Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY) Q1 2022 Earnings Conference Call May 3, 2022 8:30 AM ET Company Participants Luis Sanay - Head, IR John C. Jacobs - President and CEO Jeffrey Dierks - Chief Commercial Officer Jeffrey M. Dayno - Chief Medical Officer Sandip Kapadia - CFO Conference Call Participants Danielle Brill - Raymond James Chris Howerton - Jefferies Charles Duncan - Cantor Fitzgerald David Amsellem - Piper Sandler Corinne Jenkins - Goldman Sachs Francois Brisebois - Oppenheimer Operato ...

Harmony Biosciences Q1 2022 Financial and Business Update May 3, 2022 Legal Disclaimer This presentation includes forward‐looking statements within the meaning of the Private Securities Reform Act of 1995. All statements other than statements of historical facts contained in these materials or elsewhere, including statements regarding Harmony Biosciences Holdings, Inc.'s (the "Company") future financial position, business strategy and plans and objectives of management for future operations, should be consi ...

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited condensed consolidated financial statements for Q1 2022 reflect substantial growth in revenues and net income, with increased assets and strong liquidity [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28Unaudited%29) Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $280,257 | $284,439 | | Cash and cash equivalents | $224,499 | $234,309 | | **Total Noncurrent Assets** | $183,748 | $149,004 | | Intangible assets, net | $178,837 | $143,919 | | **TOTAL ASSETS** | **$464,005** | **$433,443** | | **Total Current Liabilities** | $56,528 | $53,775 | | **Total Noncurrent Liabilities** | $192,974 | $193,161 | | Long term debt, net | $189,896 | $189,984 | | **TOTAL LIABILITIES** | **$249,502** | **$246,936** | | **TOTAL STOCKHOLDERS' EQUITY** | **$214,503** | **$186,507** | - Total assets increased to **$464.0 million** as of March 31, 2022, from **$433.4 million** at year-end 2021, primarily driven by a **$34.9 million** increase in net intangible assets[9](index=9&type=chunk) - Total stockholders' equity grew by **$28.0 million** during the first quarter of 2022, reaching **$214.5 million**, mainly due to net income of **$21.5 million**[9](index=9&type=chunk)[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Unaudited%29) Statement of Operations Highlights (in thousands, except per share data) | Metric | Q1 2022 | Q1 2021 | % Change | | :--- | :--- | :--- | :--- | | Net product revenues | $85,313 | $59,674 | 43.0% | | Gross profit | $70,597 | $49,265 | 43.3% | | Total operating expenses | $43,041 | $34,732 | 23.9% | | Operating income | $27,556 | $14,533 | 89.6% | | Net income | $21,485 | $7,386 | 191.0% | | Diluted EPS | $0.35 | $0.13 | 169.2% | - The company demonstrated strong top-line growth, with net product revenues increasing **43.0%** year-over-year, leading to a significant **191.0%** increase in net income[10](index=10&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity%20%28Unaudited%29) - Total stockholders' equity increased from **$186.5 million** at the end of 2021 to **$214.5 million** as of March 31, 2022. The increase was primarily driven by **$21.5 million** in net income for the quarter[11](index=11&type=chunk) - Stock-based compensation expense added **$4.6 million** to additional paid-in capital during the first quarter of 2022[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%28Unaudited%29) Cash Flow Summary (in thousands) | Activity | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $28,852 | $12,530 | | Net cash used in investing activities | ($40,045) | ($100,004) | | Net cash provided by financing activities | $1,383 | $12 | | **Net decrease in cash** | **($9,810)** | **($87,462)** | - Cash from operating activities more than doubled to **$28.9 million** in Q1 2022 from **$12.5 million** in Q1 2021, driven by higher net income[12](index=12&type=chunk) - Investing activities primarily consisted of a **$40.0 million** milestone payment in Q1 2022, compared to a **$100.0 million** milestone payment in Q1 2021[12](index=12&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) - As of March 31, 2022, three customers (CVS Caremark, Accredo, and Pantherx) accounted for **100%** of gross accounts receivable and **100%** of gross product revenues[28](index=28&type=chunk)[29](index=29&type=chunk) - In February 2022, the company achieved **$500 million** in aggregate net sales of WAKIX, triggering a final **$40.0 million** milestone payment which was capitalized as an intangible asset[36](index=36&type=chunk) - The company has a **$200 million** senior secured term loan facility with Blackstone, with **$199.0 million** in principal outstanding as of March 31, 2022[41](index=41&type=chunk)[44](index=44&type=chunk) - Diluted earnings per share for Q1 2022 was **$0.35**, calculated using the treasury stock method with **60,586,875** weighted average diluted shares outstanding[10](index=10&type=chunk)[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong revenue growth to WAKIX patient expansion, with increased R&D expenses and solid liquidity maintained despite COVID-19 challenges [Company Overview and Strategy](index=26&type=section&id=Company%20Overview%20and%20Strategy) - Harmony is a commercial-stage pharmaceutical company focused on rare neurological diseases, with its primary product being WAKIX (pitolisant), approved for treating EDS and cataplexy in adult narcolepsy patients[76](index=76&type=chunk)[79](index=79&type=chunk) - The company is pursuing label expansion for WAKIX in pediatric narcolepsy and is advancing clinical trials for other indications, including Prader-Willi Syndrome (PWS), myotonic dystrophy (DM), and idiopathic hypersomnia (IH)[80](index=80&type=chunk)[81](index=81&type=chunk) - In August 2021, Harmony expanded its pipeline by acquiring **HBS-102**, a potential first-in-class molecule for which it plans a preclinical proof-of-concept study in a mouse model of PWS in 2022[82](index=82&type=chunk) [Commercial Performance and COVID-19 Impact](index=30&type=section&id=Commercial%20Performance%20and%20COVID-19%20Impact) - The average number of patients on WAKIX was approximately **3,900** for the three months ended March 31, 2022[87](index=87&type=chunk) - As of March 31, 2022, the company has secured formulary access for WAKIX for over **80%** of all insured lives in the United States[87](index=87&type=chunk) - The COVID-19 pandemic has negatively impacted business by reducing in-person access to healthcare professionals (HCPs) and affecting the ability to conduct clinical trials, though the company has implemented virtual engagement and remote trial monitoring to mitigate these effects[89](index=89&type=chunk)[91](index=91&type=chunk)[96](index=96&type=chunk) - The company expects to have an adequate supply of WAKIX into the second quarter of **2023**, with additional API inventory to support at least **36 months** beyond that[94](index=94&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Comparison of Results for the Three Months Ended March 31 (in thousands) | Line Item | 2022 | 2021 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net product revenue | $85,313 | $59,674 | $25,639 | 43.0% | | Cost of product sales | $14,716 | $10,409 | $4,307 | 41.4% | | Research and development | $7,578 | $4,679 | $2,899 | 62.0% | | Sales and marketing | $17,583 | $15,506 | $2,077 | 13.4% | | General and administrative | $17,880 | $14,547 | $3,333 | 22.9% | | Net income | $21,485 | $7,386 | $14,099 | 191.0% | - The **43.0%** increase in net product revenue was driven by growth in the average number of patients on WAKIX[123](index=123&type=chunk) - R&D expenses increased by **62.0%** primarily due to clinical development work for PWS, DM, and IH, along with higher stock compensation[125](index=125&type=chunk) - G&A expenses rose **22.9%**, mainly from increased stock compensation and higher intangible asset amortization following a recent milestone payment[127](index=127&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2022, the company had **$225.2 million** in cash, cash equivalents, and restricted cash[131](index=131&type=chunk) - The company has an outstanding debt of **$199.0 million** under its Blackstone Credit Agreement, which also provides for a senior secured delayed draw term loan facility of up to **$100.0 million** available through August 9, 2022[131](index=131&type=chunk)[134](index=134&type=chunk) - In March 2022, the company made a final **$40.0 million** milestone payment to Bioprojet after WAKIX achieved **$500.0 million** in aggregate net sales in the U.S[139](index=139&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces interest rate risk on variable-rate debt, though a 10% LIBOR change is not material, and currently has limited foreign currency or inflation exposure - The company's primary market risk is interest rate sensitivity on its **$199.0 million** in outstanding variable-rate debt (LIBOR + **6.50%**). However, management states a **10%** change in LIBOR would not have a material impact[150](index=150&type=chunk) - The company is not currently exposed to significant foreign currency fluctuation risk but may be in the future due to contracts with European vendors[151](index=151&type=chunk) - Inflation is not considered to have had a material effect on the business for the three months ended March 31, 2022[152](index=152&type=chunk) [Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded the company's disclosure controls and procedures were effective as of March 31, 2022, with no material changes in internal control over financial reporting - Based on an evaluation as of March 31, 2022, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[153](index=153&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2022, that have materially affected, or are reasonably likely to materially affect, internal controls[154](index=154&type=chunk) [Part II. Other Information](index=47&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no pending claims or actions that could materially adversely affect its operations or financial condition - As of the filing date, management believes there are no pending legal proceedings that would materially impact the company's financial condition[159](index=159&type=chunk) [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021, have occurred - The report refers investors to the risk factors detailed in the Annual Report on Form 10-K for the year ended December 31, 2021, for a comprehensive discussion of risks affecting the company[160](index=160&type=chunk) [Other Required Disclosures](index=47&type=section&id=Items%202-5.%20Other%20Required%20Disclosures) The company reported no unregistered equity sales, no defaults on senior securities, and no other material disclosures under these items, with mine safety disclosures being not applicable - Item 2 (Unregistered Sales of Equity Securities), Item 3 (Defaults upon Senior Securities), and Item 5 (Other Information) are all reported as "None"[161](index=161&type=chunk)[162](index=162&type=chunk)[164](index=164&type=chunk) - Item 4 (Mine Safety Disclosures) is reported as "Not applicable"[163](index=163&type=chunk) [Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the quarterly report, including CEO and CFO certifications and financial statements in Inline XBRL format - The exhibits filed with this report include CEO and CFO certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[166](index=166&type=chunk) - Financial statements are provided in Inline XBRL format as part of the filing[166](index=166&type=chunk)

Harmony Biosciences Company Overview April 2022 Legal Disclaimer This presentation includes forward‐looking statements within the meaning of the Private Securities Reform Act of 1995. All statements other than statements of historical facts contained in these materials or elsewhere, including statements regarding Harmony Biosciences Holdings, Inc.'s (the "Company") future financial position, business strategy and plans and objectives of management for future operations, should be considered forward-looking ...

Financial Data and Key Metrics Changes - For Q4 2021, the company reported net revenues of $91.2 million, representing a 62% increase compared to the same quarter in the prior year and a 13% increase from Q3 2021 [14][40] - Full-year 2021 net revenue was $305.4 million, reflecting a 91% increase from 2020 [14][40] - Operating income for Q4 2021 was $28.6 million, compared to $7.8 million in the prior year quarter, while full-year operating income was $87.5 million, an increase of over $70 million compared to 2020 [41][42] Business Line Data and Key Metrics Changes - The average number of patients on WAKIX increased to approximately 3,800, representing a 9% increase from the previous quarter [15] - The company continues to see strong underlying demand for WAKIX, with a significant portion of new prescriptions coming from both type 1 and type 2 narcolepsy patients [20][21] Market Data and Key Metrics Changes - Market access for WAKIX remains strong, with over 80% of U.S. covered lives having favorable published policy access [19] - The narcolepsy market is currently valued at over $2 billion, indicating a large and growing opportunity for WAKIX [8] Company Strategy and Development Direction - The company aims to evolve into a leading rare orphan neurology company with a robust multiproduct portfolio and significant long-term growth potential [7][13] - The three pillars of the growth strategy include optimizing WAKIX's commercial performance, expanding its clinical utility beyond narcolepsy, and acquiring new assets to broaden the portfolio [8][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in building upon the momentum from 2021 and making 2022 the best year yet, with expectations for continued growth in WAKIX sales [7][47] - The company is optimistic about the potential of WAKIX to become a $1 billion-plus franchise through narcolepsy and additional indications [12][45] Other Important Information - The company generated $44.6 million in cash during Q4 2021, closing with $234.3 million in cash and cash equivalents at year-end [44] - The company plans to make a final milestone payment of $40 million to its partner, Bioprojet, in Q1 2022 [44] Q&A Session Summary Question: How should the company think about Q1, given the deductible reset and general seasonality? - Management indicated that while they are not providing specific guidance, they anticipate continued growth based on historical performance [49][50] Question: What is the status of enrollment in the ongoing Phase 2 trials? - Management noted that enrollment has improved due to contingency plans and flexibility in trial designs, with a focus on maintaining momentum [61][64] Question: What portion of narcolepsy patients are currently treated by the additional healthcare providers being targeted? - Approximately 10% of the patient opportunity resides within the additional 1,000 healthcare professionals being targeted, with these physicians managing a small number of narcolepsy patients [108] Question: How does the current market backdrop impact business development conversations? - Management noted a renewed interest in neurology and a favorable market backdrop facilitating deal discussions [111]

HAR Harmony Biosciences Q4 2021 Financial and Business Update February 28, 2022 Legal Disclaimer This presentation includes forward‐looking statements within the meaning of the Private Securities Reform Act of 1995. All statements other than statements of historical facts contained in these materials or elsewhere, including statements regarding Harmony Biosciences Holdings, Inc.'s (the "Company") future financial position, business strategy and plans and objectives of management for future operations, shoul ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39450 HARMONY BIOSCIENCES HOLDINGS, INC. (Exact name of registrant as specified in its charter) 630 W. Germant ...

HAR Harmony Biosciences Q3 2021 Financial and Business Update November 9, 2021 Legal Disclaimer This presentation includes forward‐looking statements within the meaning of the Private Securities Reform Act of 1995. All statements other than statements of historical facts contained in these materials or elsewhere, including statements regarding Harmony Biosciences Holdings, Inc.'s (the "Company") future financial position, business strategy and plans and objectives of management for future operations, should ...

Financial Data and Key Metrics Changes - The company reported net revenues of $80.7 million for Q3 2021, representing a 77% increase compared to Q3 2020 and a 9.4% increase from Q2 2021 [44][45] - Gross profit for Q3 2021 was $66.1 million, up from $37.7 million in the prior year quarter [45] - Operating income for Q3 2021 was $21.1 million, compared to $10.4 million in the prior year quarter [45] - Non-GAAP adjusted net income for Q3 2021 was $30.4 million or $0.51 per diluted share, compared to $13.7 million or $0.25 per diluted share in the prior year quarter [47] Business Line Data and Key Metrics Changes - Wakix achieved net sales of almost $81 million in Q3 2021, marking the seventh consecutive quarter of growth [8][18] - The average number of patients on Wakix increased approximately 10% from Q2 2021 to about 3,500 patients [19] - Over 80% of U.S. covered lives have favorable access to Wakix, with a significant increase in positive formulary decisions for narcolepsy patients with cataplexy [22][58] Market Data and Key Metrics Changes - The company observed strong organic growth for Wakix despite seasonal decreases in patient foot traffic during the summer [18][21] - The prescriber base for Wakix grew, with approximately 40% of healthcare professionals treating narcolepsy having prescribed Wakix since its launch [23] Company Strategy and Development Direction - The company is focused on three pillars: optimizing Wakix's commercial performance, expanding its clinical utility beyond narcolepsy, and acquiring new assets to diversify its portfolio [8][12] - The acquisition of HBS-102 marks the first step in expanding the pipeline beyond Wakix, targeting rare neurological diseases [13][14] - The strategic financing collaboration with Blackstone provides additional capital to support growth initiatives [15][49] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued growth in Q4 2021, driven by strong demand and improved access to healthcare professionals [50][88] - The company anticipates increased investments in R&D and SG&A while maintaining profitability [50] - Management highlighted the importance of addressing unmet needs in the narcolepsy market and the potential for expanding indications for Wakix [28][89] Other Important Information - The company incurred a one-time loss of $26.1 million due to the extinguishment of a prior debt facility, contributing to a net loss of $9.6 million for Q3 2021 [46] - The company generated $30.4 million from cash operations in Q3 2021, maintaining a strong cash position of $189.7 million as of September 30 [48] Q&A Session Summary Question: Coverage perspective and step edits for plans - The majority of plans for type 2 narcolepsy patients have one or two generic step edits, while type 1 patients have become less frequent in having these edits [57][58] Question: Expectations for covered lives and formulary access - Approximately 80% of U.S. insured lives have documented formulary access for Wakix, with the remaining 20% having paths for approval through medical necessity letters [58][59] Question: Status of pediatric narcolepsy trial - The partner Bioprojet is conducting a Phase 3 trial in pediatric patients, with data readout expected to inform future strategies [63] Question: Quarterly patient adds and prescription growth - The company has seen consistent growth in patient adds, with a mix of new prescribers and existing prescribers expanding their patient base [75][76] Question: Gross to net improvements and future expectations - The company expects stable gross to net ratios moving into Q4, with continued strong organic demand anticipated [88][89] Question: Exploration of idiopathic hypersomnia indication - The company is considering idiopathic hypersomnia as a potential indication for Wakix, with further exploration ongoing [89]

Table of Contents FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-39450 HARMONY BIOSCIENCES HOLDINGS, INC. Indicate by check mark whether the registrant (1) has filed all ...