Actionable news
0
All posts from Actionable news
Actionable news in RVNC: REVANCE THERAPEUTICS Inc,

Revance: Special Note Regarding Forward-Looking Statements

The following excerpt is from the company's SEC filing.

This current report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this current report, including statements regarding our future financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as believe, will, may, estimate, continue, anticipate, intend, should, plan, expect, predict, could, potentially or the negative of these terms or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include, but are not limited to, statements concerning the following:

our expectations regarding the results and the timing of clinical trials in our development of RT001 for the treatment of crows feet, hyperhidrosis or other indications;

our expectations regarding the results and the timing of clinical trials of RT002 for the treatment of glabellar lines, muscle movement disorders including cervical dystonia or other indications;

our expectations regarding our future development of RT001 and RT002 for other therapeutic or aesthetic indications;

our expectation regarding the timing of our regulatory submissions for approval of RT001 for the treatment of crows feet in the United States, Europe and other countries or for the treatment of hyperhidrosis in the United States;

the potential for commercialization of RT001 and RT002, if approved, by us;

our expectations regarding the potential market size, opportunity and growth potential for RT001 and RT002, if approved for commercial use;

our belief that RT001 and RT002 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 product candidates, if approved;

our ability to transfer manufacturing from third parties to our facility and to scale up our manufacturing capabilities if our product candidates 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, 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, or the JOBS Act;

our financial performance; and

developments and projections relating to our competitors and our industry.

These forward-looking statements are subject to a number of risks, uncertainties and assumptions described under the section titled Risk Factors and elsewhere in this current report and our filings with the SEC. We also operate in a very competitive and rapidly changing environment. New risks emerge from time to time and it is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances described in this current report and our other filings with the SEC may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements contained in this current report.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance, events, circumstances or achievements reflected in the forward-looking statements will ever be achieved or occur. These forward-looking statements represent our estimates and assumptions only as of the date of the document containing the applicable statement. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason to conform these statements to actual results or to changes in our expectations.

You should read this current report and our filings with the SEC with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

OUR COMPANY AND RECENT DEVELOPMENTS

Revance Therapeutics, Inc. is a clinical-stage specialty biopharmaceutical company focused on the development, manufacturing, and commercialization of novel botulinum toxin products for multiple aesthetic and therapeutic indications. We are leveraging our proprietary portfolio of botulinum toxin type A compounds, combined with our patented TransMTS

peptide delivery system, to address unmet needs in large and growing neurotoxin markets. Our proprietary TransMTS technology enables delivery of botulinum toxin type A through two investigational drug product candidates, RT001, also referred to as RTT150 (Botulinum Toxin Type A) Topical Gel, and RT002, or RTT150 (Botulinum Toxin Type A) for Injection. We are pursuing clinical development for RT001 and RT002 in a broad spectrum of aesthetic and therapeutic indications. We hold worldwide rights for all indications of RT001, RT002, and our TransMTS technology platform.

RT001 has the potential to be the first commercially available non-injectable dosage form of botulinum toxin type A. We are studying RT001 for aesthetic indications, such as crows feet (wrinkles around the eyes, also known as lateral canthal lines), and therapeutic indications, such as hyperhidrosis (excessive sweating). RT002 is a novel, injectable formulation of botulinum toxin type A designed to be a targeted and long-lasting injectable botulinum toxin type product. We are studying injectable RT002 for aesthetic indications, such as glabellar (frown) lines, and therapeutic uses, such as muscle movement disorders, including cervical dystonia. Both products may have the potential to expand into additional aesthetic and therapeutic indications in the future.

RT002 for Injection

We are developing RT002, an injectable formulation of botulinum toxin type A, for indications where deep delivery of the botulinum toxin is required and a long-lasting effect is desired. We believe RT002 may provide targeted delivery of botulinum toxin to intended treatment sites, while reducing the unwanted spread of botulinum toxin to adjacent areas. We believe, and our preclinical and clinical studies indicate, that this targeted delivery, enabled by our proprietary peptide technology, may permit safe administration of higher doses of botulinum toxin and may result in long-lasting effect. We have demonstrated these properties in preclinical studies and have tested RT002 in a four-cohort, dose escalating, open-label Phase 1/2 clinical trial outside of the United States for the treatment of glabellar lines, the vertical lines between the eyebrows and above the nose. Data from this clinical trial indicated that RT002 appears to be well tolerated and met efficacy endpoints at all four doses. We also reported duration of effect of seven months from the last cohort of this trial, the only cohort for which duration of effect was measured. Based upon the results to date, we are further developing RT002 for the treatment of glabellar lines and reported interim results from BELMONT, a Phase 2 active comparator clinical trial against the market leader BOTOX

Cosmetic, on October 29, 2015.

The ongoing BELMONT trial involves treatment for glabellar lines in 268 subjects at nine investigational sites in Canada. The trial compares the safety, efficacy and duration of effect of three doses of RT002 against placebo and current market leader, BOTOX Cosmetic/VISTABEL

in a randomized 1:1:1:1:1 trial design. A total of 77 subjects were excluded from the per protocol population across all cohorts in accordance with the trial protocol. The topline interim data from the trial showed that RT002 achieved its primary efficacy measurement at four weeks for all doses of RT002. The study demonstrated six-month RT002 median duration of effect based upon at least 1-point improvement in glabellar lines at maximum frown on the Investigator Global Assessment-Facial Wrinkle Severity, or IGA-FWS, scale. The four week primary efficacy measurement of at least 1-point improvement in glabellar lines based on the IGA-FWS scale for all three doses (20 Units, 40 Units and 60 Units) of RT002 was highly statistically significant (p<0.001) as compared to placebo for all three doses. All doses of RT002 achieved a 100 percent response rate of at least 1-point improvement in glabellar lines, based on the IGA-FWS scale, at four weeks versus a 95 percent response rate for BOTOX Cosmetic. In the trial, RT002 40U achieved statistically significant six-month duration of effect. Additionally, RT002 40U was statistically significant in duration compared to BOTOX Cosmetic for all definitions on the IGA-FWS scale by both Intent to Treat, or ITT, and Per Protocol, or PP, populations. RT002 40U also achieved statistical significance compared to BOTOX Cosmetic on all three responder definitions for the IGA-FWS median duration of effect. On the IGA-FWS duration of response, RT002 demonstrated a 23.6-week median duration versus BOTOX Cosmetic with an 18.8-week median duration (p=0.020). More than twice as many subjects receiving 40 Units and 60 Units of RT002 in the study maintained none or mild wrinkles on the IGA-FWS scale, as compared to BOTOX Cosmetic at Week 16 (p

0.002). Outcomes reported by subjects were consistent with investigator findings of duration and efficacy of RT002. Across all cohorts, RT002 appeared to be generally safe and well tolerated. Adverse events were generally mild, localized and transient. No subjects receiving two of the doses evaluated, 20 Units and 40 Units of RT002, experienced ptosis (eyelid droop). There were no serious adverse events or evidence of any systemic exposure at any of the three doses evaluated. We plan to report final results from our BELMONT trial and conduct an End-of-Phase 2 meeting with the United States Food and Drug Administration, or FDA, in the first half of 2016. We then expect to begin Phase 3 clinical studies of RT002 for the treatment of glabellar lines in the second half of 2016.

Botulinum toxin treatment of glabellar lines is the largest proportion of cosmetic neurotoxin sales in the United States and, according to the American Society for Aesthetic Plastic Surgery, botulinum toxin treatment is the number one nonsurgical cosmetic procedure in the United States. We believe RT002 has the potential to satisfy significant unmet needs in this market. According to market research we conducted in April 2015, which involved a quantitative study with eighty dermatologists and plastic surgeons, 60% of the physicians surveyed stated that longer duration is a significant unmet need in the market for the botulinum toxin treatment of glabellar lines and 75% stated that they are likely or very likely to use RT002 based on both injectable data available during the study and the RT002 product concept.

We have also initiated a Phase 2 dose-escalating, open-label clinical study of RT002 in the therapeutic indication of cervical dystonia, an indication for which botulinum toxin is already approved as a treatment. The Phase 2 study will evaluate safety, preliminary efficacy, and duration of effect of RT002 for injection in subjects with moderate-to-severe isolated cervical dystonia symptoms of the neck. We expect to release interim results in 2016. The category of muscle movement disorders, which includes cervical dystonia, accounted for approximately half of the estimated $1.8 billion neurotoxin therapeutic sales globally in 2014.

RT001 Topical Gel

We are developing and plan to commercialize RT001 for indications where topical application provides a meaningful advantage over injectable administration. RT001 is designed to have primary advantages, which include painless topical administration, no bruising, ease of use and limited dependence on administration technique by physicians and medical staff. We believe these potential advantages may improve the experience of patients undergoing botulinum toxin procedures and make RT001 suitable for multiple indications.

The first indications we are pursuing are in the fields of dermatology and plastic surgery. If approved, we believe RT001 can expand the overall botulinum toxin aesthetic market by appealing to new patients who would prefer a needle-free approach to treatment. The aesthetic dermatology market is attractive because we believe that patients in this market tend to be open to trying new products and are willing to pay for aesthetic procedures out of pocket, reducing reliance on reimbursement. We are focused on this market not only because of its size and growth potential but also because, in the United States and Europe, this market can be easily accessed by a specialty sales force and distributor network.

We are in a Phase 3 development program of RT001 in North America for the treatment of crows feet. During the third quarter of 2015, we initiated REALISE 1, a pivotal Phase 3 clinical trial designed to evaluate the safety and efficacy of a single, bilateral administration of RT001 topical gel compared to placebo in subjects with moderate to severe crows feet. We expect to report efficacy data from this study in the first half of 2016. To date, we have conducted seventeen clinical trials with RT001 for the treatment of crows feet, with a total of over 1,600 subjects. In two of our Phase 2b clinical trials, RT001 demonstrated a statistically significant and clinically meaningful reduction in crows feet visible to both physicians and subjects. After completing our Phase 2b clinical trials, we modified the formulation of the RT001 diluent. We then conducted a Phase 3 clinical trial with this new diluent formulation to evaluate the efficacy and safety of RT001. Data generated from this clinical trial were inconsistent with the data from our previous three Phase 2b clinical trials for the treatment of crows feet. Specifically, we observed no improvement from baseline in either the placebo or RT001 group. We initiated two open-label studies to further assess our RT001 investigational topical drug product candidate. Following analysis of the data available from these open-label studies, taken together with our analysis of prior studies and early data from newly developed clinical methods, we decided to proceed with a RT001 U.S. Phase 3 clinical trial for the treatment of crows feet. Our clinical and other studies have consistently indicated that RT001 appears to be well tolerated with no serious adverse events related to the study drug or study treatment procedures or other safety concerns.

We are also developing RT001 for therapeutic applications where botulinum toxin has shown efficacy and that are particularly well suited for needle-free treatments. We have completed initial Phase 2 clinical trials for the treatment of primary axillary, or underarm, hyperhidrosis, and for the prevention of chronic migraine headache. In the third quarter of 2015, we initiated an additional randomized, double-blinded, dose-ranging, placebo-controlled Phase 2 clinical trial designed to evaluate the safety and efficacy of a single, bilateral application of RT001 Topical Gel for the treatment of primary axillary hyperhidrosis and expect to report interim results later in the fourth quarter of 2015.

Since commencing operations in 2002, we have devoted substantially all our efforts to identifying and developing product candidates for the aesthetic and therapeutic markets, recruiting personnel and raising capital. We have devoted predominantly all of our resources to the preclinical and clinical development of, and manufacturing capabilities for, RT001 and RT002. We have retained all rights to develop and commercialize RT001 and RT002 worldwide. We have not filed for approval with the FDA for the commercialization of RT001 or RT002 and we have not generated any revenue from product sales for RT001 or RT002.

As of September 30, 2015, we had cash, cash equivalents, and investments of $144.2 million. Through September 30, 2015, we have funded substantially all of our operations through the sale and issuance of our common stock, preferred stock, venture debt and convertible debt. In March 2015, we entered into an At-The-Market, or ATM, sales agreement, or the ATM agreement, with Cowen and Company, LLC, or Cowen, under which we may offer and sell our common stock having aggregate proceeds of up to $50.0 million from time to time. As of September 30, 2015, we sold 352,544 shares of our common stock under the ATM agreement at a weighted average price of $30.76 per share, resulting in net proceeds of approximately $10.1 million, after underwriting discounts, commissions and other offering expenses. On June 19, 2014, we completed a follow-on public offering, pursuant to which we issued 4,600,000 shares of common stock at $30.50 per share, including the exercise of the underwriters option to purchase 600,000 additional shares of common stock, for net proceeds of $131.3 million, after underwriting discounts, commissions and other offering expenses. On February 6, 2014, we completed our initial public offering, or IPO, for sale of 6,900,000 shares of common stock at $16.00 per share, including the exercise of the underwriters option to purchase an additional 900,000 shares of common stock, for net proceeds of $98.6 million, after underwriting discounts, commissions and other offering expenses. We also raised $23.7 million through the issuance of convertible notes in the fourth quarter of 2013 and January 2014.

On October 31, 2015, we entered into a separation agreement with Arthur P. Bertolino, M.D., Ph.D., our Chief Medical Officer and Executive Vice President, pursuant to which he resigned his employment with the Company, effective as of December 31, 2015, to pursue opportunities outside of the Company. Dr. Bertolino was previously granted options to purchase an aggregate of 152,570 shares of the Companys common stock and restricted stock awards for an aggregate of 45,453 shares. In connection with the separation and transition, the Company agreed to accelerate the vesting of a portion of his outstanding equity awards. If he remains employed with the Company through November 15, 2015, then his option grants and restricted stock awards will have vested with respect to an aggregate of 76,286 shares and 23,740 shares, respectively. If he remains employed with the Company through December 31, 2015, then his option grants and restricted stock awards will have vested with respect to an aggregate of 114,428 shares and 35,610 shares, respectively. Dr. Bertolino will not be entitled to cash severance payments in connection with his departure. The terms of the separation agreement further provide for a general release and other customary provisions.

Our Corporate Information

We were incorporated in Delaware in August 1999 under the name Essentia Biosystems, Inc. We commenced operations in June 2002 and, in April 2005, 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 www.revance.com. The information contained in, or that can be accessed through, our website is not part of this current report.

We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012. As an emerging growth company we are eligible for exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and reduced disclosure obligations regarding executive compensation. 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 initial public offering in February 2014, (b) in which we have total annual gross revenue of at least $1.0 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is 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 refer to the Jumpstart Our Business Startups Act of 2012 herein as the JOBS Act, and references herein to emerging growth company shall have the meaning associated with it in the JOBS Act.

Revance Therapeutics, the Revance logos and other trademarks or service marks of Revance appearing in this current report are the property of Revance. This current report contains additional trade names, trademarks and service marks of others, which are the property of their respective owners. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies.

RISK FACTORS

Investing in our common stock involves a high degree of risk. You should carefully consider the risks described below, as well as all other information

included

in our most recent annual report on Form 10-K and in our most recent quarterly report on Form 10-Q,

including our condensed consolidated financial statements, the notes thereto and the section entitled Managements Discussion and Analysis of Financial Condition and Results of Operations, before you decide to purchase shares of our common stock. If any of the following risks actually occurs, our business, prospects, financial condition and operating results could be materially harmed. As a result, the trading price of our common stock 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 deem immaterial may also impair our business operations and stock price.

Risks Related to Our Business and Strategy

We are substantially dependent on the clinical and commercial success of our product candidates, primarily our topical product candidate RT001 and our injectable product candidate RT002.

To date, we have invested most of our efforts and financial resources in the research and development of RT001, also referred to as RTT150 (Botulinum Toxin Type A) Topical Gel, our topical formulation of botulinum toxin. We are in a Phase 3 development program for RT001 for the treatment of crows feet. In October 2014, we initiated an open-label study designed to confirm successful transfer of the production of our topical RT001 drug product to our manufacturing facility. Following a comprehensive analysis of the data obtained in such study, we subsequently commenced and completed a second open-label study using RT001 in the first half of 2015. Following analysis of the data obtained from these open-label studies, taken together with our analysis of prior studies and early data from newly developed clinical methods, we decided to proceed with a RT001 U.S. pivotal Phase 3 clinical trial for the treatment of crows feet, which commenced during the third quarter of 2015. To date, we have conducted 17 clinical trials for RT001, with a total of over 1,600 subjects, for the treatment of crows feet. We also initiated a Phase 2 clinical trial for the treatment of primary axillary hyperhidrosis in the third quarter of 2015.

We have also invested in the research and development of an injectable form of botulinum toxin, RT002, also referred to as RTT150 (Botulinum Toxin Type A) for Injection. Based upon the results to date, we are further developing RT002 for the treatment of glabellar lines and reported interim results from BELMONT, a Phase 2 active comparator clinical trial against the market leader BOTOX

The ongoing BELMONT trial involves treatment for glabellar lines in 268 subjects at nine investigational sites in Canada. The trial compares the safety, efficacy and duration of effect of three doses of RT002 against placebo and current market leader, BOTOX Cosmetic/VISTABEL

in a randomized 1:1:1:1:1 trial design. A total of 77 subjects were excluded from the per protocol population across all cohorts in accordance with the trial protocol. The topline interim data from the trial showed that RT002 achieved its primary efficacy measurement at four weeks for all doses of RT002. The study demonstrated six-month RT002 median duration of effect based upon at least 1-point improvement in glabellar lines at maximum frown on the Investigator Global Assessment-Facial Wrinkle Severity, or IGA-FWS, scale. The four week primary efficacy measurement of at least 1-point improvement in glabellar lines based on the IGA-FWS scale for all three doses (20 Units, 40 Units and 60 Units) of RT002 was highly statistically significant (p < 0.001) as compared to placebo for all three doses. All doses of RT002 achieved a 100 percent response rate of at least 1-point improvement in glabellar

lines, based on the IGA-FWS scale, at four weeks versus a 95 percent response rate for BOTOX Cosmetic. In the trial, RT002 40U achieved statistically significant six-month duration of effect. Additionally, RT002 40U was statistically significant in duration compared to BOTOX Cosmetic for all definitions on the IGA-FWS scale by both Intent to Treat, or ITT, and Per Protocol, or PP, populations. RT002 40U also achieved statistical significance compared to BOTOX Cosmetic on all three responder definitions for the IGA-FWS median duration of effect. On the IGA-FWS duration of response, RT002 demonstrated a 23.6-week median duration versus BOTOX Cosmetic with an 18.8-week median duration (p=0.020). More than twice as many subjects receiving 40 Units and 60 Units of RT002 in the study maintained none or mild wrinkles on the IGA-FWS scale, as compared to BOTOX Cosmetic at Week 16 (p

0.002). Outcomes reported by subjects were consistent with investigator findings of duration and efficacy of RT002. Across all cohorts, RT002 appeared to be generally safe and well tolerated. Adverse events were generally mild, localized and transient. No subjects receiving two of the doses evaluated, 20 Units and 40 Units of RT002, experienced ptosis (eyelid droop). The most common adverse events were headache and injection site erythema. There were no serious adverse events or evidence of any systemic exposure at any of the three doses evaluated. We plan to report final results from our BELMONT trial and conduct an End-of-Phase 2 meeting with the United States Food and Drug Administration, or FDA, in the first half of 2016. We then expect to begin Phase 3 clinical studies of RT002 for the treatment of glabellar lines in the second half of 2016. Final results may differ from interim results.

We continue to explore therapeutic indications for muscle movement disorders such as cervical dystonia, which account for a large proportion of neurotoxin therapeutic sales globally, using RT002. In September 2015, we initiated a Phase 2 dose-escalating, open-label clinical study of RT002 in the therapeutic indication of cervical dystonia.

Our 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 RT001 and RT002, as well as any future product candidates. The clinical and commercial success of our product 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 RT001, RT002 and any future product candidates, which may be significantly slower or cost more than we currently anticipate and will depend substantially upon the number and design of such trials and the accurate and satisfactory performance of third-party contractors;

our ability to demonstrate the effectiveness and duration of effect of our product 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 RT001, RT002 or any future 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 of RT001, RT002 or any future product candidates;

the acceptance of parameters for regulatory approval, including our proposed indication, primary endpoint assessment and primary endpoint measurement relating to our lead indications of RT001;

our success in educating physicians and patients about the benefits, administration and use of RT001, RT002 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 RT001, RT002 or any future 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 RT001, RT002 or any future product candidates and to develop, validate and maintain a commercially viable manufacturing process that is compliant with current good manufacturing practices, or cGMP;

our ability to successfully commercialize RT001, RT002 or any future product candidates, if approved for marketing and sale, whether alone or in collaboration with others;

our ability to enforce our intellectual property rights in and to RT001, RT002 or any future product candidates;

our ability to avoid third-party patent interference or intellectual property infringement claims;

acceptance of RT001, RT002 or any future product candidates, if approved, as safe and effective by patients and the medical community; and

the continued acceptable safety profile of RT001, RT002 or any future product candidates following approval.

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 significant delays or an inability to successfully commercialize our product candidates. Accordingly, we cannot assure you that we will be able to generate sufficient revenue through the sale of RT001, RT002 or any future product candidate to continue our business.

We may be unable to obtain regulatory approval for RT001, RT002 or future product candidates under applicable regulatory requirements. The denial or delay of any such approval would delay commercialization and have a material adverse effect on our potential to generate revenue, our business and our results of operations.

To gain approval to market a biologic product such as RT001 and RT002, we must provide the FDA and foreign regulatory authorities with data that adequately demonstrate the safety, purity and potency of the product for the intended indication applied for in a Biologics License Application, or BLA, or other respective regulatory filings. The development of biologic products is a long, expensive and uncertain process, and delay or failure can occur at any stage of any of our clinical trials. A number of companies in the pharmaceutical industry, including biotechnology companies, have suffered significant setbacks in clinical trials, including in Phase 3 development, even after promising results in earlier preclinical studies or clinical trials. These setbacks have been caused by, among other things, findings made while clinical trials were underway and safety or efficacy observations made in clinical trials, including previously unreported adverse events. Success in preclinical testing and early clinical trials does not ensure that later clinical trials will be successful, and the results of clinical trials by other parties may not be indicative of the results in trials we may conduct. In particular, we have conducted two Phase 2b controlled clinical trials of RT001, in which RT001 met the primary efficacy and all secondary endpoints. We have also conducted one open-label, Phase 2b safety trial, which demonstrated that sequential applications of RT001 appear to be safe and well tolerated, even at an accelerated frequency. However, we have conducted one Phase 3 clinical efficacy trial using a modified diluent formulation, the results of which were inconsistent with our previous Phase 2b clinical trials and which did not show improvement from baseline in either the placebo or RT001 group. In

October 2014, we conducted an open-label clinical trial of our topical RT001 drug product. The safety analysis from the 43 subjects enrolled in the open-label trial indicated that RT001 appeared to be well tolerated. The efficacy analysis showed clinically meaningful efficacy measured by the one-point investigators global assessment, or IGA, and the one-point patient severity assessment, or PSA, as well as in the aggregate for the composite one-point assessment. The two-point response rates for the individual IGA and composite IGA and PSA assessments, however, did not meet the endpoints for the subjects enrolled in the trial. Following a comprehensive analysis of the data obtained in this trial, we determined that the preliminary composite results were not adequate to move forward with our Phase 3 pivotal trial at such time.

In the first half of 2015, we then commenced and completed an additional open-label clinical trial using RT001. We designed this study to evaluate the attributes of different RT001 drug products aimed at improving the interaction between our peptide and toxin. The safety analysis from the 69 subjects enrolled in this study indicated that RT001 appeared to be well tolerated. The efficacy analysis for two of the RT001 drug products evaluated in this open-label trial showed clinically meaningful efficacy measured by the one-point IGA and the one-point PSA as well as in the aggregate for the composite one-point assessment. In the same two RT001 drug products evaluated, we observed some two-point composite response but given the small number of subjects enrolled in this trial, the patient response and other results observed are not necessarily predictive of future clinical trial results. Following analysis of the data available from these open-label studies, taken together with our analysis of prior studies and early data from newly developed clinical methods, we decided to proceed with a RT001 U.S. Phase 3 clinical trial for the treatment of crows feet using a drug product that incorporates attributes of the drug products evaluated in the 2015 open-label trial.

If this RT001 drug product, Phase 3 clinical trial or any of our clinical trials do not demonstrate the safety and efficacy to our satisfaction, or to the satisfaction of the FDA, we may be required to conduct additional clinical trials and the timing and our ability to obtain regulatory approval for RT001 could be materially and adversely affected.

Our topical product candidate RT001 is currently in Phase 3 development, and our injectable product candidate RT002 is in Phase 2 development. Our business currently depends substantially on their successful development, regulatory approval and commercialization. We currently have no drug or biologic products approved for sale, and we may never obtain regulatory approval to commercialize RT001 or RT002. The research, testing, manufacturing, labeling, approval, sale, marketing and distribution of drug and biologic products are subject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, and such regulations differ from country to country. We are not permitted to market RT001 or RT002 in the United States until we receive approval of a BLA from the FDA. We are also not permitted to market RT001 or RT002 in any foreign countries until we receive the requisite approval from the regulatory authorities of such countries.

The FDA or any foreign regulatory bodies can delay, limit or deny approval of our product candidates, including RT001 and RT002, for many reasons, including:

our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory body that RT001, RT002 or any future product candidates are safe and effective for the requested indication;

the FDAs or the applicable foreign regulatory agencys disagreement with our trial protocol or the interpretation of data from preclinical studies or clinical trials;

our inability to demonstrate that clinical and other benefits of RT001, RT002 or any future product candidates outweigh any safety or other perceived risks;

the FDAs or the applicable foreign regulatory agencys requirement for additional preclinical or clinical studies;

the FDAs or the applicable foreign regulatory agencys non-approval of the formulation, labeling or the specifications of RT001, RT002 or any future product candidates;

the FDAs or the applicable foreign regulatory agencys failure to approve our manufacturing processes or facilities, or the manufacturing processes or facilities of third-party manufacturers with which we contract; or

the potential for approval policies or regulations of the FDA or the applicable foreign regulatory agencies to significantly change in a manner rendering our clinical data insufficient for approval.

Of the large number of drugs, including biologics, in development, only a small percentage successfully complete the FDA or other regulatory approval processes and are commercialized. We are not conducting and do not plan to conduct our U.S. Phase 3 clinical trials for RT001 under a Special Protocol Assessment, or SPA. In the absence of an agreed SPA, there can be no assurance that the FDA will agree with REALISE 1, our Phase 3 pivotal clinical trial protocols.

Further, after our Phase 2 clinical trials, we used the FDAs Formal Dispute Resolution process to obtain confirmation from the FDA that our proposed indication, primary endpoint assessment and primary endpoint measurement were acceptable for continued clinical trials. At the end of this process, the FDA indicated that the final indication would depend on the patient populations studied, the data collected, and the interpretation of the data during the BLA review process. The FDA also indicated its expectation for demonstration of the paralytic mechanism of action in RT001 to be assessed at maximum contraction, or at smile, to inform its analysis of the risks and benefits of RT001. Our clinical development program for RT001 measures effect at smile as an additional assessment endpoint to demonstrate botulinum toxins effect on the relaxation of muscle at maximum contraction. However, age-related crows feet of the upper face are the lines visible at rest, and the primary endpoint of our clinical development program measures the efficacy of RT001 by a composite of physician and patient assessments at rest.

In August 2014, the FDA issued a Draft Guidance prepared by the Division of Dermatology and Dental Products entitled Upper Facial Lines: Developing Botulinum Toxin Drug Products. The Draft Guidance, among other things, recommends assessing the primary endpoint measurement for efficacy at maximum contraction, recommends defining treatment success as a score of 0 or 1 and at least a two grade reduction on both investigator and subject assessments, and recommends that review of photographs at maximum contraction by a masked independent committee be a required secondary efficacy measurement. We responded to the FDAs request for public comment on the non-binding Draft Guidance on October 30, 2014 and our response was filed as an exhibit to our Current Report on Form 8-K, filed with the SEC on November 4, 2014. We do not know when the guidance will be finalized, if at all, or the recommendations that will be contained therein. Even if final guidance is issued by the FDA, industry may pursue approval using an alternative approach if the approach satisfies the requirements of the applicable statutes and regulations. After consultation with our regulatory consultants, and based on the outcome of our Formal Dispute Resolution and related written confirmation from the FDA that we could proceed with Phase 3 development, we plan to complete our RT001 clinical trials using our current primary endpoint assessment by a composite of investigator and patient assessments at rest, supplemented by an additional assessment at smile to demonstrate the paralytic mechanism of action in RT001 is a botulinum toxin effect.

While the FDA provided written confirmation that our proposed indication, primary endpoint assessment and primary endpoint measurement were acceptable for Phase 3 clinical trials, the FDA has not confirmed that our proposed indication, primary endpoint assessment and primary endpoint measurement are acceptable for regulatory approval. Further, while we did obtain written confirmation

with respect to these aspects of our Phase 3 clinical trial designs, there is no assurance that the FDA will approve our BLA for RT001, will agree that the benefits of RT001 outweigh its risks or will not raise new concerns regarding our clinical trial designs.

Even if we eventually complete clinical testing and receive approval of any regulatory filing for RT001, RT002 or any future product candidates, the FDA or the applicable foreign regulatory agency may grant approval contingent on the performance of costly additional post-approval clinical trials. The FDA or the applicable foreign regulatory agency also may approve RT001, RT002 or any future product candidates for a more limited indication or a narrower patient population than we originally requested, and the FDA or applicable foreign regulatory agency may not approve the labeling that we believe is necessary or desirable for the successful commercialization of our product candidates. Any delay in obtaining, or inability to obtain, applicable regulatory approval for any of our product candidates and RT001, in particular, would delay or prevent commercialization of RT001 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, or at 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 product candidates RT001 and RT002. In particular, our U.S. clinical programs for RT001 and RT002 will require substantial additional funds to complete. We have funded our operations primarily through the sale and issuance of convertible preferred stock, common stock, notes payable and convertible notes. As of September 30, 2015, we had capital resources consisting of cash, cash equivalents, and investments of $144.2 million. On February 6, 2014, we sold 6,900,000 shares of common stock at $16.00 per share for aggregate net proceeds of $98.6 million in our IPO, after underwriting discounts, commissions, and other offering expenses. On June 19, 2014, we sold 4,600,000 shares of common stock at $30.50 per share for aggregate net proceeds of $131.3 million in our follow-on public offering, after underwriting discounts, commissions, and other offering expenses. In the third quarter of 2015, we sold 352,544 shares of our common stock under the ATM agreement at a weighted average price of $30.76 per share, resulting in net proceeds of approximately $10.1 million, after underwriting discounts, commissions, and other offering expenses. We believe that we will continue to expend substantial resources for the foreseeable future for the clinical development of RT001, RT002 and development of any other indications 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 amounts necessary to successfully complete the development and commercialization of RT001, RT002 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 offering and ATM offering will allow us to fund our operations for at least the next 12 months. However, our operating plan may change as a result of many factors currently unknown to us, and we may need to seek additional capital sooner than planned, through public or private equity or debt financings or other sources, such as strategic collaborations. Such financings may result in dilution to stockholders, imposition of debt covenants and repayment obligations or other restrictions that may affect our business. In addition, we may seek additional capital due to favorable market conditions or strategic 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 RT001 and RT002;

the timing of, and the costs involved in, obtaining regulatory approvals for RT001, RT002 or any future product candidates;

the number and characteristics of any additional product candidates we develop or acquire;

the scope, progress, results and costs of researching and developing RT001, RT002 or any future product candidates, and conducting preclinical and clinical trials;

the cost of commercialization activities if RT001, RT002 or any future product candidates are approved for sale, including marketing, sales and distribution costs;

the cost of manufacturing RT001, RT002 or any future product candidates and any products we successfully commercialize and maintaining 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 competing products or treatments;

any product liability or other lawsuits related to our products;

the expenses needed to attract and...


More