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Good morning and thank you for standing by. Welcome to the Horizon Therapeutics PLC First Quarter 2019 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded.
I would now like to introduce Ms. Tina Ventura, Senior Vice President of Investor Relations.
Thank you, Jimmy. Good morning, everyone, and thank you for joining us. On the call with me today are Tim Walbert, Chairman, President and Chief Executive Officer; Shao-Lee Lin, Executive Vice President, Head of Research and Development and Chief Scientific Officer; Paul Hoelscher, Executive Vice President, Chief Financial Officer; Bob Carey, Executive Vice President, Chief Business Officer; and Vikram Karnani, Executive Vice President, Chief Commercial Officer.
Tim will provide a high-level review of the first quarter and an update on the business and Shao-
Lee will discuss the clinical development programs for our rare disease medicines. Paul will then provide detail on our financial performance and guidance. After closing remarks from Tim, we'll take your questions.
As a reminder, during today's call, we will be making certain forward-looking statements, including statements about financial projections, our business strategy and the expected timing and impact of future events. These statements are subject to various risks that are described in our filings made with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2018, subsequent quarterly reports on Form 10-Q and our earnings press release, which was issued this morning. You are cautioned not to place undue reliance on these forward-looking statements, and Horizon disclaims any obligation to update such statements.
In addition, on today's conference call, non-GAAP financial measures will be used. These non-GAAP financial measures are reconciled with the comparable GAAP financial measures on our earnings press release and other filings from today that are available on our Investor website at www.horizonpharma.com.
I will now turn the call over to Tim.
Thank you, Tina, and good morning, everyone. We're off to strong start this year reporting first quarter results that outperformed by expectations. We achieved net sales of $280.4 million representing 25% year-over-year growth and adjusted EBITDA of $88.4 million, up 163% year-over-year. As a result of our strong execution, we're raising our full your net sales guidance range to $1.26 billion to $1.28 billion, and our full year adjusted EBITDA guidance range to $450 million to $465 million.
Importantly, we are raising guidance for further increasing our investment with potential U.S. launch of teprotumumab, our biological development for active thyroid disease or TED.
In addition to our strong commercial performance, we're executing on our pipeline strategy. We announced unprecedented results from our teprotumumab Phase III trial in the first quarter, which was a major milestone for the company. The Phase III results along with the Phase II data from a highly convincing body of clinical evidence that support our plan to mid-year U.S. regulatory submission. Preparation for U.S. commercial loans continues where we're investing in market development and market access activities to bring teprotumumab to patients who have no other options as well as investing in the second manufacturing site to increase commercial supply for our long-term needs.
I will discuss our plans and our thoughts on the active TED market in a moment. Regarding our uncontrolled gout pipeline programs, we have now finalized the design of our KRYSTEXXA Immunomodulation trial, the MIRROR trial, and expected to begin next month. As a reminder, we've adapted this trial for registration to evaluate the effect of adding methotrexate to KRYSTEXXA to improve patient response rates. In addition, during the quarter we selected a lead PASylated uricase candidate HZN-007 that we intended to advance further in development. Shao-Lee will discuss our R&D progress in more detail.
In line with our evolution to an R&D focused company, last week shareholders approved the changing of our name to Horizon Therapeutics PLC. Our new name reflects more clearly both our long-term strategy to develop and commercialize innovative new medicines to address rare diseases as well as the fact that our work with patients, caregivers, physicians and communities goes well beyond our medicine.
I'll now summarize our first quarter results. Our Orphan and Rheumatology medicines generated net sales of $185.9 million, driven by KRYSTEXXA, RAYOS and PROCYSBI. Net sales for this segment increased 10%, excluding the divest of ex-U.S. rights for RAVICTI, BUPHENYL and LODOTRA. KRYSTEXXA net sales are $52.3 million, increased 12% meeting our expectations, driven by more than 30% year-over-year volume growth. The KRYSTEXXA team continues to execute extremely well opening more than 600 new accounts over the last 12 months. Vial growth in existing accounts increased approximately 30% compared to the first quarter last year. We continue to see strong interest from nephrologists with good sequential growth and looking forward to initiating our trial in kidney transplant patients later this year. Demand remains strong as we enter into the second quarter and we remain on track for a double-digit full year net sales growth expectations. RAYOS generated strong double-digit growth during the quarter as well, driven by continued focus execution by this team. Demand remained strong for both PROCYSBI and RAVICTI in the first quarter, driven by mid single-digit year-over-year patient growth and improved compliance. PROCYSBI net sales increased 13% year-over-year. RAVICTI net sales increased 5%, excluding the impact of divested rights for RAVICTI outside of North America and Japan.
Our first quarter outperformance has put us in a very strong position for the year allowing us to increase our investment in teprotumumab, while also increasing our full year guidance. I'll conclude my remarks this morning with an update on our teprotumumab, U.S. commercial launch preparations and our latest thoughts on the active TED market. Following the dramatic Phase III results, we received significantly more interest in teprotumumab from patients, caregivers and physicians. As I mentioned, we're increasing our investment in teprotumumab and the pace of that investment to successfully bring this medicine to patients as quickly as possible upon approval.
Based on a significant amount of research we've conducted internally and with external parties, we have very good understanding of the U.S. TED patient population. As it's done for most rare diseases with limited public data, we have dealt our estimates using patient level data, including actual claims and hospital readmissions data. As we've previously discussed, we estimate that 15,000 to 20,000 active TED patients are eligible for teprotumumab treatment each year. This is the annual incident patient population. Because TED patients have active disease were up to three years, a portion of those patients rollover into the following year and are additive for the teprotumumab eligible patient population each year.
Given the impressive efficacy data for teprotumumab, we expect significant interest in demand from both physicians and patients from approved therapy. Patients with TED are desperate for treatment given that there is no approved treatment today. The active TED market is one we need to build from the ground up, which is typical of rare diseases and require significant investments in market development and market access. Today, with no well defined teprotumumab or successful patient journey for those with active TED, endocrinologists and ophthalmologists in the United States typically take a watch and wait approach until patient progress from active TED to inactive TED. At that point, they refer to an oculoplastic surgeon to perform surgery to reduce proptosis or eye bulging and its deleterious effects. The surgery is highly complex, invasive and often partially effective, and often needs to be repeated multiple times given the technical challenges in this disease. If teprotumumab is approved, we believe that this treatment paradigm will shift. Early on, we see ophthalmologists and oculoplastic surgeons playing a larger role. And once the market is more established, we believe that both endocrinologists and ophthalmologist will play central role in co-managing active TED. From the qualitative feedback we have received today, key opinion leaders and clinicians across all specialties are very enthusiastic about this potential treatment option.
A significant amount of market development is hard to identify and educate potential treating physicians and help them get their active TED patients to a place where they can receive proper administration of therapy. This requires a dedicated infrastructure that we are in process of building out now. It includes sales professionals, medical affairs professionals, patient educators and reimbursement specialists. As teprotumumab is an infused therapy both endocrinologists and ophthalmologists who primarily prescribe oral medicines, will need to establish for treatment path, infrastructure and the referral patterns to ensure patient access and success.
We remain extremely encouraged by the opportunity we see for teprotumumab, and even more confident today in our annual peak U.S. net sales guidance of more than $750 million. We're excited about the benefits teprotumumab could potentially offer to many patients living with the challenges and pain of active TED. We look forward to updating you as our BLA submission and launch activities progress.
I'll now turn the call over to Shao-Lee.
Thank you, Tim, and good morning, everyone. The first quarter of 2019 marked a milestone quarter for us as we've reported positive top-line results for our teprotumumab Phase III confirmatory trial. As Tim mentioned, we achieved our primary endpoint of reduction in proptosis of 2 millimeters or greater with an impressive 82.9% response rate in the teprotumumab compared to 9.5% in the placebo group, and with the P value of less than 0.001. Proptosis or eye bulging is the main cause of morbidity and TED, all secondary endpoints were also met with the P value of less than or equal to 0.001. The safety profile was consistent with that reported in the Phase II trial with no new safety events noted relative to Phase II. In patients with active TED, the IGF-1 receptor is over expressed on orbital tissues, resulting in local inflammation, orbital cellular proliferation, tissue expansion, which in turn causes proptosis.
Patients may experience discomfort symptom closing or blinking their eyes, which can lead to poor sleep patterns and result in painful ulcers on the surface of the eye itself. Proptosis can result in diplopia or double vision. Overall, the morbidity that patients experience with active TED can be highly detrimental to activities of daily living such as the ability drive a car, read or even walk downstairs. In some instances, pressure on the OPTIC nerve from proptosis can even result in blindness.
Currently no pharmacotherapy is approved for the treatment of active TED. And by blocking IGF-1 receptor signaling, teprotumumab is believed to specifically target the downstream autoimmune pathophysiology that underlines active TED, resulting in the efficacy and safety seen in the clinical program. At the AACE meeting two weeks ago, we shared additional secondary endpoint data from the Phase III trial. These data showed a rapid reduction in proptosis featuring statistically significant differences at the first measure time point of week six.
The secondary end point of mean proptosis reduction showed an average reduction over the span of the trial, essentially the average of how patients did at week 6, 12, 18 and 24 all together and demonstrated an average of 2.82 millimeters for teprotumumab group versus 0.454 millimeters for placebo with the P value of less than 0.001.
Perhaps more clinically meaningful is the proptosis reductions team from baseline to week 24 representing proptosis response after the full six-month course of therapy. That result from baseline to week 24 was 3.32 millimeter reduction for the teprotumumab group versus 0.53 millimeters for placebo.
Additionally, the overall responder rate of weak 24, which was the primary endpoint in Phase II, and was defined as proptosis reduction of more than 2 millimeters plus clinical activity score improvement of 2.2 more, was significantly better for patients treated with teprotumumab. The overall responder rate was 78% for patients treated with teprotumumab compared with 7.1% in placebo. These Phase III results give us confidence that teprotumumab has the potential to become the first approved therapy for active TED. And if approved, could improve lives of many people living with this debilitating disease. We remain on track to submit a DLA in mid-2019 with breakthrough therapy, orphan drugs and fast track designations. We anticipate the potential for approval in the first half of 2020.
We are also evaluating an early access program for teprotumumab given the level of interest we have received since sharing top line results from the Phase III confirmatory trial. As we continue to explore ways to further advance our understanding of the mechanisms through which IGF-1 receptor is providing clinical benefit so that we can consider potential for benefit in additional patient populations. We look forward to sharing more review on these investigations in the future.
Moving now to KRYSTEXXA and our uncontrolled gap programs, we continue to make progress towards our goal of maximizing the benefit of KRYSTEXXA for patients. As we have discussed in the past, in the KRYSTEXXA pivotal Phase III trial, 42% of patients achieved complete response, maintaining serum uric acid level of less than six milligrams per deciliter over six months. In the MIRROR study, we're investigating the use of the immunomodulator methotrexate to enhance the response rate of KRYSTEXXA and increase the number of patients who can benefit from it. We have finalized the trial design. It is a randomized placebo controlled study that will involve approximately 135 patients to receive either KRYSTEXXA plus methotrexate or KRYSTEXXA plus placebo. The primary endpoint is a comparison of the proportional responders defined as patients with serum uric acid levels less than 6 milligrams per deciliter as six months between treatment launch. We remain on track to initiate this study in June.
As of the last quarter, in support of our strategy to expand KRYSTEXXA's use among nephrologists, we also initiating a clinical trial in the second half of 2019 evaluating KRYSTEXXA in kidney transplant patients. Managing uncontrolled gout is both a common and significant unmet need in kidney transplant patients. This trial will also serve as an opportunity to further informed nephrologists as to the use and effectiveness of KRYSTEXXA, and its potential benefit for the chronic kidney disease patients with uncontrolled gout.
Across both the MIRROR trial and the study of KRYSTEXXA in kidney transplant patients, we're gaining additional information to advance our understanding as a chronic systemic disease such as a better understanding of the effects of KRYSTEXXA on uric acid diposition in organs beyond the join.
Finally, we've made good progress in our early stage next-generation biologic programs for uncontrolled gout. We're working on two programs with different technologies to enhance response rates and target subcutaneous dosing. One program is evaluating PASylated uricase technology. And we recently selected a lead candidate known as HZN-007. The other program underway optimizes PEGylation as well as the uricase and as HZN-003. We are committed to rigorous for certain development in the area of uncontrolled gout to enhance our leadership position in the space and improve the therapies available for gout patients.
As always, I look forward to updating you on our continued progress. And I'll now turn the call over to Paul.
Thanks, Shao-Lee. My comments this morning will primarily focus on our non-GAAP results unless otherwise noted. First quarter net sales of $280.4 million were driven by another quarter of strong commercial execution. Our Orphan and Rheumatology segment generated net sales of $185.9 million in the quarter, an increase of 8%, and generated segment operating income of $46.7 million also an increase of 8%. As we have discussed previously, we are no longer recognizing RAVICTI and BUPHENYL net sales outside of North America and Japan, or any net sales of LODOTRA. Excluding the impact of those divestitures, net sales for Orphan and Rheumatology segment increased 10%, and RAVICTI net sales increased 5%. As Tim referenced, demand for RAVICTI remain strong, driven by year-over-year patient growth along with improved compliance and adherence.
We also recently gained additional insight into downstream inventory levels with along with an increase medicated mix has resulted indeed to approve somewhat higher of Medicaid rebates resulted in a lower net price for RAVICTI in 2019 compared to 2018. Net sales for the primary care segment were $94.5 million, and segment operating income was $41.4 million. This exceeded our expectations driven by continued execution by the commercial team, which has lead to stabilization of this business over the last several quarters.
Importantly, we're investing the cash flow from this segment into the Orphan and Rheumatology, including increasing our investment in the preparation for the potential U.S. launch of teprotumumab. Our non-GAAP first quarter gross profit ratio was 89.8% in net sales. Non-GAAP operating expenses were $163.8 million. This included GAAP -- non-GAAP R&D expense of $17.1 million, reflecting investment in teprotumumab as well as our Rheumatology pipeline programs. Non-GAAP SG&A expense was $146.7 million.
Adjusted EBITDA was $88.4 million for the first quarter. Non-GAAP income tax expense for the first quarter was $12.8 million. Non-GAAP net income and non-GAAP diluted earnings per share were $53.9 million and $0.30, respectively. The weighted average shares outstanding used to calculate first quarter 2019 non-GAAP diluted EPS were 180.3 million shares. And non-GAAP operating cash flow was $62.2 million. We continued to execute on our capital allocation strategy and we are well on our way to achieving our goal of aligning our capital structure to be closer to that of our aspirational biopharma peers. As of March 31, cash and cash equivalents were $1.033 billion. On March 11, we closed and underwritten public equity offering of 14.1 million ordinary shares and we received net proceeds of $326.8 million. We used the net proceeds along with cash on hand, the funded repayment of $300 million of our term loans in March and $250 million of our senior notes due 2023 on May 1st. Reducing the principal amount of our debt outstanding to $1.443 billion. As of March 31, our net debt was $660 million, and our net leverage ratio defined as net debt to the last 12 months adjusted EBITDA was 1.3 times. This compares to 3.6 times at March 31, 2018. A reduction of more than two turns compared to a year ago.
Moving to our outlook for 2019, we now expect full year 2019 net sales to be in the range of $1.26 billion to $1.28 billion versus the previous range of $1.23 billion to $1.25 billion. We continue to project double-digit full year net sales growth for KRYSTEXXA, and we now expect primary care net sales for the full year to be roughly similar to 2018.
Full year 2019 adjusted EBITDA in now expected to be in the range of $450 million to $465 million versus the previous range of $440 million and $455 million. We continue expect our non-GAAP gross profit ratio to be approximately 90%. And we continue to expect non-GAAP R&D expense as a percentage of net sales to be in the high-single-digits for the full year.
We anticipate a higher year-over-year increase in non-GAAP SG&A expense, which primarily reflects the investments we were making to prepare for the potential teprotumumab U.S. commercial launch, which we've increased following the receipt of the Phase III data in late February.
Following the repayment of $550 million of our outstanding debt that I mentioned earlier, we expect full year non-GAAP net interest expense to be approximately $70 million, a decrease from our previous guidance of between $90 million and $95 million.
We continue to expect our full year non-GAAP tax rate in the low to mid-teens, and the cash tax rate in the low to mid single-digits. In-line with what we've seen in previous years, we anticipate variability in our non-GAAP tax rate on a quarterly basis. And as always, this projection could change significantly as a result of any acquisitions or divestitures we make or any changes in tax laws.
Following our recent equity offering, we now expect our full year 2019 weighted average diluted share count to be approximately 190 million shares.
With that I'll turn the call over to Tim for his concluding remarks.
Thank you, Paul. In summary, we're off to a great start for 2019, exceeding expectations on both net sales and adjusted EBITDA. The outperformance we achieved this quarter allowed us to raise our full year guidance while at the same time further increasing our investment in the potential U.S. commercial launch of teprotumumab.
The first quarter of 2019 was significant from an R&D perspective with two key milestone developments. The dramatic Phase III results of teprotumumab that we announced in February and the additional data we presented at AACE two weeks ago are highly significant and gives us increased confidence that teprotumumab has the potential to be the first approved therapy for active TED patients and improve the lives of many people living with this debilitating disease.
And secondly, our KRYSTEXXA immunomodulation trial MIRROR is on track to begin in June.
Looking to the future, both of these high growth opportunities KRYSTEXXA, and if approved teprotumumab, to more than double our full year 2018 total company net sales with each expected to generate more than $750 million in peak net sales. We also completed our underwritten public offering in March, which helped us reduce our gross debt by $550 million and reduce our net leverage ratio to 1.3 times, well below our targets.
Finally, we've changed our name to Horizon Therapeutics, which more clearly reflects both our long-term strategy to developing commercialize innovative new medicines addressing rare diseases. There's also the fact that our work with patients, caregivers, physicians and communities goes well beyond our medicines.
With that now, we'd now like to open up for questions. Tina?
Jimmy, go ahead
Thank you. [Operator Instructions] Our first question comes from David Amsellem with Piper Jaffray. Your line is now open.
Just a couple. So first on KRYSTEXXA, can you talk about how users are evolving regarding the usage of the product with immunomodulator agents? I mean, do you have a sense of the portion of practitioners who are actually using that combination now in practice? Secondly, you talked about the nephrology setting. Do you have a number in terms of the number of nephrologists who were actually using the product? And then, lastly just switching gears to tepro. Tim, maybe if you can opine on pricing, price per infusion or give us your thinking to the extent you can. I know its early days. That would be helpful. Thanks.
From a pricing standpoint, we're not committed to get into specifics until after approval. Certainly, we are very excited with the positive data that we saw. And we are continuing to do our work to understand the full cost involved with the surgery, the multitude of surgeries and the overall care involved for these patients to make sure that the value reflects the benefit of the medicine. Beyond that we will comment more as we get closer to after the approval timeframe. And maybe with the KRYSTEXXA question, Vikram can handle that.
So David on your question about use of immunomodulation agents with KRYSTEXXA, it is still quite low, but it is growing anecdotal evidence continuously from the field, especially post ACR presentation of Dr. Boston and Dr. Peterson at Fast Track last year. There's certainly a lot more interest given the dramatic results that they showed 100% response rate in nine out of nine patients. So we continue to hear more and more about it. But it is still quite low and, but we expect that to continue to increase over time. Part of the nephrology is concerned I'd say that nephrology is right in line with our expectations. In terms of specific numbers of nephrologists, it's a little bit difficult to give you the exact number just because often nephrologists and rheumatologists co-manage those patients. So when the patient comes into an infusion center or a rheumatologist, they might have been referred by nephrologists. So it's difficult to parse the data out exactly until much later. I would say that aside the interest within the nephrology community remains extremely strong and is increasing over time.
Thanks, David. Jimmy, next question please.
Thank you. Our next question comes from Annabel Samimy with Stifel. Your line is now open.
Morning everyone, this is Nick Rubino on for Annabel. Thanks for taking my questions. On tepro, you just came out of AACE where you had a big presentation that acknowledges based on the reception from those docs where your expectations for creating market among these physicians and the ease of creating a referral network between all of them. And given so few patients did not respond in the OPTIC trial. What can we expect from enrollment in OPTIC-X? And then lastly on KRYSTEXXA, you mentioned while growth of 38% quarter-over-quarter, can you give us some color about how you're thinking about it accelerating or decelerating through the rest of the year? Thank you.
Starting with the backend, I think our guidance maintains with KRYSTEXXA. So we have double-digit net sales growth, which would indicate in excess of continued growth of over 38% on a year-over-year basis. So we continued to have strong expectations that that will continue from an OPTIC-X standpoint. We do have significant enrollment from the placebo population. And as you've noted, a smaller number because of the high response rate with teprotumumab. So that enrollment is continuing over time. And from a standpoint of teprotumumab and the AACE meeting that as you'd expect with the dramatic data that we received, there was significant excitement and receiving the data understanding the secondary endpoint that the team presented and Dr. Ray Doug was presented in his section. As we look at the distribution network and the referral network, I think there was a -- this is a sequential process oculoplastic surgeons have given us a strong inclination that they would like to begin to infuse the medicine themselves. And we've heard that from some endocrinologists as well. We do see this as an area of focus in our pre-launch and launch efforts to make sure that those referral networks are properly set up to ensure that when a patient is prescribed a medicine that they are efficiently infused in a way that works for both the patient and the physician.
All right, thanks Nick. Next question please.
Thank you. And our next question comes from Ken Cacciatore with Cowen and Company. Your line is now open.
I wanted to drill down a little bit more in the TV marketing and where the patients are. So just to give us a sense, obviously, KRYSTEXXA was fantastic investment. But would this be a similar size do you think, Tim, in terms of sales force and an investment? And then going back to where the patients are you did mention ophthalmologists, endocrinologists, obviously the surgeons. Is it your sensor right now that in every local area there is a thought leader? Or is it really spread out into many different practices? So just a little bit more color and commentary there. And then in terms of KRYSTEXXA and penetration, obviously, you're giving us nice metrics into accounts and changes and account penetration. Can you give us a sense of where we are in the spectrum? Are we nearing? Are we three quarters penetrated into the accounts kind of maybe a abroad thought on how much -- how many more clinicians we could theoretically get onboard as you continue to educate? And then real lastly, timing of the MIRROR results, when can we expect that? Thank you.
Sure. Well, I'll start with some and then pass on KRYSTEXXA to Shao-Lee and Vikram. As far as the investment, the overall framework of reimbursement specialists and patient support and overall sales representatives, in the general range of what we have with KRYSTEXXA, we're still finalizing and beginning the hiring process there relative to where these patients now exist. As you know the current process for these patients to be seen by, for the Graves disease, by endocrinologists for their eye disease, thyroid eye disease, they are then referred on to the ophthalmologists. And primarily, the treatment is being done by the oculoplastic surgeon, because surgery is the only viable outcome for most of these patients.
So in the early phase, we would expect most of these patients to be in that network of oculoplastic surgeons as the primary relationship, and continue to build that co-management in the early phase. And we expect endocrinologists to play more active role in the treatment of TED as time progresses. And with KRYSTEXXA, maybe on the MIRROR, Shao-Lee can address it. And then Vikram can get into the commercial question.
So with regards to MIRROR, we anticipate starting that trial in June and having about a year of enrollment. So that'll take us to the second half of 2020. If you add six months treatment to that, and we think it's reasonable to anticipate some data to be available by the end of 2020.
And on the question around KRYSTEXXA and penetration, remember, when we expanded the team last year, the reason we did that was so that we could penetrate up to 75% from what was 50% aggressive of the targets of rheumatologists. And as we said before, our patient population is 100,000 patients, and we've accomplished that we have treated right around 3,000 patients. So that remains a significant amount of headroom for future growth. And we continue to provide the metrics around the same account growth as well as new account growth as we progress here.
Jimmy next question.
And our next question comes from David Risinger with Morgan Stanley. Your line is now open.
I have two questions. First, with respect to tepro, could you talk about your plans to pursue ex-U.S. commercial opportunities and discuss the potential timing and magnitude relative to the U.S. market? And then second, with respect to primary care, were there any reversals and accruals or anything this quarter? And I believe that the guidance implies that we should be modeling sales to be lower going forward for primary care than you booked in the first quarter. But be helpful to understand how you would suggest we model primary care sequentially in the second quarter? Thank you.
So there were no reversals or anything material involved there from a modeling standpoint. We expect to have similar sales that we saw last year. With teprotumumab and outside the United States, we continue to evaluate those markets and have preliminary discussions in Europe with regulatory authorities as we get through the U.S. filing and approval we look to them accelerate our ex-U.S. activities, which is a significant opportunity in the China market given experience with a number of different key opinion leaders in the treatment of thyroid eye disease. And we will update more as time goes along.
Thanks, David. Jimmy next question.
Thank you. Our next question comes from David Steinberg with Jefferies. Your line is now open. Once again, the next question comes from David Steinberg with Jefferies. Your line is now open.
Perhaps we can move on to the next question in the queue. Maybe you can hop back in David. We're having trouble hearing you.
Understood. Our next question comes from Louise Chen with Cantor Fitzgerald. Your line is now open.
Hi, this is Jennifer Kim on for Louise. Thanks for taking our questions. I have two. My first question is just on tepro. Is there any additional data between now and approval or other than OPTIC-X that you think physicians and patients would find most meaningful? And what would the timing beyond that extra data? And then also, you mentioned that you're considering additional populations for tepro. And I'm wondering if you could give more color on that, and what the potential upside is in terms of patient size? And then just on primary care, you talked about stabilization in the business. Last quarter, you talked -- you gave the data on the U.S. market share for RAVICTI and PROCYSBI, and I'm wondering if you could give update on market share now? And then also give color on exactly what the extent of the net pricing impact on RAVICTI this past quarter? Thanks.
Sure. So Paul, maybe take the RAVICTI question and then we'll go from there.
I mean, the actual price and volume on RAVICTI has laid out in the MD&A and Q. So gives you the exact dollar amount of volume growth and net price decline. So that's in that filing really available.
And so as Paul mentioned, there were some Medicate accruals that increase or decrease the net price with RAVICTI. Relative to data for teprotumumab, we expect to have a number of meaningful endpoints and data from that presented in several full conferences this year. And we expect that data to be meaningful to potential prescribers. So Lee, do you want to talk about how we looked at other the indications?
Sure. So we're in the early stages of evaluating the potential for benefit. We're really focused on understanding better how we think that IGF-1 receptor is really having clinical impact in the case of thyroid eye disease and asking ourselves how we can apply that potentially to additional population. So it's early stages there.
This question around that PROCYSBI and RAVICTI's market share, it's in the mid 50s as we said before as well.
Thanks, Jennifer. Next question please, Jimmy.
Thank you. Our next question comes from Gary Nachman of BMO Capital Markets. Your line is now open.
First on tepro, for the oculoplastic surgeon, specifically, how did they think about the value proposition of using tepro versus the economics that they might get from doing the surgery? On ACTIMMUNE, will you be able to turn that around? Or will we see similar declines over the course of the year? And then just talk about the spending cadence, how that might look over the course of the year both SG&A and R&D? Thank you.
So from a surgery standpoint and looking at the oculoplastic surgeons, importantly, they have played a lead role in the development of teprotumumab with Ray Douglas being one of the top oculoplastic surgeons in U.S. and rest of the world. So they see the opportunity with teprotumumab and the magnitude of the data when you get 83% response rate versus placebo and the opportunity benefit for their patients. They want as they've indicated to us to be a key part of offering teprotumumab to their patients. One of the key things for them is how they use the success of surgery. They see that as something that it is really effective from a long-term perspective and very difficult to perform with minimal improvement and outcomes for patients. So leases they've indicated to us, they are very excited with the opportunity for teprotumumab into the market. And maybe, Paul, do you want to talk about spend?
Yes, I think on the OpEx, you should expect it to sequentially increase as we go through the year. And as we said a lot of that is driven by increased investment behind the preparation for the potential U.S. commercial launch of tepro. And so that will build as we move through the year and get closer to the end of the year.
The question on ACTIMMUNE, and we expect ACTIMMUNE is viewed as a maintenance brand is a stable, expected to be in the $100 million range or that area. Not a growth driver, but a significant source of cash in the business.
Jim, next question. I think we have time for one more.
[Operator Instructions] Our next question comes from Liav Abraham with Citigroup. Your line is now open.
Two quick ones. Firstly, on the MIRROR study. Can you quantify the potential revenue contribution that this treatment paradigm could have as it relates to KRYSTEXXA revenues over the longer term? And then secondly, I'd be interested in any additional comments that you have on business development, the types of transactions you're looking at and the sense of urgency just given the maturing of the teprotumumab clinical trial? Thank you.
So maybe Vikram talk about potential, and Bob can handle the degree.
Yes, I would say the way to think about the MIRROR study is in the event that improves out the way we think it should. It should result in a twofold impact on the medicine. It should be the impact the number of bios per patient that should increase, because of increased patient compliance in the MIRROR as well as for those physicians that feel that they hesitate in putting patients on that would significantly alleviate their concerns. So we will probably expect that each will have a material impact on the medicine depending on the outcome of the study.
And Liav, it's Bob. We continue to see good opportunities to pursue in the marketplace. We are optimistic about the opportunity to build out the pipeline behind the commercial organization. We do have a sense of urgency in attempting to accomplish that objective. However, our first quarter is, for do no harm. So we will not go out and do something that is outside of strategy or off from a financial standpoint. We've been good stewards of capital we believe over growing the company to this point. And you should expect the best what we'll do in the future.
And thank you Jimmy. That concludes our call this morning. A replay of this call and webcast will be available in approximately two hours. Thank you for joining us.
Ladies and gentlemen, thank you for your participation in today's conference. This does conclude your program and you may all disconnect. Everyone have a great day.