Harmony Biosciences shares jump 2.8% after FDA approves pediatric Wakix
First and only non-scheduled treatment for children with narcolepsy expands addressable market
Harmony Biosciences shares rose 2.8% to $37.01 on Tuesday after the U.S. Food and Drug Administration approved the company's Wakix treatment for cataplexy in children with narcolepsy, marking a significant expansion for the drug that generated $868 million in revenue last year.
The FDA clearance for pediatric patients aged six years and older makes Wakix the first and only FDA-approved non-scheduled treatment for both adult and pediatric narcolepsy patients, with or without cataplexy. The approval eliminates certain regulatory hurdles associated with controlled substances, allowing for same-day electronic prescriptions that could accelerate patient access.
"This pediatric approval represents a meaningful expansion of our addressable market," Harmony Biosciences stated in its regulatory filing announcing the decision. The Philadelphia-based company, valued at approximately $2.1 billion, now gains access to an underserved pediatric population for a rare neurological disorder that affects approximately one in 2,000 people in the United States.
The market reaction reflects growing confidence in Wakix's trajectory toward blockbuster status. Harmony has provided 2026 revenue guidance of $1.0 to $1.04 billion for the drug, representing approximately 21% year-over-year growth from 2024 levels. The company reported approximately 8,500 average patients on Wakix in the fourth quarter of 2025, adding roughly 400 new patients for the third consecutive quarter.
Analysts have maintained an overwhelmingly positive outlook on the stock following the announcement. Of 11 analysts covering Harmony Biosciences, nine rate the shares as a buy or strong buy, with an average price target of $46.73—indicating roughly 30% upside from current levels. One analyst maintains a hold rating, while one recommends selling.
The broader narcolepsy therapeutics market, valued at $4.11 billion in 2025, is projected to grow to $4.42 billion this year and reach $6.36 billion by 2031, according to industry research. While sodium oxybate remains the dominant revenue generator with nearly 49% of market sales, histamine H3 antagonists including pitolisant are growing at a compound annual rate of 13.4% through 2031.
Harmony's financial metrics suggest the company is executing efficiently. The stock trades at 11.4 times trailing earnings and 8.1 times forward earnings, with a price-to-sales ratio of 2.5 times. The company reported operating margins of 27.4% over the trailing 12 months, with quarterly revenue growth of 28.7% year-over-year and earnings growth of 10.1%.
Institutional investors hold 88.4% of Harmony's outstanding shares, while insiders own approximately 12.1%. The stock has traded between $25.52 and $40.87 over the past 52 weeks, with shares currently sitting below their 50-day moving average of $37.59 but above the 200-day moving average of $34.12.
The pediatric approval comes at a critical juncture for the company as it seeks to diversify its revenue streams beyond the adult narcolepsy market. Cataplexy, a sudden loss of muscle tone triggered by strong emotions, affects approximately 70% of narcolepsy patients and represents a significant unmet need in pediatric medicine.
Looking ahead, investors will be monitoring adoption rates among pediatric prescribers and the impact on quarterly patient addition numbers. The company's ability to maintain its current growth trajectory will depend partly on successful commercialization of the newly-approved indication and physician awareness of Wakix's non-scheduled status advantages.
Harmony Biosciences is scheduled to report its fourth-quarter and full-year 2025 financial results in the coming weeks, which should provide additional insight into Wakix's commercial momentum and management's outlook for the pediatric market opportunity.