By Sam Boughedda
Harmony Biosciences (NASDAQ:HRMY) plunged Tuesday after Scorpion Capital revealed it is short the stock, claiming it is a "house of cards, built on an extensive scientific, clinical, and commercial fraud."
HRMY is currently down 27% at $30.30 per share after closing Monday's session at $41.50.
Short-selling firm Scorpion alleges Harmony is "designed to exploit every weak link in the US healthcare system," adding that the company's latest CEO departure is a sign that the end is near.
"A revolving door of CEOs, CFOs, and bad actors, the last CEO's surprise departure on Jan 6th signals the end is near, as doctors and patients sour; territories struggle; and fake metrics cover up a looming collapse," Scorpion stated.
Scorpion's conclusions are based on a four-month investigation that included 50 research interviews with 14 ex-employees and executives, 16 physicians, including Harmony's highest volume prescribers and speakers, five trial investigators, and four senior scientists.
"Harmony's drug Wakix (pitolisant) is a repeat of the Seldane (terfenadine) saga, another histamine antagonist that the FDA pulled from the market and which is the poster child for cardiac toxicity via fatal QT prolongation/arrhythmia. Wakix is worse," the short-selling firm claim.
They added that after obtaining dozens of serious adverse event reports from the FDA via Freedom of Information Act requests filed over several months, they paint a "devastating picture of the drug's risk to even young, otherwise healthy patients."