---

---

---

---

(1)	You may vote over the Internet. You may vote your shares by following the “Vote by Internet” instructions on the enclosed proxy card. If you vote over the Internet, you do not need to vote by telephone or complete and mail your proxy card.

(2)	You may vote by telephone. You may vote your shares by following the “Vote by Phone” instructions on the enclosed proxy card. If you vote by telephone, you do not need to vote over the Internet or complete and mail your proxy card.

(3)	You may vote by mail. You may vote by completing, dating and signing the proxy card delivered with this proxy statement and promptly mailing it in the enclosed postage-paid envelope. If you vote by mail, you do not need to vote over the Internet or by telephone.

(4)	You may vote in person. If you attend the 2019 annual meeting, you may vote by delivering your completed proxy card in person or you may vote by completing a ballot at the 2019 annual meeting. Ballots will be available at the 2019 annual meeting.

•	submitting a new proxy by following the “Vote by Internet” or “Vote by Phone” instructions on the enclosed proxy card up until 11:59 p.m., Eastern time, the day before the 2019 annual meeting;

•	signing another proxy card and either arranging for delivery of that proxy card by mail prior to the start of the 2019 annual meeting, or by delivering that signed proxy card in person at the 2019 annual meeting;

•	giving our Secretary a written notice before or at the 2019 annual meeting that you want to revoke your proxy; or

---

•	voting in person at the 2019 annual meeting.

---

---

(1)	Member of our audit committee.

(2)	Member of our compensation committee.

(3)	Member of our nominating and corporate governance committee.

(5)	Dr. Graves joined our board of directors on December 12, 2018.

(6)	Dr. Roberts joined our board of directors on January 1, 2019.

---

---

•	the class I directors are Ms. Henderson and Mr. Sblendorio, and their term expires at our annual meeting of stockholders to be held in 2020;

•	the class II directors are Mr. Bolte, Mr. Redlick and Dr. Roberts, and their term expires at our annual meeting of stockholders to be held in 2021; and

•	the class III directors are Dr. Dyrberg, Dr. Graves and Dr. Guyer, and their term expires at the 2019 annual meeting.

---

---

•	chairing meetings of the independent directors in executive session;

•	facilitating communications between other members of our board, our executive chairman and our chief executive officer;

•	working with our executive chairman and our chief executive officer in the preparation of the agenda for each board meeting and in determining the need for special meetings of our board;

•	reviewing and, if appropriate, recommending action to be taken with respect to written communications from stockholders submitted to our board (see “Board Processes—Communications with Stockholders” below);

•	consulting with our executive chairman and our chief executive officer on matters relating to corporate governance and board performance; and

•	meeting with any director who is not adequately performing his or her duties as a member of our board of directors or any committee.

•	appointing, approving the compensation of, and assessing the independence of our registered public accounting firm;

•	overseeing the work of our independent registered public accounting firm, including through the receipt and consideration of reports and other communications from such firm;

•	reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures;

•	monitoring our internal control over financial reporting, disclosure controls and procedures and code of business conduct and ethics;

•	overseeing our risk assessment and risk management policies, including for cybersecurity;

•	establishing policies regarding hiring employees from our independent registered public accounting firm and procedures for the receipt and retention of accounting-related complaints and concerns;

---

•	meeting independently with our independent registered public accounting firm and management;

•	reviewing and approving or ratifying any related person transactions; and

•	preparing the audit committee report required by SEC rules.

•	reviewing and approving, or making recommendations to our board with respect to, the compensation of our executive chairman, our chief executive officer and our other executive officers;

•	overseeing an evaluation of our senior executives;

•	overseeing and administering our cash and equity incentive plans;

•	reviewing and making recommendations to our board with respect to director compensation;

•	reviewing and discussing annually with management our compensation disclosure required by SEC rules; and

•	preparing the compensation committee report required by SEC rules.

•	identifying individuals qualified to become members of our board;

---

•	recommending to our board the persons to be nominated for election as directors and to each of our board’s committees;

•	reviewing and making recommendations to our board with respect to our board leadership structure;

•	reviewing and making recommendations to our board with respect to management succession planning;

•	developing and recommending to our board corporate governance principles; and

•	overseeing a periodic evaluation of our board.

---

---

•	our board’s principal responsibility is to oversee our management;

•	a majority of the members of our board must be independent directors;

•	the independent directors meet in executive session at least twice a year;

•	directors have full and free access to management and, as necessary, independent advisors;

•	new directors participate in an orientation program and all directors are expected to participate in continuing director education on an ongoing basis; and

•	our board will conduct an annual self-evaluation to determine whether it and its committees are functioning effectively.

---

•	the related person’s interest in the related person transaction;

•	the approximate dollar value of the amount involved in the related person transaction;

•	the approximate dollar value of the amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;

•	whether the transaction was undertaken in the ordinary course of our business;

•	whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;

•	the purpose of, and the potential benefits to us of, the transaction; and

•	any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.

•

interests arising solely from the related person’s position as an executive officer of another entity (whether or not the person is also a director of such entity) that is a participant in the transaction, where (a) the related person and all other related persons own in the aggregate less than a 10% equity interest in such entity, (b) the related person and his or her immediate family members are not involved in the negotiation of the terms of the transaction and do not receive any special benefits as a result of the transaction and (c) the amount involved in the transaction is less than the greater of $200,000 or 5% of the annual gross revenues of the company receiving payment under the transaction; and

•	a transaction that is specifically contemplated by provisions of our charter or bylaws.

---

---

---

(1)

We entered into a separation agreement with Ms. Wood on January 5, 2018 pursuant to which we and Ms. Wood mutually agreed that her employment with us would terminate during the first quarter of 2018. Following our entry into the separation agreement, our compensation committee and board of directors did not make any further determinations regarding Ms. Wood’s compensation for 2018. For this reason, we have not included any additional information regarding Ms. Wood’s compensation in this CD&A. For a description of the severance benefits Ms. Wood received upon the termination of her employment with us on February 23, 2018, please see “Summary Compensation Table”, which follows this CD&A.

•

completed enrollment and obtained data from our Phase 2a clinical trial of our C5 complement inhibitor, Zimura® (avacincaptad pegol), in combination with Lucentis® (ranibizumab) for the treatment of wet age-related macular degeneration, or AMD. The results of this trial did not replicate the results we observed in our prior Phase 1/2a trial of Zimura in combination with Lucentis in this indication and therefore we are not pursuing further development of Zimura in wet AMD at this time;

•	completed enrollment for our ongoing Phase 2b clinical trial of Zimura for the treatment of geographic atrophy secondary to dry AMD;

•	continued enrollment in our ongoing Phase 2b clinical trial of Zimura for the treatment of autosomal recessive Stargardt disease, an orphan inherited retinal disease;

•	initiated several gene therapy sponsored research programs with the University of Massachusetts Medical School, or UMMS;

---

•	in-licensed our gene therapy product candidate for the treatment of rhodopsin-mediated autosomal dominant retinitis pigmentosa, or RHO-adRP, which is an orphan inherited retinal disease, from the University of Pennsylvania, or Penn, and the University of Florida Research Foundation, or UFRF;

•	acquired our program of High temperature requirement A serine peptidase 1 protein, or HtrA1, inhibitors through our acquisition of Inception 4, Inc., or Inception 4, which included an infusion of approximately $6.1 million in cash;

•	entered into an exclusive option agreement with Penn and UFRF to obtain an exclusive license for gene therapy product candidates for bestrophinopathies, which are a category of orphan inherited retinal diseases;

•	ended 2018 with $131.2 million in cash and cash equivalents; and

•	undertook several initiatives to continue to develop our company’s culture and retain and develop key talent.

---

---

---

---

---

---

•	attract, retain and motivate experienced and talented executives;

•	align the interests of our executives with our stockholders by rewarding performance that leads to the creation of stockholder value;

•	promote the achievement of key strategic, development and operational performance measures by linking compensation to the achievement of measurable corporate goals; and

•	provide an opportunity for executives to realize value over the long-term based on company performance and appreciation in our stock price.

•	base salary;

•	short-term cash incentive awards; and

•	long-term equity incentive awards.

•	to ensure adequate currently‑paid base compensation to attract and retain talent;

•	to provide rewards for meeting near-term business goals; and

---

•	to provide incentives to align the interests of our management with those of our stockholders by incentivizing our executives to take steps to maximize our long‑term value.

---

---

•	each component of compensation, including 2018 base salary, 2018 short-term cash incentive opportunity and the long-term equity awards granted in December 2017 as incentive compensation for 2018 and beyond;

•	long-term and short-term compensation; and

•	“at risk” pay.

---

•

SCT compensation consists of the aggregate three-year pay for Dr. Guyer (full-year 2016 and first half of 2017), and Mr. Sblendorio (second half of 2017 and full-year 2018). SCT pay consists of: (i) actual base salary; (ii) the value of the retention award (consisting of a mix of cash and restricted stock units) granted to Dr. Guyer on the grant date in January 2017, based on the expected cash value and grant date fair value of the restricted stock units, calculated as required for the SCT; (iii) actual short-term cash incentive awards earned; and (iv) the fair value of all long‑term incentive awards on the date of grant, calculated as required for the SCT.

•

Realizable pay as of FYE consists of (i) actual base salary; (ii) the value of the 2017 retention award realized by Dr. Guyer based on the cash value and the value of the shares issued upon vesting of the restricted stock units in June 2017 and December 2017; (iii) actual short-term cash incentive awards earned; and (iv) the value of long‑term incentive awards on the vesting date (if vested) or on December 31, 2018 (if unvested), which was the last trading day of 2018.

---

•	the level of performance and contributions made by our NEOs, including performance against individual goals and eligibility to participate in our short-term cash incentive program;

•	the need for salary increases; and

•	whether or not equity awards should be made and the recommended amounts.

---

•	biotechnology or pharmaceutical industry;

•	Phase 2 stage of clinical development;

•	market capitalization in the range of $30 million to $300 million; and

•	fewer than 120 employees.

---

•	establishment of corporate goals for our short-term cash incentive program and individual goals for our executive officers that are consistent with our annual operating and strategic plans, that are designed to achieve the proper risk/reward balance, and that should not require excessive risk taking to achieve;

•	the mix between fixed and variable, annual and long‑term and cash and equity compensation are designed to encourage strategies and actions that balance our short‑term and long‑term best interests;

•	equity awards generally vest over a period of time, which we believe encourages executives to take a long‑term view of our business; and

•	our ownership guidelines, which require NEOs to hold equity over a specified time-period and above a certain value, further align executive interests with the interests of our stockholders.

---

---

(1)	Mr. Carroll’s individual goal achievement rating of 112% was based upon: (i) exceeding year-end cash balance targets; (ii) successful filing of shelf registration statement and establishment of “at-the-market” facility; (iii) implementation of adaptive forecasting tool for tighter financial modeling; and (iv) completion of financial reporting requirements ahead of schedule.

(2)	Mr. Westby’s individual goal achievement rating of 103% was based upon: (i) meeting clinical recruitment goals; (ii) successfully refocusing clinical operations team on future gene therapy programs; and (iii) providing key clinical, manufacturing and operational diligence support for business development activities.

•	a value-based approach, based on the value of the award at the time of grant; and

•	a percent of company approach, based on the size of the award relative to the number of shares a company has outstanding at the time of grant.

---

(1)	In addition to time-based vesting, these awards will not vest and become exercisable unless, for a period of twenty consecutive trading days, the average closing sale price of our common stock equals or exceeds 125% of the per share exercise price of the options.

---

•	an accounting restatement is required due to our material noncompliance with any financial reporting requirement under the U.S. federal securities laws; and

•	the board of directors (or a committee thereof), in its sole discretion, determines that an act or omission of a current or former executive officer contributed to the circumstances requiring the restatement and that such act or omission involved fraud or intentional misconduct

---

---

---

(1)	The amounts reported in the “Bonus” column for 2017 reflect the cash portion of retention awards that we granted in January 2017 as an incentive for our continuing NEOs to remain with the company and which vested in two installments in June 2017 and December 2017. We paid Mr. Sblendorio $100,000 as a discretionary, sign-on bonus upon his joining our company in April 2016.

(2)

The amounts reported in the “Stock Awards” and “Option Awards” columns reflect the aggregate fair value of share-based compensation granted during the year computed in accordance with the provisions of Financial Accounting Standards Board Accounting Standard Codification, or ASC, Topic 718. See Note 2 to our audited financial statements appearing in our Annual Report on Form 10-K, which was filed with the SEC on February 28, 2019, regarding assumptions underlying the valuation of equity awards. The amounts reported in the “Option Awards“ column for 2018 reflect the grant date fair value of the RSUs granted to Mr. Sblendorio and Dr. Guyer in December 2018. For more information about these awards, please see Note 4 of “Grants of Plan-Based Awards Table”. The amounts reported in the “Stock Awards” column for 2017 reflect the grant date fair value of the RSU portion of retention awards that we granted in January 2017 as an incentive for our continuing NEOs to remain with the company and which vested with respect to 50% of the shares subject to the award in each of June 2017 and December 2017. In addition, until 2017 our annual equity awards were granted effective in the beginning of the calendar year taking into account performance during the previous year. For example, the compensation committee and our board of directors approved the annual equity grant for 2016 in January 2017. However, for administrative purposes, the compensation committee and our board of directors approved the annual equity grant for 2017 in December 2017 and therefore, the 2017 performance grants that previously would have occurred in January

---

(3)	The amounts reported in the “Non-Equity Incentive Plan Compensation” column represent awards to our NEOs under our short-term cash incentive program.

(4)	The compensation included in the “All Other Compensation” column includes the following:

•	for 2018, matching contributions that we made under our 401(k) plan of $8,000 for Mr. Sblendorio, $8,000 for Dr. Guyer, $8,000 for Mr. Carroll, $8,000 for Mr. Westby and $2,604 for Ms. Wood, housing payments of $88,800 for Mr. Sblendorio, and severance payments of $404,620 for Ms. Wood (see Note 9 below);

•	for 2017, matching contributions that we made under our 401(k) plan of $8,000 for Mr. Sblendorio, $8,000 for Dr. Guyer, $8,000 for Mr. Carroll and $8,000 for Ms. Wood, housing payments of $92,100 for Mr. Sblendorio, and vacation carry-over payouts of $7,211 for Mr. Carroll and $7,781 for Ms. Wood; and

•	for 2016, matching contributions that we made under our 401(k) plan of $8,000 for Mr. Sblendorio, $8,000 for Dr. Guyer and $8,000 for Ms. Wood, housing payments of $80,837 for Mr. Sblendorio, vacation carry-over payouts of $9,519 for Mr. Sblendorio and $7,781 for Ms. Wood, and additional salary payments on account of a change in payroll practices of $2,405 for Dr. Guyer and $1,556 for Ms. Wood.

(5)

Mr. Sblendorio joined us as our executive vice president, chief operating officer, chief financial officer and treasurer effective as of April 1, 2016. He subsequently ceased to serve as chief operating officer effective as of January 29, 2017 upon the appointment of Mr. Westby to such position, and was appointed as president effective as of January 30, 2017. He ceased serving as chief financial officer and treasurer effective as of April 24, 2017 upon the appointment of Mr. Carroll to such positions. On July 1, 2017, upon the transition of Dr. Guyer to executive chairman, Mr. Sblendorio assumed the position of chief executive officer in addition to his role as president, and Mr. Sblendorio’s annual salary was increased from $495,000 to $625,000. The salary information and non-equity incentive plan compensation provided for 2016 for Mr. Sblendorio represents the pro-rated portion of Mr. Sblendorio’s annual salary of $495,000 attributable to the portion of the year during which Mr. Sblendorio served as our executive vice president, chief operating officer, chief financial officer and treasurer. Mr. Sblendorio also serves as a member of our board of directors but does not receive any additional compensation for his service as a director.

(6)	In 2017, in connection with Dr. Guyer's transition to his new role as executive chairman, we and Dr. Guyer agreed that starting in 2018, his base salary would be reduced from $625,200 to $525,000. Dr. Guyer also serves as a member of our board of directors but does not receive any additional compensation for his service as a director.

(7)	Mr. Carroll was promoted to the role of chief financial officer and treasurer effective April 24, 2017, at which time he became an executive officer and his annual salary was increased from $365,000 to $375,000.

(8)	Mr. Westby was promoted to the role of chief operating officer effective January 29, 2017, at which time he became an executive officer and his annual salary was increased from $303,200 to $325,000.

(9)

Ms. Wood served as our senior vice president, general counsel and secretary until her departure from the company on February 23, 2018. The salary information provided for 2018 represents the pro-rated portion of Ms. Wood's annual salary of $404,620 attributable to the portion of the year during which Ms. Wood served as our senior vice president, general counsel and secretary. Pursuant to a Separation and General Release that we entered into with Ms. Wood in January 2018, Ms. Wood also received a pro-rated portion, as of the separation date, of her target short-term cash incentive compensation for 2018, which is shown in the “Non-Equity Incentive Plan Compensation” column, and a severance payment of $404,620, consisting

---

---

(1)

Represents the target payout levels under our short-term cash incentive program. Target payouts for Mr. Sblendorio, Dr. Guyer, Mr. Carroll and Mr. Westby represented 65%, 50%, 40% and 40% of base salary in 2018, respectively. As discussed above under “Compensation Discussion and Analysis—2018 NEO Compensation Determinations—2018 Short-Term Cash Incentive Awards—2018 Corporate Goals,” the actual payout with respect to each NEO was less than the target award amount. The short-term cash incentive program did not have threshold payout levels, as the determination of the level of achievement of corporate objectives was subjective and subject to the discretion of our compensation committee and board of directors. Additional information regarding the design of our short-term cash incentive program, including a description of the corporate objectives applicable to 2018 awards, is described above in “Compensation Discussion and Analysis—2018 NEO Compensation Determinations—2018 Short-Term Cash Incentive Awards.”

(2)	The exercise price per share of each option award is equal to the closing market price of our common stock on the date of grant. Each of the option awards vest with respect to 25% of the shares subject to the option on the first anniversary of the grant date and with respect to the remaining shares in approximately equal monthly installments through the fourth anniversary of the grant date.

(3)	The amounts in the “Grant Date Fair Value of Stock and Option Awards” column reflect the grant date fair value of stock and option awards granted in 2018 calculated in accordance with ASC 718.

(4)

These option awards, which were granted to Mr. Sblendorio and Dr. Guyer, are, in addition to being subject to the traditional time-based vesting that we typically use for our other long-term equity awards and which is described in Note 2 above, subject to performance-based vesting. They will not vest and become exercisable unless, for a period of twenty consecutive trading days, the average closing sale price of our common stock equals or exceeds 125% of the per share exercise price of the options. As with other stock options granted under our stock incentive plan, these stock options have a ten-year term. The performance criteria for these stock options may be satisfied at any time during the ten-year term of these options.

(5)	Ms. Wood did not receive any plan-based awards in 2018.

---

---

(1)	These options were granted in connection with Mr. Sblendorio’s service on our board of directors and are fully vested.

(2)	The unvested shares vest monthly in approximately equal amounts through April 2020.

(3)	The unvested shares vest monthly in approximately equal amounts through January 2021.

(4)	The unvested shares vest monthly in approximately equal amounts through December 2021.

(5)	These options are also subject to performance-based vesting. For more information, see Note 4 in “Grants of Plan-Based Awards Table” above.

(6)	These restricted stock units vest in annual increments, with the remaining vesting event occurring in April 2019.

(7)	These restricted stock units vest in annual increments, with the remaining vesting events occurring in December 2019, December 2020, December 2021 and December 2022.

(8)	These restricted stock units are subject to performance-based vesting. The unvested shares vest upon the occurrence of certain milestones.

(9)	The unvested shares vested in January 2019.

(10)	The unvested shares vest monthly in approximately equal amounts through January 2020.

(11)	These restricted stock units vested in annual increments, with the final vesting event occurring in January 2019.

(12)	These restricted stock units vest in annual increments, with the remaining vesting events occurring in January 2019 and January 2020.

(13)	The unvested shares vest monthly in approximately equal amounts through June 2020.

(14)	The unvested shares vest monthly in approximately equal amounts through April 2021.

(15)	The unvested shares vest over four years, with 25% vesting in December 2019 and the remaining unvested shares vesting monthly in approximately equal amounts through December 2022.

(16)	These restricted stock units vest in annual increments, with the remaining vesting events occurring in July 2019 and July 2020.

(17)	These options were retained under the terms of the Separation and General Release that we entered into with Ms. Wood following the termination of her employment and remained exercisable until February 23, 2019. These options are no longer outstanding as of the date of this proxy statement.

---

---

---

(1)

The value of stock options with accelerated vesting represents the value of unvested stock options, calculated by multiplying the number of shares subject to the accelerated portion of the option by the amount by which $1.20, the closing market price of our common stock on December 31, 2018, exceeds the exercise price of such option. Because the exercise prices of these stock options each exceed $1.20, the closing market price of our common stock on December 31, 2018, the value of each of these options is $0.

(2)	The value of restricted stock units with accelerated vesting represents the value of unvested restricted stock units, calculated by multiplying the number of shares subject to the accelerated portion of the restricted stock units by $1.20, the closing market price of our common stock on December 31, 2018.

---

•	provide that awards shall be assumed, or substantially equivalent awards shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof);

•	upon written notice to a plan participant, provide that the participant’s unexercised awards will terminate immediately prior to the consummation of such transaction unless exercised by the participant within a specified period;

•	provide that outstanding awards shall become exercisable, realizable, or deliverable, or restrictions applicable to an award shall lapse, in whole or in part prior to or upon such transaction;

•

in the event that, under the terms of the transaction, holders of common stock will receive upon consummation thereof a cash payment for each share surrendered in the transaction, make or provide for a cash payment to a plan participant with respect to each award held by a participant equal to (1) the number of shares of our common stock subject to the vested portion of the award (after giving effect to any acceleration of vesting that occurs upon or immediately prior to such reorganization event) multiplied by (2) the excess, if any, of the cash payment for each share surrendered in the reorganization event over the exercise, measurement or purchase price of such award and any applicable tax withholdings, in exchange for the termination of such award;

•	provide that, in connection with a liquidation or dissolution of the company, awards shall convert into the right to receive liquidation proceeds (if applicable, net of the exercise, measurement or purchase price thereof and any applicable tax withholdings); or

•	any combination of the foregoing.

•	all unvested options then held by such participant shall immediately become exercisable in full; and

•	all restricted stock then held by such participant shall immediately become free from all conditions or restrictions.

---

•	the number of shares of our common stock covered by options and the dates upon which the options become exercisable;

•	the type of options to be granted;

•	the duration of options, which may not be in excess of ten years;

•	the exercise price of options, which must be at least equal to the fair market value of our common stock on the date of grant; and

•

the number of shares of our common stock subject to and the terms of any stock appreciation rights, restricted stock awards, restricted stock units or other stock-based awards and the terms and conditions of such awards, including conditions for repurchase, measurement price, issue price and repurchase price (though the measurement price of stock appreciation rights must be at least equal to the fair market value of our common stock on the date of grant and the duration of such awards may not be in excess of ten years).

•	provide that all outstanding awards shall be assumed, or substantially equivalent awards shall be substituted, by the acquiring or successor corporation (or an affiliate thereof);

•	upon written notice to a participant, provide that all of the participant’s unvested and/or unexercised awards will terminate immediately prior to the consummation of such reorganization event unless exercised by the participant;

•	provide that outstanding awards shall become exercisable, realizable or deliverable, or restrictions applicable to an award shall lapse, in whole or in part, prior to or upon such reorganization event;

•	in the event of a reorganization event pursuant to which holders of shares of our common stock will receive a cash payment for each share surrendered in the reorganization event, make or provide for a cash payment to the

---

•	provide that, in connection with a liquidation or dissolution, awards shall convert into the right to receive liquidation proceeds (if applicable, net of the exercise, measurement or purchase price thereof and any applicable tax withholdings).

---

---

•	provide that options will be assumed, or substantially equivalent options will be substituted, by the acquiring or succeeding corporation (or an affiliate thereof);

•

upon written notice to employees, provide that all outstanding options will be terminated immediately prior to the consummation of the reorganization event and that all such outstanding options will become exercisable to the extent of accumulated payroll deductions as of a date specified by our board or committee appointed by our board in such notice, which date will not be less than ten (10) days preceding the effective date of the reorganization event;

•	upon written notice to employees, provide that all outstanding options will be cancelled as of a date prior to the effective date of the reorganization event and that all accumulated payroll deductions will be returned to participating employees on such date;

•

in the event of a reorganization event under the terms of which holders of our common stock will receive upon consummation thereof a cash payment for each share surrendered in the reorganization event, change the last day of the offering period to be the date of the consummation of the reorganization event and make or provide for a cash payment to each employee equal to (1) the cash payment for each share surrendered in the reorganization event times the number of shares of our common stock that the employee’s accumulated payroll deductions as of immediately prior to the reorganization event could purchase at the applicable purchase price, where the cash payment for each share surrendered in the reorganization event is treated as the fair market value of our common stock on the last day of the applicable offering period for purposes of determining the purchase price and where the number of shares that could be purchased is subject to the applicable limitations under the ESPP, minus (2) the result of multiplying such number of shares by the purchase price; and/or

•	provide that, in connection with our liquidation or dissolution, options will convert into the right to receive liquidation proceeds (net of the purchase price thereof).

---

(1)

Includes our amended and restated 2007 stock incentive plan, 2013 stock incentive plan and 2016 employee stock purchase plan. As described above under “Additional Narrative Disclosure—2013 Stock Incentive Plan”, the 2013 stock incentive plan includes provisions for an annual increase, to be added the first day of each fiscal year, beginning with the fiscal year ending December 31, 2014 and continuing until, and including, the fiscal year ending December 31, 2023, with such annual increase to be equal to the lowest of 2,542,372 shares of our common stock, 4% of the number of shares of our common stock outstanding on the first day of the fiscal year and an amount determined by our board of directors, which, in the case of 2019, was 1,655,887 shares, or 4% of the total number of shares of our common stock outstanding as of January 1, 2019.

(2)

Includes stock option awards made pursuant to the Nasdaq inducement grant exception as a component of employment compensation for newly hired executives. The inducement grants were approved and recommended by our compensation committee, approved by our board of directors and were made as an inducement material to each executive’s acceptance of employment with us in accordance with Nasdaq Listing Rule 5635(c)(4).

---

•	annual establishment of corporate and individual objectives for our performance-based cash bonus programs for our executive officers that are consistent with our annual operating and strategic plans, that are designed to achieve the proper risk/reward balance, and that should not require excessive risk taking to achieve;

•	the mix between fixed and variable, annual and long-term and cash and equity compensation are designed to encourage strategies and actions that balance our short-term and long-term best interests; and

•	equity awards generally vest over a period of time, which we believe encourages executives to take a long-term view of our business.

(1)	Fees earned or paid in cash consist of:

•	for Mr. Bolte, $45,000 for serving as a member of our board, $10,000 for serving as a member of our audit committee and $5,000 for serving as a member of our nominating and corporate governance committee;

•	for Ms. Graves, $11,250 for serving as a member of our board and $1,875 for serving as a member of our compensation committee after joining in December 2018;

•	for Ms. Henderson, $45,000 for serving as a member of our board, $20,000 for serving as the chair of our audit committee and $2,500 for serving as the chair of our litigation demand review committee;

•	for Mr. Redlick, $45,000 for serving as a member of our board, $25,000 for serving as our independent lead director, $15,000 for serving as the chair of our compensation committee, and $10,000 for serving as a member of our audit committee; and

---

•	for Dr. Ross, $45,000 for serving as a member of our board, $7,500 for serving as a member of our compensation committee, and $5,000 for serving as a member of our nominating and corporate governance committee.

(2)

The amounts reported in the “Stock Awards” and “Option Awards” columns reflect the aggregate fair value of share-based compensation awarded during the year computed in accordance with the provisions of ASC Topic 718. See Note 2 to our audited financial statements appearing in our Annual Report on Form 10-K, which was filed with the SEC on February 28, 2019, regarding assumptions underlying the valuation of equity awards.

(3)	Dr. Dyrberg has elected to decline compensation for service on our board of directors.

(4)	Dr. Ross served on our board of directors from his election in May 2013 through February 2019, when he resigned from our board of directors based on his commitments to SV Health Investors, where he serves as a managing partner, and not as a result of any disagreement with the company.

•	each non-employee director is eligible to receive an annual fee of $45,000;

•	the chair of our audit committee is eligible to receive an additional annual fee of $20,000 and the other members of our audit committee are eligible to receive an additional annual fee of $10,000;

•	the chair of our compensation committee is eligible to receive an additional annual fee of $15,000 and the other members of our compensation committee are eligible to receive an additional annual fee of $7,500;

---

•	the chair of our nominating and corporate governance committee is eligible to receive an additional annual fee of $10,000 and the other members of our nominating and corporate governance committee are eligible to receive an additional annual fee of $5,000;

•	the chair of our research and development committee, formed in February 2019, is eligible to receive an additional annual fee of $10,000 and the other members of our research and development committee are eligible to receive an additional annual fee of $5,000;

•	the chair of our litigation demand review committee is eligible to receive an additional annual fee of $10,000 and the other members of our litigation demand review committee are eligible to receive an additional annual fee of $5,000;

•	our independent lead director is eligible to receive an additional annual fee of $25,000.

---

(1)

This category includes fees for professional services performed by Ernst & Young LLP for the audit of our annual financial statements included in our Annual Report on Form 10-K, the review of condensed financial statements included in our Quarterly Reports on Form 10-Q, and the review of our registration statements during 2018 and 2017. Also during 2018, this category included fees for the completion of comfort letter procedures associated with our “at-the-market” facility.

(2)	This category consists of fees for professional services rendered by Ernst & Young LLP for tax compliance services rendered in 2017.

(3)	This category consists of fees for any other products or services provided by Ernst & Young LLP not described above. The services for fees in 2018 and 2017 under this category are related to licensed accounting research software.

---

•	the class I directors are Ms. Henderson and Mr. Sblendorio, and their term expires at our annual meeting of stockholders to be held in 2020;

•	the class II directors are Mr. Bolte, Mr. Redlick and Dr. Roberts, and their term expires at our annual meeting of stockholders to be held in 2021; and

•	the class III directors are Dr. Dyrberg, Dr. Graves and Dr. Guyer, and their term expires at the 2019 annual meeting.

---

•	for each non-employee director who served as a director for any amount of time during the prior calendar year, whom we refer to as an incumbent director, no more than $275,000 per calendar year;

•	for each non-employee director who did not serve as a director for any amount of time during the prior calendar year, whom we refer to as a new non-employee director, no more than $550,000 within the new non-employee director's first calendar year of election or appointment.

•	each non-employee director is eligible to receive an annual fee of $45,000;

•	the chair of our audit committee is eligible to receive an additional annual fee of $20,000, and the other members of our audit committee are eligible to receive an additional annual fee of $10,000;

•	the chair of our compensation committee is eligible to receive an additional annual fee of $15,000, and the other members of our compensation committee are eligible to receive an additional annual fee of $7,500;

---

•	the chair of our nominating and corporate governance committee is eligible to receive an additional annual fee of $10,000, and the other members of our nominating and corporate governance committee are eligible to receive an additional annual fee of $5,000;

•	the chair of our research and development committee is eligible to receive an additional annual fee of $10,000, and the other members of our research and development committee are eligible to receive an additional annual fee of $5,000; and

•	our independent lead director is eligible to receive an additional annual fee of $25,000.

---

---

•	each of our directors;

•	each of our named executive officers;

•	all of our directors and current executive officers as a group; and

•	each person, or group of affiliated persons, who is known by us to beneficially own more than 5% of our common stock.

---

(1)

Consists of (i) 75,019 shares of common stock and (ii) 467,742 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date. The shares of common stock owned as of April 1, 2019 included 6,914 shares Mr. Sblendorio sold on April 2, 2019 to satisfy his minimum statutory withholding obligations with respect to the income recognized by him upon the vesting of RSUs on April 1, 2019.

(2)	Consists of (i) 43,164 shares of common stock and (ii) 709,220 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(3)	Consists of (i) 8,980 shares of common stock and (ii) 147,323 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(4)	Consists of (i) 32,606 shares of common stock and (ii) 186,160 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(5)	Consists of 16,462 shares of common stock. The number of shares held by Ms. Wood is based on information available to us as of February 23, 2018, Ms. Wood's last day with the company.

(6)

Mr. Bolte is a venture partner of HBM Partners AG, which provides investment management services to HBM Healthcare Investments AG. Mr. Bolte, a member of our board of directors, has no voting or investment power over shares, if any, held by HBM Healthcare Investments AG. Consists of 32,000 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(7)	Consists of 700 shares of common stock held by Dr. Dyrberg in his individual capacity. Dr. Dyrberg is employed as a Senior Partner/Managing Partner of Novo Holdings A/S and does not have beneficial ownership of shares of common stock, if any, held by Novo Holdings A/S.

(8)	Consists of 4,444 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date

(9)	Consists of 30,222 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(10)	Consists of (i) 1,050 shares of common stock and (ii) 59,000 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(11)	Consists of 3,556 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(12)	Consists of (i) 161,519 shares of common stock and (ii) 1,639,667 shares of common stock underlying options that are exercisable as of April 1, 2019, or will become exercisable within 60 days after such date.

(13)

Consists of 5,174,727 aggregate shares of common stock, including (i): 5,044,201 shares reported as beneficially owned by Versant Side Fund IV, L.P. (“VSF IV”), Versant Venture Capital IV, L.P. (“VVC IV”) and Versant Ventures IV, LLC (“VV IV” and collectively, the “Versant Persons”), of which VSF IV reports sole voting power with respect to 31,577 shares, VVC IV reports sole voting power with respect to 5,012,624 shares and VV IV reports sole voting power with respect to zero shares, VSF IV and VVC IV each reports shared voting power with respect to zero shares and VV IV reports shared voting power with respect to 5,044,201 shares, VSF IV reports sole dispositive power with respect to 31,577 shares, VVC IV reports sole dispositive power with respect to 5,012,624 shares and VV IV reports sole dispositive power with respect to zero shares, and VSF IV and VVC IV each reports shared dispositive power with respect to zero shares and VV IV reports shared dispositive power with respect to 5,044,201 shares; and (ii) 130,526 shares reported as beneficially owned by VV IV. VV IV serves as the general partner of VSF IV and VVC IV and owns none of the shares directly. As a result, VV IV is deemed to be the indirect owner of the shares held directly by VSF IV and VVC IV. Despite such shared beneficial ownership, the Versant Persons disclaim that they constitute a statutory group within the meaning of Rule 13d-5(b)(1) of the Securities

---

(14)

Consists of 4,072,301 shares of common stock reported as beneficially owned by each of Stonepine Capital Management, LLC (the “General Partner”), Stonepine Capital, L.P. (the “Partnership”), Jon M. Plexico and Timothy P. Lynch (collectively, the “Filers”). The General Partner is the general partner and investment adviser of investment funds, including the Partnership. Mr. Plexico and Mr. Lynch are the control persons of the General Partner. Each Filer disclaims beneficial ownership of the shares beneficially owned except to the extent of that person’s pecuniary interest therein. In addition, the Partnership disclaims that it is a beneficial owner of the shares. The address for each of the Filers is 919 NW. Bond Street, Suite 204, Bend, OR 97703. We obtained the information regarding beneficial ownership of these shares solely from Amendment No. 3 to Schedule 13G that was filed with the SEC on February 13, 2019.

(15)

Consists 2,887,500 of shares of common stock reported as beneficially owned by each of BML Investment Partners, L.P. (“BML LP”) and Brandon M. Leonard (“Mr. Leonard”), of which Mr. Leonard reports sole voting power with respect to 87,500 shares and BML LP reports sole voting power with respect to zero shares, each such entity or person reports shared voting power with respect to 2,800,000 shares, Mr. Leonard reports sole dispositive power with respect to 87,500 shares and BML LP reports sole dispositive power with respect to zero shares, and each such entity or person reports shared dispositive power with respect to 2,800,000 shares. BML LP is a Delaware limited partnership whose general partner is BML Capital Management, LLC. The managing member of BML Capital Management, LLC is Mr. Leonard. As a result, Mr. Leonard is deemed to be the indirect owner of the shares held directly by BML LP. Despite such shared beneficial ownership, the reporting persons disclaim that they constitute a statutory group within the meaning of Rule 13d-5(b)(1) of the Securities Exchange Act of 1934. The address for BML LP is 65 E. Cedar - Suite 3, Zionsville, IN 46007. We obtained the information regarding beneficial ownership of these shares solely from Amendment No. 1 to Schedule 13G that was filed with the SEC on February 6, 2019.

(16)

Consists of 2,521,995 shares of common stock reported as beneficially owned by each of D.E.Shaw & Co., L.P. and David E. Shaw, of which each such entity or person reports sole voting power with respect to zero shares, shared voting power with respect to 2,440,115 shares, sole dispositive power with respect to zero shares and shared dispositive power with respect to 2,521,995 shares. This is composed of (i) 932,688 shares in the name of D. E. Shaw Valence Portfolios, L.L.C., (ii) 901,246 shares in the name of D. E. Shaw Oculus Portfolios, L.L.C., and (iii) 688,061 shares under the management of D. E. Shaw Investment Management, L.L.C. David E. Shaw does not own any shares directly. By virtue of David E. Shaw’s position as President and sole shareholder of D. E. Shaw & Co., Inc., which is the general partner of D. E. Shaw & Co., L.P., which in turn is the manager and investment adviser of D. E. Shaw Valence Portfolios, L.L.C., the investment adviser of D. E. Shaw Oculus Portfolios, L.L.C., and the managing member of (i) D. E. Shaw Investment Management, L.L.C. and (ii) D. E. Shaw Adviser, L.L.C., which in turn is the investment adviser of D. E. Shaw Asymptote Portfolios, L.L.C., and by virtue of David E. Shaw’s position as President and sole shareholder of D. E. Shaw & Co. II, Inc., which is the managing member of D. E. Shaw & Co., L.L.C., which in turn is the manager of D. E. Shaw Oculus Portfolios, L.L.C. and the managing member of D. E. Shaw Manager, L.L.C., David E. Shaw may be deemed to have the shared power to vote or direct the vote of 2,440,115 shares, and the shared power to dispose or direct the disposition of 2,521,995 shares and, therefore, David E. Shaw may be deemed to be the beneficial owner of such shares. David E. Shaw disclaims beneficial ownership of such 2,521,995 shares. The address for each of D.E.Shaw & Co., L.P. and David E. Shaw is 1166 Avenue of the Americas, 9th Floor, New York, NY 10036. We obtained the information regarding beneficial ownership of these shares solely from Amendment No. 3 to Schedule 13G that was filed with the SEC on February 14, 2019.

---

---

•

Compensation Limits for Incumbent Non-Employee Directors: The total annual base compensation, including cash and equity components (based on grant date fair value for financial reporting purposes), for each non-employee director who served as a director of the Company for any amount of time during the prior calendar year (each, an “Incumbent Non-Employee Director”) will be no more than $275,000 per calendar year.

•

Compensation Limits for Newly-Elected or Appointed Non-Employee Directors: The total annual base compensation, including cash and equity components (based on grant date fair value for financial reporting purposes), for each non-employee director who did not serve as a director of the Company for any amount of time during the prior calendar year (each, a “New Non-Employee Director”) will be no more than $550,000 within his or her first calendar year of election or appointment.

---

•	each non-employee director is eligible to receive an annual fee of $45,000;

•	the chair of the audit committee is eligible to receive an additional annual fee of $20,000, and the other members of the audit committee are eligible to receive an additional annual fee of $10,000;

•	the chair of the compensation committee is eligible to receive an additional annual fee of $15,000, and the other members of the compensation committee are eligible to receive an additional annual fee of $7,500;

•	the chair of the nominating and corporate governance committee is eligible to receive an additional annual fee of $10,000, and the other members of the nominating and corporate governance committee are eligible to receive an additional annual fee of $5,000;

•	the chair of the R&D committee is eligible to receive an additional annual fee of $10,000, and the other members of the R&D Committee are eligible to receive an additional annual fee of $5,000; and

•	the independent lead director is eligible to receive an additional annual fee of $25,000.

---

---

---