Harmony Biosciences Holdings, Inc. Q4 FY2024 earnings call

• 2024 was a year of strong execution with 23% YoY growth in net product revenues to $714.7 million. Q4 2024 alone had $201.3 million in net revenue.
• Announced first generic settlement agreement with Novagen Pharma regarding Pitolisant hydrochloride patent litigation, with Novagen having a license to sell generic product from Jan 2030 or earlier.
• Progress in pipeline: Pitolisant HD Phase 3 trials set to initiate in Q4 2025, ZYN002 Phase 3 RECONNECT Study data expected in Q3 2025, and EPX-100 Phase 3 trials in Dravet and Lennox-Gastaut Syndromes ongoing.
• WAKIX continues to show strong growth with over 7,000 average patients and a growing prescriber base in narcolepsy.

In 2024, Harmony Bioscience's net product revenues were $714.7 million, representing a 23% year-over-year growth. Q4 2024 alone generated $201.3 million in net revenue. The key product segment is WAKIX, which had net sales of $201.3 million in Q4 2024 and $714.7 million for the full year 2024, showing 23% growth from 2023. WAKIX contributes significantly to revenue, with the potential to be a $1 billion plus opportunity in narcolepsy based on its broad clinical utility and commercial execution.

• For full year 2025, net revenue guidance for WAKIX is $820 million to $860 million.
• Anticipates seasonal dynamics in revenue, with Q1 having traditional payer dynamic headwinds, Q2-Q4 having tailwinds and typical seasonal patterns.
• Expect increased R&D investments in 2025, including potential $29 million in R&D related milestone payments.

• Intellectual property litigation risks related to ANDA filers for generic versions of Pitolisant; Markman hearing scheduled for March with trial in 2026.
• Regulatory challenges with the supplemental new drug application for Pitolisant in idiopathic hypersomnia (IH) due to the Phase 3 INTUNE study not meeting the primary endpoint.
• Competition in clinical trials for CNS indications, which could impact enrollment and timelines.

Q: Regarding ZYN002 Phase 3 study, color on patient enrollment range, ages, and open label extension rollover rate?

A: Charles Duncan asked about ZYN002. Kumar Budur responded that the trial is enrolling patients 3-30 years old, with variable weight. A good proportion of patients are rolling over into the long-term extension study, with some patients exposed to ZYN002 for over 8 years.

Q: Why feel comfortable Pitolisant HD has higher likelihood of success in IH patients?

A: John Gregory Dean asked. Jeffrey Dayno and Kumar Budur responded that there is dose exposure response data from clinical trials, and pitolisant HD is an optimized formulation with higher dose, showing clear dose response and exposure response, and the trial design is favorable.

Q: Status of remaining patent challenges and timelines?

A: Graig Suvannavejh asked. Jeffrey Dayno responded that there are 7 ANDA filers, Markman hearing scheduled for March 2026, trial in 2026, and the Novagen settlement reinforces intellectual property strength.

Q: Success criteria for ZYN002 Phase 3 trial and FDA acceptance of CONNECT study?

A: Ami Fadia asked. Kumar Budur responded that success is defined by statistically significant and clinically meaningful outcome on primary endpoint (social avoidance subscale in complete methylation patients). The FDA will accept the CONNECT study data as part of the filing package.

Q: Rationale for studying sleep inertia in IH and orexin 2-receptor agonist first-in-human study?

A: David Wong asked. Jeffrey Dayno and Kumar Budur responded that sleep inertia is pathognomonic for IH and there are fit-for-purpose scales. For the orexin 2-receptor agonist, they are on track for IMPD submission mid-2025 and first-in-human studies in the second half of 2025, leveraging lessons from other programs.

Q: Orexin agonist effect on Alzheimer's pathology?

A: Ash Verma asked. Kumar Budur responded that there is no evidence linking orexin-2 receptor agonist to increased risk of cognitive impairment, as previous concerns were related to orexin-1 receptor agonists and sleep deprivation.

Q: Key data points for Pitolisant GR bioequivalence study and regulatory submission timeline?

A: Luis Santos asked. Kumar Budur responded that the pivotal bioequivalence study is initiated this quarter, top-line data expected Q3 2025, and regulatory submission on track for later this year with PDUFA in 2026.

Q: RTF for Pitolisant in IH and trial design for Pitolisant HD?

A: Pavan Patel asked. Jeffrey Dayno and Kumar Budur responded that RTF was based on FDA's primary endpoint review, but focus is on Pitolisant HD Phase 3 trial initiated in Q4 2025 with randomized prospective parallel group design, leveraging dose response and exposure response data from prior trials