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Investing.com - H.C. Wainwright lowered its price target on Harmony Biosciences Holdings Inc. (NASDAQ:HRMY) to $55 from $70 while maintaining a Buy rating after the company’s Phase 3 trial failure. The stock, currently trading near its 52-week low at $26.76 with a market cap of $1.54 billion, has declined 18% over the past week.
The price target reduction follows Harmony’s Wednesday announcement that its pivotal Phase 3 RECONNECT trial for ZYN002, a synthetic transdermal cannabidiol gel, did not meet its primary endpoint for treating Fragile X syndrome. According to H.C. Wainwright, the trial was impacted by a higher-than-anticipated placebo response observed across the full methylation cohort.
Harmony has also paused development of ZYN002 for 22q11.2 deletion syndrome pending further analysis of the RECONNECT trial data. The company confirmed it remains on track to initiate Phase 3 trials evaluating pitolisant HD in narcolepsy and idiopathic hypersomnia in the fourth quarter of 2025.
H.C. Wainwright removed ZYN002 from its financial model following the trial failure, resulting in the lower price target. Despite this setback, the firm maintained its Buy rating, citing Harmony’s multiple upcoming registrational trials over the next 12-18 months.
The research firm also highlighted Harmony’s continued commercial strength from WAKIX and its strong balance sheet supporting both internal R&D and business development as factors in maintaining the Buy rating.
In other recent news, Harmony Biosciences has faced several developments regarding its clinical trials and stock assessments. The company reported that its Phase 3 clinical trial for ZYN002 in Fragile X Syndrome did not meet its primary endpoint, primarily due to a higher than expected placebo response rate. This trial, known as the RECONNECT Study, involved 215 patients and aimed to evaluate the efficacy and safety of ZYN002, a transdermal cannabidiol gel. Following these disappointing results, both Mizuho and Oppenheimer adjusted their price targets for Harmony Biosciences. Mizuho lowered its target from $50.00 to $35.00, while Oppenheimer reduced its target from $70.00 to $62.00, although both firms maintained an Outperform rating. UBS, on the other hand, raised its price target for the company to $50.00 from $48.00, citing increased sales estimates for Zygel, another product from Harmony Biosciences. These adjustments reflect the mixed reactions from analysts in response to the company’s recent trial outcomes and sales projections.
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