERISA following a denial on review of the claim, as described in Section 12(d).The notice of denial will be given to the applicant within ninety (90) days after the Plan Administrator receives the application, unless specialcircumstances require an extension of time, in which case, the Plan Administrator has up to an additional ninety (90) days for processing the application. If anextension of time for processing is required, written notice of the extension will be furnished to the applicant before the end of the initial ninety (90) dayperiod.The notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is torender its decision on the application.(c) Request for a Review. Any person (or that person’s authorized representative) for whom an application for benefits is denied, in whole or in part,may appeal the denial by submitting a request for a review to the Plan Administrator within sixty (60) days after the application is denied. A request for areview will be in writing and will be addressed to:Revance Therapeutics, Inc.Attn: Human Resources Director7555 Gateway BoulevardNewark, CA 94560A request for review must set forth all of the grounds on which it is based, all facts in support of the request and any other matters that the applicant feels arepertinent. The applicant (or his or her representative) will have the opportunity to submit (or the Plan Administrator may require the applicant to submit)written comments, documents, records, and other information relating to his or her claim. The applicant (or his or her representative) will be provided, uponrequest and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim. The review willtake into account all comments, documents, records and other information submitted by the applicant (or his or her representative) relating to the claim,without regard to whether such information was submitted or considered in the initial benefit determination.(d) Decision on Review. The Plan Administrator will act on each request for review within sixty (60) days after receipt of the request, unless specialcircumstances require an extension of time (not to exceed an additional sixty (60) days), for processing the request for a review. If an extension for review isrequired, written notice of the extension will be furnished to the applicant within the initial sixty (60) day period. This notice of extension will describe thespecial circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the review. The PlanAdministrator will give prompt, written or electronic notice of its decision to the applicant. Any electronic notice will comply with the regulations of the U.S.Department of Labor. In the event that the Plan Administrator confirms the denial of the application for benefits, in whole or in part, the notice will set forth,in a manner designed to be understood by the applicant, the following:(1) the specific reason or reasons for the denial;(2) references to the specific Plan provisions upon which the denial is based;(3) a statement that the applicant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents,records and other information relevant to his or her claim; and(4) a statement of the applicant’s right to bring a civil action under Section 502(a) of ERISA.(e) Rules and Procedures. The Plan Administrator will establish rules and procedures, consistent with the Plan and with ERISA, as necessary andappropriate in carrying out its responsibilities in reviewing benefit claims. The Plan Administrator may require an applicant who wishes to submit additionalinformation in connection with an appeal from the denial of benefits to do so at the applicant’s own expense.(f) Exhaustion of Remedies. No legal action for benefits under the Plan may be brought until the applicant (i) has submitted a written application forbenefits in accordance with the procedures described by Section 12(a), (ii) has been notified by the Plan Administrator that the application is denied, (iii) hasfiled a written request for a review of the application in accordance with the appeal procedure described in Section 12(c), and (iv) has been notified that thePlan Administrator has denied the appeal. Notwithstanding the foregoing, if the Plan Administrator does not respond to an applicant’s claim or appeal withinthe relevant time limits specified in this Section 12, the applicant may bring legal action for benefits under the Plan pursuant to Section 502(a) of ERISA.13. BASIS OF PAYMENTS TO AND FROM PLAN. All benefits under the Plan will be paid by the Company. The Plan will be unfunded, and benefitshereunder will be paid only from the general assets of the Company.14. OTHER PLAN INFORMATION.(a) Employer and Plan Identification Numbers. The Employer Identification Number assigned to the Company (which is the “Plan Sponsor” asthat term is used in ERISA) by the Internal Revenue Service is 77-055-1645. The Plan Number assigned to the Plan by the Plan Sponsor pursuant to theinstructions of the Internal Revenue Service is 502.(b) Ending Date for Plan’s Fiscal Year. The date of the end of the fiscal year for the purpose of maintaining the Plan’s records is December 31.(c) Agent for the Service of Legal Process. The agent for the service of legal process with respect to the Plan is:Revance Therapeutics, Inc.Attn: Chief Financial Officer7555 Gateway BoulevardNewark, CA 94560(d) Plan Sponsor and Administrator. The “Plan Sponsor” and the “Plan Administrator” of the Plan is:Revance Therapeutics, Inc.Attn: Human Resources Director7555 Gateway BoulevardNewark, CA 94560 The Plan Sponsor’s and Plan Administrator’s telephone number is (510) 742-3400. The Plan Administrator is the named fiduciary charged with theresponsibility for administering the Plan.15. STATEMENT OF ERISA RIGHTS.Participants in the Plan (which is a welfare benefit plan sponsored by Revance Therapeutics, Inc.) are entitled to certain rights and protections under ERISA.For the purposes of this Section 15, and under ERISA, Participants are entitled to:Receive Information About the Plan and Benefits(a) Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as worksites, all documents governing the Planand a copy of the latest annual report (Form 5500 Series), if applicable, filed by the Plan with the U.S. Department of Labor and available at the PublicDisclosure Room of the Employee Benefits Security Administration;(b) Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annualreport (Form 5500 Series), if applicable, and an updated (as necessary) Summary Plan Description. The Plan Administrator may make a reasonable charge forthe copies; and(c) Receive a summary of the Plan’s annual financial report, if applicable. The Plan Administrator is required by law to furnish each participant witha copy of this summary annual report.Prudent Actions By Plan FiduciariesIn addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employeebenefit plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of each Plan Participant andtheir beneficiaries. No one, including a Participant’s employer, a Participant’s union or any other person, may fire a Participant or otherwise discriminateagainst a Participant in any way to prevent a Participant from obtaining a Plan benefit or exercising a Participant’s rights under ERISA.Enforcement of Participant RightsIf a Participant’s claim for a Plan benefit is denied or ignored, in whole or in part, a Participant has a right to know why this was done, to obtaincopies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules.Under ERISA, there are steps a Participant can take to enforce the above rights. For instance, if a Participant request a copy of Plan documents or thelatest annual report from the Plan, if applicable, and does not receive them within thirty (30) days, the Participant may file suit in a federal court. In such acase, the court may require the Plan Administrator to provide the materials and pay the Participant up to $110 a day until the Participant receive the materials,unless the materials were not sent because of reasons beyond the control of the Plan Administrator.If a Participant has a claim for benefits that is denied or ignored, in whole or in part, the Participant may file suit in a state or federal court.If a Participant is discriminated against for asserting the Participant’s rights, the Participant may seek assistance from the U.S. Department of Labor,or the Participant may file suit in a federal court. The court will decide who should pay court costs and legal fees. If the Participant is successful, the courtmay order the person the Participant has sued to pay these costs and fees. If the Participant loses, the court may order the Participant to pay these costs andfees, for example, if it finds the Participant’s claim is frivolous.Assistance With QuestionsIf a Participant has any questions about the Plan, the Participant should contact the Plan Administrator. If a Participant has any questions about thisstatement or about the Participant’s rights under ERISA, or if a Participant needs assistance in obtaining documents from the Plan Administrator, theParticipant should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in the telephone directory orthe Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W.,Washington, D.C. 20210. A Participant may also obtain certain publications about the Participant’s rights and responsibilities under ERISA by calling thepublications hotline of the Employee Benefits Security Administration. 16. GENERAL PROVISIONS.(a) Notices. Any notice, demand or request required or permitted to be given by either the Company or a Participant pursuant to the terms of the Planwill be in writing and will be deemed given when delivered personally, when received electronically (including email addressed to the Participant’sCompany email account and to the Company email account of the Company’s Chief Financial Officer), or deposited in the U.S. Mail, First Class with postageprepaid, and addressed to the parties, in the case of the Company, at the address set forth in Section 14(d), in the case of a Participant, at the address as setforth in the Company’s employment file maintained for the Participant as previously furnished by the Participant or such other address as a party may requestby notifying the other in writing.(b) Transfer and Assignment. The rights and obligations of a Participant under the Plan may not be transferred or assigned without the prior writtenconsent of the Company. The Plan will be binding upon any surviving entity resulting from a Change in Control and upon any other person who is asuccessor by merger, acquisition, consolidation or otherwise to the business formerly carried on by the Company without regard to whether or not suchperson or entity actively assumes the obligations hereunder.(c) Waiver. Any party’s failure to enforce any provision or provisions of the Plan will not in any way be construed as a waiver of any such provisionor provisions, nor prevent any party from thereafter enforcing each and every other provision of the Plan. The rights granted to the parties herein arecumulative and will not constitute a waiver of any party’s right to assert all other legal remedies available to it under the circumstances.(d) Severability. Should any provision of the Plan be declared or determined to be invalid, illegal or unenforceable, the validity, legality andenforceability of the remaining provisions will not in any way be affected or impaired.(e) Section Headings. Section headings in the Plan are included only for convenience of reference and will not be considered part of the Plan for anyother purpose. EXHIBIT AREVANCE THERAPEUTICS, INC.EXECUTIVE SEVERANCE BENEFIT PLANPARTICIPATION NOTICETo: Revance Human Resources DirectorDate:Revance Therapeutics, Inc. (the “Company”) has adopted the Revance Therapeutics, Inc. Executive Severance Benefit Plan (the “Plan”). The Company isproviding you this Participation Notice to inform you that you have been designated as a Participant in the Plan. [For SVP/VP only: This ParticipationNotice also informs you that your Severance Multiplier for the purpose of Section 2(v)(iii)(B) of the Plan is currently designated as [nine (9)/ twelve (12)].] Acopy of the Plan document is attached to this Participation Notice. The terms and conditions of your participation in the Plan are as set forth in the Plan andthis Participation Notice, which together constitute the Summary Plan Description for the Plan.You understand that by accepting your status as a Participant in the Plan, you are waiving your rights to receive any severance benefits on any type oftermination of employment under any other contract or agreement with the Company.You also understand that by accepting your status as a Participant in the Plan, your stock options that have been considered to be “incentive stock options”prior to the date hereof may cease to qualify as “incentive stock options” as a result of the vesting acceleration benefit provided in the Plan. By acceptingparticipation, you represent that you have either consulted your personal tax or financial planning advisor about the tax consequences of your participationin the Plan, or you have knowingly declined to do so.Please return a signed copy of this Participation Notice to the Company’s Human Resources Director at the Company’s offices and retain a copy of thisParticipation Notice, along with the Plan document, for your records.REVANCE THERAPEUTICS, INC.: (Signature) By: Title: PARTICIPANT: (Signature) By: EXHIBIT BRELEASE AGREEMENT[EMPLOYEES AGE 40 OR OVER; INDIVIDUAL TERMINATION]I have reviewed, I understand, and I agree completely to the terms set forth in the Revance Therapeutics, Inc. Executive Severance Benefit Plan (the “Plan”).I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between theCompany, affiliates of the Company, and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or anaffiliate of the Company that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.I hereby acknowledge and reaffirm my obligations under my Employee Proprietary Information and Inventions Agreement.Except as otherwise set forth in this Release, I hereby generally and completely release the Company and its affiliates, and its and their parents, subsidiaries,successors, predecessors and affiliates, and their partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys, predecessors,insurers, affiliates and assigns (collectively, the “Released Parties”), of and from any and all claims, liabilities and obligations, both known and unknown,that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to or on the date I sign this Release (collectively,the “Released Claims”). The Released Claims include, but are not limited to: (a) all claims arising out of or in any way related to my employment with theCompany and its affiliates, or their affiliates, or the termination of that employment; (b) all claims related to my compensation or benefits, including salary,bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock awards, or any other ownership interests in theCompany and its affiliates, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith andfair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (e) all federal,state, provincial and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under thefederal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federal Age Discrimination inEmployment Act (as amended) (“ADEA”), the federal Employee Retirement Income Security Act of 1974 (as amended), the federal Family and MedicalLeave Act (as amended) (“FMLA”), the California Family Rights Act (as amended) (“CFRA”), the California Labor Code (as amended), and the CaliforniaFair Employment and Housing Act (as amended).Notwithstanding the foregoing, I understand that the following rights or claims are not included in my Release (the “Excluded Claims”): (a) any rights orclaims for indemnification I may have pursuant to any fully executed indemnification agreement with the Company or its affiliate to which I am a party; thecharter, bylaws, or operating agreements of the Company or its affiliate; or under applicable law; (b) any rights or claims which cannot be waived as a matterof law; or (c) any claims for breach of the Plan arising after the date that I sign this Release. I hereby represent and warrant that, other than the ExcludedClaims, I am not aware of any claims I have or might have against the Released Parties that are not included in the Released Claims.I understand that nothing in this release limits my ability to file a charge or complaint with the Equal Employment Opportunity Commission, the Departmentof Labor, the National Labor Relations Board, the Occupational Safety and Health Administration, the California Department of Fair Employment andHousing, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”). Ifurther understand this release does not limit my ability to communicate with any Government Agencies or otherwise participate in any investigation orproceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. Whilethis release does not limit my right to receive an award for information provided to the Securities and Exchange Commission, I understand and agree that, tomaximum extent permitted by law, I am otherwise waiving any and all rights I may have to individual relief based on any claims that I have released and anyrights waived by signing this release.I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA, and that the consideration given under thePlan for the waiver and release in the preceding paragraphs hereof is in addition to anything of value to which I was already entitled. I further acknowledgethat I have been advised by this writing, as required by the ADEA, that: (a) my waiver and release do not apply to any rights or claims that may arise after thedate I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not do so); (c) I have twenty-one (21) days to consider this Release (although I may choose voluntarily to sign this Release earlier); (d) I have seven (7) days following the date I sign thisRelease to revoke the Release by providing written notice of my revocation to an officer of theCompany; and (e) this Release will not be effective until the date upon which the revocation period has expired, which will be the eighth day after I sign thisRelease.In giving the releases set forth in this Release, which include claims which may be unknown or unsuspected by me at present, I acknowledge that I have readand understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does notknow or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or hersettlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law or legal principle of similar effectin any jurisdiction with respect to the releases granted herein, including but not limited to the release of unknown and unsuspected claims granted in thisRelease.I hereby represent and warrant that: (a) I have been paid all compensation owed and for all time worked; (b) I have received all the leave and leave benefitsand protections for which I am eligible pursuant to FMLA, CFRA, the Company’s policies, or applicable law; and (c) I have not suffered any on-the-jobinjury or illness for which I have not already filed a workers’ compensation claim.I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than twenty-one (21) daysfollowing the date it is provided to me, and I must not subsequently revoke the Release.PARTICIPANT: (Signature) Printed Name:Date: EXHIBIT CRELEASE AGREEMENT[EMPLOYEES AGE 40 OR OVER; GROUP TERMINATION]I have reviewed, I understand, and I agree completely to the terms set forth in the Revance Therapeutics, Inc. Executive Severance Benefit Plan (the “Plan”).I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between theCompany, affiliates of the Company, and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or anaffiliate of the Company that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.I hereby acknowledge and reaffirm my obligations under my Employee Proprietary Information and Inventions Agreement.Except as otherwise set forth in this Release, I hereby generally and completely release the Company and its affiliates, and its and their parents, subsidiaries,successors, predecessors and affiliates, and its and their partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys,predecessors, insurers, affiliates and assigns (collectively, the “Released Parties”), of and from any and all claims, liabilities and obligations, both known andunknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to or on the date I sign this Release(collectively, the “Released Claims”). The Released Claims include, but are not limited to: (a) all claims arising out of or in any way related to myemployment with the Company and its affiliates, or their affiliates, or the termination of that employment; (b) all claims related to my compensation orbenefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock awards, or any otherownership interests in the Company and its affiliates, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the impliedcovenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of publicpolicy; and (e) all federal, state, provincial and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or otherclaims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federal AgeDiscrimination in Employment Act (as amended) (“ADEA”), the federal Employee Retirement Income Security Act of 1974 (as amended), the federal Familyand Medical Leave Act (as amended) (“FMLA”), the California Family Rights Act (as amended) (“CFRA”), the California Labor Code (as amended), and theCalifornia Fair Employment and Housing Act (as amended).Notwithstanding the foregoing, I understand that the following rights or claims are not included in my Release (the “Excluded Claims”): (a) any rights orclaims for indemnification I may have pursuant to any fully executed indemnification agreement with the Company or its affiliate to which I am a party; thecharter, bylaws, or operating agreements of the Company or its affiliate; or under applicable law; (b) any rights or claims which cannot be waived as a matterof law; or (c) any claims for breach of the Plan arising after the date that I sign this Release. I hereby represent and warrant that, other than the ExcludedClaims, I am not aware of any claims I have or might have against the Released Parties that are not included in the Released Claims.I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA, and that the consideration given under thePlan for the waiver and release in the preceding paragraphs hereof is in addition to anything of value to which I was already entitled. I further acknowledgethat I have been advised by this writing, as required by the ADEA, that: (a) my waiver and release do not apply to any rights or claims that may arise after thedate I sign this Release; (b) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (c) I have forty-five (45) days to consider this Release (although I may choose voluntarily to sign this Release earlier); (d) I have seven (7) days following the date I sign thisRelease to revoke the Release by providing written notice of my revocation to an office of the Company; (e) this Release will not be effective until the dateupon which the revocation period has expired, which will be the eighth day after I sign this Release; and (f) I have received with this Release a writtendisclosure under 29 U.S. Code Section 626(f)(1)(H) that includes certain information relating to the Company’s group termination.I understand that nothing in this release limits my ability to file a charge or complaint with the Equal Employment Opportunity Commission, the Departmentof Labor, the National Labor Relations Board, the Occupational Safety and Health Administration, the California Department of Fair Employment andHousing, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”). Ifurther understand this release does not limit my ability to communicate with any Government Agencies or otherwise participate in any investigation orproceeding that may be conducted by any Government Agency, including providing documents or other information, withoutnotice to the Company. While this release does not limit my right to receive an award for information provided to the Securities and Exchange Commission, Iunderstand and agree that, to maximum extent permitted by law, I am otherwise waiving any and all rights I may have to individual relief based on anyclaims that I have released and any rights waived by signing this release.In giving the releases set forth in this Release, which include claims which may be unknown or unsuspected by me at present, I acknowledge that I have readand understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does notknow or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or hersettlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law or legal principle of similar effectin any jurisdiction with respect to the releases granted herein, including but not limited to the release of unknown and unsuspected claims granted in thisRelease.I hereby represent and warrant that: (a) I have been paid all compensation owed and for all time worked; (b) I have received all the leave and leave benefitsand protections for which I am eligible pursuant to FMLA, CFRA, the Company’s policies, or applicable law; and (c) I have not suffered any on-the-jobinjury or illness for which I have not already filed a workers’ compensation claim.I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than forty-five (45) days followingthe date it is provided to me, and I must not subsequently revoke the Release.PARTICIPANT: (Signature) Printed Name:Date: EXHIBIT DRELEASE AGREEMENT[EMPLOYEES UNDER AGE 40]I have reviewed, I understand, and I agree completely to the terms set forth in the Revance Therapeutics, Inc. Executive Severance Benefit Plan (the “Plan”).I understand that this Release, together with the Plan, constitutes the complete, final and exclusive embodiment of the entire agreement between theCompany, affiliates of the Company, and me with regard to the subject matter hereof. I am not relying on any promise or representation by the Company or anaffiliate of the Company that is not expressly stated therein. Certain capitalized terms used in this Release are defined in the Plan.I hereby acknowledge and reaffirm my obligations under my Employee Proprietary Information and Inventions Agreement.Except as otherwise set forth in this Release, I hereby generally and completely release the Company and its affiliates, and its and their parents, subsidiaries,successors, predecessors and affiliates, and its and their partners, members, directors, officers, employees, stockholders, shareholders, agents, attorneys,predecessors, insurers, affiliates and assigns (collectively, the “Released Parties”), of and from any and all claims, liabilities and obligations, both known andunknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to or on the date I sign this Release(collectively, the “Released Claims”). The Released Claims include, but are not limited to: (a) all claims arising out of or in any way related to myemployment with the Company and its affiliates, or their affiliates, or the termination of that employment; (b) all claims related to my compensation orbenefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock awards, or any otherownership interests in the Company and its affiliates, or their affiliates; (c) all claims for breach of contract, wrongful termination, and breach of the impliedcovenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of publicpolicy; and (e) all federal, state, provincial and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or otherclaims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990 (as amended), the federalEmployee Retirement Income Security Act of 1974 (as amended), the federal Family and Medical Leave Act (as amended) (“FMLA”), the California FamilyRights Act (as amended) (“CFRA”), the California Labor Code (as amended), and the California Fair Employment and Housing Act (as amended).Notwithstanding the foregoing, I understand that the following rights or claims are not included in my Release (the “Excluded Claims”): (a) any rights orclaims for indemnification I may have pursuant to any fully executed indemnification agreement with the Company or its affiliate to which I am a party; thecharter, bylaws, or operating agreements of the Company or its affiliate; or under applicable law; (b) any rights or claims which cannot be waived as a matterof law; or (c) any claims for breach of the Plan arising after the date that I sign this Release. I hereby represent and warrant that, other than the ExcludedClaims, I am not aware of any claims I have or might have against the Released Parties that are not included in the Released Claims.I understand that nothing in this release limits my ability to file a charge or complaint with the Equal Employment Opportunity Commission, the Departmentof Labor, the National Labor Relations Board, the Occupational Safety and Health Administration, the California Department of Fair Employment andHousing, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”). Ifurther understand this release does not limit my ability to communicate with any Government Agencies or otherwise participate in any investigation orproceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. Whilethis release does not limit my right to receive an award for information provided to the Securities and Exchange Commission, I understand and agree that, tomaximum extent permitted by law, I am otherwise waiving any and all rights I may have to individual relief based on any claims that I have released and anyrights waived by signing this release.In giving the releases set forth in this Release, which include claims which may be unknown or unsuspected by me at present, I acknowledge that I have readand understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does notknow or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or hersettlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law or legal principle of similar effectin any jurisdiction with respect to the releases granted herein, including but not limited to the release of unknown and unsuspected claims granted in thisRelease.I hereby represent and warrant that: (a) I have been paid all compensation owed and for all time worked; (b) I have received all the leave and leave benefitsand protections for which I am eligible pursuant to FMLA, CFRA, the Company’s policies, or applicable law; and (c) I have not suffered any on-the-jobinjury or illness for which I have not already filed a workers’ compensation claim.I acknowledge that to become effective, I must sign and return this Release to the Company so that it is received not later than fourteen (14) days followingthe date it is provided to me.PARTICIPANT: (Signature) Printed Name:Date: 141311021 v2 Exhibit 10.26REVANCE THERAPEUTICS, INC. 2018 MANAGEMENT BONUS PROGRAMOn February 8, 2018, the Compensation Committee of the Board of Directors of Revance Therapeutics, Inc. (the “Company”) approved the Company’s 2018corporate objectives, weighted for purposes of determining bonuses, if any, for the Company’s executive officers with respect to performance for fiscal year2018 (the “2018 Bonus Program”).The 2018 Bonus Program is designed to reward, through the payment of annual cash bonuses, the Company’s executive officers for the Company’sperformance in meeting key corporate objectives and for individual performance in meeting specified corporate goals for the year.The Company’s 2018 corporate goals include the achievement of clinical development and non-clinical milestones for RT002 injectable for the treatment ofglabellar (frown) lines, cervical dystonia, plantar fasciitis and other potential indications (65% weighting), achievement of commercialization objectives(20% weighting), and achievement of other research and regulatory milestones (5-15% weighting), as well as a stretch goal of achieving other developmentrelated milestones (up to 25% weighting).The cash bonus for L. Daniel Browne will be based on the achievement of the 2018 corporate goals (100% weighting). The cash bonus for Todd Zavodnick,Lauren P. Silvernail and Abhay Joshi, Ph.D. will be based on the achievement of the 2018 corporate goals (75% weighting) and his or her individualperformance goals (25% weighting). The executive officers’ actual bonuses for fiscal year 2018 may exceed 100% of his or her 2018 target bonus percentagein the event performance exceeds the predetermined goals and/or upon the achievement of other specified goals, including stretch goals. Payment of bonuses to the Company’s executive officers under the 2018 Bonus Program and the actual amount of such bonus, if any, are within thediscretion of the Compensation Committee. The actual bonus awarded, if any, may be more or less than each executive’s annual target bonus. Exhibit 21.1REVANCE THERAPEUTICS, INC.LIST OF SUBSIDIARIES1. Revance Therapeutics LTD, a wholly owned subsidiary incorporated in England and Wales.2. Revance International Limited, a wholly owned subsidiary incorporated in the Cayman Islands.Exhibit 23.1CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe hereby consent to the incorporation by reference in the Registration Statements on Forms S‑8 (Nos. 333-216342, 333-209949, 333-208543, 333-203235,333-198499, and 333-193963) and the Registration Statements on Forms S-3 (Nos. 333-210001, 333-207469 and 333-221911) of Revance Therapeutics Inc.of our report dated March 2, 2018 relating to the financial statements, which appears in this Form 10‑K./s/ PricewaterhouseCoopers LLP San Jose, CaliforniaMarch 2, 2018Exhibit 31.1CERTIFICATIONSI, L. Daniel Browne, certify that:1. I have reviewed this annual report on Form 10-K of Revance Therapeutics, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscalquarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting; and5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control overfinancial reporting.Date: March 2, 2018 /s/ L. Daniel Browne L. Daniel Browne President and Chief Executive Officer (Principal Executive Officer) Exhibit 31.2CERTIFICATIONSI, Lauren P. Silvernail, certify that:1. I have reviewed this annual report on Form 10-K of Revance Therapeutics, Inc.;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for theregistrant and have:(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles;(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscalquarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, theregistrant’s internal control over financial reporting; and5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control overfinancial reporting.Date: March 2, 2018 /s/ Lauren P. Silvernail Lauren P. Silvernail Chief Financial Officer and Chief Business Officer (Principal Financial Officer) Exhibit 32.1CERTIFICATIONPursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 ofChapter 63 of Title 18 of the United States Code (18 U.S.C. §1350), L. Daniel Browne, President and Chief Executive Officer of Revance Therapeutics, Inc.(the “Company”), hereby certifies that, to the best of his knowledge:1.The Company’s Annual Report on Form 10-K for the period ended December 31, 2017 (the “Annual Report”), to which this Certification is attachedas Exhibit 32.1, fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act, and2.The information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of theCompany.In Witness Whereof, the undersigned has set his hand hereto as of the 2nd day of March, 2018. /s/ L. Daniel Browne L. Daniel Browne President and Chief Executive Officer “This certification accompanies the Form 10-K to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to beincorporated by reference into any filing of Revance Therapeutics, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,as amended (whether made before or after the date of the Form 10-K), irrespective of any general incorporation language contained in such filing.”Exhibit 32.2CERTIFICATIONPursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 ofChapter 63 of Title 18 of the United States Code (18 U.S.C. §1350), Lauren P. Silvernail, Chief Financial Officer and Chief Business Officer of RevanceTherapeutics, Inc. (the “Company”), hereby certifies that, to the best of her knowledge:1.The Company’s Annual Report on Form 10-K for the period ended December 31, 2017 (the “Annual Report”), to which this Certification is attachedas Exhibit 32.2, fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act, and2.The information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of theCompany.In Witness Whereof, the undersigned has set her hand hereto as of the 2nd day of March, 2018. /s/ Lauren P. Silvernail Lauren P. Silvernail Chief Financial Officer and Chief Business Officer “This certification accompanies the Form 10-K to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to beincorporated by reference into any filing of Revance Therapeutics, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,as amended (whether made before or after the date of the Form 10-K), irrespective of any general incorporation language contained in such filing.”

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