Harmony Biosciences(US:HRMY)2021-11-14 10:37Financial 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]