Harmony Biosciences (NASDAQ: HRMY) announced today that it has entered into a sublicense agreement with Bioprojet Société Civile de Recherche and Bioprojet Pharma SAS for an experimental narcolepsy drug. The agreement grants Harmony exclusive rights to develop, manufacture, and commercialize the orexin-2 receptor agonist, known as the Licensed Compound, in the U.S. and Latin America.
The Licensed Compound, which is in pre-clinical development, is expected to be the subject of an Investigational New Drug application in the second half of 2025. Harmony will pay Bioprojet an upfront fee of $25.5 million and could pay up to $127.5 million more if certain development and regulatory milestones are met. Additionally, up to $240 million is on the line for sales-based milestones, along with royalties on sales in the mid-teens percentage range.
This sublicense stems from rights Bioprojet originally licensed from Teijin Pharma, the innovator of the Licensed Compound. The deal could significantly expand Harmony's portfolio in the treatment of narcolepsy, a chronic sleep disorder characterized by overwhelming daytime drowsiness and sudden attacks of sleep.
In conjunction with this sublicense, Harmony also amended its existing agreements with Bioprojet. These amendments, dated April 6, 2024, modify the License and Commercialization Agreements from July 2017 and July 2023, respectively. The changes remove certain exclusivity provisions, allowing Harmony to broaden its research and development efforts.
The financial terms of the agreement, including the upfront payment and potential milestone payments, reflect Harmony's commitment to advancing treatment options for narcolepsy and potentially other indications. The agreement and amendments underscore the company's strategy to enhance its product pipeline and therapeutic reach in the neuroscience field.
This news is based on a press release statement.
InvestingPro Insights
As Harmony Biosciences (NASDAQ: HRMY) secures a promising sublicense for an experimental narcolepsy drug, the financial health and market performance of the company provide a broader context for investors considering the recent announcement. Harmony's commitment to expanding its neuroscience portfolio is reflected in its strategic moves, including the recent agreement with Bioprojet.
InvestingPro data indicates that Harmony Biosciences holds a market capitalization of $1.68 billion, with a positive P/E ratio of 13.53, which has adjusted to an even more attractive 12.27 over the last twelve months as of Q4 2023. This suggests that investors have confidence in the company's earnings potential. Additionally, the company's revenue growth is robust, with an increase of 32.93% over the last twelve months as of Q4 2023, underscoring Harmony's expanding business operations and market reach.
Two InvestingPro Tips that stand out for Harmony Biosciences are the management's aggressive share buyback program and the company's strong balance sheet, which holds more cash than debt. These factors may reassure investors about the company's financial prudence and stability, especially in light of the significant investment Harmony is making in the sublicensed narcolepsy drug. Moreover, the valuation of Harmony implies a strong free cash flow yield, which is a positive sign for the company's ability to generate cash and potentially fund future growth initiatives.
For those looking to delve deeper into Harmony Biosciences' financials and market performance, InvestingPro offers additional insights. There are currently six more InvestingPro Tips available, including the company's profitability forecasts for this year and its performance over the last twelve months. Interested readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro, which includes these valuable tips and more.
As Harmony Biosciences continues to navigate the development and potential commercialization of the Licensed Compound, these financial metrics and InvestingPro Tips provide a snapshot of the company's current standing and future prospects in the dynamic field of neuroscience.
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