As investors await the district court ruling on Harmony Biosciences' botched patent infringement case against AET Pharma, the drug developer has made sweeping changes to its management and board. The investor who played a pivotal role creating the business has left the board, while his hand-picked CFO was also kicked to the curb. Neither retained meaningful stakes in the business, each selling the moment shares vested. Perhaps the new individuals will have more skin in the game.
None of that matters much without a successful conclusion to the patent infringement case. Given what's at stake, I would lean toward a last-minute settlement agreement, which is relatively common. Then again, I dismissed the risks of the patent infringement case because of how uncommon it is for threats to materialize. Oops.
A settlement agreement would lift shares close to the fair value, or beyond.
Meanwhile, the recent acquisitions of Avadel Pharmaceuticals and Centessa Pharmaceuticals both demonstrate the arms race for orexin-2 receptor (OX2R) agonists, which could bode well for a comeback for Harmony Biosciences. It wields both excellent commercial infrastructure in narcolepsy and one of the most potent molecules in the class.
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NOTE: The model doesn't account for a negative result from the patent litigation case with AET Pharma. A negative outcome would make Harmony Biosciences uninvestable and likely reset the stock price to below $10 per share.
Full-year 2026 operating metrics:
Wakix contributes $52.26 per share and Wakix GR contributes $3.94 per share. All other assets are excluded.
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