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Revance Releases Second Quarter 2018 Results

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Revance Therapeutics, Inc. (NASDAQ:RVNC), a biotechnology company
developing neuromodulators for use in treating aesthetic and therapeutic
conditions, today announced results for the second quarter ended June
30, 2018.

Recent Company Highlights and Upcoming Milestones for
DaxibotulinumtoxinA for Injection (RT002)

  • Revance expects to complete the SAKURA 3 open-label, long-term safety
    study of RT002 for the treatment of glabellar (frown) lines in the
    fourth quarter of 2018. The Company remains on track to file its
    Biologics Licensing Application (BLA) for RT002 to treat glabellar
    (frown) lines in first half of 2019.
  • Revance initiated the ASPEN Phase 3 program with RT002 for the
    treatment of moderate to severe isolated cervical dystonia for the
    U.S. in June of 2018. The program includes a single pivotal trial and
    an open-label safety study, each to enroll approximately 300 patients
    across sites in the U.S., Canada and Europe.
  • Announced the appointments of Susanne Fors, Vice President, Regulatory
    Affairs, Conor Gallagher, Ph.D., as Head of Medical Affairs,
    Aesthetics, and Caryn McDowell as Senior Vice President, General
    Counsel & Corporate Secretary in May of 2018.

"Our clinical body of work for RT002 injectable, including the SAKURA 1
& 2 pivotal trials for the treatment of glabellar lines, supports the
potential for this product to provide patients and physicians with
unequaled, enduring performance. We look forward to the SAKURA 3
open-label safety study readout in the fourth quarter of this year,
followed by the BLA filing in the first half of 2019," said Dan Browne,
President and Chief Executive Officer at Revance. "In parallel to our
pre-commercialization plans underway in the aesthetics market, we are
advancing the development of long-acting RT002 in multiple therapeutic
indications. We recently dosed the first patient in our ASPEN Phase 3
Program for RT002 for the treatment of cervical dystonia and look
forward to accomplishing additional clinical milestones in the fourth
quarter, including the initiations of Phase 2 trials for the treatment
of plantar fasciitis and upper limb spasticity. With the potential for
twice yearly administration, RT002 could represent a meaningful
advancement in neuromodulator treatment."

Summary Financial Results

Cash, cash equivalents and investments as of June 30,
2018 were $233.7 million.

Revenue for the three and six months ended June 30, 2018 was $0.7
million and $0.9 million compared to $0.1 million and $0.2 million for
the same periods in 2017, respectively. The revenue recognized during
2018 represents the portion of revenue earned from the $25 million
upfront payment from Mylan under the biosimilar collaboration and
license agreement.

Research and development expenses for the three and six months
ended June 30, 2018 were $22.9 million and $45.1 million compared to
$18.3 million and $37.7 million for the same periods in 2017,
respectively. The change in research and development expenses is
primarily due to the cervical dystonia Phase 3 clinical trial
implementation costs and increased costs to support manufacturing,
quality efforts and research.

General and administrative expenses for the three and six months
ended June 30, 2018 were $12.7 million and $26.4 million compared
to $8.6 million and $16.4 million for the same periods in 2017,
respectively. The increase in general and administrative expenses is
primarily due to increased costs related to personnel, consulting and
pre-commercial activities to support future product launches.

Total operating expenses for the three and six months ended June
30, 2018 were $35.6 million and $71.5 million compared to $26.9
million and $54.1 million for the same periods in 2017, respectively.
Stock-based compensation for the three and six months ended June 30,
2018 was $4.2 million and $8.3 million, respectively. When excluding
depreciation and stock-based compensation, total operating expenses for
the three and six months ended June 30, 2018 were $31.0 million and
$62.3 million, respectively.

Net loss for the three and six months ended June 30,
2018 was $34.1 million and $69.1 million compared to $26.9 million and
$54.0 million for the same periods in 2017, respectively.

2018 Financial Outlook

Revance reiterates its financial guidance provided in January 2018.
Revance expects cash burn for 2018 to be in the range of $117 to $137
million. Revance expects 2018 GAAP operating expense to be in the range
of $128 to $154 million, which when excluding depreciation of $1 to $3
million and estimated stock-based compensation of $17 to $21 million,
results in projected 2018 non-GAAP operating expense of $110 to $130
million, driven by increased research and development expenditure and
launch preparation activities. With three clinical programs and
preparations to file the BLA for RT002 to treat glabellar (frown) lines
all underway, Revance anticipates 2018 GAAP research and development
expense to be in the range of $84 to $101 million, which when excluding
depreciation of $1 to $2 million and estimated stock-based compensation
of $7 to $9 million, results in projected 2018 non-GAAP research and
development expense of $76 to $90 million.

Conference Call

Individuals interested in listening to the conference call may do so by
dialing (855) 453-3827 for domestic callers, or (484) 756-4301 for
international callers and reference conference ID: 3480629; or from the
webcast link in the investor relations section of the company's website
at: www.revance.com.

A replay of the call will be available beginning August 2, 2018
at 4:30pm PT/7:30pm ET to August 3, 2018 at 4:30pm PT/7:30pm ET. To
access the replay, dial (855) 859-2056 or (404) 537-3406 and reference
conference ID: 3480629. The webcast will be available in the investor
relations section on the company's website for 30 days following the
completion of the call.

About Revance Therapeutics, Inc.

Revance Therapeutics is an emerging Silicon Valley biotechnology leader
developing neuromodulators for the treatment of aesthetic and
therapeutic conditions. Revance uses a unique proprietary, stabilizing
excipient peptide technology to create novel, differentiated therapies.
The company's lead compound, DaxibotulinumtoxinA for Injection (RT002),
is in clinical development for a broad range of aesthetic and
therapeutic indications, including glabellar lines, cervical dystonia,
plantar fasciitis, upper limb spasticity and chronic migraine. RT002 has
the potential to be the first long-acting neuromodulator. The company is
advancing a robust pipeline of injectable and topical formulations of
DaxibotulinumtoxinA. More information on Revance may be found at www.revance.com.

"Revance Therapeutics" and the Revance logo are registered trademarks of
Revance Therapeutics, Inc.

Forward-Looking Statements

This press release contains forward-looking statements, including
statements related to Revance Therapeutics' long-term financial outlook,
expected cash burn and other financial performance, the process and
timing of, and ability to complete, current and anticipated future
clinical development of our investigational drug product candidates,
including but not limited to initiation and design of clinical studies
for current and future indications, including the timing and results of
the SAKURA 3 study of RT002 and ASPEN Phase 3 program, related results
and reporting of such results; statements about our business strategy,
timeline and other goals and market for our anticipated products, plans
and prospects; including our pre-commercialization plans; and statements
about our ability to obtain regulatory approval, including the timing of
potential BLA filing for RT002 to treat glabellar (frown) lines; and
potential benefits of our drug product candidates and our technologies.

Forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from our
expectations. These risks and uncertainties include, but are not limited
to: the outcome, cost, and timing of our product development activities
and clinical trials; the uncertain clinical development process,
including the risk that clinical trials may not have an effective design
or generate positive results; our ability to obtain and maintain
regulatory approval of our drug product candidates; our ability to
obtain funding for our operations; our plans to research, develop, and
commercialize our drug product candidates; our ability to achieve market
acceptance of our drug product candidates; unanticipated costs or delays
in research, development, and commercialization efforts; the
applicability of clinical study results to actual outcomes; the size and
growth potential of the markets for our drug product candidates; our
ability to successfully commercialize our drug product candidates and
the timing of commercialization activities; the rate and degree of
market acceptance of our drug product candidates; our ability to develop
sales and marketing capabilities; the accuracy of our estimates
regarding expenses, future revenues, capital requirements and needs for
financing; our ability to continue obtaining and maintaining
intellectual property protection for our drug product candidates; and
other risks. Detailed information regarding factors that may cause
actual results to differ materially from the results expressed or
implied by statements in this press release may be found in Revance's
periodic filings with the Securities and Exchange Commission (the
"SEC"), including factors described in the section entitled "Risk
Factors" of our quarterly report on Form 10-Q filed May 9, 2018. These
forward-looking statements speak only as of the date hereof. Revance
disclaims any obligation to update these forward-looking statements.

Use of Non-GAAP Financial Measures

Revance has presented certain non-GAAP financial measures in this
release. This release and the reconciliation tables included herein
include total non-GAAP operating expense and non-GAAP R&D expense, both
of which exclude depreciation and stock-based compensation. Revance
excludes depreciation costs and stock-based compensation expense because
management believes the exclusion of these items is helpful to investors
to evaluate Revance's recurring operational performance. Revance
management uses these non-GAAP financial measures to monitor and
evaluate its operating results and trends on an on-going basis, and
internally for operating, budgeting and financial planning purposes. The
non-GAAP financial measures should be considered in addition to results
prepared in accordance with GAAP, but should not be considered a
substitute for or superior to GAAP results.

 

Revance Therapeutics, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share amounts)

(Unaudited)

 
  June 30,   December 31,
2018 2017
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 39,282 $ 282,896
Short-term investments 194,452
Prepaid expenses and other current assets 9,148   2,315  
Total current assets 242,882 285,211
Property and equipment, net 12,196 9,250
Restricted cash 730 580
Other non-current assets 3,315   658  
TOTAL ASSETS $ 259,123   $ 295,699  
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 5,435 $ 6,805
Accruals and other current liabilities 13,569 12,225
Deferred revenue, current portion 9,320
Financing obligations   1,872  
Total current liabilities 28,324 20,902
Derivative liability associated with Medicis settlement 2,717 2,613
Deferred revenue, net of current portion 14,800
Deferred rent 3,427   3,339  
TOTAL LIABILITIES 49,268 26,854
Commitments and Contingencies
STOCKHOLDERS' EQUITY

Common stock, par value $0.001 per share — 95,000,000 shares
authorized as of June 30, 2018 and December 31, 2017; 36,917,723
and 36,516,075 shares issued and outstanding as of June 30, 2018
and December 31, 2017, respectively

37 37
Additional paid-in capital 821,326 810,975
Accumulated other comprehensive loss (224 )
Accumulated deficit (611,284 ) (542,167 )
TOTAL STOCKHOLDERS' EQUITY 209,855   268,845  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 259,123   $ 295,699  
 
 

Revance Therapeutics, Inc.

Condensed Consolidated Statements of Operations and
Comprehensive Loss

(In thousands, except share and per share amounts)

(Unaudited)

 
  Three Months Ended
June 30,
  Six Months Ended
June 30,
2018   2017 2018   2017
Revenue $ 686 $ 75 $ 880 $ 150
Operating expenses:
Research and development 22,871 18,307 45,111 37,714
General and administrative 12,734   8,609   26,350   16,363  
Total operating expenses 35,605   26,916   71,461   54,077  
Loss from operations (34,919 ) (26,841 ) (70,581 ) (53,927 )
Interest income 1,081 347 2,103 658
Interest expense (141 ) (44 ) (335 )
Change in fair value of derivative liability associated with Medicis
settlement
(70 ) (107 ) (104 ) (167 )
Other expense, net (172 ) (132 ) (492 ) (258 )
Net loss (34,080 ) (26,874 ) (69,118 ) (54,029 )
Unrealized gain (loss) on available for sale securities 52   (17 ) (224 ) (69 )
Comprehensive loss $ (34,028 ) $ (26,891 ) $ (69,342 ) $ (54,098 )
Basic and Diluted net loss attributable to common stockholders $ (34,080 ) $ (26,874 ) $ (69,118 ) $ (54,029 )
Basic and Diluted net loss per share attributable to common
stockholders
$ (0.94 ) $ (0.90 ) $ (1.92 ) $ (1.84 )
Basic and Diluted weighted-average number of shares used in
computing net loss per share attributable to common stockholders
36,123,659   29,776,893   36,037,604   29,295,220  
 
 

Revance Therapeutics, Inc.

2018 Financial Results

Reconciliation of GAAP Operating Expense to Non-GAAP Operating
Expense

(In thousands)

 
 

Three Months
Ended June 30, 2018

 

Six Months
Ended June 30, 2018

Operating expense:
GAAP operating expense $ 35,605 $ 71,461
Adjustments:
Stock-based compensation (4,172 ) (8,330 )
Depreciation (417 ) (807 )
Non-GAAP operating expense $ 31,016   $ 62,324  
 
 

Revance Therapeutics, Inc.

2018 Financial Guidance

Reconciliation of GAAP Operating Expense to Non-GAAP Operating
Expense

(In thousands)

 
  Fiscal Year
2018
Low   High
Operating expense:
GAAP operating expense $ 128,000 $ 154,000
Adjustments:
Stock-based compensation (17,000 ) (21,000 )
Depreciation (1,000 ) (3,000 )
Non-GAAP operating expense $ 110,000   $ 130,000  
 
 

Reconciliation of GAAP R&D Expense to Non-GAAP R&D Expense

(In thousands)

 
  Fiscal Year
2018
Low   High
R&D expense:
GAAP R&D expense $ 84,000 $ 101,000
Adjustments:
Stock-based compensation (7,000 ) (9,000 )
Depreciation (1,000 ) (2,000 )
Non-GAAP R&D expense $ 76,000   $ 90,000  
 

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