Core Viewpoint - Harmony Biosciences (HRMY) has faced challenges, including a 10.8% decline in stock price over the past six months, primarily due to a Refusal to File (RTF) letter from the FDA regarding pitolisant for excessive daytime sleepiness in idiopathic hypersomnia [1][20] Group 1: Company Performance - The stock has underperformed compared to the industry, which declined by 9.7%, and the S&P 500 index during the same period [1] - Despite the setback, the fourth-quarter results reported on February 25 were better than expected, leading to a slight recovery in shares [3] - The lead drug, Wakix, is a first-in-class therapy that has driven growth since its initial FDA approval in 2019, with expected net revenues between $820 million and $860 million for 2025 [7][8] Group 2: Drug Development and Pipeline - The company aimed to expand the label of pitolisant for excessive daytime sleepiness in adult patients with idiopathic hypersomnia, but the submission faced regulatory challenges [4][5] - Two next-generation formulations, pitolisant Gastro-Resistant and pitolisant High-Dose, are in development, with phase III studies planned for late 2025 [9][10] - The acquisition of Zynerba Pharmaceuticals added ZYN-002 to the portfolio, currently in a phase III trial for Fragile X Syndrome, with data expected in Q3 2025 [11][12] Group 3: Financial Position and Valuation - As of December 31, 2024, the company had cash, cash equivalents, and investments totaling $576.1 million, with long-term debt of $163 million, indicating a sound cash position [14] - HRMY's shares trade at a price/sales ratio of 2.27x forward sales, lower than its historical mean of 4.23x but higher than the industry average of 1.70x [15] - The estimate for 2025 earnings per share has decreased to $2.89 from $3.16 over the past 30 days, reflecting a downward trend in earnings expectations [17] Group 4: Market Outlook - The narcolepsy market in the U.S. had an approximate net sales value of $2.9 billion in 2023, with expectations for continued growth [19] - The company believes its pipeline has the potential to deliver more than $3 billion in net revenues in the coming years, driven by successful development of its candidates [19] - The company is advised to maintain investment in HRMY, with potential for value increase from favorable data readouts later in the year [20]

Core Viewpoint - Harmony Biosciences Holdings, Inc. is under investigation for potential securities fraud and unlawful business practices following a negative FDA response regarding its drug pitolisant [1][2]. Group 1: Company Overview - Harmony Biosciences Holdings, Inc. trades on NASDAQ under the ticker HRMY [1]. - The company recently received a Refusal to File (RTF) letter from the FDA concerning pitolisant, which is intended for treating excessive daytime sleepiness in adult patients with idiopathic hypersomnia [2]. Group 2: Financial Impact - Following the FDA's announcement, Harmony's stock price dropped by $3.77 per share, representing a decline of 9.64%, closing at $35.32 per share on February 19, 2025 [2]. Group 3: Legal Context - Pomerantz LLP is leading the investigation into Harmony, focusing on whether the company and its officers engaged in securities fraud or other unlawful practices [1]. - Pomerantz LLP has a long history in corporate and securities class litigation, having recovered significant damages for victims of securities fraud [3].

Financial Data and Key Metrics Changes - The company reported net product revenues of $714.7 million for 2024, representing a 23% year-over-year growth. In Q4 alone, net revenue was $201.3 million, reflecting a 20% increase from $168.4 million in the prior year quarter [11][25][55] - Non-GAAP adjusted net income for Q4 2024 was $63 million, or $1.08 per diluted share, compared to $42.8 million or $0.73 per diluted share in the prior year quarter [56] - The company ended Q4 with approximately $576 million in cash and cash equivalents, reflecting robust cash generation of approximately $219.8 million from operations in 2024 [55][57] Business Line Data and Key Metrics Changes - The average number of patients on WAKIX increased to approximately 7,100 in Q4, with a sequential increase of about 300 patients from the previous quarter [25][26] - The growth in WAKIX prescriptions was primarily driven by adult narcolepsy, which constitutes approximately 95% of the diagnosed narcolepsy opportunity [27] - The company anticipates net revenue guidance for WAKIX in 2025 to be between $820 million and $860 million [30][58] Market Data and Key Metrics Changes - The company continues to see strong double-digit growth in net revenue for WAKIX, demonstrating sustained demand in the narcolepsy market [25][26] - The company is on track to initiate pivotal Phase 3 registration trials for pitolisant HD in both narcolepsy and idiopathic hypersomnia in Q4 2025, with anticipated PDUFA dates in 2028 [40][41] Company Strategy and Development Direction - The company aims to become a leading CNS company focused on developing innovative treatments for patients with unmet medical needs, with a pipeline poised to deliver over $3 billion in net revenue [9][10] - The company is committed to defending its intellectual property and has announced its first generic settlement agreement with Novagen Pharma, reinforcing the strength of its IP portfolio [12][100] - The company is actively engaged in identifying additional opportunities to expand its leadership in Sleep/Wake, neurobehavioral disorders, and rare epilepsies [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of WAKIX, projecting it to be a $1 billion plus opportunity in narcolepsy alone [11][12] - The company views 2025 as a transformational year, with key clinical milestones expected to reinforce its leadership in Sleep/Wake and rare CNS disorders [17][23] - Management acknowledged challenges with the supplemental new drug application for pitolisant in idiopathic hypersomnia but emphasized their commitment to the patient community [15][16] Other Important Information - The company has a robust late-stage pipeline with four ongoing Phase 3 registrational trials and plans to initiate six by the end of the year [36] - The company is advancing its next-generation pitolisant formulations, including pitolisant HD and pitolisant GR, designed to address unmet needs in narcolepsy and idiopathic hypersomnia [41][42] Q&A Session Summary Question: Can you provide updates on ZYN002 and the Phase 3 study? - Management expressed satisfaction with the ongoing trial and noted that they are on track for top-line data in Q3 2025. They are enrolling patients aged three to 30 years and have seen a good rollover rate into the long-term extension study [66][71] Question: What is the rationale for Pitolisant HD's likelihood of success in IH patients? - Management highlighted the evidence of efficacy from previous studies and the optimized formulation of pitolisant HD, which is expected to deliver enhanced therapeutic benefits [76][79] Question: How confident is the company in the timeline for Pitolisant HD trials given competition? - Management indicated confidence in the recruitment process due to established relationships with clinical trial sites and the robust signal from previous studies [84][88] Question: What is the status of remaining patent challenges? - Management confirmed ongoing litigation processes and mentioned a Markman hearing scheduled for March, with a trial set for 2026 [96][99] Question: What would success look like for the ZYN002 trial? - Success would be defined by demonstrating a statistically significant and clinically meaningful outcome on the primary endpoint, with supportive data from the previous CONNECT study [104][109]

Q4 & FY 2024 Financial Results & Business Update February 25, 2025 Copyright © 2025 Harmony Biosciences. All rights reserved. Forward-Looking Statements This presentation includes forward‐looking statements within the meaning of the Private Securities Litigation 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, preliminary financ ...

Financial Data and Key Metrics Changes - The company reported net product revenues of $714.7 million for 2024, representing a 23% year-over-year growth. In Q4 alone, net revenue was $201.3 million, reflecting a 20% increase from $168.4 million in the prior year quarter [11][25][55]. - Non-GAAP adjusted net income for Q4 2024 was $63 million, or $1.08 per diluted share, compared to $42.8 million or $0.73 per diluted share in the prior year quarter [56]. - The company ended Q4 with approximately $576 million in cash and cash equivalents, reflecting robust cash generation of approximately $219.8 million from operations in 2024 [55][57]. Business Line Data and Key Metrics Changes - The average number of patients on WAKIX increased to approximately 7,100 in Q4, with a sequential increase of about 300 patients from the previous quarter [25][26]. - The growth in WAKIX prescriptions was primarily driven by adult narcolepsy patients, constituting approximately 95% of the diagnosed narcolepsy opportunity [27]. Market Data and Key Metrics Changes - The company anticipates continued growth in WAKIX, with net revenue guidance for 2025 set at $820 million to $860 million, reflecting strong expectations for the year [58]. - The company is on track to achieve a $1 billion plus opportunity in narcolepsy alone, with a robust commercial infrastructure supporting this growth [30][31]. Company Strategy and Development Direction - The company aims to become a leading CNS company by advancing its late-stage pipeline to deliver one or more new product or indication launches each year [9]. - The strategic focus includes the development of next-generation formulations of pitolisant, such as pitolisant high-dose (HD) and pitolisant gas resistant (GR), to enhance patient care and extend revenue growth into the mid-2040s [31][40]. - The company is actively engaged in identifying additional opportunities to expand its leadership in Sleep/Wake, neurobehavioral disorders, and rare epilepsies [22]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth strategy, emphasizing that 2025 is shaping up to be a transformational year with key clinical milestones expected [17][62]. - The company remains committed to addressing unmet medical needs in idiopathic hypersomnia and narcolepsy, despite recent challenges with the supplemental new drug application for pitolisant in idiopathic hypersomnia [15][16]. Other Important Information - The company announced its first generic settlement agreement with Novagen Pharma, reinforcing the strength of its intellectual property portfolio [12][100]. - The company is on track to initiate pivotal Phase 3 registration trials for pitolisant HD in both narcolepsy and idiopathic hypersomnia in Q4 2025, with anticipated PDUFA dates in 2028 [40][41]. Q&A Session Summary Question: Can you provide updates on ZYN002 and the Phase 3 study? - Management expressed satisfaction with the ongoing trial and noted that they are enrolling patients aged three to 30 years, with a good proportion rolling over into the long-term extension study [66][71]. Question: Why should investors feel confident about Pitolisant HD's success in IH patients? - Management highlighted the evidence of efficacy from previous studies and the optimized formulation of pitolisant HD, which is expected to deliver larger efficacy for excessive daytime sleepiness and target symptoms like sleep inertia [76][79]. Question: How confident is the company in the timeline for Pitolisant HD trials given competition? - Management indicated confidence in the recruitment process due to established relationships with clinical trial sites and the robust signal shown in previous studies [84][88]. Question: What is the status of remaining patent challenges? - Management confirmed ongoing litigation processes and mentioned a Markman hearing scheduled for March, with a trial set for 2026 [96][99]. Question: What would success look like for the ZYN002 trial? - Success would be defined by demonstrating a statistically significant and clinically meaningful outcome on the primary endpoint, with supportive data from the previous CONNECT study [104][109].

Harmony Biosciences Holdings, Inc. (HRMY) came out with quarterly earnings of $0.85 per share, beating the Zacks Consensus Estimate of $0.74 per share. This compares to earnings of $0.45 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 14.86%. A quarter ago, it was expected that this company would post earnings of $0.64 per share when it actually produced earnings of $0.79, delivering a surprise of 23.44%.Over the last four qua ...

Financial Performance - WAKIX generated net product revenue of $714.7 million for the year ended December 31, 2024, with approximately 7,100 patients on the treatment in Q4 2024[25]. - Three customers accounted for 100% of gross product revenue for the year ended December 31, 2024, with Caremark LLC accounting for 39%[57]. - The company has U.S. federal net operating loss carryforwards of $220.2 million and state net operating loss carryforwards of approximately $111.1 million as of December 31, 2024[209]. - The company has never paid dividends on its common stock and does not intend to do so in the foreseeable future, relying on stock price appreciation for investor returns[206]. - Revenue from WAKIX depends on market size, competition, pricing acceptance, and reimbursement capabilities[144]. Market Opportunities - The U.S. narcolepsy market had an approximate net sales value of $2.9 billion in 2023, expected to grow due to new therapies and increased diagnosis rates[24]. - The total addressable market for ZYN-002 in Fragile X Syndrome (FXS) is estimated to be approximately 25,000 people in the United States, with no FDA approved treatments currently available[40]. - The total addressable market for EPX-100 among patients with Dravet Syndrome (DS) is approximately 5,000 people, and for Lennox-Gastaut Syndrome (LGS) is approximately 35,000 people[45]. - The potential market opportunity for WAKIX may be smaller than estimated, with risks of lower patient numbers and treatment acceptance[149]. Product Development and Regulatory Affairs - The company submitted a supplemental New Drug Application for pitolisant in idiopathic hypersomnia in Q4 2024, following a comprehensive evaluation of data[19]. - The company initiated a Phase 3 registrational trial for pitolisant in Prader-Willi syndrome in Q1 2024, following FDA alignment on the study design[32]. - The FDA granted Orphan Drug designation to pitolisant for the treatment of Prader-Willi syndrome in February 2024[32]. - The company has made progress in developing two new formulations of pitolisant, with anticipated PDUFA dates of 2026 for pitolisant GR and 2028 for pitolisant HD[37]. - EPX-100 has been granted orphan drug designation by the FDA for the treatment of both DS and LGS, and is currently in a Phase 3 registrational clinical trial for DS[45]. Intellectual Property and Licensing - The company relies on a license agreement with Bioprojet for core intellectual property; loss of rights would adversely affect commercialization[150]. - The company has filed non-provisional patents for both new formulations of pitolisant, with potential patent protection extending to the mid-2040s[37]. - The patent portfolio for WAKIX includes four U.S. patents, with expiration dates ranging from March 2030 to March 2044, ensuring protection for the product's formulation and treatment methods[66][67]. - The company has exclusive rights to develop and commercialize BP1.15205 for narcolepsy, having paid an upfront license fee of $25.5 million and potential milestone payments totaling up to $367.5 million[64]. Compliance and Regulatory Risks - The FDA regulates the drug development process, requiring substantial time and financial resources for compliance, with potential sanctions for non-compliance[78]. - The company faces significant risks related to compliance with various state and federal healthcare regulations, which could impact product demand and pricing strategies[134]. - The company’s reliance on third parties for compliance with regulatory requirements could result in delays in obtaining regulatory approval[164][166]. - The regulatory approval process for new drug candidates is costly and unpredictable, with potential delays or denials impacting the company's business[211]. Operational Challenges - The company relies on a single supplier for the active pharmaceutical ingredient (API) for WAKIX and other potential product candidates[56]. - The company relies heavily on third parties for clinical trials and manufacturing, which may lead to delays and increased costs if these parties do not meet their obligations[161][165][168]. - The company may face challenges in negotiating contracts with CROs, which could lead to delays in clinical development timelines[162]. - The company is dependent on third-party manufacturers for the supply of raw materials and finished products, which poses risks if these suppliers fail to meet regulatory requirements[168][171]. Employee and Corporate Structure - As of December 31, 2024, the company had 268 full-time employees, with 124 dedicated to commercial functions and 90 to research and development[136]. - The company has 268 employees as of December 31, 2024, and anticipates needing to grow its workforce to support the development and commercialization of its products[174]. - The company has no employees represented by labor unions, indicating a stable labor environment[136]. - The company does not maintain "key person" insurance for its executives, which could impede its objectives if key personnel leave[177]. Market and Competitive Landscape - The company faces significant competition from larger pharmaceutical companies and generic drug manufacturers, which may hinder its ability to capture market share[172][173]. - The effectiveness of sales and marketing strategies is crucial for gaining market share and maintaining compliance with regulatory requirements[144]. - Market acceptance of WAKIX is influenced by physician and patient perceptions, safety profiles, and treatment guidelines[145]. - Negative publicity regarding drug pricing could impact revenue and market acceptance of WAKIX[155]. Social Responsibility and ESG - The company is committed to corporate social responsibility, focusing on ethical business practices and community engagement[139]. - Failure to meet evolving ESG expectations could damage the company's reputation and hinder access to capital, impacting overall business performance[196]. - The company expects compliance costs with climate and ESG-related regulations to increase in the future, which could adversely affect its financial condition and operating results[198]. - The company may incur costs related to establishing ESG-related goals to improve its profile, but there is no guarantee these efforts will be successful[197]. External Risks - Public health pandemics, such as COVID-19, have disrupted clinical trials and manufacturing operations, potentially leading to adverse effects on financial condition and operating results[182]. - The COVID-19 pandemic resulted in fewer patient visits to healthcare providers, leading to a decrease in prescriptions written, which could impact future revenue[183]. - Supply chain disruptions caused by the pandemic may delay clinical trials and impair the ability to meet demand for new prescriptions of WAKIX[184]. - Cybersecurity risks have increased due to remote working arrangements, which may expose the company to data breaches and operational disruptions[190]. Financial Obligations and Capital Needs - The company is subject to significant payment obligations under licensing agreements with Bioprojet, which could impact its ability to develop and market products if not met[199]. - The TLA Credit Agreement contains restrictive covenants that may limit the company's operational flexibility and ability to engage in new business activities[201]. - The company may need to raise additional capital if it cannot secure suitable collaborations for product development[160]. - The company may need to raise additional funds, which could lead to dilution of existing shareholders or impose restrictive covenants that affect operations[207].

Financial Performance - Preliminary net revenue for WAKIX® in Q4 2024 was approximately $201 million, compared to $168.4 million in Q4 2023, representing a growth of ~19.5%[7] - Full year 2024 net revenue for WAKIX® reached approximately $714 million, up from $582 million in 2023, indicating a growth of ~23%[7] - 2025 net revenue guidance for WAKIX® is projected between $820 million and $860 million, positioning the company for a potential $1 billion+ opportunity[1] - The company is entering 2025 with strong momentum and a clear path toward long-term growth, aiming for over $3 billion in net revenue going forward[4] Patient and Market Growth - The average number of patients on WAKIX® increased by approximately 300 sequentially to about 7,100 in Q4 2024[7] - Harmony Biosciences emphasizes the importance of commercialization efforts and market acceptance for its products, particularly WAKIX[34] Pipeline and Development - Key catalysts anticipated in 2025 include FDA decision on pitolisant sNDA for Idiopathic Hypersomnia in Q1 and pivotal Phase 3 data for ZYN002 in Fragile X Syndrome in Q3[1][7] - The pipeline includes up to six Phase 3 clinical programs expected by year-end 2025, with the potential to generate over $3 billion in net revenue[13] - The company initiated a pivotal Phase 3 study in Lennox-Gastaut syndrome (LGS) for EPX-100 in Q4 2024, with further studies planned for 2025[13] - The company anticipates at least one new product or indication approval every year for the next four years, extending to 2028[13] - The FDA decision on the pitolisant sNDA for Idiopathic Hypersomnia is expected in 2025, with potential approval following[7] - EPX-100, a clemizole hydrochloride, is under development for Dravet syndrome and Lennox-Gastaut syndrome, targeting central 5-hydroxytryptamine receptors[30] Disease Information - Dravet syndrome has an estimated incidence rate of 1:15,700, with approximately 85% of cases caused by de novo loss-of-function mutations in the SCN1A gene[31] - Lennox-Gastaut syndrome affects approximately 48,000 patients in the U.S., characterized by multiple seizure types and developmental issues[32] Company Strategy and Risks - Harmony Biosciences focuses on developing therapies for rare neurological diseases, established in 2017 and headquartered in Plymouth Meeting, PA[33] - The company plans to submit a supplemental New Drug Application (sNDA) for pitolisant in idiopathic hypersomnia, aiming for growth in net product revenue for 2024[34] - The company is exploring the therapeutic potential of pitolisant in additional indications and has ongoing clinical trials[34] - Harmony aims to expand its license agreements and acquire products with significant commercial potential[34] - The company acknowledges risks related to competition, regulatory approvals, and market fluctuations that may impact future performance[34] - Harmony's management is committed to maintaining effective internal controls and addressing the challenges of operating as a public company[34]

Core Viewpoint - Harmony Biosciences Holdings, Inc. (HRMY) has received an upgrade to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][4]. Earnings Estimates and Stock Price Impact - The Zacks rating system is primarily based on a company's changing earnings picture, with the Zacks Consensus Estimate tracking EPS estimates from sell-side analysts [2]. - Changes in earnings estimates are strongly correlated with near-term stock price movements, influenced by institutional investors who adjust their valuations based on these estimates [5]. - Rising earnings estimates and the subsequent rating upgrade for Harmony Biosciences indicate an improvement in the company's underlying business, suggesting potential upward pressure on the stock price [6]. Zacks Rank System - The Zacks Rank stock-rating system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [8]. - The system maintains a balanced distribution of 'buy' and 'sell' ratings across over 4000 stocks, ensuring that only the top 5% receive a 'Strong Buy' rating [10]. Recent Earnings Estimate Revisions - For the fiscal year ending December 2024, Harmony Biosciences is expected to earn $2.41 per share, reflecting a 13.2% increase from the previous year [9]. - Over the past three months, the Zacks Consensus Estimate for Harmony Biosciences has increased by 21.1%, indicating positive sentiment among analysts [9]. Conclusion - The upgrade to Zacks Rank 1 positions Harmony Biosciences in the top 5% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [11].

Core Viewpoint - Harmony Biosciences received a Refusal to File (RTF) letter from the FDA for pitolisant for excessive daytime sleepiness (EDS) in adult patients with idiopathic hypersomnia (IH), but the company's 2025 net revenue guidance remains unchanged at $820 million to $860 million [1]. Group 1: Company Developments - The CEO of Harmony Biosciences expressed disappointment over the RTF letter but reaffirmed the long-term strategy for pitolisant in IH, with plans to initiate a Phase 3 registrational trial in Q4 2025 and a target PDUFA date in 2028 [2]. - Despite the primary outcome for EDS not reaching statistical significance in the Phase 3 INTUNE Study, open-label phase data indicated that patients experienced improvements on the Epworth Sleepiness Scale that were five times greater than clinically meaningful levels [2]. - Most patients in the long-term extension study achieved normal wakefulness levels and maintained this response beyond one year [3]. Group 2: Financial Performance - In January, Harmony reported preliminary net product revenue for Q4 of approximately $201 million, up from $168.4 million year-over-year, exceeding the consensus estimate of $198.6 million [4]. - The average number of patients on Wakix increased by approximately 300 sequentially to around 7,100 for the quarter ended December 31, 2024 [4]. Group 3: Market Reaction - Following the news, HRMY stock declined by 6.50% to $36.55 [5].