Halozyme scores $190M Horizon deal to develop subQ Tepezza formula

With a failed pancreatic cancer program now well in the rearview, Halozyme Therapeutics has spent the last year and change moving full speed ahead on its drug delivery business. With team-ups with Roche and Johnson & Johnson and other pharma juggernauts already pulling in a profit, the company recently signed its tenth global partnership for its delivery platform, Enhanze.

Halozyme has struck a licensing deal worth upward of $190 million with Horizon Therapeutics, granting the drugmaker access to Halozyme’s Enhanze drug delivery platform. Horizon will tap Enhanze to develop a subcutaneous formulation of its thyroid eye disease med Tepezza (teprotumumab-trbw), the companies said in a release.

Horizon is set to pay Halozyme $30 million upfront for the deal and is on the hook for further payments of up to $160 million linked to pre-set development, regulatory and sales-based milestones, plus future royalty payments for a potential Enhanze-paired commercial product.

Halozyme, for its part, will provide API for its drug delivery platform, based on its patented recombinant human hyaluronidase enzyme—also known as rHuPH20—and will also advise Horizon, offering input on formulation work, clinical trial design and potential meetings with regulators

Enhanze tees up injectable formulations of large molecule drugs by breaking down hyaluronan, a natural sugar chain that forms a gel in the innermost layer of the skin. By cutting through the hyaluronan—which also regenerates within 48 to 72 hours after treatment—Halozyme’s platform is able to carve out a space just below the skin for high-volume delivery of monoclonal antibodies and other related drugs, company CEO Helen Torley said in an interview.

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A swift and effective treatment option could be a boon for patients with thyroid eye disease, who currently rely on symptomatic treatment with steroids or surgery, and—as of this year—Horizon’s Tepezza, approved in January as the first drug specifically indicated for the disease.

Today, Tepezza is given as a 90-minute initial dose followed by a 60-minute infusion every three weeks for a total of 24 weeks—about a six-month therapy process overall. While Halozyme and Horizon have yet to kick off work on Tepezza, Enhanze has previously been used to develop subcutaneous versions of Johnson & Johnson’s multiple myeloma med Darzalex and Roche’s fixed combination of breast cancer meds Perjeta and Herceptin—also known as Phesgo—for injection just below the skin in as little as three to five minutes, drastically cutting down time spent in the infusion chair, Torley said.

Horizon hasn't yet laid out a strict timeline for when it expects to push an Enhanze-paired version of Tepezza into the clinic, but the process from partnership to testing has taken, on average, about five months in the past, Torley said, pointing to Halozyme’s recent deal with argenx, working on a subcutaneous version of its drug efgartigimod to treat a group of autoimmune skin disorders.

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Meanwhile, Halozyme’s Enhanze partnerships have continued to drive profits in 2020. The company charted $65.3 million in third-quarter revenues this year, up from $46.2 million during that same period in 2019. That year-over-year increase was largely driven by $32 million in collaboration revenue from Roche and argenx, the company said in a release—plus, royalties added $23.9 million to that sum, an increase of 44% over the $16.6 million in revenues Halozyme raked in the previous year.

Halozyme has also raised its full-year guidance twice in the last month alone thanks to Enhanze's momentum. During its third-quarter earnings call, Halozyme bumped up sales expectations to $250 million to $260 million from $230 million to $245 million, primarily driven by the strength of its Darzalex partnership, Torley said. And now, armed with a $30 million milestone from the Horizon arrangement, Halozyme has upped its guidance again to $265 million to $275 million.

Meanwhile, in its first year as a profitable company, Halozyme now expects earnings per share to jump to between 90 cents and 95 cents, up from a previously predicted range of 60 cents to 75 cents.