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Investing.com - Goldman Sachs has resumed coverage of Harmony Biosciences Holdings Inc. (NASDAQ:HRMY) with a Neutral rating and a $33.00 price target on Thursday. According to InvestingPro data, the company maintains excellent financial health with a P/E ratio of 12.76 and impressive revenue growth of 20.62% over the last twelve months. InvestingPro analysis suggests the stock is currently undervalued.
The investment firm anticipates that Wakix/pitolisant patent protection will extend until early 2030, following the recent settlement between Harmony (JO:HARJ) Biosciences and Novugen, which could allow approximately two years between pitolisant HD’s launch and generic pitolisant entry in a best-case scenario. The company’s strong balance sheet, with more cash than debt and a healthy current ratio of 3.67, positions it well for this transition period.
Goldman Sachs has introduced a switching model for pitolisant HD based on potential clinical benefits that meet Harmony’s target product profile, which includes meaningful improvement on excessive daytime sleepiness plus benefits on fatigue compared to Wakix.
The firm models the franchise revenue trajectory assuming a base case comparable to Jazz Pharmaceuticals (NASDAQ:JAZZ)’ ongoing switch in the narcolepsy market from Xyrem to Xywav, where safety considerations drive switching decisions.
Goldman Sachs has risk-adjusted post-loss of exclusivity revenue by 25%, citing limited data on pitolisant HD, and expects questions about the Wakix franchise to persist until clinical results from pitolisant HD emerge in 2027, potentially limiting upside for the stock. For deeper insights into HRMY’s valuation and growth prospects, InvestingPro subscribers can access comprehensive financial analysis and 8 additional key insights about the company’s performance and outlook.
In other recent news, Harmony Biosciences reported first-quarter 2025 revenues of $184.7 million, exceeding both Oppenheimer’s and consensus estimates. This financial achievement was attributed to the sustained growth of its product, WAKIX, with an increasing patient base. Oppenheimer has assumed coverage of Harmony Biosciences with an Outperform rating, setting a price target of $61.00, following these strong financial results. Meanwhile, Mizuho (NYSE:MFG) has reiterated its Outperform rating and $48.00 price target on Harmony Biosciences, citing positive developments around the company’s ZYN-002 drug candidate for Fragile X Syndrome. The firm expressed optimism for ZYN-002, highlighting its potential in the Phase 3 study. Additionally, Harmony Biosciences announced plans to begin human trials for its narcolepsy drug, BP1.15205, in the latter half of 2025. The company also reached a settlement with Lupin (NSE:LUPN) Limited regarding a patent infringement case over a generic version of WAKIX®, allowing Lupin to launch its product no earlier than 2030. Harmony continues to defend its intellectual property rights actively, reinforcing its market position.
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