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Harmony Biosciences Holdings, Inc. (HRMY)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $200.5M (+16% YoY), with GAAP diluted EPS of $0.68 and non‑GAAP diluted EPS of $0.92; management reaffirmed FY25 net product revenue guidance of $820–$860M .
  • Versus S&P Global consensus, revenue modestly missed ($200.5M vs $204.1M*), while EPS beat on a non‑GAAP basis ($0.92 vs $0.73*), helped by lower OpEx and underlying demand; management cited a “few days” trade inventory drawdown as a headwind to reported sales in Q2 .
  • Average WAKIX patients increased by ~400 sequentially to ~7,600 in Q2, underscoring durable demand and positioning for 2H sequential growth; CFO expects quarter‑over‑quarter net revenue growth in H2 and noted ~$79M cash from operations in Q2 .
  • Patent estate strengthened via June settlement with Lupin (no generic launch before Jan 2030, or July 2030 with pediatric exclusivity), while next‑gen pitolisant and ZYN002 catalysts remain on track (RECONNECT topline data in Q3 2025) .
  • Near‑term stock catalysts: Fragile X (ZYN002) Phase 3 RECONNECT topline in Q3 2025; clarity on pitolisant GR BE readout (Q4 2025) and initiation of pitolisant HD Phase 3 trials in narcolepsy & IH (Q4 2025) .

What Went Well and What Went Wrong

  • What Went Well

    • Non‑GAAP EPS beat vs consensus ($0.92 vs $0.73*), reflecting tight OpEx and robust underlying demand despite channel headwinds .
    • Continued patient growth: average WAKIX patients rose by ~400 to ~7,600 in Q2, supporting durable top‑line trajectory and 2H growth commentary .
    • Strategic/IP momentum: Lupin settlement (no generic launch before Jan/Jul 2030) and reaffirmed multi‑year lifecycle/LCM strategy (pitolisant HD/GR; potential exclusivity to 2044) .

  • What Went Wrong

    • Top‑line modest miss vs consensus ($200.5M vs $204.1M*), with management pointing to a few‑days trade inventory drawdown despite strong demand .
    • GAAP EPS ($0.68) below non‑GAAP figure due to $15M IPR&D charge tied to CiRC collaboration; OpEx mix remains elevated with pipeline build .
    • Sequential revenue increase was smaller than underlying demand would imply (inventory and seasonality effects), temporarily muting QoQ optics heading into H2 .

Financial Results

MetricQ2 2024Q1 2025Q2 2025 ActualQ2 2025 ConsensusVs Est.
Revenue ($M)$172.8 $184.7 $200.5 $204.1*($3.6)
GAAP Diluted EPS ($)$0.20 $0.78 $0.68 ——
Non‑GAAP Diluted EPS ($)$0.43 $1.03 $0.92 $0.73*+$0.19
Operating Income ($M)$21.4 $56.2 $48.2 ——
Net Income ($M)$11.6 $45.6 $39.8 ——
Gross Margin %81.40%*82.68%*80.97%*——
EBIT Margin %12.36%*30.45%*24.03%*——
Net Income Margin %6.71%*24.66%*19.84%*——
  • Note: Revenue YoY +16% as disclosed by management .
  • Asterisks (*) indicate values retrieved from S&P Global.

KPIs

  • Average WAKIX patients: ~7,600 in Q2 (+~400 sequential) .
  • HCP reach: ~9,000 HCPs called on; ~5,000 non‑oxybate REMS prescribers expanding footprint .
  • Cash, cash equivalents & investments: $672.3M at 6/30/25 .
  • Cash from operations: ~$79M in Q2 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Product RevenueFY 2025$820–$860M (May 6, 2025) $820–$860M (Aug 5, 2025) Maintained

Additional Outlook Details

  • Expect QoQ net revenue growth in H2 2025; Street consensus sits within guidance range, per CFO .
  • Anticipated 2025 R&D milestones: ~$29M (incl. $15M for RECONNECT completion in Q3, $10M on positive topline, ~$4M for OX2 initiation in Q4) .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24, Q1’25)Current Period (Q2’25)Trend
WAKIX growthQ4’24: $201.3M; FY’24 $714.7M; steady adds Q2’25: $200.5M; +~400 patients to ~7,600; strong demand Solid growth with patient adds
GuidanceFY’25 $820–$860M reiterated in Q4’24 & Q1’25 FY’25 $820–$860M reaffirmed; expect QoQ growth in H2 Maintained; positive H2 phasing
ZYN002 (FXS)Topline Q3’25 on track Topline Q3’25 on track; high confidence; success criteria outlined Imminent catalyst
IP/LOEFirst ANDA settlement disclosed in Q4’24 Lupin settlement adds protection to 2030/2030+ IP position strengthened
Pitolisant HD/GRHD/GR programs guided; GR pivotal BE in 2025 HD Ph3 in narcolepsy & IH to start Q4’25; GR BE topline Q4’25 Advancing LCM catalysts
Channel/Net priceSeasonality implied historically“Few days” trade inventory drawdown; net price improves through year Temporary Q2 headwind; improving net price trajectory

Management Commentary

  • “Harmony Biosciences is a growth story…a profitable, self‑funding biotech company with an innovative late‑stage pipeline poised to deliver meaningful value” — CEO Jeffrey Dayno .
  • “WAKIX delivered $200.5M in net sales…16% year‑over‑year growth…7,600 average patients in Q2, up ~400” — CCO Adam Zaeske .
  • “Performance…reflects strong underlying demand…offset by a reduction in trade inventories of a few days” — CFO Sandip Kapadia .
  • “On track to report topline data later this quarter [Q3] for ZYN002 RECONNECT in Fragile X” — CEO/CMO .
  • “We are reiterating our revenue guidance of $820M to $860M…expect continued quarter over quarter net revenue growth the balance of the year” — CFO .

Q&A Highlights

  • ZYN002 RECONNECT timing and success: Topline Q3; success = statistically significant improvement on social avoidance in fully methylated patients; study “more than adequately powered” (≥90% to detect ~1‑point placebo‑adjusted difference) .
  • Labeling/filing path: If positive, pre‑NDA quickly; anticipate priority review in an indication with no approved therapies; EMA‑aligned design .
  • Revenue phasing/gross‑to‑net: Q2 impacted by “few days” trade inventory drawdown; net price typically lowest in Q1, improving through the year; expect QoQ growth in H2 .
  • Orexin class impact: Company expects polypharmacy to persist; sees potential mechanistic synergy between orexin agonists and H3 inverse agonism (WAKIX) .
  • Commercial levers: Focus on increasing referrals/day, conversion to dispenses, and patient retention; operations improvements underway .

Estimates Context

  • Q2 2025 vs S&P Global consensus: Revenue $200.5M vs $204.1M* (miss), Primary EPS $0.92 vs $0.73* (beat). 11 estimates for both revenue and EPS*.
  • Street FY25 view: CFO noted consensus sits within $820–$860M guidance; reaffirmed outlook and pointed to 2H sequential growth .
  • Potential model updates: Expect intra‑year phasing adjustments (channel/seasonality), but unchanged FY revenue range given reiterated guidance .
  • Asterisks (*) indicate values retrieved from S&P Global.

Key Takeaways for Investors

  • Durable commercial engine: Patient adds (+~400 to ~7,600) and reaffirmed FY guide support a constructive 2H setup despite transient Q2 inventory effects .
  • Mixed headline; constructive internals: Modest revenue miss vs consensus offset by an EPS beat on lower OpEx and strong demand; CFO flagged sequential growth ahead .
  • Near‑term biotech catalyst: ZYN002 RECONNECT Fragile X topline in Q3 could be transformative in an unserved market; high management confidence and clear success criteria .
  • IP overhang reduced: Lupin settlement pushes earliest generic entry to 2030/2030+; LCM (HD/GR) targets extended runway (utility patents filed to 2044) .
  • Pipeline breadth: Multiple late‑stage programs (pitolisant HD in narcolepsy/IH, GR bioequivalence readout, orexin‑2 agonist FIH in 2H25) diversify medium‑term growth vectors .
  • Cash strength: $672M cash/investments and ~$79M Q2 operating cash flow provide flexibility for BD and pipeline acceleration .
  • Trading implications: Stock likely sensitive to Fragile X readout and any signs of 2H acceleration; near‑term sentiment should track catalyst execution and evidence that inventory headwinds abate .

Additional Detail and Sources

  • Earnings press release: “Harmony Biosciences Reports Strong Q2 2025 Financial Results…” (Aug 5, 2025) .
  • Earnings call transcript: Q2 2025 (Aug 5, 2025) .
  • Other relevant press releases (Q2 2025): Lupin ANDA settlement (June 5, 2025) .
  • Prior quarters for trend: Q1 2025 press release (May 6, 2025) ; Q4 2024 press release (Feb 25, 2025) .

Estimates disclaimer: Values marked with an asterisk (*) are retrieved from S&P Global.