Building a Premier Oncology Biotech September 2017
Forward-Looking Statements All of the statements in this presentation that are not statements of historical facts constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of such statements include possible activity, benefits and attributes of PEGPH20, future product development and regulatory events and goals, anticipated clinical trial results and strategies, product collaborations, our business intentions and financial estimates and results, including projected revenue amounts. These statements are based upon management s current plans and expectations and are subject to a number of risks and uncertainties which could cause actual results to differ materially from such statements. A discussion of the risks and uncertainties that can affect these statements is set forth in the Company s annual and quarterly reports filed from time to time with the Securities and Exchange Commission under the heading Risk Factors. The Company disclaims any intention or obligation to revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise. 1
Halozyme Has a Unique Two-Pillar Strategy for Growth ENHANZE Technology Oncology Pipeline 7 Global Licensing & Collaboration Agreements 3 launched products generating growing revenues from mid singledigit royalties 3 programs in active clinical development $1.3B in potential milestones for active targets 1 PEGPH20 2 : phase 3 asset with HA- High population of ~75,000 3 in solid tumors studied Phase 2 Study 202 data in pancreas cancer supportive of phase 3 design Emerging applications for PEGPH20 in immuno-oncology 1 Assumes all developmental and commercial milestones achieved and paid to Halozyme for Herceptin SC, Mabthera SC, HYQVIA, Daratumumab SC and targets in development or planned for development. 2 PEGPH20 is an investigational drug; safety and efficacy profiles have not been established, nor is it available for commercial distribution. 3 Estimated addressable patients in U.S., EU5 based on annual Incidence of 1L Metastatic Pancreatic Cancer, Advanced Non-Small Cell Lung Cancer, 2L Metastatic Gastric Cancer, 2L Stage IV Breast Cancer (HER2-), SEER 18 2006-2012, Globocan 2012, Medscape; and Halozyme estimates for HA-HIGH %. 2
ENHANZE Technology
ENHANZE Value Demonstrated in Three Commercial Products Product ENHANZE Subcutaneous Alternative 2014 2030 Patent Extension 1 EU patent expiration for Herceptin IV 2 ~8 minutes / visit 3,4 1.5-6 hours / visit for MabThera IV 3,4 1 European patent: EP2459167B1, U.S. patent: 9345661 2 Generics and Biosimilars Initiative, Aug. 12, 2016 (http://www.gabionline.net/biosimilars/general/biosimilars-of-trastuzumab) 3 Shpilberg O, et al. British J Cancer. 2013; 109(6):1556 1561 4 De Cock E, et al. Plos One. 2016; 11(6):e0157957 4
Up to $2B Revenue Potential for Global Collaboration and License Agreement with Bristol-Myers Squibb TARGETS MILESTONES FOCUS STRUCTURE 5
Robust ENHANZE Royalty Growth Growing Royalty Revenue Average Mid-Single Digit Royalty Rate Across Partnerships $51M $31M 1H 2017 Royalty Revenue of $29M, continued growth expected $9M 2013 2014 2015 2016 2017 Ex-U.S. Launch U.S. Launch 6/17 6
ENHANZE Approved Product Potential Opportunity $10B+ Opportunity Today Rituxan U.S. Oncology MabThera 2016 Proprietary Product Sales 1 Currently Approved Geographies 7.5B 3,4,6 Countries Launched 5 ~60 Herceptin 4B 3 ~80 HyQvia 1.5B 2 ENHANZE royalty revenue will depend upon indications approved, number of countries in which launches occur and market penetration, among other factors 1 ENHANZE royalty revenue will depend upon indications evaluated by partners and market penetration. 2 Reflects 2016 sales of all Shire Immunoglobulin Therapies less Halozyme internal estimate for U.S. pediatric sales. Information provided during Shire investor update (Feb. 16, 2017). 3 Reflects 2016 sales for Mabthera/Rituxan and Herceptin excluding the U.S. and Japan. Information provided during Roche investor update (Feb. 17, 2017). 4 Reflects 2016 U.S. sales for Mabthera/Rituxan. Information provided during Roche investor update (Feb. 17, 2017). 5 Information provided during Halozyme investor update (Aug. 8, 2017). 6 Excludes estimates for Mabthera/Rituxan sales in Rheumatoid Arthritis indication in applicable geographies, incorporated from EvaluatePharma, Sept. 2016. 7
ENHANZE Portfolio Potential Future Opportunity Future Opportunity Darzalex Darzalex 2020 Darzalex 2025 Proprietary Product Sales 1 Currently in Clinical Development 3.5B 2 7B 2 Perjeta Perjeta 2020 Perjeta 2025 4B 2 5B 2 Additional targets in development and multiple targets projected to enter development ENHANZE royalty revenue will depend upon indications approved, number of countries in which launches occur and market penetration, among other factors 1 ENHANZE royalty revenue will depend upon indications evaluated by partners and market penetration. 2 Mean analyst estimates for global revenue, Bloomberg; Analyst model estimates. 8
Game Changers for ENHANZE June 2017: U.S. approval of Rituxan HYCELA September 2017: Landmark I-O deal with Bristol-Myers Squibb September 2017: Roche signs amended terms for new target August 2017: Lilly initiates Phase 1 trial Upcoming: Janssen initiation of Daratumumab SC Phase 3 Trial 9
Increasing Value of Agreements Driven by Regulatory and Commercial Success 2006 2007 2012 2014 2015 2017 One-time Upfront $20M $10M $8M $15M $23M $25M $105M $30M Milestones / Target 1 $37-47M $37M $85M $113M $130M $160M $160M $160M Targets 8 1 6 5 9 5 11 1 Recurring Average Mid-single Digit Royalties on Net Sales 1 Assumes all developmental and commercial milestones per target achieved and paid to Halozyme. 10
Lead Oncology Asset: PEGPH20
Our Path to PEGPH20 Value Creation is Clear 1 Strong rationale for pancreas cancer focus 2 Conviction and support for PEGPH20 in pancreas cancer 3 Defined path to seek approval 4 Near-term milestones 12
Pancreas Cancer Focus Based on High Unmet Need and Potential Opportunity Unmet Need 52% of patients have metastatic disease at diagnosis 1 85% Median 1-year mortality for metastatic patients 2 98% Median 5-year mortality for metastatic patients 2 Potential Opportunity 65,000 metastatic pancreas cancer patients diagnosed annually (U.S., EU5) 3 25,000 have negative prognostic factor: high levels of Hyaluronan (HA) 4 1 SEER 18 2007-2013. 2 Statistics adapted from the American Cancer Society's publication, Cancer Facts & Figures 2016. 3 SEER 18 2006-2012, Globocan 2012, Medscape. 4 Halozyme estimates for HA-High %. 13
Hyaluronan (HA) Can Be a Barrier to Therapeutic and Immune Cell Access to Tumor Cells HA is a Structural Carbohydrate that: Stabilizes the Tumor Microenvironment (TME) Is associated with decreased survival 1 and immunosuppression in the TME 2,3 HA Surrounding a Cancer Cell Compromises Access to the Tumor Increases tumor interstitial pressure 4,5 Compresses vasculature 6,7 Can decrease therapeutic and immune cell access 8 1 Whatcott, et al. AACR (2013) 2 Rosengren et al, Cancer Res 2016;76(14 Suppl):Abstract # 4886. 3 Zhang et al, Oncoimmunology 2016; 5(6) 4 Brekken et al. Anticancer Res. 20:3503 (2000) 5 Provenzano and Hingorani, Br J Cancer 108:1 (2013) 6 Thompson et al. Mol Cancer Ther. 9:3052 (2010) 7 Stylianopoulos et al. PNAS. 110:18632 (2013) 8 Singha et al.. Mol Cancer Ther. 14:523 (2015) 9 Rilla et al. JHC. 56:901 (2008) HA (Red) surrounding a single breast cancer cell overexpressing HAS3 (Bright Green) 9 14
Tumor HA Overexpression Associated with Shorter Survival in Pancreas Cancer Retrospective Evaluation of Pancreatic Cancer Survival in ~50 Patients 1 HA-Low Median Survival: 24.3 months HA-High Median Survival: 9.3 months H.R. 2.6 p=0.037 In US and EU-5, estimated 25,000 HA-High metastatic pancreas cancers annually (~35-40%) 2,3 1 Whatcott et al: Clin Cancer Res 2015, 21:3561-3568. HA staining by HABP. Scoring algorithm assessed percent staining and intensity. 2 15 Annual Incidence, SEER 18 2006-2012, Globocan 2012, Medscape; Estimated HA-High %, Halozyme estimates. 3 Not all HA-High patients may be eligible for PEGPH20.
PEGPH20 Targets Hyaluronan (HA) in the Tumor Microenvironment In HA-High Tumor Animal Models, Removal of HA by PEGPH20 Demonstrated to: Decrease intratumoral pressure Decompress vasculature Increase perfusion Increase access for therapeutics Increase access for immune cells PEGPH20 16
PEGPH20 Directly Addresses Barriers to Effective Therapy in Animal Models PEGPH20 Increases Tumor Concentration of Cancer Therapy in Animal Models PEGPH20 Creates a Less Immunosuppressive Tumor Microenvironment BxPC3/HAS3 PDA Xenograft Tumors 1 In HA-rich animal tumor models, PEGPH20 demonstrated to: n g /m g tis s u e, p a c lita x e l ± S td e v 8 6 4 2 Increased tumor paclitaxel accumulation* 89% [paclitaxel] tum 43% ** [paclitaxel] tum ** ü Reduce levels of Hyaluronan associated with an immunosuppressive phenotype in some solid tumors 2,3 ü Decrease immunosuppressive markers and cell types 2 ü Increase CD8 + T cells in tumors 4 0 N A lo n e N + P P -2 4 h r- N ü Increase tumor growth inhibition when combined with immune checkpoint inhibitor antibodies 2 and chemotherapy 5 1 Osgood et al., AACR PDA Mtg., 2014 and unpublished data 2 Rosengren et al, Cancer Res 2016;76(14 Suppl):Abstract # 4886 3 Zhang et al, Oncoimmunology 2016; 5(6) 4 Clift et al. (2017). AACR Annual Meeting, Poster #641 5 Thompson et al. Mol Cancer Ther 2010; 9:3052 (2010) 17
HALO-202 Explored Association Between HA Levels and Outcomes in Pancreas Cancer Phase 2 open label, randomized, multicenter study Designed to evaluate PFS and association with HA levels Develop Companion Diagnostic algorithm and cut-point Support Phase 3 trial design CR, complete response; DCR, disease control rate; DoR, duration of response; HA, hyaluronan; KPS, Karnofsky performance status; ORR, objective response rate; OS, overall survival; PDA, pancreatic ductal adenocarcinoma; PFS, progression-free survival; PR, partial response; SD, stable disease. 18
HALO-202 Evolved to Have Two Stages Allowing Acceleration of Companion Diagnostic Validation STAGE 1 Randomized 1:1 to PAG:AG PEGPH20 discontinued at clinical hold (38% of HA-High patients) Training Set for HA diagnostic assay scoring algorithm and threshold 1 Presented at ASCO 2016 2 STAGE 2 Randomized 2:1 to PAG:AG Validation Set to prospectively evaluate scoring algorithm and threshold (extracellular matrix HA staining 50% of the entire tumor surface at any intensity) Presented at ASCO 2017 3 MAR 2013 ENROLLMENT APR AUG ENROLLMENT FEB FOLLOW-UP 2014 2014 2016 n = 146 n = 133 DEC 2016 CLINICAL HOLD Increased thromboembolic events observed in PAG arm HOLD LIFTED Protocol amended to include TE screening and thromboprophylaxis with enoxaparin DATA CUT Primary endpoint achieved with statistical significance 1 (Ventana HA RxDx) Co-developed by Halozyme Therapeutics, Inc. and Ventana Medical Systems. 2 Bullock AJ, et al. J Clin Oncol 34, 2016 (suppl; abstract 4104). 3 Hingorani, et al., J Clin Oncol 35, 2017 (suppl; abstract 4008). 19
Encouraging Efficacy Demonstrated in HALO-202 Stage 1 + Stage 2 in Target HA-High Population Progression Free Survival Overall Survival AG 5.2 months HR: 0.51 (0.26, 1.00); P value: 0.048 PAG 9.2 months AG 8.5 months PAG 11.5 months HR 0.96 (0.57, 1.61) 77% improvement in median PFS (secondary endpoint) ITT Population, Data as of December 2016 20
Encouraging Efficacy Demonstrated in HALO-202 Stage 2 in Target HA-High Population Progression Free Survival Overall Survival HR: 0.63 (0.21, 1.93) HR: 0.52 (0.22, 1.23) AG 4.5 months PAG 8.6 months AG 7.8 months PAG 11.7 months Remaining on treatment: PAG (n=2); AG (n=1) Remaining on treatment and/or follow up: PAG (n=6); AG (n=1) 91% improvement in median PFS (secondary endpoint) 50% improvement in median OS (exploratory endpoint) Treated Population, Data as of December 2016 21
Achieved Primary Endpoint of Reduction in Incidence of Thromboembolic (TE) Events in Stage 2 Enoxaparin Prophylaxis Dose PAG TE Rate AG Stage 1 (Dec 2016) N/A 43% (32/74) 25% (15/61) Stage 2* (Dec 2016) Started with 40 mg/day Started on 1 mg/kg/day 28% (5/18) 10% (7/68) 29% (2/7) 6% (2/32) *TE rates for all stage 2 patients are 14% (12/86) in PAG arm and 10% (4/39) in AG arm Treated Population, Data as of December 2016 22
HALO-202 (Stage 1 + Stage 2) Treatment-Related Adverse Events (AEs) in 25% of Patients PAG (n = 160) Patients, n (%) AG (n = 100) Patients, n (%) Preferred Term Any Grade Grade 3 Any Grade Grade 3 Any AE 157 (98.1) 138 (86.3) 93 (93.0) 75 (75.0) Fatigue 115 (71.9) 33 (20.6) 66 (66.0) 16 (16.0) Peripheral edema 101 (63.1) 8 ( 5.0) 26 (26.0) 4 ( 4.0) Muscle spasms 89 (55.6) 20 (12.5) 3 ( 3.0) 1 ( 1.0) Nausea 79 (49.4) 8 ( 5.0) 47 (47.0) 4 ( 4.0) Diarrhea 64 (40.0) 11 ( 6.9) 39 (39.0) 5 ( 5.0) Anemia 62 (38.8) 27 (16.9) 38 (38.0) 20 (20.0) Alopecia 60 (37.5) 1 ( 0.6) 39 (39.0) 0 ( 0.0) Decreased appetite 59 (36.9) 7 ( 4.4) 25 (25.0) 2 ( 2.0) Neutropenia 54 (33.8) 47 (29.4) 19 (19.0) 18 (18.0) Neuropathy peripheral 47 (29.4) 10 ( 6.3) 31 (31.0) 8 ( 8.0) Vomiting 46 (28.8) 5 ( 3.1) 27 (27.0) 2 ( 2.0) Dysgeusia 45 (28.1) 0 19 (19.0) 0 Myalgia 41 (25.6) 8 ( 5.0) 7 ( 7.0) 0 ( 0.0) Thrombocytopenia 41 (25.6) 26 (16.3) 17 (17.0) 9 ( 9.0) Treated Population, Data as of December 2016 23
HALO- 202 Findings Support the Ongoing HALO-301 Phase 3 Study HALO-202 met primary PFS endpoint and key secondary PFS endpoint in HA-High patients Data supports HA-High as potential predictive and prognostic biomarker High conviction in the Phase 3 Study based on Study 202 findings PEGPH20: first targeted therapy with a validated diagnostic cut-off in pancreas cancer HA High associated with poorer prognosis and may be predictive of longer median PFS and OS with PEGPH20 Similar patient population as being evaluated in ongoing Phase 3 Strong signal in both PFS and OS supporting Phase 3 statistical assumptions 24
HALO-301 Pancreatic: Global Phase 3 Trial Enrolling in 22 Countries 1L Metastatic PDA High-HA patients N=420 PEGPH20 + ABRAXANE + gemcitabine (PAG) ABRAXANE + gemcitabine (AG) + placebo Primary Endpoints: Progression-Free Survival (PFS) Overall Survival (OS) Randomized (2:1 PAG:AG), double-blind, placebo-controlled, global Interim analysis when target number of PFS events reached PFS powered with a hazard ratio of 0.59 (to detect a 41% risk reduction for progression) First patient dosed in March 2016, study approved in 22 countries with over 200 centers ready to screen or already screening patients 25
Robust Pan-Tumor Testing With Potential for Initial Response Rate Data By Year-End 1 2 3 26
Financial Update
2017 Financial Guidance Update August 2017 September 2017 1 Notes Net Revenue $115M to $130M $245M to $260M Reflects upfront payments from recently signed BMS, Roche agreements Continued royalty growth in 2017 Operating Expenses $240M to $250M $240M to $250M No change in expense trajectory Operating Cash (Burn) / Flow ($75M to $85M) $50M to $60M Reflects upfront payments from recently signed BMS, Roche agreements Excludes impact of financing, repayment of debt principal Year-end Cash $245M to $260M $380M to $395M Reflects upfront payments from recently signed BMS, Roche agreements Royalty-backed loan repayment began in 2017 1 Pending HSR review for the agreement with Bristol-Myers Squibb. 28
Value Enhancing Milestones: 2H 2017 Goal Study 202: Data Presented at ASCO, ESMO-GI RITUXAN HYCELA approved in U.S. June 2017 New ENHANZE target Phase 1 study start Initiation of Genentech/Halozyme Clinical Collaboration trials Atezolizumab + PEGPH20 Sign New ENHANZE Agreements: Bristol Myers-Squibb, Roche Target Date Initial data to demonstrate PEGPH20 pan-tumor potential Q4 2017 Daratumumab SC Phase 3 start Q4 2017 Support ENHANZE Partners Progress 2H 2017 29
Building a Premier Oncology Biotech September 2017