Horizon Therapeutics Public : Q3 2020 Presentation

Debt (principal)

November 26, 2020 at 06:09 pm EST

Third-Quarter 2020 Summary

Horizon Therapeutics plc

November 2, 2020

HorizonTherapeutics.com

Forward-Looking Statements

This presentation contains forward-looking statements, including, but not limited to, statements related to Horizon's full-year 2020 net sales and adjusted EBITDA guidance; expected financial performance and operating results in future periods, including potential growth in net sales of certain of Horizon's medicines; development plans; expected timing of clinical trials, studies and regulatory submissions; potential market opportunity for and benefits of Horizon's medicines and medicine candidates; and business and other statements that are not historical facts. These forward-looking statements are based on Horizon's current expectations and inherently involve significant risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks that Horizon's actual future financial and operating results may differ from its expectations or goals; Horizon's ability to grow net sales from existing medicines; uncertainty with respect to the COVID-19 pandemic and actions taken to slow its spread, including impacts on sales of Horizon's medicines and potential delays in clinical trials; the availability of coverage and adequate reimbursement and pricing from government and third-party payers; risks relating to Horizon's ability to successfully implement its business strategies; risks inherent in developing novel medicine candidates and existing medicines for new indications; risks associated with regulatory approvals; risks in the ability to recruit, train and retain qualified personnel; competition, including potential generic competition; the ability to protect intellectual property and defend patents; regulatory obligations and oversight, including any changes in the legal and regulatory environment in which Horizon operates and those risks detailed from time-to-time under the caption "Risk Factors" and elsewhere in Horizon's filings and reports with the SEC. Horizon undertakes no duty or obligation to update any forward-looking statements contained in this presentation as a result of new information.

Horizon: A Differentiated, High-Growth Company

We are a leading, high-growth profitable biopharmaceutical company

Focused on rare diseases
Two high-growth drivers, TEPEZZA® and KRYSTEXXA®, with >$4B in combined peak U.S. annual net sales potential(1)
Strong track record executing our strategy of maximizing our key growth drivers while expanding our pipeline for sustainable growth

Delivering innovative therapies to patients

•	Deep development expertise with proven track record	180.8%
•	Building a pipeline through M&A to support sustainable long-term growth

Generating high returns for shareholders

Outperformed NBI YTD and for 1, 3 and 5 year periods
Top-tiergrowth profile

107.0%			123.7%
	85.3%

		25.1%	38.7%	21.9%
8.7%


YTD 10/30/20		1-year	3-year	5-year
		Total Shareholder Return through Dec. 31, 2019

HZNP		NBI (Nasdaq Biotechnology Index)

(1) Horizon estimate.

Top-Tier Growth Profile

Strong Double-Digit Net Sales Growth Driving Increasing Margins

Net Sales Target		Non-GAAP Operating Income Target
Strong Double-Digit CAGR		Increasing Margins

2020

2021

2022

2023

2020

2021

2022

2023

Growth Drivers

TEPEZZA:

Peak Net Sales >$3B(1)

KRYSTEXXA:

Peak Net Sales >$1B(1)

Meaningful operating margin expansion, inclusive of increased R&D investment

Well Positioned to Deliver Sustainable Top-Tier Growth and Enhanced Shareholder Value

Note: Projections are illustrative only and represent Horizon targets. Actual results could differ significantly as a result of any acquisitions or divestitures, as well as business risks.

(1) Horizon estimate.

Third-Quarter 2020 Summary

Third-Quarter2020 and Recent Company Highlights
Third-Quarter2020 Results
Full-Year2020 Guidance
TEPEZZA Update
KRYSTEXXA Update
Pipeline and New Programs Update

Third-Quarter 2020 and Recent Company Highlights

Strong Financial Results and Significant Progress Executing on Our Strategy

Financial

Highlights

Executing on Our Strategy

Record net sales of $636.4M, up 90 percent driven by significantly higher TEPEZZA net sales and return to growth of KRYSTEXXA; record adjusted EBITDA of $329.8M
Record orphan segment net sales of $534.8M, an increase of 131 percent driven by TEPEZZA net sales of $286.9M; orphan segment represents nearly 85 percent of total company net sales
Increasing FY20 net sales guidance to $2.12B-$2.14Breflecting increased FY20 TEPEZZA net sales guidance of >$800M
Increasing FY20 adjusted EBITDA guidance to $920M-$940M
Cash balance of $1.725B and gross debt of $1.018B at Sept. 30, 2020
Significantly increasing TEPEZZA investment to support continued strong growth
Pursuing global expansion to provide TEPEZZA to patients with TED in other parts of the world
Expanding HZN-825 development program to include interstitial lung diseases
Karin Rosén, M.D., Ph.D., joined Horizon on Oct. 30 as executive vice president, R&D and chief scientific officer
KRYSTEXXA RECIPE trial achieved 86 percent response rate using KRYSTEXXA with immunomodulation
Announced interim data in KRYSTEXXA PROTECT trial
Announced topline data from TEPEZZA OPTIC-X open-label extension trial and OPTIC 48-week off-treatmentfollow-up
Significantly improved capital structure through equity raise and debt paydowns over last 18 months

FY: Full-year.

Note: Adjusted EBITDA is a non-GAAP measure; see reconciliations at the end of the presentation for a reconciliation of GAAP to non-GAAP measures.

Third-Quarter 2020 Financial Results

Continued TEPEZZA Outperformance and KRYSTEXXA Return to Growth

($M, except for per share amounts)	Q3 2020	Q3 2019	% Change	YTD 2020	YTD 2019	% Change

Net sales	$636.4	$335.5	90	$1,455.1	$936.5	55

Net income (loss)	292.8	18.2	NM	199.2	(19.7)	NM

Non-GAAP net income	392.2	124.1	216	559.2	273.6	104

Adjusted EBITDA	329.8	130.4	153	627.7	342.9	83

Earnings (loss) per share - diluted	$1.31	$0.09	NM	$0.95	($0.11)	NM

Non-GAAP earnings per share - diluted	1.74	0.64	172	2.58	1.44	79

Note: Non-GAAP net income, adjusted EBITDA and non-GAAP earnings per share are non-GAAP measures; see reconciliations at the end of the presentation for a reconciliation of GAAP to non-GAAP measures.

NM: Not meaningful.

Third-Quarter 2020 Orphan Segment Results

Orphan Segment Net Sales Now Represent Nearly 85 Percent of Total Company Net Sales

($M)	Q3 2020	Q3 2019	% Change	YTD 2020	YTD 2019	% Change

TEPEZZA®	$286.9	--	NM	$476.3	--	NM

KRYSTEXXA®	108.5	$99.6	9	276.9	231.6	20

RAVICTI®	64.6	60.0	8	191.4	160.3	19

PROCYSBI®	43.1	40.4	7	122.8	121.1	1

ACTIMMUNE®	28.3	27.9	2	83.1	78.9	5

BUPHENYL®	3.2	3.0	6	8.4	8.2	3

QUINSAIR™	0.2	0.2	(23)	0.5	0.6	(9)

Orphan segment net sales	$534.8	$231.1	131	$1,159.4	$600.7	93


Orphan segment operating income	$274.7	$79.7	245	$480.6	$180.1	167

Note: Prior to the first quarter of 2020, the two operating segments were the orphan and rheumatology segment, which included RAYOS, and the inflammation segment. Beginning with the first quarter of 2020, RAYOS was moved to the inflammation segment and the orphan and rheumatology segment was renamed the orphan segment.

NM: Not meaningful.

Third-Quarter 2020 Inflammation Segment Results

($M)	Q3 2020	Q3 2019	% Change	YTD 2020	YTD 2019	% Change

PENNSAID 2%®	$50.3	$42.1	20	$126.9	$143.7	(12)

DUEXIS®	27.9	29.9	(7)	87.1	89.4	(3)

RAYOS®	18.1	19.3	(6)	50.8	59.1	(14)

VIMOVO®(1)	5.3	13.1	(60)	30.9	41.8	(26)

MIGERGOT®(2)	--	--	NM	--	1.8	NM

Inflammation segment net sales	$101.6	$104.4	(3)	$295.7	$335.8	(12)


Inflammation segment operating income	$55.1	$49.8	11	$145.1	$161.7	(10)

Note: Beginning with the first quarter of 2020, RAYOS was moved to the inflammation segment.

On Feb. 27, 2020, Dr. Reddy's Laboratory initiated an at-risk launch of generic VIMOVO in the U.S.
In June 2019, the Company divested the rights to MIGERGOT.

NM: Not meaningful.

Increasing Full-Year 2020 Guidance

	New Guidance	Previous Guidance

Net Sales	$2.12B to $2.14B	$1.85B to $1.90B

Adjusted EBITDA	$920M to $940M	$725M to $775M

Key highlights
- Net sales and adjusted EBITDA midpoints represent year-over-year growth of 64 percent and 93 percent respectively
- Significantly higher TEPEZZA net sales expectations of >$800M (previously >$650M)
- Increased KRYSTEXXA net sales guidance to low double-digit growth

Note: Adjusted EBITDA is a non-GAAP measure.

Our Strong Financial Position Reflects Effective Execution of Our Capital Allocation Priorities

Cash Position of $1.725 Billion Gives Us Flexibility to Pursue Future M&A Opportunities

Strengthened Cash Balance While Reducing Gross Debt

$ in billions

$2.02$1.99

$1.73

	$1.42
$0.96	$1.08	$1.02

$0.75

Executed Well on Our Capital Allocation Priorities

Reduced gross debt by ~$1B since early 2019
Raised ~$920 million cash through August equity offering
Gross debt of $1.018B as of Sept. 30, 2020; earliest maturity in 2026
Cash position of $1.725B as of Sept. 30, 2020

Gross Leverage Ratio

Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2019	Sept. 30, 2020	Target

5.2x	4.4x	2.9x	1.3x	<2.0x

Gross Leverage Ratio: Gross principal amount of debt to last-12-months adjusted EBITDA.

(1) LTM adjusted EBITDA are non-GAAP measures; see reconciliation slides at the end of the presentation for a reconciliation of GAAP to non-GAAP measures.

We Are Making Significant Progress on Our Strategy

Executing on Our Strategy

Progress and Expected Milestones in 2020

Maximizing the value of our key  TEPEZZA Jan. 21 FDA expedited approval for treatment

growth drivers KRYSTEXXA and	of TED; subsequent successful launch with rapid
TEPEZZA	uptake; continued launch execution
• Expanding our pipeline to	 Advanced KRYSTEXXA immunomodulation strategy:
accelerate long-term growth	 Announced 79 percent complete response rate in
	MIRROR Open-Label Trial
	 Completed MIRROR RCT enrollment
	 RECIPE RCT demonstrated 86 percent complete
	response rate
	 TEPEZZA permanent J-code effective Oct. 1
	 OPTIC-X topline data readout
	 Initiated KRYSTEXXA shorter infusion duration trial
	 Initiated TEPEZZA subcutaneous exploratory trial
	• Complete KRYSTEXXA PROTECT trial enrollment
	• Initiate new TEPEZZA trials: chronic TED trial, dcSSc
	exploratory trial

Expected Milestones Beyond 2020

New TEPEZZA data readouts:
- Chronic TED; subcutaneous administration; dcSSc
New KRYSTEXXA data readouts:
- MIRROR RCT; PROTECT; shorter infusion duration
Initiate HZN-825 Phase 2b pivotal trials in dcSSc and IPF
Advance pre-clinical gout candidates into clinical development
Expand TEPEZZA to TED patients outside the U.S.
Advance toward peak U.S. annual net sales expectations:
- TEPEZZA: >$3B(1)
- KRYSTEXXA: >$1B(1)

TED: Thyroid Eye Disease. | dcSSc: Diffuse cutaneous systemic sclerosis. | IPF: Idiopathic pulmonary fibrosis. | RCT: Randomized controlled trial.

MIRROR: Immunomodulation program evaluating the use of KRYSTEXXA in combination with methotrexate to increase response rate. | PROTECT: Clinical trial evaluating the effect of KRYSTEXXA on serum uric acid levels in kidney transplant patients with

uncontrolled gout. | OPTIC-X:Open-label extension trial of the Phase 3 trial evaluating TEPEZZA for the treatment of Thyroid Eye Disease.

(1) Horizon estimate.

TEPEZZA

One of the Most Successful Rare Disease Medicine Launches

TEPEZZA: First and Only FDA-Approved Medicine for Patients with Thyroid Eye Disease (TED)

Outperforming Launch Expectations with Significant Demand Created by Pre-Launch and Launch Efforts

Received early U.S. FDA approval on Jan. 21, 2020 for patients with TED

Dramatic Phase 3 results: 82.9 percent of TEPEZZA patients experienced ≥2mm proptosis (eye bulging) reduction
Broad indication for treatment of TED enables treatment of acute and chronic TED patients

TED: A debilitating disease that severely impacts quality of life

Vision-threatening,rare autoimmune disease
Inflammation and tissue expansion behind the eye cause proptosis and diplopia (double vision)

U.S. commercial launch continues to benefit from significant pre-launch market education efforts

Pre-launchactivities initiated in early 2019 contributed to rapid launch uptake
Multi-functional,highly experienced field-based team engaging with stakeholders since July 2019
More favorable access than originally expected

Peak U.S. annual net sales estimate >$3B(1)

• >$800M of net sales expected in 2020(1)

(1) Horizon estimate.

FDA: U.S. Food and Drug Administration.

Our Commercialization Strategy

Driving Continued TEPEZZA Demand and Adoption to Enable More TED Patients to Benefit

Drive

Increase

Support

Accelerate

TED: Thyroid Eye Disease.

Greater penetration of our physician targets
Increased patient awareness about TED and TEPEZZA through expanded reach and engagement
Understanding of TED as a chronic, vision-threatening disease and accelerating the urgency to treat
Awareness of the role and benefits of TEPEZZA in the treatment of acute and chronic TED patients
A simplified patient journey with our comprehensive, high-touch,patient-centric model
Patient and site-of-care referral processes
More timely access to TEPEZZA
Time from disease identification to treatment

Drivers of TEPEZZA Rapid Uptake and Outperformance

Peak U.S. Annual Net Sales Estimate >$3B(1)

TEPEZZA U.S. Annual Net Sales Expectations

>$3B(1)

>$800M(1)

2020Peak

(1) Horizon estimate.

Proptosis: Eye bulging. | Diplopia: Double vision.

Acute stage of TED is characterized by changing or initial onset of signs and symptoms.

Chronic stage is the period after which the symptoms are no longer noticeably changing but still persist.

Pre-launch, launch and new expansion efforts drive strong awareness and high demand

Established robust infrastructure to support all aspects of patient journey
Significant engagement with key stakeholders
Rapid uptake through reimbursement process
Investment to support long term success

Severity of disease a motivating factor for patients to seek treatment

Proptosis, diplopia, pain and facial disfigurement
Vision-threatening;progressive; significant impact to quality of life

Broad label allows for adoption in acute and chronic patients

Physicians are using TEPEZZA in both patient populations

We Are Investing to Drive the Continued Strong Growth of TEPEZZA

Expanding U.S. Commercial & Field-Based Organization and Marketing Initiatives

Doubling commercial and field-based organization to ~200 employees to support higher-than-expected demand and enhance the patient journey
Expanding marketing initiatives to drive increased awareness of TED among physicians and patients; includes direct- to-consumercampaign to engage more patients and connect them to TED specialists

Increasing Supply Capabilities		Pursuing Global Expansion

• Investing in TEPEZZA long-termsupply	• Pursuing a global strategy for TEPEZZA to
expand access in other parts of the world
capacity to support future demand

expectations	• Evaluating a broad range of markets across
	multiple geographies, including Japan

TED: Thyroid Eye Disease.

Expanding Commercial and Field-Based Organization to Support the Continued Strong Growth of TEPEZZA

Physicians		Patient Education		Site of Care	Payers
	& Support		(Infusion Centers)


Sales force with buy-and-bill experience;		Leveraging Horizon's extensive		National and regional teams	Reimbursement team
Medical scientific liaisons		experience in patient services		supporting infusion centers	supporting access

• Expanding our sales force and	• Increasing size of patient
Medical Scientific Liaisons	services team to better
will enable us to:	support the patient journey

Increase the penetration of TEPEZZA among our current prescriber base
Expand our reach to drive new prescribers

TED: Thyroid Eye Disease.

•	Increasing size of site-of-care	•	Increasing size of
	teams to:		reimbursement team to:
•	Promote consistent	•	Increase payer understanding
	stakeholder experiences		of TED and TEPEZZA
• Enhance site of care network	• Expand access for TED
			patients

TEPEZZA: Direct-to-Consumer Campaign to Educate and Activate Patient Population

Multiple campaigns building greater awareness for both TED and TEPEZZA, and online presence driving a greater call to action

Television

TreatTED.com ThyroidEyes.com TEPEZZA.com

"It's time to discover another treatment"
Digital	>

< enter your zip code >

"Listen To Your Eyes"

TED: Thyroid Eye Disease.

Driving Greater Awareness of TED and TEPEZZA Throughout the Medical Community

Announced OPTIC-X and OPTIC Follow-Up Data; Additional Data at Upcoming Medical Meetings

Positive OPTIC-X and OPTIC 48-WeekFollow-Up Data

Topline data announced in July 2020 underscore

the efficacy of TEPEZZA in patients with longer duration of TED, the long-term durability of TEPEZZA and the potential for retreatment

OPTIC-Xpatients had TED on average for 1 year vs. 6-month average in OPTIC, supporting use of TEPEZZA in patients with longer disease duration
89 percent of OPTIC placebo patients achieved clinically significant proptosis reduction when treated with TEPEZZA in OPTIC-X
The majority of OPTIC TEPEZZA proptosis responders at Week 24 maintained response at Week 72, nearly a year off treatment
Of the small number of TEPEZZA patients who relapsed during OPTIC off-treatmentfollow-up,>60 percent experienced >2mm proptosis improvement with additional TEPEZZA treatment in OPTIC-X

Data at Upcoming Medical Meetings

Underscores the Benefit TEPEZZA Offers

Nov. 13-15

Additional details on OPTIC 48-weekoff-treatment durability of response as well as OPTIC-X treatment results
Data showing improvement of dysthyroid optic neuropathy in patient after two infusions of TEPEZZA
Several additional TEPEZZA- and TED-related sessions

Fall Scientific Symposium

Nov. 20-22

Presentation on the recent case report published in the American Journal of Ophthalmology on the treatment of a chronic
TED patient with TEPEZZA
Data showing improvement of patients with dysthyroid optic neuropathy after treatment with TEPEZZA

TED: Thyroid Eye Disease.

OPTIC: Phase 3 clinical trial, followed by 48-weekfollow-up period off TED treatment. | OPTIC-X:Open-label extension trial of the Phase 3 OPTIC trial evaluating TEPEZZA for the treatment of Thyroid Eye Disease.

Acute vs. Chronic TED

TEPEZZA is Redefining the Understanding of the Natural Course of TED

Acute vs.

Chronic TED

Acute stage of TED is characterized by changing signs and symptoms
- Estimate of 15,000-20,000 U.S. annual patient incidence
Chronic stage is after the acute stage where symptoms are no longer changing, but are persisting
- Estimate of 70,000 U.S. patients who were initially diagnosed with TED 3 to 8 years ago

Case Report Published in AJO Supports Benefit of TEPEZZA in Chronic TED

Patient; Dr. Ozzello to Present on the Case Report at ASOPRS

The Therapeutic Window for Medical Intervention of TED

May Continue Beyond the Acute Phase

	Symptoms	Acute Phase	Chronic Phase
Natural
Course of
TED	Therapeutic window
&

	Signs	Ideal
	therapy
		Time

TED: Thyroid Eye Disease.

Chronic TED patient	Same patient after
before TEPEZZA treatment	three TEPEZZA infusions

KRYSTEXXA

Our Biologic Medicine for Uncontrolled Gout

with Significant Growth Potential

Gout: A Systemic Disease Often Associated with Multiple Negative Consequences

Gout

Most common inflammatory arthritis(1)
Characterized by multiple comorbidities, including chronic kidney disease and hypertension

Systemic disease; uric acid deposits can occur almost anywhere in the body

9.5M

U.S. gout patients; growing low-single digits(3)

3.5M

Uncontrolled Gout

• Chronic gout refractory	• Principle characteristics:
(unresponsive) to conventional	-	Elevated serum uric acid (sUA) levels
therapies	-	Acute gout flares; possible tophi

U.S. gout patients seeking

treatment(3)

Uncontrolled gout

~100K patients; Growing in-line with

Can result in decreased health- related quality of life and increased healthcare resource use(2)

Bone erosions, loss of joint and limb functions; potential for chronic pain; more likely to suffer from CKD, diabetes and heart disease

gout population(4)

~4K		Treated with
		KRYSTEXXA in 2019

Zhu Y, Pandya BJ, Choi HK. (2) Khanna et al. Health and Quality of Life Outcomes 2012, 10:117. (3) Prevalence of gout and hyperuricemia in the U.S. general population: The National Health and Nutrition Examination Survey (NHANES) 2007-2016. Arthritis Rheum. 2019 Jun;71(6):991-999. (4) Approximate number of patients in our annual addressable target market in rheumatology and nephrology; Horizon estimates. Tophi: hard uric acid deposits. CKD: chronic kidney disease.

KRYSTEXXA Immunomodulation Strategy

Aiming to Solve the Problem of Loss of Response

	Increase physician awareness of immunomodulation as an option to increase the complete response rate,
Objective	duration of therapy and safety profile of KRYSTEXXA so more patients can benefit

Provides flexibility; allows physicians choice of immunomodulator and dose

We are doing this by…

• Investing in research with the MIRROR Open-Label and Randomized	Our strategy is resonating with physicians,
Controlled Trial to evaluate concomitant use of KRYSTEXXA with	as evidenced by the increasing real-world
methotrexate

Supporting research and driving awareness for the growing body of data that supports the concomitant use of KRYSTEXXA with immunomodulation
- Methotrexate - the most commonly used immunomodulator by rheumatologists
- Additional immunomodulators (leflunomide, MMF, azathioprine)

adoption of immunomodulation

Increasing percentage of physicians prescribing KRYSTEXXA with an immunomodulator; could change the treatment paradigm for patients with uncontrolled gout

MMF: mycophenolate mofetil. | MIRROR: Immunomodulation program evaluating the use of KRYSTEXXA in combination with methotrexate to increase response rate.

RECIPE RCT Adds to Growing Body of Evidence for Other Immunomodulators

Investigator-Initiated RECIPE First Randomized Clinical Trial for Immunomodulation with KRYSTEXXA

Response Rate of KRYSTEXXA with Immunomodulators (Including Methotrexate)

Dramatically Higher(1) than KRYSTEXXA Alone

Response Rate

		KRYSTEXXA	KRYSTEXXA plus Methotrexate	KRYSTEXXA plus other
		Alone	immunomodulators
					KRYSTEXXA + Immunomodulators(1)
	100%
at						86%		42%
80%
90%				100%		MMF
onBasedsUA<6mg/dL (RECIPEat Month 3)	40%		79%	80%		LEF			KRYSTEXXA Phase 3
	70%					70%
	60%
	50%
ResponseRate Month6	30%	42%							Since 2018, data has been published on
							>100 patients on KRYSTEXXA with
20%
							immunomodulation - including those in

	10%
	0%	Phase 3 Clinical	MIRROR OL	Albert	Peterson Botson	Masri	RECIPE	(2)	these featured trials - more than the
		number of Phase 3 patients on KRYSTEXXA
		Trials	n=14	n=10	n=10	n=10	n=22
		n=85

Reflects KRYSTEXXA plus immunomodulation results shown in the graph above.
RECIPE is an investigator-initiated randomized (3:1) placebo-controlled trial with 32 patients. 86 percent (19 of 22 patients) of KRYSTEXXA with MMF patients achieved the primary endpoint at Week 12 vs. 40 percent (4 of 10) in the placebo arm. At Week 24, when all patients were on KRYSTEXXA therapy alone for 12

weeks, sUA response was sustained in 68 percent of MMF arm vs. 30 percent in placebo.

KRYSTEXXA Phase 3 Clinical Trials (blinded, placebo-controlled): 36 out of 85 patients achieved a complete response. | MIRROR OL (open-label): 11 out of 14 patients enrolled achieved a complete response. | Albert Case Series (open-label): 8 out of 10 patients achieved a complete response. Arthritis &

Rheumatology, 2019;71(S10): Abstract 1236. | Peterson Botson Case Series (open-label): 10 out of 10 patients achieved a complete response. Annals of the Rheumatic Diseases, 2019;78(2):SAT0404. | Masri Case Series (open-label): 7 out of 10 patients achieved a complete response.

LEF: Leflunomide. | MMF: Mycophenolate mofetil.

Note: Data from separate clinical trials may not be directly comparable due to differences in trial protocols, endpoints, conditions and patient populations.

Adoption of KRYSTEXXA with Immunomodulation Is Increasing Following Positive Data

Growing Body of Evidence of Concomitant Use Appears to Be Changing the Current Treatment Paradigm

Dramatic increase in use of immunomodulation began soon after first case series presented in Nov. 2018 showed a

100 percent response rate with use of KRYSTEXXA with methotrexate

Use of Immunomodulation with KRYSTEXXA

Dr. Botson and Dr. Peterson

>25%

present results of

KRYSTEXXA + MTX case

series at ACR 2018

2017

2018

2019

2020

MTX: methotrexate. | ACR: American College of Rheumatology

2020: Horizon analysis of HUB and claims data of KRYSTEXXA-treated patients also receiving immunomodulators.

KRYSTEXXA: Our Commercial Strategy Has Accelerated Volume Growth

Driving Toward Our Peak U.S. Annual Net Sales Expectations of >$1B(1)

KRYSTEXXA Net Sales

>$1B(1)

			32%
		65%	$342M
	72%	$259M
	$157M
$91M


2016	2017	2018	2019	Peak U.S. Annual
				Net Sales

(1) Horizon estimate.

Expected Growth Drivers

Growth in use of

1 KRYSTEXXA plus Immunomodulation

2	Growth in New and
Existing Accounts

3 Accelerating Nephrology Growth

Our Pipeline

Expanding to Accelerate Long-Term Growth

Expanding Our Pipeline

2020: Announced Six Programs to Maximize the Potential of Our Medicines; Acquired HZN-825

	MEDICINE / PROGRAM		DESCRIPTION	PRE-CLINICAL	PHASE 1	PHASE 2	PHASE 3	PHASE 3b/4

	KRYSTEXXA Immunomodulation	• MIRROR randomized controlled trial (RCT)

	KRYSTEXXA Nephrology	•	PROTECT open-label trial in kidney transplant
		patients with uncontrolled gout

	KRYSTEXXA Shorter Infusion Duration	•	Open-label trial

	TEPEZZA Chronic (Inactive) Thyroid Eye Disease(1)	• Trial in chronic TED patients

	TEPEZZA Thyroid Eye Disease	•	OPTIC-X: Phase 3 extension trial

	HZN-825 Diffuse Cutaneous Systemic Sclerosis(1)	•	Phase 2b pivotal trial

	HZN-825 Interstitial Lung Diseases (ILD)(1)	• Phase 2b pivotal trial in IPF

	TEPEZZA Diffuse Cutaneous Systemic Sclerosis(1)	•	Exploratory trial

	TEPEZZA Subcutaneous Administration	•	Pharmacokinetic trial

	HZN-003Next-Gen Uncontrolled Gout	• Exploration of optimized uricase and
		optimized PEGylation for uncontrolled gout

	HZN-007Next-Gen Uncontrolled Gout(2)	• Exploration of optimized uricase and
		PASylation for uncontrolled gout

	HemoShear Gout Discovery Collaboration	• Exploration of novel approaches
		to treating gout

New trial announced in 2020. \| (1) Trial not yet initiated. \|	(2) Being developed under a collaboration agreement with XL Protein GmbH.

MIRROR: Trial evaluating the use of KRYSTEXXA in combination with methotrexate to increase the response rate. | PROTECT: Trial evaluating the effect of KRYSTEXXA on serum uric acid levels in kidney transplant patients with uncontrolled gout.

OPTIC-X:Open-label extension trial of the Phase 3 trial evaluating TEPEZZA for the treatment of Thyroid Eye Disease. | IPF: Idiopathic pulmonary fibrosis.

Maximizing the Long-Term Potential of TEPEZZA

Advancing the Three TEPEZZA R&D Programs Added to Pipeline in 2020

Thyroid Eye Disease (TED) Programs

Maximizing the Future and Long-term Potential of TEPEZZA for TED Patients

Potential Additional Indication

High Unmet Need in a Rheumatic Disease, Core Therapeutic Area

Chronic Disease

Randomized, placebo-controlled trial of TEPEZZA in chronic TED patients
TEPEZZA mechanism of action inhibits IGF- 1R overexpression, which appears to be relevant in chronic disease as well
Broad TEPEZZA indication includes all TED patients; objective is to generate data to better inform physicians who may wish to use TEPEZZA to treat chronic TED patients
Expect to initiate by year-end 2020

IGF-1R:Insulin-like growth factor 1 receptor.

dcSSc: Diffuse cutaneous systemic sclerosis.

Subcutaneous Administration

Pharmacokinetic trial to explore subcutaneous TEPEZZA dosing
Objective is to inform the potential for additional administration options for
TEPEZZA
Additional delivery options could provide greater flexibility for patients and physicians
Recently initiated the trial

Diffuse Cutaneous Systemic Sclerosis

Exploratory trial to evaluate efficacy based on TEPEZZA mechanism of action, which is to block IGF-1R
Similar underlying pathologies of TED and dcSSc
Preclinical data implicate IGF-1R signaling in dcSSc pathology
Expect to initiate by year-end 2020

Expanding HZN-825 into Interstitial Lung Diseases (ILD)

Our Two HZN-825 Clinical Programs Expected to Initiate in 2021

HZN-825 is an oral selective LPAR1 antagonist with early signs of benefit in several fibrosing conditions

Continuing to advance HZN-825 for

Diffuse Cutaneous Systemic Sclerosis (dcSSc)

dcSSc is a rare, chronic autoimmune disease that can progress to internal organ damage; one of the highest mortality rates of any rheumatic disease(1)
High unmet need with no FDA-approved treatments and estimated U.S. prevalence of 30K
Phase 2a trial showed promising efficacy and safety data in dcSSc; continued improvement demonstrated in 16‐week open‐label extension period
Engaging with FDA on clinical development plan and expect to begin a Phase 2b pivotal trial in the first half of 2021

Expanding HZN-825 program to include

Interstitial Lung Diseases (ILD)

Most common ILD is idiopathic pulmonary fibrosis (IPF), a rare progressive lung disease with a median survival of < 5 years
- High unmet need; estimated U.S. prevalence of 100K
LPAR1 antagonism has shown a beneficial impact on FVC in IPF patients
Synergizes with our other clinical programs as interstitial lung diseases can be a component of systemic sclerosis
Anticipate initiating a Phase 2b pivotal trial in IPF mid-2021

(1) Nikpour M, Baron M. Curr Opin Rheumatol. 2014 Mar;26(2):131-7.

LPAR1: Lysophosphatidic acid 1 receptor. | FVC: Forced vital capacity is a measure of lung capacity used to assess the progression of lung disease and the effectiveness of treatment.

KRYSTEXXA MIRROR RCT Underway to Potentially Expand Prescribing Information

Enrollment Now Complete

Key Takeaways

Follows successful MIRROR open-label
145 patients; 2:1 randomization
Potential to expand prescribing information following MIRROR RCT readout
Preliminary 6-month results expected 1H2021
Full 12-month dataset available after trial completes (expected in 2H2021)

Dosing

KRYSTEXXA 8 mg biweekly
Oral MTX 15 mg weekly
Oral folic acid 1 mg daily

MIRROR Randomized Controlled Trial Design

145 Patients Evaluated for 52 Weeks; Initiated Q2 2019; Data Readout Expected in 2021

KRYSTEXXA + methotrexate

Biweekly KRYSTEXXA infusions and weekly oral MTX

KRYSTEXXA + placebo

Biweekly KRYSTEXXA infusions and weekly oral placebo

Day 1	Week 24	Week 52
	Primary Endpoint	Secondary Endpoint

Primary Endpoint at Week 24: Proportion of Month 6 responders, defined as sUA <6 mg/dL for at least 80 percent of the time during Month 6

RCT: Randomized controlled trial. | MTX: Methotrexate. | sUA: serum uric acid.

Exploring a Shorter Infusion Duration

Could Meaningfully Impact Patient Experience; Open-Label Trial Enrollment Initiated October 2020

Current State

Opportunity

KRYSTEXXA infusion duration currently 2+ hours

Open-label trial evaluating the impact of administering KRYSTEXXA over a significantly shorter infusion duration

Potential to impact the experience for patients, physicians and sites of care

Reconciliations of GAAP to Non-GAAP Measures

Note Regarding Use of Non-GAAP Financial Measures

EBITDA, or earnings before interest, taxes, depreciation and amortization and adjusted EBITDA are used and provided by Horizon as non-GAAP financial measures. Horizon provides certain other financial measures such as non-GAAP net income, non-GAAP diluted earnings per share, and non-GAAP operating income, each of which include adjustments to GAAP figures. These non-GAAP measures are intended to provide additional information on Horizon's performance, operations, expenses, profitability and cash flows. Adjustments to Horizon's GAAP figures as well as adjusted EBITDA exclude acquisition and/or divestiture-related expenses, charges related to the discontinuation of ACTIMMUNE development for Friedreich's ataxia, gain or loss from sale of assets, upfront, progress and milestone payments related to license and collaboration agreements, litigation settlements, loss on debt extinguishment, costs of debt refinancing, drug manufacturing harmonization costs, restructuring and realignment costs, the income tax effect on pre-taxnon-GAAP adjustments and other non-GAAP income tax adjustments, as well as non-cash items such as share-based compensation, depreciation and amortization, non-cash interest expense, long-lived asset impairment charges and other non-cash adjustments. Certain other special items or substantive events may also be included in the non-GAAP adjustments periodically when their magnitude is significant within the periods incurred. Horizon maintains an established non-GAAP cost policy that guides the determination of what costs will be excluded in non- GAAP measures. Horizon believes that these non-GAAP financial measures, when considered together with the GAAP figures, can enhance an overall understanding of Horizon's financial and operating performance. The non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of the Company's historical and expected 2020 financial results and trends and to facilitate comparisons between periods and with respect to projected information. In addition, these non-GAAP financial measures are among the indicators Horizon's management uses for planning and forecasting purposes and measuring the Company's performance. For example, adjusted EBITDA is used by Horizon as one measure of management performance under certain incentive compensation arrangements. These non-GAAP financial measures should be considered in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, non-GAAP financial measures used by other companies. Horizon has not provided a reconciliation of its full-year 2020 adjusted EBITDA outlook to an expected net income (loss) outlook because certain items such as acquisition/divestiture-related expenses and share-based compensation that are a component of net income (loss) cannot be reasonably projected due to the significant impact of changes in Horizon's stock price, the variability associated with the size or timing of acquisitions/divestitures and other factors. These components of net income (loss) could significantly impact Horizon's actual net income (loss).