2019 ANNUAL REPORT ANNUAL 2019 GOING TO INCREDIBLE LENGTHS INCREDIBLE TO GOING HORIZON 2019 ANNUAL REPORT OUR VALUES Transparency We value collaboration. Trusting each other and tackling tough challenges can make a powerful difference. Accountability We do what’s right for our patient communities through quality decisions and owning our successes and failures. Growth We fiercely innovate and evolve to better ourselves, our communities and our patients. HORIZON 2019 ANNUAL REPORT TO OUR SHAREHOLDERS 2019 was a year where our medicines and expanded philanthropic footprint impacted more lives than ever before. 2019 was another record year financially, as we PATIENTS generated record net sales of $1.3 billion, an We strive to help as many people as possible impacted by rare and rheumatic diseases. Last year, we provided our medicines to more increase of 8 percent over 2018, and adjusted patients than ever before: roughly 4,000 patients received treatment EBITDA of $482.8 million, an increase of 7 percent. with KRYSTEXXA® and it passed the $340 million net sales mark, which is truly remarkable growth for a medicine nine years Importantly, our growth-driving orphan and rheumatology post-FDA approval. More than 1,000 patients received treatment segment generated net sales of $929.6 million, an increase of with RAVICTI®, PROCYSBI® and ACTIMMUNE® combined, and more 12 percent over 2018. than 500,000 people living with osteoarthritis and rheumatoid arthritis were treated with our inflammation medicines. In addition to our financial growth, we experienced significant employee growth, including the addition of our approximately In January 2020, the FDA approved TEPEZZA for the treatment of 100-person field team focused on launch preparations for TED, which is a serious, progressive and vision-threatening, rare TEPEZZATM (teprotumumab-trbw), our breakthrough biologic autoimmune disease. TEPEZZA is the first and only FDA-approved medicine for thyroid eye disease (TED). medicine for the treatment of TED. At the time of approval, which was nearly two months before the target action date, the FDA As a result of our continued growth, we announced that we are said that “this treatment has the potential to alter the course moving our global corporate headquarters to a much larger space at of this disease.” As we look to the future, we have a tremendous 70 St. Stephen’s Green, which is one of the most visible and central opportunity to help thousands more people who are living with locations in Dublin, Ireland. The new office was designed with this devastating disease. sustainability in mind, making it compliant with near-zero emission building standards. We also opened a 20,000-square-foot facility in South San Francisco, featuring office and laboratory space to We are building our pipeline with purpose enable formulation and process development for manufacturing, as well as bioanalytical method development and other R&D – looking for opportunities where we can functions. And in early 2020, we announced we are moving our U.S. headquarters to a 74-acre campus with more than 650,000 bring new and novel therapies to patients. square feet of office space in Deerfield, Ill. But it is not the financial performance and company growth alone Additionally, we are building our pipeline with purpose – looking that drives who we are. Our future is defined by our people, our for opportunities where we can bring new and novel therapies to patients and our purpose. And it’s why we go to incredible lengths. patients, as well as evaluating ways to help more patients benefit HORIZON 2019 ANNUAL REPORT TO OUR SHAREHOLDERS from our current medicines. We recently announced top-line data In TEPEZZA and KRYSTEXXA, not only do we have two medicines from our MIRROR open-label trial, which evaluated the impact each with potential peak U.S. net sales of more than $1 billion, we of adding methotrexate to KRYSTEXXA to increase the patient also have two highly efficacious medicines that have the potential response rate – and the results are nothing short of impressive. to dramatically change the lives of people suffering from the Seventy-nine percent of patients (11 of 14 enrolled) achieved a devastating diseases they treat. complete response compared to 42 percent in the KRYSTEXXA Phase 3 program. This response rate is highly consistent with PURPOSE the data from other recent investigator-initiated trials. We also In the last year, we have been busy expanding our philanthropic accelerated the start of our placebo-controlled MIRROR trial, footprint for each of our global office locations. Last year alone, which began in June and is expected to enroll 135 patients. Data we provided $12 million in support to our communities. We from MIRROR is expected in 2021, and if positive, we plan to apply worked with more than 60 nonprofits and directly impacted more to update the KRYSTEXXA prescribing information to include this than 5,000 lives through our corporate social responsibility (CSR) randomized controlled trial data. programming. Another population we’re looking to help with KRYSTEXXA are kidney transplant patients with uncontrolled gout. Gout is 10 We worked with more than 60 nonprofits times more frequent in kidney transplant patients than the general population, and chronically elevated levels of serum uric and directly impacted more than 5,000 acid are often associated with transplant organ rejection. With lives through our CSR programming. that in mind, we initiated the PROTECT trial in late 2019 to study the effect of KRYSTEXXA on serum uric acid levels in kidney Just as we innovate on the R&D and commercial side of the transplant patients with uncontrolled gout. business, we do the same when it comes to finding creative ways Similar to KRYSTEXXA, we are starting to explore additional to impact our communities. One example is our new partnership potential uses for TEPEZZA in rare disease populations that have with Gift of Adoption, which we launched in February 2019. We limited or no treatment options. We recently announced plans to seeded a first of its kind #RAREis Adoption Fund, which will help initiate an exploratory trial in diffuse cutaneous scleroderma, 30 children with rare diseases to be adopted into loving homes a rare fibrotic disease with no FDA-approved treatments, in over three years. This partnership combines so much of what’s the first half of 2020. Literature suggests that the mechanism important to us at Horizon – providing our resources to those of action of TEPEZZA, which is to block the IGF-1 receptor, could living with rare diseases, supporting families, helping vulnerable have an impact on fibrotic processes like those relevant in diffuse children and making a difference. cutaneous scleroderma. 03 We are also working toward aligning with 11 of the United Nations With that said, I'm extremely proud of the pay equity study that Sustainable Development Goals. In 2015, the United Nations we conducted with external consulting firm, AON. Our focus was General Assembly established 17 global goals for 2030 – with simple: to determine if we were providing equal pay for equal the objective of creating a better world for the planet and work regardless of someone’s gender or ethnicity. The results of its inhabitants. The interconnecting goals cover environmental, the study confirmed that Horizon has both gender and ethnicity economic and humanitarian issues and involve the collective pay equity – meaning that at Horizon, women, men and people action of government, nonprofit organizations, businesses and from all ethnic backgrounds are paid equally for equal work. Being individuals. inclusive is ingrained in our values – and it’s a responsibility and theme that will continue into our future – only getting stronger It’s this commitment to our communities that has blossomed as we make a conscious effort to do and be more. into an internationally recognized CSR program that inspires and encourages other companies to follow our lead. This is why in 2019 we received awards from The Ireland Funds and PR News for Being inclusive is ingrained in our values – our CSR work. In addition, we were awarded a gold international and it’s a responsibility and theme that will CSR excellence award, and as a result, Horizon was inducted into the CSR World Leaders at the Houses of Parliament in London. continue into our future. I am also proud of our commitment to operate as a compliant From national FORTUNE workplace awards in the United organization by industry standards – but also by our steadfast States, to being named as a Great Place to Work® in Ireland, to commitment to simply “doing the right thing.” I’ve always regional Crain’s Chicago Business recognitions, it’s been another believed that being an ethical company is deeply intertwined award-winning year. While it would be easy to get complacent with our success. At Horizon, we lead with integrity and never about our winning culture, these awards serve as external validation lose sight of why we do what we do – and more importantly, the that we have one of the best cultures in the industry and one that patients we serve. we will work hard to maintain – no matter our growth or size. Today, Horizon is in its strongest position ever and I look forward PEOPLE to continuing to innovate across all aspects of our business. For us, I’m also very pleased with our efforts to make Horizon an inclusive Going to Incredible Lengths is more than a mantra – it’s our mission and fair workplace for everyone. Just as the patients we serve and one that we will work to live by this year – and beyond. come from different backgrounds with different points of view, our Horizon family must reflect diverse perspectives and backgrounds – helping each other to see what others may not when working Sincerely, with those living with rare and rheumatic diseases.