HZNP - Earnings call transcript Q1 2020 | Horizon Therapeutics Public Ltd Co

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Operator

Good morning and thank you for standing by. Welcome to the Horizon Therapeutics plc First Quarter 2020 Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session.

As a reminder, today's conference is being recorded. Instructions] [Operator

like Relations. Tina now President Senior introduce, Investor of to would Ventura, Ms. Vice I

Tina Ventura

Chris. morning you, Thank Good joining you us. for everyone and thank

Chairman Chief Chief Officer; Commercial Pasternak, call and External President President, Search; the with Chief Executive today Officer; Strategy Vikram and Tim On Executive Vice Karnani, Hoelscher, President, Vice me Clinical Development Andy Chief Officer; Vice Thompson, Liz Walbert, Executive Officer. Paul Group Financial President, Vice and are President Executive

first our Liz of including review questions. your a from high-level discuss a provide performance guidance TEPEZZA followed guidance. will on our update and review programs and remarks our Tim, will in will quarter we'll COVID-XX, Paul, R&D Tim an provide who more take by financial closing of detail. launch our then After

during today's strategy our projections we'll of future call, about certain events. timing impact be business statements including forward-looking and a As reminder, statements financial and expected the making

of materially pandemic, Our the Exchange as actual COVID-XX and and in differ other duration could well the filed extent our results a as due X-K XX-K, the factors with factors the of in XX-Q forms and Commission. Securities outlined including of effects latest number the to

reliance on disclaims are not place statements. forward-looking to You obligation statements and cautioned Horizon to these undue any such update

filings the on other In addition, and www.horizontherapeutics.com. financial financial with call our comparable our financial reconciled press investor conference measures non-GAAP release GAAP will on that non-GAAP at measures today's today are be used. are website measures These earnings from in available

call turn now Tim. the will I to over

Tim Walbert

good and everyone. morning Tina you, Thank

with initial the quarter first disease business medicine launch TEPEZZA. remarks, and my During the eye discuss we had have thyroid will remarkable our I performance

and goes these a to pandemic. thank like dedication the about professionals saying such effort care recognize I incredible start this and are that would without thoughts showing through want COVID-XX few to tireless pandemic. times. I health However, with the unprecedented It

together. with is and will patients our that It their of so many support who people maintain are medicine. the applaud employees through commitment helping also we this access and I get

been of support Horizon the communities has and such priority safety safeguard as well COVID-XX in our made which to Our an health, the at impact. patients has our employees

Our organization willing during job supporting doing a a incredible period. to to true This to support responding, and possible everything communities. have make teams patients We're tremendous services done the also go and a this we as who difference. a testament commercial always company, patient physicians lengths to is are our to

more to in response We than the have million world. COVID-XX $X.X efforts donated locations around our

position of capital to strength end milestones. following our two leverage in quarter of the This HZN-XXX, modest and including last and to royalties related pipeline us year. TEPEZZA and allowed to business rights portfolio future disease diversity our With $XXX a three with confidence addition we're level of the our of transactions we a has and future structure last and complete candidate in the a our cash rare made in payment rheumatic alone for intact, acquire company. fundamentals the to a at transactions new the month With million strong as strong position improvements debt numerous a

TEPEZZA will Given transactions pay rights back significantly and two the raised TEPEZZA this expectations, we performance believe quarter quickly. our

in supply business do and chain the our continuity forward. moving foresee from time in across not have place plans of supply medicines this our We disruptions at to availability COVID-XX support any

of have our disease need and treatment. our environment without for updated the TEPEZZA years year full this that impacts of estimate and impact best some it we've through COVID-XX business, unmet proven on patients has to done based that greatly on differs impact very our our all a the guidance. durable by while gone in to medicines in it Regarding the degree, medicine of severity

given stable serious been Our the rare they have treat. diseases medicines also disease

We are well, patient levels and KRYSTEXXA of orders has COVID-XX physician an with visits comfort inflammation have as seeing stay-at-home to and our as more reduced impacted accessing medicines impact treatment. their

As in expected and have to second it seeing discuss health it of returns, to assumed in return activity which from as to we demand deferred expect detail. will care year. will the begin relates from KRYSTEXXA, COVID-XX this Paul COVID-XX we're happen half impact the more

of expectations sales all including Moving on adjusted quarter an results, of EBITDA. and performance well across with our to exceptionally our strong had first business the better-than-expected for launch the net TEPEZZA. quarter first units, We exceeding

of million, quarter sales increase year-over-year First by net of net $XXX driven XX%. growth a were segment sales XX%, orphan

had XX%. $XXX outperforming EBITDA significantly our Adjusted TEPEZZA up expectations. was a quarter launch fantastic million,

we guidance sales million. As year are $XXX full the greater net a result, for increasing to our than TEPEZZA

sales We're our also estimated $X.XX TEPEZZA our than billion range on driven higher by to which year medicines. is guidance sales billion, other net and more the net impact COVID-XX $X.X full between raising of offsetting significantly

which We morning investments guidance new have commercial support and than reflects million, we demand recently our TEPEZZA also the to for and range higher are making our revised development-stage additional our adjusted R&D programs this million announced HZN-XXX. expected between we acquired the $XXX to TEPEZZA $XXX EBITDA candidate

scheduled extremely The in of we PDUFA FDA TEPEZZA was receiving first shortly initiated the successful action almost months date. highlight approval two which launch before January after of quarter the

positive uptick has both The far been and response from with patients medicine exceeding to expectations. the physicians overwhelmingly

full-year $XX.X million were put First into guidance million. million. initial this was $XX TEPEZZA to context our for TEPEZZA quarter sales for net $XX To

Three factors TEPEZZA drove outperformance.

Thyroid highly painful Eye a severity and and symptoms patients TED out vision-threatening or of to the is Disease factor debilitating for seek therapy. motivating the First,

been launch Second, stellar. were efforts our prelaunch third, TEPEZZA incredibly has and successful; the execution

is an severity TED The uptake. important strong the to factor contributing of

the progressing it heard from patients stories came challenging they've had TEPEZZA. to with rapidly from One live and is success about woman have how with a with countless TED We TED.

to having her on month the to job quit of other leading In verge and that debilitating she symptoms. point double the her was the due worsened up had the disease to treatment to vision

treatment By Easter out her to to was able she able she and regain help work. reached watch to accelerate importantly very in her group to April. and schedule services Our immediately TV drive her early treatment Sunday patient start ability was

disease also beginning as inactive has was patients in approval which be at with TEPEZZA. legally known fibrotic received we TEPEZZA in prescribed One one diagnosed allowed TED Shortly eye. fibrotic treatment he is indication after as broad eye. with the disease to recovered blind also patient such The rapidly sight

fibrotic shortly. new TED Liz which for reasons more than the taking which of into case, interest we're quickly generating woman discuss is in program been TEPEZZA of detail after are whose in a the Results treatment clinical another in planned In reduction fibrotic these disease more of fibrotic for strong had one our a proptosis TED year like significant moving experienced will TEPEZZA. a

execution quarter. approximately of resulted significant The therapy starting our the first prelaunch and in commercial in patients strategy investment XXX

generated than PEFs forms We a more or have demand. PEFs X,XXX enrollment are year-to-date. leading indicator patient also of

great As we to continue metrics evaluate make progress. our launch we

physician use to of about our top-tier targets. prescribers or by of oculoplastic XX% TEPEZZA In continue our surgeons. see with We significant expectations line are ophthalmologists

diversified well the are country. Patients across

current Our and XX% roughly mix commercial government. is XX% payer

expect shift to commercial patients time. the mix We more over to

quarter. administer Our centers centers site approves of XXX XXX than More those payer of first Activated ready care team infusion are the activated infusion in coverage. than in first provided to the TEPEZZA quarter. infusion administered TEPEZZA the that more sites centers

policies than lives. covered payers XX% representing lives we therefore have covered met half much with Our those favorable more access policies seeing reimbursement of Final for covered of expected. nearly for has of been those favorable sooner XX% team than with more than We're lives. published

slowed. after As it forms patient our to February TEPEZZA in has the COVID-XX, relates with growth March, and very enrollment rapid of growth

to greater guidance increased incorporates impact. than significantly Our that $XXX million

for weren't Accordingly if our impact year COVID-XX. would guidance have this it substantially the been of higher

continued full even we of expectations. greater confidence in peak year sales have guidance U.S. confidence and new see more net We in April March in our our a did gives $X sales starts which similar in us to than number billion patient U.S. that

we gout KRYSTEXXA, sales with medicine XXXX. our first growing $XX a better-than-expected quarter biologic of net With versus also delivered for XX% million uncontrolled

of in immunomodulators we've uptake KRYSTEXXA As methotrexate; we with existing growth all discussed acceleration three our continued as drivers accounts; in performance increased use contributed which adding to KRYSTEXXA see quarter; past, and this growth such of accounts of nephrology. expanded new in the and for

immunomodulation specifically, it physicians using are more to frequently. As relates immunomodulators

that includes generated results. better by continue the MIRROR response data open-label as numerous to or it evidence This with KRYSTEXXA as rate increases the the As XX% response patient well trial published similar dramatically studies rate. see we case

in we evaluating just a which trial, positive from fact, learned with KRYSTEXXA mofetil further remarks. generated or RECIPE trial mycophenolate her the data will placebo-controlled this In an discuss immunomodulator investigator-initiated MMF. Liz the is

these immunomodulators KRYSTEXXA with on grown physician of that to rates. to continue the use published, and like data presented double-digit be has Based

KRYSTEXXA impacted believe has with use expect KRYSTEXXA to long-term continue COVID-XX. by of use the We and their immunomodulators significantly been of adoption do not of

interested continue therapy study research we have market fact plus in using approximately on immunomodulation KRYSTEXXA of they in In be physicians stated COVID-XX. XX% the based conducted March, to despite

specifically of of have impact As COVID-XX mid-March to vast KRYSTEXXA, prior it maintained the impact more on started of therapy. who the that majority patients COVID-XX to therapy relates the

have However, due patients start to infusions. first-time began of in delayed mid-March, the that many their state-at-home guidelines

see care half substantially physicians new a return KRYSTEXXA generation. In This we reduction the pre-COVID-XX will has this this in health XX% to addition, visits to demand of have return declined in resulted following with We patient for second in levels in that year. visits office declining across of patient the anticipate to board. rheumatologists' resulting deferred begin the activity

demand, we have a gout of X,XXX patients KRYSTEXXA. currently more deferred As uncontrolled pending database we that who with treatment evaluate than are

circumstances. these there's patients painful them get unmet given gout. their a physician their treated appropriate continually this intact the their for The need to individual are not for are We and and engaging with market who for and fundamentals of are them chronic help when uncontrolled patients XXX,XXX-plus being treated significant

average billion patients in patients this peak so rare these Demand by of PROCYSBI RAVICTI, even treatment. remain more first growth driven as net Unfortunately, will in year-over-year highly our health more ACTIMMUNE. have and U.S. adherence defer to their KRYSTEXXA. remains for the compliance steady We than confident for our disease single-digits And improved the and quarter continue during combined $X environment. mid shipping medicines decline sales for of they expectation

for I will over to Liz our call update R&D an on now the programs. turn

Liz Thompson

Thank and morning, good everyone. you, Tim,

both we HZN-XXX. programs. very first an TEPEZZA was as also COVID-XX provide relates data. our quarter announced finally, clinical productive to new these with acquired our developments and TEPEZZA and approval it programs review R&D KRYSTEXXA. The development-stage for new And presented received I FDA also Horizon thinking from perspective. and candidate R&D a I'll for several TEPEZZA about We We

is I'll and chronic pipeline sometimes antagonist we begin The a recently with need. an chronic cutaneous rare in Curzion that transaction. is candidate we type systemic with of disease sclerosis, scleroderma which HZN-XXX. will the high autoimmune fatal unmet in and diffuse LPARX development-stage a HZN-XXX exploring is be and acquired sometimes

can patients rheumatologists internal diagnosed United organ disease with States, disease, fibrosis extensive and these sickening, managed primarily the patients kidney by suffer treatments of XX,XXX in are for and scleroderma In that disease. skin interstitial addition this lung to are bowel currently type no approved there disease. damage There including causes this roughly

signals early positive Mechanistic Phase eight-week for well LPARX clinical rationale HZN-XXX observed promising extension continued evidence trial includes the in antagonism. of open-label as an and XX-week as improvement This are Xa period. in placebo-controlled

patients clinical the short scleroderma, clinical in While benefit significant likely results benefit. too was time show potential the to frame showed evidence statistically of with

and conduct the pharmacokinetic this a later program we registrational to year formulation FDA support product plan to discuss the also to trial plan with year. new We this

of are Phase disease. to excited and in We for a Xb trial treating HZN-XXX the pivotal this initiate potential debilitating XXXX half first about the expect of

a effort R&D The the and deal part January approval organization. dedication of in of a great TEPEZZA on whole combination was our of of

of the work only However, clinical with it our medicine. represented beginning the

long-term Our strategy for is its maximize potential. TEPEZZA to

new we in and administration. to development two disease; another subcutaneous today, explore TED potential to the TEPEZZA sometimes phase inactive TEPEZA fibrotic programs: such, the As referred announced evaluate as to for of one

or inactive tissue whose inflammation TEPEZZA becomes Our inflamed Once no eye TED the of patients in behind inflammatory. active is or pain fibrotic evaluate progressive TED trial subside longer for the will fibrotic. TEPEZZA the disease and in progressive or

and diplopia active that disease is may of no life. eye debilitating other to experience continue the TED longer symptoms patients While can quality impair their proptosis, fibrotic

next that we've TEPEZZA using early mentioned, trial heard Tim As initiating with year. single-arm positive outcomes. physicians We in this patient are anticipate population a open-label

dosing Such other via currently option patients intended explore physicians. new and potential initiating is greater this is a We infusion. for for provide anticipate program trial to could of pharmacokinetic which year. dosing the to Our this administered flexibility TEPEZZA, options subcutaneous later explore

the system our start finally, decided TEPEZZA reflecting from in like We've that placed quarter reduces to cutaneous delay to later of And first proptosis we TEPEZZA smoking status. TED environment the COVID-XX. TEPEZZA III during the and the that systemic healthcare regardless data exploratory and patients and pooled Phase trials Phase trial TEPEZZA clinical of on new this sclerosis the age, presented gender significantly II diffuse demands the year, and shows

recently first, chronic efficacy in KRYSTEXXA, RECIPE MMF the and investigator-led, data as the refractory assess preliminary immunomodulator receive double-blind, to randomized, receiving Moving trial. Tim RECIPE the mofetil XX from is learned gout safety with X:X mycophenolate to referenced, to with KRYSTEXXA. patients placebo-controlled or administering all MMF or randomized of patients placebo we've an were to of KRYSTEXXA. addition study

of The with previously the target were therapy primary continued XX efficacy MMF the Phase an efficacy levels KRYSTEXXA for After adds immunomodulation. proportion achieving body on weeks which weeks X. serum evidence KRYSTEXXA to combination to with endpoint co-administration, are this III alone RECIPE regarding without acid growing of consistent the the rates evaluate methotrexate, and KRYSTEXXA and all safety program. than additional was use participants of longer-term approach. in below The uric greater maintaining patients in observed the of reported for open-label rates studies KRYSTEXXA response of alone results of XX with

results the last methotrexate on sharing of EULAR set expect and also additional the the patients the clinical in trial Rheumatology, minor we the Annual to anticipate trial. using independent We're a early the of of in second detailed results forward MIRROR with is going enrolled to the the well in complete June. in also in middle known and other open-label results trial enrollment of the Earlier abstracts towards looking at been released and investigator year, from results Trial, future European of we KRYSTEXXA. the Enrollment results this that We trial, impact precursor to of date. XXXX. year, our Randomized Controlled approximately trials data immunomodulators investigator-generated expected presentations Congress We to we COVID-XX, relatively announced which to the the There's data the upcoming the as sets quarter, will and publications. to or in of half with with planned open-label randomized full of MIRROR MIRROR anticipate be initiated XX% positive July

KRYSTEXXA Turning in PROTECT, patients to trial evaluating our uncontrolled of transplant the kidney use gout. with

Here, from patient the PROTECT impact seeing end the to year. therefore, is at-risk more of We, nature we of expect by completed which the due to of are enrollment to in COVID-XX, an population. this we believe enrollment be

previously this start advance our due in shorter medications making on-market as strides this during of maximize infusion announced again, well trial, Regarding value expand to quarter. our continue to our we we've our summary, the significant decided KRYSTEXXA COVID-XX. year delay of the trial as later respects pipeline, strategy to In both to the to

of the this safety, our remain During focused also time, on welfare in we and trial health everyone clinical programs. diligently involved

call the turn I'll that, Paul. With over to Paul?

Paul Hoelscher

then primarily on the will this quarter of about results, including with and are impact the Liz. on our rest year, begin comment focus non-GAAP I'll comments first on noted. the My we otherwise the COVID-XX thinking business. of unless morning Thanks, our how

sales quarter $XXX were net First million.

Our driven sales income RAVICTI net of the TEPEZZA, million, a was orphan generated Orphan $XX year-over-year increase by segment million, XX%, which our of operating KRYSTEXXA, launch $XXX TEPEZZA. reflects and significant ACTIMMUNE. investment commercial in segment of

with $XX inflammation of $XXX Net million. million the sales segment for segment operating income were

now segment. is beginning we this previously, RAYOS included quarter, As noted in this

segment reinvest TEPEZZA into as and continue our generated as key our pipeline. the We cash well from KRYSTEXXA, drivers, to flow this growth

was $XXX $XXX expectations. both included expenses Our profit million expense were expense of $XX in of non-GAAP SG&A million. non-GAAP Non-GAAP This gross first non-GAAP net with sales. line million XX% our quarter of ratio and R&D operating

which million, portfolio. across net expectations, performance quarter adjusted EBITDA our strong non-GAAP the exceeded significantly the our sales by driven line rate $XXX for in with tax XX.X%, The income first First was expectations. was quarter

million EPS was $XX per earnings used shares income non-GAAP calculate $X.XX. weighted non-GAAP XXXX first net were Non-GAAP share average diluted The quarter XXX diluted and outstanding million to shares. were

Moving related the and launch due flow by invested cash primarily was cash decrease versus receivables capital first, on flow. the first prior quarter inventories to driven year three to for TEPEZZA; to to factors: due second, working receivables in along of operating increased main prior The generic in significantly our medicines and payments. across accruals the gross discounts finally, lower higher related launch versus and the sales timing to to KRYSTEXXA due the decreased year; reductions for significantly trade other with VIMOVO of and invoices we accrued

growing As to manage of operations, and March our business, XX, were equivalents cash pipeline strategic invest and transactions. flexibility our expand $XXX execute in giving us million other significant cash our

is adjusted Our debt EBITDA XX-month times. X.X last leverage ratio net to

and FDA payments paid Illinois. $XXX Roche milestone the Deerfield the related in TEPEZZA to Vision purchase quarter, office in million our and In first U.S. River to new million we of campus $XXX approval to

a We our is valuable strength last actions our our debt the during XXXX Financial year took reduced out to and annualized time maturities than are extended by we gross period debt frame lowered significantly by net XX%. and to benefiting from we improve asset the million, $XXX this XXXX expense and structure. interest capital our more

have we our debt. on no Importantly, covenants maintenance

allocating terms capital, during of environment, and In our particularly our managing strong. sheet this is balance

confident three was generate our completed flow to by in operating and ability this last substantial month strategic the confidence transactions are alone. We the underscored we cash in

pursue development we transactions Our like development-stage focused expect to on acquisitions Curzion enhance activity prospects. to future growth remains continue business and our to

how XXXX I will and now of we guidance the turn see year out. provide the comments rest to on our playing

our the estimates pandemic, and overall this providing expectations. updated at of difficult predict the time with COVID-XX, best is are the scope magnitude with the along the some to impact have uncertainty While assumptions given we we the it of associated of of

net more million, net year $X.X our increase to impact sales We TEPEZZA sales to our this the billion range medicines. than $XXX expectation in billion which $X.XX expected COVID-XX reflecting year significant to are than XXXX the offset increasing more guidance for other of to our full

are million additional million, programs to our than commercial which as investments to reflects also adjusted We $XXX behind recently to we support well as range R&D acquired efforts updating asset morning EBITDA our to expected HZN-XXX. given TEPEZZA the support our development-stage announced new uptake $XXX our TEPEZZA this and faster

sales have TEPEZZA in the EBITDA expectations COVID-XX. for the to accommodate We the of uncertainty and guidance adjusted impact of ranges net our greater for both and widened factor

of half the Our to updated health care return that guidance starts activity assumes second year. this in

a we the significant For anticipate second sales TEPEZZA, increase the quarter. quarter from to net first sequential in

growth April slowing have impact been expect to million. without from COVID-XX. we higher substantially However, sales, the COVID-XX forms on of patient we This would to expectation of which the enrollment have project we net saw than some now $XXX be more in full-year from TEPEZZA impact

Given the of of in remain more U.S. expectation confident the peak $X net sales uptake, we than more successful tremendous our and launch TEPEZZA than ever billion.

For first sales with expectations our significantly KRYSTEXXA, XX%. growth exceeded performance quarter of net

on impact first COVID-XX the range. the quarter new for patient in to a from XX% sales we starts, the sequential XX% to decline given KRYSTEXXA However, quarter expect second net the

KRYSTEXXA the full the to sales. of year, sales net in we net expect range XXXX For be

pending a currently of with X,XXX to KRYSTEXXA roughly therapy. We database treatment have bring be them patients and we'll working onto

more expectation the that we immunomodulation of billion. Given our uptake net U.S. of $X than sales remain in we highly this for confident peak and KRYSTEXXA continued expect,

medicines, therapy, motivated they to a which patients on limited disease and compliant do. we to it rare remain understand anticipate we for COVID-XX believe disruption from given how are our important is For

the low be return, For we expect new single digits happens health the limited until second which half. activity the given care to in net anticipate generate the to growth opportunity to full starts in sales patients year, we

to prescriptions demand For their new engagement medicines, patient as in since absence reduction experienced mid-March, the to physicians. well we in-person a have reduced due as to with from visits physicians, our inflammation related particularly of COVID-XX

offset the to as our this be of to prescribe representatives telemedicine many the our use as sales them of treat to expect impact medicines. by by which virtual patients allows We engagement somewhat and continue well physicians,

activity to second to anticipating XX% relatively are seeing we of inflammation quick starts once we for levels pre-COVID-XX demand what care health for sales a are on segment. We to return. decline today, return our quarter, the a net XX% anticipate sequential Based

expectations Moving rest full-year on for to the statement. income the our of

This profit gross which year. sales XX%, due non-GAAP expectations for prior approximately expected to is is significantly impact higher expectation. associated the Our than to primarily our TEPEZZA modestly of net this ratio be royalties with XX% is lower

increase patient We investments TEPEZZA versus SG&A modestly operating by required full demand support additional significantly our driven expect year expectations, higher prior to XXXX pull-through. patient expenses support in to including to investment

anticipate by also As part R&D to expense of HZN-XXX TEPEZZA programs in Liz this investment increase new that higher and our discussed. OpEx, we R&D driven

percentage net sales our now expense as in We digits the high non-GAAP to a single R&D of for expect XXXX. be

million full structure to expect expense as be approximately We year in result of the $XX a capital we interest XXXX. net made non-GAAP improvements

tax full-year in rate, digits. to tax our high For a we non-GAAP continue single expect rate the

anticipate we see in quarterly some tax basis. we on year, variability a rate non-GAAP As our every

Act. projected as Our be XXXX now from some to digits of benefits Cares in the mid cash estimate tax lower than low the rate double is digits single prior a our result to high arising of

We average the expect million of our of XXXX shares. be into range XXX shares, notes quarter said to to our in million count of ordinary which diluted full last $XXX exchangeable assumes we as year share conversion million potential XXX weighted the

remarks. it that, Tim his concluding over for With to turn I'll

Tim Walbert

result our a had tremendous organization. initial We of activities prelaunch by XXXX, after its execution uptake approval in to January, rapid shortly the the and highlighted last TEPEZZA year a start Paul. Thanks, commercial great throughout TEPEZZA of of the

growth focus on candidate in resulted and the our of execution continued KRYSTEXXA excellent acquisition development-stage drove Our HZN-XXX.

sales for million than We more full expected year our higher uptake. given guidance than increased significantly the $XXX net to TEPEZZA

a has net from also expect offset company which our higher total we billion full-year the our year increased reflecting billion, impact net COVID-XX. guidance full sales than to more guidance, to We $X.X sales $X.XX

$XXX adjusted to to guidance range We million. revised our EBITDA million $XXX

investment our incorporate investment in the the support making seen, in TEPEZZA new additional we As demand well to we've as R&D as TEPEZZA HZN-XXX. Paul stronger are said to programs,

time, of And the we health, at access the and our of employees same making COVID-XX response COVID-XX help ensure business the patient we're and support our Our in priority are of fundamentals spread effort to patients welfare medicines. environment working the in minimize our safeguard efforts. to company every and our COVID-XX are their the safety as communities the we're strong. to continued to a to and The is current working

position the thanks be We made a improvements term. last We strong well-positioned -- to and structure. sheet we continue balance year our for cash have long very a to we're capital robust to the believe

With open questions. it that, I'll up to

Operator

you. comes And Thank from line the of Instructions] our first Gerberry Jason question [Operator with Bank America. of

is Your now line open.

Jason Gerberry

year meaningful the and practitioner, pretty Particularly hospital-based private practitioner prescriber were taking on of things just we're from Hey, this and Thanks thought progress. so appointments the with proportion -- the terms likely like I might private good on and launch morning. is that. really be I'm to for thinking impact my of practitioners, the you're on curious base of not about the what taking question contribution? and be they first in My questions congrats around seeing far that sort that less COVID TEPEZZA

you us sense working a achieving while result? can through So give you're headwind that this of the

talked investment motivated activation patient. candidate TEPEZZA. a like advertising And of just DTC seems follow-up, then It as you behind given just the an a for television highly obvious about

So of TEPEZZA? the little could you're a Thanks. more around us you give behind some that clarity putting investments

Tim Walbert

question. the for Thanks Jason. Sure

some We are seeing headwinds.

more We working that said, found our an predominant there at a I hasn't over of be centers been would have really very There hospitals ophthalmologist's of to that anticipated offices. sure in XXX there's – in What symptoms as and many activated fact administered originally than weren't that of sites and XXX And have lot physician's have vision infusion for can our infusions make just infused. of a all. patients the are those access offices and because very in surgeons folks double gotten living oculoplastic we is place have that centers infusion issue or As patients patients circumstances. difficult well identifying the seen TEPEZZA. we've worked with get care managers and patient disfiguring these

been organization with to the and treatment. of action ensure find taking able they're Services Patient site help they we've care And get right to our

any as being limiter. So impact rate we seen offices haven't physicians' from a

patients as a are to PEFs I the said We've ability X,XXX impact We seeing in. over in number time. get got from at point of this new large

So, that factored slowing number we of our generated in than the being are is million guidance. of PEFs $XXX seeing a and greater

think is investment. second the I question around our

DTC. evaluating are We

mentioned to both efforts physicians. primary evaluating to television. cases whether a there. number we're media sense some see digital targeted And do our of well TED consumer's as some going digital now, patients the means. as we focus We've is test You potential done to media are broader Right makes and

Tina Ventura

Great. Jason. Thanks,

Jason Gerberry

you. Thank Yeah.

Tina Ventura

please. question, next Chris,

Operator

comes you. line Steinberg And Thank question the our next from David Jefferies. of with

Your line is now.

David Steinberg

Thanks and good crisis questions good on congrats execution. of this particularly morning. on launch TEPEZZA A the and couple in pretty

getting what percent the you've sales, of that of inactive the average final of are the secondly, getting form population your your actual using already infusion. your $X the used infusion to XX,XXX patients you doctors patient. label centers XX,XXX a of forms sounds the a then at the just that mentioned been fairly think is, the does was given TED? with lot the terms number home have lot calculation active billion-plus And therapy And closed of had addressable this home have of So on to I curious, market, Tim, just some them point? the I patients are incidence are a infusions in In actual who estimates the we've group? are include broad. talked – question for infused patients, or patients that of like for of is per it price also Because inactive therapy peak those your

price the thus patient? – far I course $XXX,XXX What Thanks. per of net a know what's wait of days. about around of talked it's price you think I sort per therapy. average

Tim Walbert

Thanks, Dave. appreciate the I remarks.

to and via the as treated infusion to some a physicians over physicians been starting infusion. to and your but an have of we the able very going different increase to numbers we've We in but It's home be find have one. are home centers them. part infusion patients with But centers something specific we've on close that these to of should do target, patients see infusions seen a services utilize most home had infusion number moving point for amenable is a been see have we number expect TEPEZZA. it's a I don't that time good

approval, haven't any as population XX,XXX about guidance. overall course XX,XXX noted. patients – each as of not the greater population XX,XXX. to active the incident billion patients fibrotic full overall see of That population address you is through with multiple we a our patients in to had a disease of the To From to $X talking XX,XXX We we been than year patient as had that an included standpoint, treatment. price prior average

too talk patient. us about per it's price for early So average to

line Our gross to we've net with so expected is generally in what far.

Tina Ventura

next question, please. Chris, David. Thanks,

Operator

you. our Annabel the question of Stifel. from And with line Samimy next Thank comes

Your now is open. line

Annabel Samimy

Hi, my guys. for Thanks question. taking Congratulations.

had mentioned treatment. that had you So you on some gotten fibrotic patients

severe tell Can said you fibrotic? generally your of getting population How you that, – do us study? are Is they requirements And you the are which ones there And just is quantify physicians to are a that? – are types what then simple, better it need out? patients clinical many what also is or program you simple can on clinical multiple. the on most – seeing? just PK but patients – get requirements, therapy? fibrotic the you is it a it – So Are the that are placed subcu, a nothing

Tim Walbert

Sure.

first fibrotic. percentage we the don't question, are to get specifically know at So, what

over a I hopefully just I a it's number about of that come enough them say, that on would getting percentage. don't a And lot that we we're more are it's have seeing working in. of I specific time. that We'll learn population. comments think that

population, on it analysis really since you we're claims fibrotic out And approval that active doing data, we've five post the purchased right at incremental and Looking do whether the gone three now. cutoff, and disease, depends years how years. it's

different now, right there's analysis will do requirements, we final data. to it's really things, know and with determination as we've formulation multiple, understand -- conversations whether to formulation we based got the Relative the claims that we then of of that dose really studies that's bridging there's So of look and a what our to work finalize clinical things, a and on number right is update a different FDA. at number

So we'll along. moves update as have further to that

Tina Ventura

next Chris, Annabel. Thanks, question, please.

Operator

Amsellem our comes the question David Sandler. with line And you. Piper from of next Thank

line now open. Your is

David Amsellem

Thanks.

I So modicum demand like on on some a KRYSTEXXA, TEPEZZA of it one mean and sounds pent-up there's so effect. then TEPEZZA, on

your are so. see we'll confidence do the I may XXXX? on then year realize mean half? comment enrollments says KRYSTEXXA, go you extent you are about patients underpins kind talk vulnerable These just And move as broad-based secondly, lot with can second of we to comment that mean, your what can as about I for these the demand So pent-up of of in progresses. on what as But To patients. into can we sales normalization you -- this a comorbidities. the cadence

that caution to expect So kind in? degree do your updated of getting in Thanks. high you be regarding there's a of patients these reflected And that caution guidance? is

Tim Walbert

wanting is There guidance the Data Sure. it I'll we're patients hesitancy providing. been published XX%. are rheumatology factored with offices. that visits to KRYSTEXXA. David, into is go physician's start that's shows Yes, now down right in into

acute from are patients these multiple on, a is with going gout. their flares important thing patients sick standpoint of the in of even needing potentially the amputation. state often very severity flares uncontrolled and The They're

get their because communication. patients of disease. have confident we're they're to a these feel very them. as We've maintaining see We we going database ultimately X,XXX got deal So to to of out with

We continue to communicate with them.

been those as to get into get use they'll because year ability on on of gives of that's strong growth factored years. back X the take second drug COVID, We and we in trajectory our they get offices, through intend of to that in the plus immunomodulation say last X And over that that of patients, we we've back research to KRYSTEXXA what that physicians half got confidence target in and of those hesitancy important spite begin our great us showed back it the XX% have patients our position. time into will an that guidance to current but the get

the efficacy So them and uncontrolled gout great gives they us of it immunomodulation, option that strong right that you're patients. for gives confidence confidence understand that it's KRYSTEXXA doubling those the

congress, data, the data to, see we that was scientific that next thing Liz had RECIPE which XX went a here published important other as through hope at months is placebo-controlled, the The over coming is all patients data, now XX%. the of III PHASE with similar all of double seen -- north leflunomide more which data mycophenolate, mycophenolate. with Phase and well And immunomodulators, than XX%, methotrexate, is we've II

all So KRYSTEXXA as feel us strong XXXX. confident that very back on into of makes in trajectory ability growth our we get to move that

Tina Ventura

bolus. question the TEPEZZA think I to or PEZA was pent-up other around And

Tim Walbert

Sure.

longer of I three active one with anywhere there's to smokers and the bolus, we of the from typically expected around as think population, side active disease, that. have years So

the going XX,XXX to years incremental So to you're two of here, one, to have launch in XX,XXX. patients the

XX,XXX So XX,XXX having bolus coming in and positively speak of a are the this that tremendous the does that plus and in to we think we that into just year are there's a XXXX only patients, multiple beyond. move fibrotic as the patients XXX runway

Tina Ventura

David. Thanks,

Next question, Chris. please,

Operator

Thank you.

Markets. with Our the from BMO comes next of question Nachman line Capital Gary

now line is Your open.

Gary Nachman

Hi. Good well. progress morning. My congrats on as TEPEZZA the

and still So you J-Code help? on confident said, inflection yes, is confident how you happens? be are big much already, that are the there'll more, then Tim. X like when one reimbursement And get that still you October a good Sounds you'll might

most oculoplastics infusions, of officers in just how accounting with the much curious the use. help whole managing involved get said You are the to the have the for process? and to endocrinologists I'm

Tim Walbert

Sure.

ophthalmologists treaters oculoplastic and primary And at the to So, underlying treat here. ophthalmologist disease refer the the and all. treat out The to are not surgeons the eye. endocrinologists then generally, involved they the graves'

have involved So not they in been process. heavily the

and most part and over the interest, ophthalmologist it's are endocrinologists the but subspecialty surgeons taken is XX% of for neuro oculoplastic an in There one ophthalmologists. the active who've off

very J-Code, seeing think in XX% the around point I at question access. what plus your put this say which indication not the actual beyond XX% of them indication lives. criteria. of to about are our clinical restricted commercial favorable trial they XX% or -- in our have overall policies good meaning the we're To our is probably access aren't that I'd is time place, plans of

more and average XX get -- favorable we've to treated. So patients days expected XX also we on to seen time

patient got XXX early And call treated look had enrollment patients when and if quarter. point had forms the at quarter that at time first our XXX we in when you we February second we in in

faster access we see can patients has and good. at overall you a rate than So been are getting we quite expected on

Gary Nachman

Thank you.

Tina Ventura

Thanks Gary.

please, Chris. next Our question,

Operator

you. next our Thank and Cowen with Ken Company. the question And comes from of the line Cacciatore

is line Your now open.

Ken Cacciatore

Congratulations the much so guys. launch. Thanks on

the think about On and XXX stages Just did patients. enrollment QX XXX we of we at on entered one believe I TEPEZZA on TEPEZZA, we had forms KRYSTEXXA. I later

not is a So up Can conversion, even learning sure now we Are getting can make rate? investing hit are as as really of many patients part who you of kind is and we're this you're good about those it? to in you talk the to that X,XXX. great converting? And just not about though personnel anything grabbing that's

And target then either using about on just with methotrexate. wanting base in KRYSTEXXA, at talked wondering about a combination XX% you to or clinician

next or community? where think Thank the eventually so? what wondering the could for utilization And kind Just is the broader you over you. combination year of to do go

Tim Walbert

Sure.

that strong for KRYSTEXXA I we've think sense. the and that is support broader makes there KYRSTEXXA, done So immunomodulation. other with It plus community research confirms

important methotrexate, mycophenolate now three immunomodulators methotrexate been the showed we most we're used and it's consistent with think beyond leflunomide that that seeing with across by results rheumatologists. I

that is to this So we'll patient the continuing we able feel return the of to positive patients communicate for funnel move with And we as very into future. with think through we're move X,XXX them database we XXXX. that be

think our you we XXX had pointed the XXX patient quarter early February, on quarter. call. enrollment I forms. accurately in In patients first TEPEZZA, We treated fourth out With about

in forms. than expected. this at have quicker And much time, cycling X,XXX we patient they're So point we enrollment

incremental is patient has are patient managers. the getting have issued as the expected. able XX% job amazing greater those here which adding an and percentage, The a are volume resources team Overall of and whole policies now XX% thing patients them services that a there's of there time unlike than handle just plans to matter of to Right access small we done is we have. be for more than that just processed. less not We've added yet some

six up months. a number through working able initially we caught to having than them standpoint. would to a with dialogues up plans a policy and just three still to less that remaining take hope XX% that number We're that We're of are be move from we of thought those

the expect rate that right processing So, continue treatment. seeing any we we're issues. I major those of having them and them to site get with conversion care a matter -- of through patients work And don't to to getting think overall, well. very getting it's And just identified

Tina Ventura

question please. next Thanks Chris, Ken.

Operator

Risinger from with Thank David you. question Morgan the comes And Stanley. next of line our

is open. line now Your

David Risinger

much update. very Thanks and congrats TEPEZZA the on

combination enthused that but to are, there's color KYRSTEXXA could you respect some XXXX infection doctors with cases more questions I that my due I risk. in any So to provide methotrexate's also little about methotrexate have hesitation that first, potential. a off-label, to know including whether would growth, be use in understand

development SEL-XXX alternative given Selecta's you just on please as rapamycin of methotrexate? could comment Second to an

on you. operating cash provide if could for then And update first any third, you Thank flow results? XXXX quarter following

Tim Walbert

will show that hesitancy have. to remarks, as two I in And recent KRYSTEXXA that cash mentioned first opposite flow relative seen and using of in nephrologists the and willingness address question interest I'll you and methotrexate. We've rheumatologists immunomodulation with research address Paul then Sure. strong the indicated in the with my XX% fact, methotrexate.

option leflunomide now a that good the we've mycophenolate shown They and is also have of option.

that is has to KRYSTEXXA Your do in used flow inferior take about And far cash this question? plus uricase with Paul you immunomodulation. what rapamycin combination immunomodulator question we've is the to want shown the that's efficacy seen not rheumatology. in with

Paul Hoelscher

Sure.

for we're year cash the providing not on So regarding that. specific flow guidance full operating

flow remainder from do we cash generate that say significant expect to would of operations the I the year. for However,

David Risinger

Great. Thank you.

Tina Ventura

time more question looks we’ve please. like it Chris, got one Operator. for

Operator

Thank you. Dana from our with Flanders And Guggenheim. last question line comes of the

now is line open. Your

Dana Flanders

first would be as use in. be mild? mRSS And development? you're My And on severe think on patients you. see quarter. in think the do Thank on And question across type that you your granularity the acceptable? you. Thank more me clinical FDA congrats you just move those seeing on secondly want might of just do to deemed do TEPEZZA, thanks for moderate Great. LPARX just then to here you endpoint any squeezing what you And forward versus acquisition, will have

Tim Walbert

Sure.

On space this on not commentary an KRYST And at FDA's acquired, the we there whether individual critical look to where and KRYST Curzion that it. looking I Liz, endpoint ago. it do both what we part There's been are address around probably before comment a HZN-XXX long components that's question? LPAR scleroderma comment you is to our like. is want any need in antagonist, to think and both lot of of further TEPEZZA the too endpoint in appropriate going as components an is the individual the KRYST

Liz Thompson

agree our response the mRSS completely with components look. the be developed endpoint KRYST it Tim. I going some the the opinion demonstrate composite important individual been That the to in in some on of community challenges as impact give some like is in Thanks individual said, has that an overall to of to to those well. endpoints

way the about state. thinking completely what this said So we're about echo Tim disease

Tim Walbert

with moderate seeing we're by with meeting one out half around – we meet months start be will those class-end next just of patients which stage. and question we're that be severe up it say IIb have in seen now severe severe first the FDA Phase that Relative the the to active your in to also to program been FDA would map but coming and use over setting the would year. So are fibrotic a patients to of to Dan in point of at disease, definition more we we said and a to the TEPEZZA plan here who population us a patients IND transferred got in typical moderate, disease in more I have to

as early to now that's I not identified right to we is XX,XXX severe that the carve-out a patients So which of population moderate and patients. primarily population to it's moderate include active the subset XX,XXX mild say does would

we much we What patients pretty as used expected. is it's as well. are seeing So fibrotic in greater-than-expected

Operator

today's concludes Ventura for the session. to turn Tina This I remarks. call to back closing like you. Thank question-and-answer would now

Tina Ventura

for morning. call in this Thank of and you Chris. Well, hours. be thanks, A webcast call will concludes approximately this available That joining. our two replay

Horizon Therapeutics Public (HZNP) 6 May 202020 Q1 Earnings call transcript