HARMONY BIOSCIENCES REPORTS STRONG THIRD QUARTER 2024 FINANCIAL RESULTS AND HIGHLIGHTS CATALYST-RICH, LATE-STAGE PIPELINE POISED TO DELIVER ONE OR MORE NEW LAUNCHES EVERY YEAR OVER NEXT FIVE YEARS

WAKIX (pitolisant) Net Revenue of $186.0 Million for Third Quarter 2024; Surpassed $2B in Cumulative Net Revenue in Less Than Five Years

On Track to Submit sNDA for Pitolisant in Idiopathic Hypersomnia (IH) in Q4 2024 Based on Updated Strong and Sustained Efficacy Data from Long-Term Extension Study

Next-Gen Pitolisant-GR and Pitolisant-HD Programs Advance; IND for Potential Best-In-Class, Novel Orexin-2 Agonist On Track for mid-2025, Extending Leadership in Sleep/Wake Beyond 2040s

Highlights Most Advanced Development Program and Proven Serotonergic (5-HT2) Mechanism of Action For EPX-100 in Rare Epilepsies; Pivotal Phase 3 Trial in Dravet Syndrome Ongoing; Phase 3 Registrational Trial in Lennox-Gastaut Syndrome to Initiate Before Year End

Next Major Clinical Catalyst: Topline Data From ZYN-002 Pivotal Phase 3 RECONNECT Trial in Fragile X Syndrome on Track For mid-2025

Reiterates 2024 Net Product Revenue Guidance of $700 - $720 Million

Conference Call and Webcast to be Held Today at 8:30 a.m. ET 

PLYMOUTH MEETING, Pa., Oct. 29, 2024 /PRNewswire/ -- Harmony Biosciences Holdings, Inc. (Nasdaq: HRMY), today reported a record $186.0 million in net revenue for the quarter ending on September 30, 2024, surpassing $2 billion in cumulative net revenues since the launch of WAKIX® in adult narcolepsy in November of 2019. In addition, the company recently hosted an Investor Day on October 1, during which it highlighted its transformation into an innovative, catalyst-rich, self-funding biotech company with a robust late-stage pipeline.

"Going into Q4, Harmony has great momentum. During our Investor Day, we shared new data in support of our confidence and excitement about the company's growth trajectory as we advance our robust, catalyst-rich, late-stage pipeline and expand into additional rare CNS therapeutic areas. We are building on our success in sleep/wake with a strategy focused on continuous innovation, patient impact, and long-term value creation for our shareholders, and, if successful, our current pipeline is poised to deliver over $3 billion in net revenue going forward," said Jeffrey M. Dayno, M.D., President and Chief Executive Officer of Harmony Biosciences. "We have been building a leading CNS biotech company and are committed to addressing unmet medical needs for people living with CNS disorders that have few or no treatment options and, when we deliver on this promise to patients, we have the potential to deliver significant value to our shareholders as well."

Key Franchise Highlights:

Sleep/Wake: Extending Leadership Position

WAKIX:

• Net Sales for the quarter were $186.0M; with these quarterly sales, WAKIX surpassed $2B in cumulative net revenue in less than five years on the market
• The average number of patients on WAKIX increased by approximately 250 patients sequentially to approximately 6,800 for the quarter ended September 30, 2024

Pitolisant in Idiopathic Hypersomnia (IH): 

• New data from the Long-Term Extension study demonstrate robust and sustained efficacy of pitolisant in patients with idiopathic hypersomnia

Mean improvement in Epworth Sleepiness Scale (ESS) was ~9 points from baseline out beyond one year, with the majority of patients in the normal range as measured by the ESS

Sustained efficacy was also observed on the Idiopathic Hypersomnia Severity Scale (IHSS) and Sleep Inertia Questionnaire (SIQ) beyond one year

• Data supports strong benefit/risk proposition; on track to submit sNDA in Q4 2024

Pitolisant-HD (high dose) program: 

• Pitolisant-HD is an enhanced formulation of pitolisant designed with the following attributes:

A higher dose with an optimized pharmacokinetic profile to drive greater efficacy in EDS and cataplexy

Targeting a unique indication for fatigue in narcolepsy

A gastro-resistant coating with no need for a titration dose

• Preliminary safety data up to 5x the current highest labeled dose of WAKIX are consistent with the established safety profile of WAKIX and establish safety margins for the pitolisant-HD development program
• Pitolisant-HD on track for PDUFA in 2028 with the goal to extend the pitolisant franchise to mid-2040s
• Provisional patents filed until 2044 with the opportunity to grow the pitolisant franchise by pursuing additional indications

Pitolisant-GR (gastro-resistant) program: 

• Pitolisant-GR is a gastro-resistant formulation of pitolisant designed to minimize GI tolerability issues in patients with narcolepsy; approximately 90% of patients with narcolepsy experience GI symptoms partly related to the underlying disease mechanism
• On track to initiate pivotal bioequivalence study and dosing optimization study (to remove the titration dose) in Q1 2025
• PDUFA on track for 2026 with IP to the mid-2040s

Orexin-2 agonist program: 

• BP1.15205 (formerly TPM-1116) potential to be best-in-class orexin-2 receptor agonist

Based on a novel chemical scaffold

Demonstrated greater potency compared to all publicly disclosed data on orexin-2 agonists; allows for dosing flexibility to target all central disorders of hypersomnolence. The potency was consistent across species along with an excellent selectivity of greater than 600x which translates to over 140-fold margin over orexin-1 receptors at the anticipated maximum human dose

In addition, BP1.15205 demonstrated over 1000-fold selectively over 150 other targets of interest

Preclinical PK data consistent with once-a-day dosing

Rare Epilepsy: Most Advanced Development Program in the 5-HT2 agonist class

EPX-100 (clemizole hydrochloride):

• MoA: Proven serotonergic (5-HT2) mechanism of action in Developmental Epileptic Encephalopathies (DEEs) confirmed via a validated and highly predictive preclinical model (zebra fish model)
• Most advanced development program for the DEEs:

EPX-100 in Phase 3 registration trial, ARGUS study, in patients with Dravet syndrome (DS); on track for topline data in 2026

• EPX-100 Phase 3 registration trial for Lennox-Gastaut syndrome (LGS) on track to initiate later this year
• Preliminary Safety and Tolerability data suggests favorable profile compared to select approved drugs for rare epilepsies (with no need for routine laboratory or cardiac monitoring)
• Received Orphan Drug Designation (ODD) and Rare Pediatric Disease Designation (RPDD) by the FDA for DS and LGS

EPX-200 (lorcaserin hydrochloride):

• MoA: Potent, selective 5HT2C agonist with proven mechanism of action in DEEs confirmed via non-clinical and clinical data
• Currently in IND-enabling stage
• Received ODD for DS, and ODD / RPDD for LGS by the FDA; and ODD for DS by the European Medicines Agency

Neurobehavioral: Next Major Clinical Catalyst

ZYN-002

• Pivotal Phase 3 RECONNECT trial in Fragile X syndrome ongoing; topline data on track for mid-2025
• Anticipate initiation of pivotal Phase 3 trial in 22q11.2 deletion syndrome (22q) in 2025

Third Quarter 2024 Financial Results

Net product revenues for the quarter ended September 30, 2024, were $186.0 million, compared to $160.3 million for the same period in 2023. The 16% growth versus the same period in 2023 is primarily attributed to strong commercial sales of WAKIX driven by continued organic demand tapping into a large market opportunity (approximately 80,000 patients diagnosed with narcolepsy in the U.S.) and the broad clinical utility of WAKIX across the approximately 9,000 HCPs that we call on (about 5,000 of whom do not participate in an oxybate REMS program). The average number of patients on WAKIX increased by approximately 250 sequentially to approximately 6,800 for the quarter ended September 30, 2024. 

GAAP net income for the quarter ended September 30, 2024, was $46.1 million, or $0.79 earnings per diluted share, compared to GAAP net income of $38.5 million, or $0.63 earnings per diluted share, for the same period in 2023. Non-GAAP adjusted net income was $59.6 million, or $1.03 earnings per diluted share, for the quarter ended September 30, 2024, compared to Non-GAAP adjusted net income of $58.8 million, or $0.97 per diluted share, for the same period in 2023.

Reconciliations of applicable GAAP financial measures to Non-GAAP financial measures are included at the end of this press release.

Harmony's operating expenses include the following:

• Research and Development expenses were $25.4 million in the third quarter of 2024, as compared to $17.5 million for the same quarter in 2023, representing a 45% increase;
• Sales and Marketing expenses were $27.6 million in the third quarter of 2024, as compared to $23.4 million for the same quarter in 2023, representing a 18% increase;
• General and Administrative expenses were $28.6 million in the third quarter of 2024, as compared to $22.5 million for the same quarter in 2023, representing a 27% increase; and
• Total Operating Expenses were $81.6 million in the third quarter of 2024, as compared to $63.5 million for the same quarter in 2023, representing a 29% increase.

As of September 30, 2024, Harmony had cash, cash equivalents and investments of $504.7 million, compared to $425.6 million as of December 31, 2023.

Reiterates 2024 Net Product Revenue Guidance

Expect full year 2024 net product revenue of $700 million to $720 million.

Share Repurchase Program

The remaining amount of common stock authorized for repurchases as of September 30, 2024, was $150 million.

Conference Call Today at 8:30 a.m. ET

We are hosting our third quarter 2024 financial results conference call and webcast today, beginning at 8:30 a.m. Eastern Time. The live and replay webcast of the call will be available on the investor relations page of our website at  https://ir.harmonybiosciences.com/. To participate in the live call by phone, dial (800) 245-3047 (domestic) or (203) 518-9765 (international), and reference passcode HRMYQ324.

Non-GAAP Financial Measures

In addition to our GAAP results, we present certain Non-GAAP metrics including Non-GAAP adjusted net income and Non-GAAP adjusted net income per share, which we believe provides important supplemental information to management and investors regarding our performance. These measurements are not a substitute for GAAP measurements, and the manner in which we calculate Non-GAAP adjusted net income and Non-GAAP adjusted net income per share may not be identical to the manner in which other companies calculate adjusted net income and adjusted net income per share. We use these Non-GAAP measurements as an aid in monitoring our financial performance from quarter-to-quarter and year-to-year and for benchmarking against comparable companies.

Non-GAAP financial measures should not be considered in isolation or as a substitute for comparable GAAP measures; should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP; have no standardized meaning prescribed by GAAP; and are not prepared under any comprehensive set of accounting rules or principles. In addition, from time to time in the future there may be other items that we may exclude for purposes of our Non-GAAP financial measures; and we may in the future cease to exclude items that we have historically excluded for purposes of our Non-GAAP financial measures.

About WAKIX® (pitolisant) TabletsWAKIX, a first-in-class medication, is approved by the U.S. Food and Drug Administration for the treatment of excessive daytime sleepiness (EDS) or cataplexy in adult patients with narcolepsy and for the treatment of EDS in pediatric patients 6 years of age and older with narcolepsy. It was granted orphan drug designation for the treatment of narcolepsy in 2010, and breakthrough therapy designation for the treatment of cataplexy in 2018. WAKIX is a selective histamine 3 (H₃) receptor antagonist/inverse agonist. The mechanism of action of WAKIX is unclear; however, its efficacy could be mediated through its activity at H₃ receptors, thereby increasing the synthesis and release of histamine, a wake promoting neurotransmitter. WAKIX was designed and developed by Bioprojet (France). Harmony has an exclusive license from Bioprojet to develop, manufacture and commercialize pitolisant in the United States.

Indications and UsageWAKIX is indicated for the treatment of excessive daytime sleepiness (EDS) or cataplexy in adult patients with narcolepsy and for the treatment of excessive daytime sleepiness (EDS) in pediatric patients 6 years of age and older with narcolepsy.

Important Safety Information

ContraindicationsWAKIX is contraindicated in patients with known hypersensitivity to pitolisant or any component of the formulation. Anaphylaxis has been reported. WAKIX is also contraindicated in patients with severe hepatic impairment.

Warnings and PrecautionsWAKIX prolongs the QT interval. Avoid use of WAKIX in patients with known QT prolongation or in combination with other drugs known to prolong the QT interval. Avoid use in patients with a history of cardiac arrhythmias, as well as other circumstances that may increase the risk of the occurrence of torsade de pointes or sudden death, including symptomatic bradycardia, hypokalemia or hypomagnesemia, and the presence of congenital prolongation of the QT interval. 

The risk of QT prolongation may be greater in patients with hepatic or renal impairment due to higher concentrations of pitolisant; monitor these patients for increased QTc. Dosage modification is recommended in patients with moderate hepatic impairment and moderate or severe renal impairment. WAKIX is contraindicated in patients with severe hepatic impairment and not recommended in patients with end-stage renal disease (ESRD).

Adverse ReactionsIn the placebo-controlled clinical trials conducted in patients with narcolepsy with or without cataplexy, the most common adverse reactions (≥5% and at least twice placebo) for WAKIX were insomnia (6%), nausea (6%), and anxiety (5%). Other adverse reactions that occurred at ≥2% and more frequently than in patients treated with placebo included headache, upper respiratory tract infection, musculoskeletal pain, heart rate increased, hallucinations, irritability, abdominal pain, sleep disturbance, decreased appetite, cataplexy, dry mouth, and rash.

In the placebo-controlled phase of the clinical trial conducted in pediatric patients 6 years and older with narcolepsy with or without cataplexy, the most common adverse reactions (≥5% and greater than placebo) for WAKIX were headache (19%) and insomnia (7%). The overall adverse reaction profile of WAKIX in the pediatric clinical trial was similar to that seen in the adult clinical trial program.

Drug InteractionsConcomitant administration of WAKIX with strong CYP2D6 inhibitors increases pitolisant exposure by 2.2-fold. Reduce the dose of WAKIX by half. 

Concomitant use of WAKIX with strong CYP3A4 inducers decreases exposure of pitolisant by 50%. Dosage adjustments may be required.

H1 receptor antagonists that cross the blood-brain barrier may reduce the effectiveness of WAKIX. Patients should avoid centrally acting H1 receptor antagonists. 

WAKIX is a borderline/weak inducer of CYP3A4. WAKIX may reduce the effectiveness of sensitive CYP3A4 substrates, including hormonal contraceptives. Patients using hormonal contraception should be advised to use an alternative non-hormonal contraceptive method during treatment with WAKIX and for at least 21 days after discontinuing treatment.

Use in Specific Populations

There is a pregnancy exposure registry that monitors pregnancy outcomes in women who are exposed to WAKIX during pregnancy. Patients should be encouraged to enroll in the WAKIX pregnancy registry if they become pregnant. To enroll or obtain information from the registry, patients can call 1-800-833-7460.

The safety and effectiveness of WAKIX have not been established for treatment of excessive daytime sleepiness in pediatric patients less than 6 years of age with narcolepsy.

The safety and effectiveness of WAKIX have not been established for treatment of cataplexy in pediatric patients with narcolepsy.

WAKIX is extensively metabolized by the liver. WAKIX is contraindicated in patients with severe hepatic impairment. Dosage adjustment is recommended in patients with moderate hepatic impairment.

WAKIX is not recommended in patients with end-stage renal disease. Dosage adjustment of WAKIX is recommended in patients with eGFR