PLYMOUTH MEETING, PA — Harmony Biosciences Holdings, Inc. (Nasdaq: HRMY) this week reported financial results and business updates for the quarter ended September 30, 2023.
“We continue to demonstrate very strong growth in our commercial business, with WAKIX in narcolepsy delivering the strongest revenue quarter in Harmony’s history,” stated Jeffrey M. Dayno, M.D., President and Chief Executive Officer of Harmony. “In addition, we advanced our pitolisant pipeline programs, and expanded our pipeline with the addition of Zygel through the closing of the Zynerba acquisition.”
“Given our continued confidence in the underlying strength of the business and our conviction in the growth potential for the company, we are announcing a new share repurchase program of $200 million.”
Third Quarter 2023 Financial Results
Net product revenues for the quarter ended September 30, 2023 were $160.3 million, compared to $117.2 million for the same period in 2022. The 37% growth versus the same period in 2022 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 United States). The average number of patients on WAKIX increased by approximately 350 sequentially to approximately 5,800 for the quarter ended September 30, 2023.
GAAP net income for the quarter ended September 30, 2023 was $38.5 million, or $0.63 earnings per diluted share, compared to GAAP net income of $87.9 million, or $1.44 earnings per diluted share, for the same period in 2022. The decrease in GAAP net income was primarily driven by the release of the valuation allowance on the Company’s deferred tax assets, which resulted in a $74.5 million income tax benefit for the quarter ended September 30, 2022, partially offset by a $30.0 million initial licensing fee as part of the 2022 Licensing and Commercialization Agreement with Bioprojet (the “2022 LCA”). For the quarter ended September 30, 2023, the Company also incurred a $9.8 million loss on debt extinguishment. Non-GAAP adjusted net income was $58.8 million, or $0.97 earnings per diluted share, for the quarter ended September 30, 2023, compared to Non-GAAP adjusted net income of $58.1 million, or $0.95 per diluted share, for the same period in 2022.
Reconciliations of applicable GAAP financial measures to Non-GAAP financial measures are included in the Company’s original release.
Harmony’s operating expenses include the following:
- Research and Development expenses were $17.5 million in the third quarter of 2023, as compared to $40.5 million for the same quarter in 2022, representing a 57% decrease, driven by a $30.0 million licensing fee as part of the 2022 LCA incurred during the third quarter of 2022;
- Sales and Marketing expenses were $23.4 million in the third quarter of 2023, as compared to $20.5 million for the same quarter in 2022, representing a 14% increase;
- General and Administrative expenses were $22.5 million in the third quarter of 2023, as compared to $21.3 million for the same quarter in 2022, representing a 6% increase; and
- Total Operating Expenses were $63.5 million in the third quarter of 2023, as compared to $82.3 million for the same quarter in 2022, representing a 23% decrease.
As of September 30, 2023, Harmony had cash, cash equivalents and investment securities of $438.4 million, compared to $345.7 million as of December 31, 2022.
Company Updates
- Reported topline results from the Phase 3 INTUNE study in adult patients with idiopathic hypersomnia (IH). While the primary endpoint did not reach statistical significance during the randomized withdrawal phase, a robust clinical effect was demonstrated in the open label phase of the study. Based on the totality of the data, the company remains committed and continues to pursue an indication for pitolisant in IH. Next step is to meet with the FDA informed by the review of the full data set.
- Received FDA alignment on the protocol for the Phase 3 TEMPO study in patients with Prader-Willi syndrome (PWS) which will satisfy the requirements for both the registrational trial and now pediatric exclusivity as well. The Company expects to initiate the study in the first quarter of 2024.
- On track for topline data from the Myotonic Dystrophy (DM1) Phase 2 proof-of-concept signal detection trial in the fourth quarter of 2023.
- On track to submit a supplemental new drug application (sNDA) for a pediatric narcolepsy indication to the FDA in the fourth quarter of 2023.
- Advancing new pitolisant based formulations into the clinic in the fourth quarter of 2023. Anticipate data in the first half of 2024.
- Expanded and diversified the Company’s pipeline with the acquisition of Zynerba Pharmaceuticals. Zygel is in a Pivotal Phase 3 trial for Fragile X syndrome (FXS).
- During the third quarter of 2023, the company repurchased 1,439,792 shares of common stock at an aggregate cost of $50 million, as part of the prior $125 million share repurchase program, which the Company closed.
- The Company’s Board of Directors authorized a new $200 million share repurchase program.
For more information, visit www.harmonybiosciences.com.
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