Paragon's Harmony Biosciences brings in $330M of debt capital and equity, looking to expand narcolepsy drug label
Jeff Aronin’s Harmony Biosciences is ringing in a new financing agreement, one that’s bringing in hundreds of millions of dollars.
The Plymouth Meeting, PA-based biotech has signed a deal with New York investment firm Blackstone worth $330 million, Harmony announced Tuesday morning as it updated investors about its second quarter earnings. Funds will come in the form of $300 million of debt capital and $30 million equity investment, the company said.
Harmony expects to use the new financing to “expand our portfolio of assets in rare, neurological diseases while also reducing our annual interest expense,” CEO John Jacobs said in a statement.
Of the $300 million in debt capital, $200 million will comprise the principal loan. The other $100 million will be reserved for a future loan that can be withdrawn within 12 months of the deal closing.
Harmony’s main revenue driver is the drug Wakix, which is approved in the US to treat narcolepsy in adults with both excessive daytime sleepiness and cataplexy. But Harmony has been looking to “expand the clinical utility” of the drug, execs said during Tuesday’s investor presentation, and recently launched a Phase II study for Wakix in myotonic dystrophy.
The biotech is also conducting a Phase II trial of Prader-Willi syndrome, with data expected in the first half of next year. The myotonic dystrophy data are expected by the end of 2022.
In addition, Harmony is running a Phase III study with Bioprojet to study Wakix in children with narcolepsy.
Further down the pipeline, the biotech is trying to move another candidate known as HB-102 into a trial for narcolepsy. Executives noted there are already some Phase I pharmacokinetic data available from a study conducted in the UK.
Harmony had previously outlined an expensive path to getting Wakix past the finish line in both narcolepsy indications, noting in its S-1 last summer that it shelled out $150 million for the US license, $50 million for NDA acceptance and another $77 million for the first approval. The business plan proved enough to bring OrbiMed on board in March 2020, however, with a $200 million credit facility agreement.
The biotech is managed under Aronin’s portfolio at Paragon, and the first US Wakix approval came as Aronin had pushed a pricing controversy behind him. Back in 2016, Aronin hiked the price of a steroid for Duchenne muscular dystrophy to $89,000, to the consternation of patients and their families.