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Horizon CEO says pivots helped save 2020 drug launch amid COVID-19 challenge

A little more than a year from Horizon Therapeutics PLC's launch of rare eye disease drug Tepezza, CEO Tim Walbert is looking back at the ways the company has had to navigate a successful drug launch in trying times stemming from the COVID-19 pandemic.

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Horizon Therapeutics CEO Tim Walbert
Source: Horizon Therapeutics

In Tepezza's first year on the market, the thyroid eye disease treatment approached blockbuster status with $820 million in 2020 sales, contributing to what Walbert, who is also Horizon's chairman and president, called "one of the most successful rare disease drug launches ever" in an interview with S&P Global Market Intelligence.

To get to that point so soon after entering the market, Horizon had to pivot strategically as the pandemic became more severe at the outset, Walbert said. Tepezza is an infused medicine that is given to patients in a healthcare setting at a time when many hospitals were focusing on treating those infected with COVID-19.

"One of the key things that we learned and that we had to adapt to immediately, was that we expected reimbursement and most of the infusions to be held in the hospital setting," the CEO said. "What we learned immediately with the pandemic was that these patients could not go get treated at the hospital."

At varying times during the year, 95% to almost all infusions were performed at alternative sites, which Horizon had to bring online quickly, Walbert said.

"That was one of the critical aspects, not only the efficacy of the drug but the fact that we found alternative sites of care versus hospitals so that these patients can get treated in the face of the pandemic made a huge difference," the CEO said.

And then in December another more acute effect of the pandemic disrupted supply of Tepezza completely: As part of Operation Warp Speed, the U.S. government invoked the Defense Production Act of 1950 to make Moderna Inc.'s COVID-19 vaccine at Horizon's third-party manufacturing facility run by contractor Catalent Inc.

The disruption has continued into March 2021 as the U.S. seeks to vaccinate every adult in the country by the end of May following a slow initial rollout.

Tepezza brought in $344 million in sales for Horizon in the fourth quarter of 2020. The full-year sales of $820 million were more than 20 times more than what the company forecast in a Feb. 26, 2020, filing. On a Feb. 24 earnings call, Walbert said the growth would have been even greater without the supply disruption.

The manufacturing cutoff also delayed the start of a few clinical trials for new indications of the drug, Walbert said.

The CEO acknowledged the unique situation of the pandemic and said U.S. regulators have been cooperative in bringing capacity back up to speed.

"The [U.S. Food and Drug Administration] committed at the time of the disruption that they would rapidly review in real time any data we generate to work to get this back to patients as soon as possible," Walbert said. "The agency has been very responsible and helpful, and we all understand that vaccines are saving lives and that is a priority for everyone and we respect that, but also working to make sure patients facing vision loss don't go interrupted for too long a period of time."

'Aggressive in M&A'

Meanwhile, Horizon has been busy expanding its marketed products and pipeline with a $2.67 billion acquisition of Viela Bio Inc. The deal, announced Feb. 1, is expected to close at the end of March.

"We've historically been aggressive in M&A, and one of our stated goals over the last several years is to build a development-stage pipeline, with a focus on rare diseases and also in autoimmune diseases," Walbert said.

But even for the area of M&A, the pandemic has changed aspects of how business gets done, particularly as the integration process begins after the closing of the deal, the CEO said.

"The world is a little different given that we're operating in a work-from-home remote strategy, but we've done many integrations over the years so it's something we have experience with," Walbert said.

Horizon's experience with infused medicines like Tepezza and gout treatment Krystexxa sets the company up to bring Viela's ophthalmology drug Uplizna into its marketed assets, as well as two major pipeline prospects.

Walbert said the company is looking to the Viela purchase as a way to increase R&D spending after already doubling its research operations prior to the deal. The goal, in a year that was hampered in many ways by the COVID-19 outbreak, is to show that the biopharma sector is willing to spend on innovation, Walbert said.

The biopharmaceutical industry's response to the pandemic may help improve a reputation in part harmed due to drug pricing and safety in the past, as long as such products are priced and distributed responsibly, Moody's Investors Service Senior Vice President Michael Levesque said in a March 2 report. Developing new treatments for diseases with few options is another way drugmakers can reduce risks around pricing, Levesque said.

"As an industry, with COVID-19 and the fact that in less than a year we have three vaccines authorized and millions who have been vaccinated, you can see that investing in innovation is really paying off," Walbert said.