Executive Summary

Harmony Biosciences delivered a strong Q3, with net product revenue of $239.5M (+29% YoY) and non-GAAP diluted EPS of $1.08; management raised FY25 revenue guidance to $845–$865M, citing record net patient adds (~500) and ~8,100 average patients on WAKIX .
Results beat S&P Global consensus: revenue $239.5M vs. $222.7M estimate* and non-GAAP EPS $1.08 vs. $0.66 estimate*; CFO noted a few days of wholesaler inventory build in Q3 alongside robust underlying demand, while Q4 sequential revenue is sensitive to year-end channel dynamics .
Cash generation remained strong (+$106M in the quarter) with $778M in cash, equivalents, and investments at 9/30, providing flexibility to pursue BD/M&A and fund late-stage programs (pitolisant HD Phase 3 initiations in narcolepsy and IH in Q4; pitolisant GR BE topline in Q4; EPX-100 DS/LGS Phase 3 toplines in 2026) .
Offsets: R&D expense more than doubled YoY on milestones and pipeline investment, and the Phase 3 RECONNECT trial for ZYN002 in Fragile X did not meet its primary endpoint; the 22q program is paused pending a full data review .

What Went Well and What Went Wrong

What Went Well

Record commercial execution: WAKIX net revenue of $239.5M (+29% YoY), driven by the highest quarterly increase in average patients (~500) and ~8,100 average patients; management emphasized execution, payer wins, and improved conversion/time-to-dispense .
Strong cash generation and balance sheet: +$106M cash generation in Q3 with $778M cash/equivalents/investments at 9/30, positioning HRMY for BD and pipeline acceleration; FY25 revenue guidance raised to $845–$865M .
Pipeline momentum: IND submitted for pitolisant HD; two Phase 3 initiations (narcolepsy, IH) targeted in Q4 2025; pitolisant GR BE topline on track for Q4 2025; EPX-100 DS/LGS Phase 3 ongoing with topline in 2026 .
- Management: “WAKIX is rapidly approaching a $1 billion-plus blockbuster status in narcolepsy alone,” highlighting durable growth potential .

What Went Wrong

ZYN002 headwind: Phase 3 RECONNECT in Fragile X missed the primary endpoint due to higher-than-expected placebo response; 22q program paused pending full data review, tempering near-term neurobehavioral optionality .
Operating expense intensity: Total Opex rose 40% YoY to $114.3M on R&D investment and a $15M ZYN002 milestone; management expects continued R&D spend with five Phase 3 programs by year-end .
Channel dynamics: Q3 benefited from a few days’ inventory build at wholesalers; Q4 revenue cadence will depend on year-end inventory behavior, which is inherently harder to predict, even as underlying patient adds remain strong .

Financial Results

Income statement highlights and estimate comparison (non-GAAP EPS used for “EPS actual” to align with S&P consensus “Primary EPS”):

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($M)	$184.7	$200.5	$239.5
Revenue Consensus ($M)*	$182.3*	$204.1*	$222.7*
Beat/(Miss) vs Rev Cons ($M)*	+$2.4*	($3.6)*	+$16.8*
Non-GAAP Diluted EPS ($)	$1.03	$0.92	$1.08
EPS Consensus ($)*	$0.61*	$0.73*	$0.66*
Beat/(Miss) vs EPS Cons ($)*	+$0.42*	+$0.19*	+$0.42*

Values retrieved from S&P Global.*

Margins (calculated from reported figures; percentages are calculations; sources cited for underlying data):

Margin	Q1 2025	Q2 2025	Q3 2025
Gross Margin %	82.7% (calc from $152.7 GP / $184.7 Rev)	81.0% (calc from $162.3 GP / $200.5 Rev)	75.1% (calc from $179.8 GP / $239.5 Rev)
Operating Margin %	30.4% (calc $56.2 OI / $184.7 Rev)	24.0% (calc $48.2 OI / $200.5 Rev)	27.3% (calc $65.5 OI / $239.5 Rev)
Net Income Margin % (GAAP)	24.7% (calc $45.6 NI / $184.7 Rev)	19.8% (calc $39.8 NI / $200.5 Rev)	21.3% (calc $50.9 NI / $239.5 Rev)

Key operating/KPIs:

KPI	Q1 2025	Q2 2025	Q3 2025
Average Patients on WAKIX	~7,200	7,600	~8,100
Net Adds (Average Patients)	n/a	~400	~500 (record)
Cash, Cash Equivalents & Investments ($M)	$610.2	$672.3	$778.4
Total Operating Expenses ($M)	$96.5	$114.2	$114.3

Notes: Q3 Opex mix included a $15M R&D milestone (ZYN002 enrollment milestone), contributing to YoY Opex growth . CFO flagged a few days of trade inventory build in Q3; Q4 cadence could be affected by typical holiday/ordering variability even as patient adds remain strong .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Product Revenue	FY 2025	$820–$860M (reaffirmed Aug 5)	$845–$865M (Oct 23 preannounce; reaffirmed Nov 4)	Raised
R&D/Expenses (qualitative)	FY 2025	n/a	Continued investment with two Phase 3 pitolisant HD starts in Q4; expect $4M milestone in Q4 for Orexin 2 program	Update

Q4 revenue implication: Management acknowledged Q4 revenue could be flatter QoQ within the full-year range given year-end channel dynamics; the range implies ~$221–$241M in Q4 revenues, though final outcome depends on trade inventory at year-end .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025, Q2 2025)	Current Period (Q3 2025)	Trend
WAKIX growth trajectory	Q1: $184.7M revenue, ~7,200 avg patients; reiterated $820–$860M FY guide . Q2: $200.5M revenue, +400 avg patient adds to 7,600; guidance reaffirmed .	$239.5M revenue, record +~500 avg adds to ~8,100; FY25 guide raised to $845–$865M .	Improving
Commercial execution & payer coverage	Q1–Q2: Strong brand awareness, broad clinical utility; continued penetration .	Sales deployment/call plan/messaging refined; new payer wins; better conversion/time-to-dispense .	Improving
Channel inventory dynamics	Not highlighted.	Q3 benefited from a few days of inventory build; Q4 outcome sensitive to year-end ordering .	Neutral/Caution (timing)
Pitolisant HD & GR	Q1: HD/GR timelines set for Q4’25/2026–28 . Q2: Plans reaffirmed .	HD IND submitted; Phase 3 (narcolepsy, IH) to start Q4’25; GR BE topline Q4’25 .	On track
ZYN002 (Fragile X, 22q)	Q1–Q2: Anticipated Phase 3 topline in Q3’25; planned 22q start in Q4’25 pending data .	RECONNECT missed primary endpoint; 22q paused pending full data review .	Negative
EPX-100 (DS/LGS)	Q1–Q2: Phase 3 enrollment ongoing; topline 2026 .	Phase 3 ongoing; sharing OLE and safety data at AES; topline 2026 .	Steady
BD/M&A posture	Ongoing evaluation across rare CNS .	Strategy unchanged; optionality with strong cash; priorities include innovative assets; buybacks remain a tool .	Steady

Management Commentary

“We reported $239.5 million in net revenue for the quarter…with the highest number of quarterly patient adds…approximately 500…resulting in an average of 8,100 patients on WAKIX at the end of Q3…WAKIX is rapidly approaching a $1 billion-plus blockbuster status in narcolepsy alone” — Jeffrey Dayno, CEO .
“We have adjusted our field sales deployment, call plan, and messaging…secured important new payer coverage wins…improvements in how we support patients moving from prescription to dispense, reflected in higher conversion and shorter times to dispense” — Adam Zaeske, CCO .
“We did see a slight increase in trade inventories of a few days as we head into the fourth quarter…hard to predict…we feel very good about the top-line demand growth” — Sandip Kapadia, CFO .
“IND for pitolisant HD has been submitted…on track to initiate two phase III trials: one in narcolepsy and one in idiopathic hypersomnia, before the end of the year” — Kumar Budur, CM&SO .
“ZYN002…did not meet the primary endpoint…due to higher-than-expected placebo response…the 22q program has been paused pending the full review” — Kumar Budur .

Q&A Highlights

Guidance/4Q cadence: Raised FY guide to $845–$865M; Q3 included a few days of inventory build, while Q4 outcome depends on year-end ordering; underlying demand (patient adds) remains strong .
Competitive outlook vs. Orexin agonists (post-2026): Management expects polypharmacy to persist; WAKIX’s unique non-scheduled profile and extensive physician experience should support continued growth, with potential market expansion from new entrants .
GR/HD lifecycle: GR “fast-to-market” for new and prior WAKIX patients; HD aimed at new/prior and switching patients seeking efficacy gains and fatigue label differentiation; payers indicate expected broad coverage, minimal step edits—particularly for fatigue .
EPX-100: Phase 3s in DS/LGS progressing; AES to feature OLE efficacy and safety data; topline remains targeted for 2026 .
Patient mix: ~45% NT1 / 55% NT2 on WAKIX—stable over several years .

Estimates Context

Q3 2025 vs S&P Global consensus: Revenue $239.5M vs $222.7M estimate*; non-GAAP EPS $1.08 vs $0.66 estimate*; HRMY outperformed on both revenue (+$16.8M) and EPS (+$0.42), aided by record net patient adds and minor wholesaler inventory build .
Prior quarters for context: Q2 2025 revenue $200.5M vs $204.1M estimate* (slight miss), but EPS $0.92 vs $0.73 estimate* (beat); Q1 2025 revenue $184.7M vs $182.3M estimate* (beat) and EPS $1.03 vs $0.61 estimate* (beat). Values retrieved from S&P Global.* .
Street models likely move up modestly on FY25 revenue after the guidance raise; Q4 modeling should incorporate possible year-end channel normalization while sustaining patient add momentum .

Key Takeaways for Investors

Commercial momentum inflected in Q3: record net patient adds (~500) and ~8,100 average patients drove a clean top-line beat and a guidance raise; underlying demand drivers (execution, payer wins, conversion) appear durable into Q4 and 2026 .
EPS quality: Q3 non-GAAP EPS beat vs consensus despite higher R&D; note non-GAAP add-backs (amortization, SBC, tax effects) and a $15M R&D milestone—useful for assessing core earnings power .
Watch the channel: Q3 included a small inventory tailwind; Q4 revenue can be choppy around holidays/ordering, but patient adds remain the core driver of medium-term growth .
Lifecycle defense and expansion: Pitolisant HD (greater efficacy, fatigue label pursuit) and GR (no titration, GI tolerability) aim to extend the franchise through the 2040s and support switching/new starts ahead of potential Orexin agonist competition .
Diversification optionality: EPX-100 DS/LGS Phase 3 toplines in 2026 plus strong cash ($778M) support BD/M&A to broaden the portfolio; recent ZYN002 setback tempers the neurobehavioral pillar near term .
Risk/reward: Core WAKIX growth remains the near-term engine; pipeline execution and BD deployment are the next legs; monitor payer dynamics, competitor timelines (2026+), and R&D milestones for narrative inflections .

Appendix: Source Documents

Q3 2025 8-K earnings release and financials .
Q3 2025 earnings call transcript (prepared remarks and Q&A) .
Q3 2025 preannouncement 8-K (10/23): preliminary revenue (~$239M), guidance raise, ~8,100 average patients, +~500 adds .
Q3 2025 earnings slides .
Prior quarters: Q2 2025 press release ($200.5M revenue; +400 avg patient adds; reaffirmed guide) ; Q1 2025 press release ($184.7M revenue; ~7,200 avg patients; reiterated guide) .