ZYNE Zynerba Pharmaceuticals Inc

The name of the subject company to which this Solicitation/Recommendation Statement on Schedule 14D-9 (together with any exhibits and annexes attached hereto, this “Schedule 14D-9”) relates is Zynerba Pharmaceuticals, Inc., a Delaware corporation (“Zynerba” or the “Company”). The address of Zynerba’s principal executive office is 80 W. Lancaster Avenue, Suite 300, Devon, Pennsylvania 19333, and its telephone number is (484) 581-7505.

The title of the class of equity securities to which this Schedule 14D-9 relates is Zynerba’s common stock, par value $0.001 per share (the “Shares”). As of the close of business on August 24, 2023, there were 53,939,431 Shares issued and outstanding.

The name, business address and business telephone number of Zynerba, which is both the person filing this Schedule 14D-9 and the subject company, are set forth above in “Item 1. Subject Company Information—Name and Address.”

This Schedule 14D-9 relates to a tender offer by Xylophone Acquisition Corp., a Delaware corporation (“Purchaser”), a wholly owned subsidiary of Harmony Biosciences Holdings, Inc., a Delaware corporation (“Harmony Biosciences”), to acquire all of the issued and outstanding Shares for (i) $1.1059 per Share (the “Closing Amount”), in cash, subject to any applicable withholding of taxes and without interest, plus (ii) one contingent value right (each, a “CVR”) per Share (the “CVR Amount”), which represents the right to receive contingent payments, in cash, subject to any applicable withholding of taxes and without interest, upon the achievement of the milestones set forth in, and subject to and in accordance with the terms and conditions of, the CVR Agreement (as defined in Item 3. Past Contacts, Transactions, Negotiations and Agreements—Arrangements with Harmony Biosciences and Purchaser and their Affiliates—CVR Agreement below) (the Closing Amount plus the CVR Amount, collectively, being the “Offer Price”), upon the terms and subject to the conditions set forth in the Offer to Purchase, dated August 28, 2023 (as amended or supplemented from time to time, the “Offer to Purchase”), and in the related Letter of Transmittal (as amended or supplemented from time to time, the “Letter of Transmittal,” which, together with the Offer to Purchase, constitute the “Offer”).

The Offer is described in a Tender Offer Statement on Schedule TO (as amended or supplemented from time to time, and together with the exhibits thereto, the “Schedule TO”), filed by Harmony Biosciences and Purchaser with the U.S. Securities and Exchange Commission (the “SEC”) on August 28, 2023. Copies of the Offer to Purchase and form of Letter of Transmittal are filed as Exhibits (a)(1)(A) and (a)(1)(B) hereto, respectively, and are incorporated herein by reference. The Offer to Purchase and form of Letter of Transmittal are being mailed to Zynerba’s stockholders together with this Schedule 14D-9.

The Offer is being made pursuant to an Agreement and Plan of Merger, dated as of August 14, 2023 (as it may be amended or supplemented, the “Merger Agreement”), by and among Zynerba, Purchaser and Harmony Biosciences, pursuant to which, among other matters, after the completion of the Offer and the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Purchaser will merge with and into Zynerba (the “Merger”) pursuant to Section 251(h) of the General Corporation Law of the State of Delaware, as amended (the “DGCL”), with Zynerba continuing as the surviving corporation in the Merger (the “Surviving Corporation”) and as a wholly owned subsidiary of Harmony Biosciences, without a meeting or vote of Zynerba’s stockholders in accordance with Section 251(h) of the DGCL. Upon the closing of the Merger and filing of the certificate of merger with the Secretary of State of the State of Delaware (the “Effective Time”), each Share (other than Shares that (a) as of immediately prior to the Effective Time were held in the treasury of Zynerba, (b) owned by Harmony Biosciences or Purchaser as of the commencement of the Offer, (c) irrevocably accepted for payment in the Offer and/or (d) Shares held by a holder (or beneficial owner, as the case may be) who is entitled to demand and properly exercises and perfects appraisal rights in accordance with Section 262 of the DGCL with respect to such Shares) (collectively, the “Excluded Shares”) will be automatically converted into the right to receive the Offer Price (the “Merger Consideration”), subject to any applicable withholding of taxes and without interest.

In addition, immediately prior to the Effective Time, by virtue of the Merger and without any action on the part of any holder thereof:

The treatment of equity awards under Zynerba’s benefit plans, including stock options, is discussed below in “Item 3. Past Contacts, Transactions, Negotiations and Agreements—Arrangements Between Zynerba and its Executive Officers, Directors and Affiliates.” A copy of the Merger Agreement is filed as Exhibit (e)(1) hereto and is incorporated herein by reference.

The obligation of Purchaser to purchase the Shares tendered in the Offer is subject to the satisfaction or waiver of a number of conditions set forth in Annex I to the Merger Agreement, including (i) that there will have been validly tendered (and “received” as defined in Section 251(h) of the DGCL) and not validly withdrawn prior to the expiration date of the Offer; (ii) that number of Shares that, considered together with all other Shares (if any) beneficially owned by Harmony Biosciences and its controlled affiliates, represent one more than 50% of the total number of Shares outstanding at the time of the expiration of the Offer (the “Minimum Condition”); and (iii) those other conditions set forth in Annex I to the Merger Agreement and further summarized in Section 15 of the Offer to Purchase (collectively, the “Offer Conditions”).

The Offer will initially expire at 5:00 p.m. (New York City time) on September 26, 2023 (the “Expiration Date”). The expiration date may be extended: (i) if on the then scheduled Expiration Date, the Minimum Condition has not been satisfied or any of the other Offer Conditions has not been satisfied, or waived by Harmony Biosciences or Purchaser if permitted under the Merger Agreement, then Purchaser may, and at the request of Zynerba, shall, extend the Offer for one (1) or more occasions in consecutive increments of up to ten (10) business days (or such longer period as may be agreed to by Zynerba and Harmony Biosciences) in order to permit the satisfaction of such Offer Conditions (subject to the right of Harmony Biosciences or Purchaser to waive any Offer Condition to the extent permitted under the Merger Agreement) and (ii) Purchaser shall (and Harmony Biosciences shall cause Purchaser to) extend the Offer from time to time to the minimum extent required by any applicable law, any interpretation or position of the SEC, the staff thereof or Nasdaq applicable to the Offer, except that Purchaser shall not (A) be required to extend the Offer and the then-scheduled Expiration Date beyond the earlier to occur of (the “Extension Deadline”) (1) the valid termination of the Merger Agreement or (2) the first business day following the “End Date” under the Merger Agreement, which is November 13, 2023, or (B) be permitted to extend the Offer beyond the Extension Deadline without the prior written consent of Zynerba; and (ii) Purchaser shall extend the Offer for the minimum period required by applicable law, requirement, interpretation or position of the SEC or its staff or Nasdaq Capital Market (“Nasdaq”) or its staff.

As set forth in the Schedule TO, the address of the principal executive office of Harmony Biosciences is 630 W. Germantown Pike, Suite 215, Plymouth Meeting, PA 19462 and its telephone number is (484) 539-9800. The address of the principal executive office of Purchaser is c/o Harmony Biosciences Holdings, Inc., 630 W. Germantown Pike, Suite 215, Plymouth Meeting, PA 19462, and its telephone number is (484) 539-9800.

Except as set forth or incorporated by reference in this Schedule 14D-9, to the knowledge of Zynerba, as of the date hereof, there are no material agreements, arrangements or understandings, or any actual or potential conflicts of interest between Zynerba or its affiliates, on the one hand, and (i) its executive officers, directors or affiliates, or (ii) Harmony Biosciences, Purchaser, or their respective executive officers, directors or affiliates, on the other hand. The board of directors of Zynerba (the “Zynerba Board”) was aware of the agreements and arrangements described in this Item 3 during its deliberations of the merits of the Merger Agreement and in determining to make the recommendation set forth in this Schedule 14D-9.

On August 14, 2023, Zynerba, Purchaser and Harmony Biosciences entered into the Merger Agreement. The summary of the material provisions of the Merger Agreement contained in Section 11 of the Offer to Purchase, and the description of the conditions of the Offer contained in Section 15 of the Offer to Purchase are incorporated herein by reference. Such summary and description are qualified in their entirety by reference to the full text of the Merger Agreement.

The Merger Agreement governs the contractual rights among Harmony Biosciences, Purchaser and Zynerba in relation to the Offer and the Merger. The Merger Agreement has been included as an exhibit to this Schedule 14D-9 to provide Zynerba’s stockholders with information regarding the terms of the Merger Agreement. The Merger Agreement contains representations and warranties made by Zynerba to Harmony Biosciences and Purchaser and representations and warranties made by Harmony Biosciences and Purchaser to Zynerba. Neither the inclusion of the Merger Agreement nor the summary of the Merger Agreement is intended to modify or supplement any factual disclosures about Zynerba, Harmony Biosciences or Purchaser in Zynerba’s public reports filed with the SEC. In particular, the assertions embodied in these representations and warranties are qualified by information in a confidential disclosure schedule provided by Zynerba to Harmony Biosciences and Purchaser in connection with the signing of the Merger Agreement. This disclosure schedule contains information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Merger Agreement. In addition, the representations and warranties in the Merger Agreement were negotiated with the principal purpose of allocating risk among Zynerba, Harmony Biosciences and Purchaser, rather than establishing matters of fact. Additionally, such representations and warranties may also be subject to a contractual standard of materiality that is different from what may be viewed as material by holders of Shares or from the standard of materiality generally applicable to reports or documents filed with the SEC. Accordingly, the representations and warranties in the Merger Agreement may not constitute the actual state of facts about Zynerba, Harmony Biosciences or Purchaser. Zynerba’s stockholders are not third-party beneficiaries of the Merger Agreement, except with respect to their right to receive the Offer Price, subject to any applicable withholding of taxes, following the time Purchaser accepts for payment of Shares tendered and not validly withdrawn pursuant to the Offer (the “Offer Acceptance Time”) or to receive the Merger Consideration at and after the Effective Time, and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or conditions of Zynerba, Harmony Biosciences, Purchaser or any of their respective subsidiaries or affiliates. Information concerning the subject matter of such representations, warranties and covenants, which do not purport to be accurate as of the date of this Schedule 14D-9, may have changed since the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the public disclosures of Zynerba or Harmony Biosciences.

The summary of the material terms of the Merger Agreement and the descriptions of the conditions to the Offer contained in the Offer to Purchase and incorporated herein by reference do not purport to be complete and are qualified in their entirety by reference to the full text of the Merger Agreement, which is filed as Exhibit (e)(1) hereto and is incorporated herein by reference.

Pursuant to the Merger Agreement, at or prior to the Offer Acceptance Time, Harmony Biosciences and Computershare Limited or one or more of its Affiliates (collectively, the “Rights Agent”) will enter into a Contingent Value Rights Agreement (the “CVR Agreement”) governing the terms of the CVRs to be issued pursuant to the Merger Agreement. The Rights Agent will maintain an up-to-date register of the holders of CVRs. Such holders shall not be permitted to transfer CVRs (subject to certain limited exceptions specified in the CVR Agreement).

Each CVR represents the non-transferable right to receive the following Milestone Payments, if any, without interest thereon and less any applicable withholding taxes, with each Milestone Payment conditioned upon the achievement of the applicable milestone as follows (each, a “Milestone”):

Harmony Biosciences has the right, in its sole and absolute discretion, to direct and control the research, development, commercialization and other exploitation of Zygel in all respects, except that Harmony Biosciences is obligated to use Commercially Reasonable Efforts (as defined and described in the CVR Agreement) to achieve the foregoing Milestones. The CVR Agreement will terminate on December 31, 2040, and no Milestone may be achieved following such date. There can be no assurance that any of the Milestones will be achieved and that any of the resulting Milestone Payments will be required to be paid by Harmony Biosciences. It is not possible to predict whether a payment will become payable with respect to the CVRs. Whether any Milestone required for payment of any Milestone Payment is met will depend on many factors, some within the control of Harmony Biosciences and its subsidiaries and others outside the control of Harmony Biosciences and its subsidiaries.

The summary of the material provisions of the CVR Agreement contained in Section 11 of the Offer to Purchase is incorporated herein by reference. The foregoing summary and description of the material terms of the CVR Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the CVR Agreement, a form of which is included as Exhibit B to the Merger Agreement filed as Exhibit (e)(2) to this Schedule 14D-9, and is incorporated herein by reference.

On August 14, 2023, in connection with the execution of the Merger Agreement, certain directors and executive officers of Zynerba (the “Supporting Stockholders”), entered into Tender and Support Agreements with Harmony Biosciences and Purchaser (the “Support Agreements”). Under the terms of the Support Agreements, each Supporting Stockholder has agreed, among other things, to tender their Shares (other than unvested Company RSAs) in the Offer and, subject to certain exceptions, not to transfer any of the Shares prior to the consummation or expiration of the Offer.

As of August 24, 2023, the Supporting Stockholders collectively held shares representing approximately 6.9% of the outstanding Shares. The Support Agreements will terminate upon termination of the Merger Agreement and certain other specified events.

The foregoing summary and description of the material terms of the Support Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Support Agreement, a copy of which is included as Exhibit A to the Merger Agreement filed as Exhibit (e)(3) to this Schedule 14D-9, and is incorporated herein by reference.

Harmony Biosciences, LLC, a wholly owned subsidiary of Harmony Biosciences, and Zynerba entered into a Confidentiality and Nondisclosure Agreement, effective November 17, 2021 (the “Confidentiality Agreement”), in connection with Harmony Biosciences, LLC’s consideration of a potential negotiated business relationship with Zynerba. Under the terms of the Confidentiality Agreement, Harmony Biosciences, LLC agreed, subject to certain exceptions, to keep confidential certain confidential and non-public information relating to Zynerba for a period lasting two (2) years from the date of the Confidentiality Agreement. The Confidentiality Agreement did not contain a standstill or similar provision. For further discussion, see “Item 4. The Solicitation or Recommendation—Background of the Offer and the Merger.”

The foregoing summary and description of the material terms of the Confidentiality Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Confidentiality Agreement, a copy of which is filed as Exhibit (e)(4) to this Schedule 14D-9, and is incorporated herein by reference.

Certain Zynerba executive officers and directors have financial interests in the transactions contemplated by the Merger Agreement, including the Offer and the Merger (the “Transactions”) that are different from, or in addition to, the interests of stockholders generally. The Zynerba Board was aware of these potentially differing interests and considered them, among other matters, in evaluating and negotiating the Merger Agreement and in reaching its decision to approve the Merger Agreement and the Transactions, as more fully discussed below in “Item 4. The Solicitation or Recommendation—Recommendation of the Zynerba Board” and “Item 4. The Solicitation or Recommendation—Reasons for the Recommendation.”

For further information with respect to the arrangements between Zynerba and its named executive officers, see the information included under “Item 3. Past Contacts, Transactions, Negotiations and Agreements—Treatment of Equity Awards in the Transaction—Golden Parachute Compensation.”

Zynerba’s executive officers are as follows:

Immediately prior to the Effective Time, and consistent with the terms of the Zynerba Pharmaceuticals, Inc. Amended and Restated 2014 Omnibus Incentive Compensation Plan (as amended from time to time, the “2014 Plan”), by virtue of the Merger and without any action on the part of any holder thereof:

For an estimate of the amounts that would be payable to each of our executive officers and directors with respect to his or her outstanding equity awards, see the section entitled “—Consideration Payable for Outstanding Shares and Company Options Pursuant to the Offer or the Merger” below.

Immediately prior to the Effective Time, by virtue of the Merger and without any action on the part of any holder thereof, each Company Option and Company RSA, whether vested or unvested, that is outstanding immediately prior thereto, will be cancelled and converted into the right to receive the amount, if any, described above in the section entitled “—Effect of the Transactions on Company Equity Awards.”

Company Options. The following table identifies, for each of the Company’s executive officers and directors, the number of Shares subject to his or her In-the-Money Company Options or Out-of-the-Money Company Options, as applicable, that were outstanding and vested and exercisable as of August 24, 2023 that will be cancelled in exchange for consideration in connection with the Merger. No Company executive officer holds any In-the-Money Company Option. The following table assumes that no Company Stock Options will be exercised between August 24, 2023 and the closing of the Merger, and no awards will be exercised or forfeited, between the date of the Merger Agreement and the Effective Time. All dollar amounts have been rounded to the nearest whole dollar.

If the executive officers and directors of Zynerba tender Shares for purchase pursuant to the Offer, they will receive the same consideration on the same terms and conditions as the other stockholders of Zynerba. If such executive officers and directors do not tender their Shares for purchase pursuant to the Offer, but the conditions to the Offer are otherwise satisfied or waived in accordance with the terms of the Merger Agreement and the Merger is consummated, such executive officers and directors will also receive the same consideration on the same terms and conditions as the other stockholders of Zynerba. As of August 24, 2023, excluding the Shares underlying Company Options (whether or not currently exercisable) and including the Shares subject to Company RSAs, the executive officers and directors of Zynerba beneficially own 3,837,525 Shares.

The following table sets forth the number of Shares beneficially owned as of August 24, 2023 by each of Zynerba’s executive officers and directors (excluding Shares underlying Company Options (whether or not currently exercisable) and including Shares subject to Company RSAs) and the approximate aggregate Closing Amount and maximum value of CVRs in respect of such Shares and the approximate maximum aggregate consideration that would be payable for such Shares pursuant to the Offer or the Merger (i.e., $3.6503 per share, which represents the Closing Amount plus the maximum amount payable for one CVR), respectively.

Zynerba is party to preexisting employment agreements with each of its executive officers. Zynerba may terminate the executive officers’ employment with the Company at any time, with or without cause. The employment agreements confirm the executive officers’ titles, compensation arrangements and eligibility for benefits made available to employees generally. These agreements, together with the indemnification agreement for certain executive officers executed upon commencing employment with the Company, set forth the rights and responsibilities of each party.

To incentivize Zynerba’s executive officers to remain with Zynerba through the closing of the Merger, and to bring alignment to each executive officer’s employment agreement so that these agreements have similar terms, and following discussion by the Compensation Committee, the Compensation Committee recommended to the Zynerba Board in late June 2023 that the Employment Agreement Amendments (as defined below) for Mr. Anido and Ms. Sebree be approved. In August 2023, the Zynerba Board approved, and the Company amended, the employment agreements previously entered into with each of the following executive officers: (i) Armando Anido, its Chief Executive Officer, (ii) Terri Sebree, its President, (iii) James Fickenscher, its Chief Financial Officer, Vice President, Corporate Development, (iv) Albert Parker, its Chief Legal Officer and Corporate Secretary, and (v) Brian Rosenberger, its Vice President, Commercial and Business Development (the “Employment Agreements” and, such amendments, the “Employment Agreement Amendments”). The Employment Agreement Amendments were entered into concurrently with the signing of the Merger Agreement. Each Employment Agreement Amendment revises the severance benefits payable to the applicable executive pursuant to his or her employment agreement in the event of such executive’s termination by Zynerba (or Harmony Biosciences) without “cause” or executive’s resignation for “good reason” (each, as defined in the applicable Employment Agreement Amendment, and each such termination, collectively, a “Qualifying Termination”) within the ninety (90) day period preceding a “change of control” (as defined therein) or within twelve (12) months following a change of control (such period, the “Change of Control Period”) to provide for (i) a lump sum cash payment equal to the full monthly COBRA premium applicable to such executive multiplied by the number of months in such executive’s applicable severance period (whereas prior to such Employment Agreement Amendment, the applicable employment agreement provided for a monthly COBRA continuation subsidy during the applicable severance period equal to 90% of the total COBRA premium applicable

thereto) and (ii) vesting of such executive’s performance awards at target (if such award specifies a target). In addition, with respect to the Employment Agreement Amendments for each of Mr. Anido and Ms. Sebree, the minimum share price related to their target bonus severance payment was removed, such that each of Mr. Anido and Ms. Sebree will be entitled to receive 100% of his or her target bonus in the event of a Qualifying Termination during the Change of Control Period, which is consistent with the provisions set forth in the employment agreements for the other executive officers. Mr. Anido’s and Ms. Sebree’s target bonuses are 60% of their respective base salaries. The estimated value of Mr. Anido’s and Ms. Sebree’s target bonus amounts is set forth below in the table entitled “—Golden Parachute Compensation.” The Zynerba Board determined to remove the minimum share price related to payment of target bonus following a change of control from Mr. Anido’s and Ms. Sebree’s employment agreements, which minimum share price was included in their employment agreements prior to the Company’s initial public offering in 2015, in recognition of their long service to the Company, to incentivize them to stay with the Company through Closing and to align their agreements with the employment agreements of all other executive officers, which do not contain such a minimum share price.

Pursuant to the Employment Agreement Amendments, if an executive officer’s termination of employment is due to a Qualifying Termination, in each case within the Change of Control Period, and subject to the executive officer’s execution of an effective general release of potential claims against the Company and compliance with all of the terms and provisions of his or her employment agreement that survive the executive’s termination of employment, each executive officer will be entitled to:

As described in the section titled “—Effect of the Transactions on Company Equity Awards” above, the vesting of all outstanding Company Stock Options and Company RSAs is being accelerated in full and such outstanding equity awards will be paid out in accordance with the terms of the Merger Agreement as described above in “Item 3. Past Contacts, Transactions, Negotiations and Agreements—Treatment of Equity Awards in the Transaction.”

In lieu of the payments and benefits described above, under the terms of the employment agreements with the executive officers, if an executive’s employment is terminated by the Company without “Cause” or by such executive officer for Good Reason, in each case outside of the Change of Control period, and subject to the executive officer’s execution of an effective general release of potential claims against the Company and compliance with all of the terms and provisions of his or her employment agreement that survive the executive’s termination of employment, each executive officer will be entitled to:

For purposes of the executive officers’ employment agreements, “Good Reason” shall mean the following actions by Company, in each case without executive’s consent: (i) a material reduction in the executive’s duties and responsibilities, which means the assignment to the executive of any duties or responsibilities which are materially inconsistent with or adverse to the executive’s then current duties, responsibilities, positions and/or titles with the Company; (ii) a material reduction in the executive officer’s then-current base salary or target bonus opportunity; (iii) requirement that the executive regularly report to work at a location that is more than fifty (50) miles from the location of the executive’s employment as of the effective date of the employment agreement; (iv) a material breach of the employment agreement by the Company; (v) in the event of the assignment of employment agreement to a third party, the failure of the assignee or successor entity to agree to be bound to the terms of the agreement, in each case, subject to the executive officer’s written notification of his or her intention to resign within ninety (90) days after such executive officer first knows or has reason to know of the occurrence of any such event or condition, and Zynerba must have thirty (30) business days to cure such event or condition.

The estimated value of the severance payments and benefits for each of the Company’s named executive officers is set forth below in the table entitled “—Golden Parachute Compensation.” If there is a Qualifying Termination within the Change of Control Period, the estimated aggregate cash severance payment for all of the Company’s executive officers who are not named executive officers, excluding any cash payment in lieu of applicable COBRA premiums, is $1,540,956.

It is possible that Zynerba employees, including the executive officers, will enter into new compensation arrangements with Harmony Biosciences or its affiliates. Such arrangements may include agreements regarding future terms of employment and/or retention awards. As of the date of this Schedule 14D-9, no compensation arrangements between such persons and Harmony Biosciences and/or its affiliates have been established.

Pursuant to the Merger Agreement, prior to the acceptance of the Shares in the Offer, the Compensation Committee of the Zynerba Board (the “Compensation Committee”) will cause each employment compensation, severance or other employee benefit arrangement pursuant to which consideration is payable to any officer, director or employee who is a holder of any security of the Company to be approved by the Compensation Committee (comprised solely of “independent directors”) in accordance with the requirements of Rule 14d-10(d)(2) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the instructions thereto as an “employment compensation, severance or other employee benefit arrangement” within the meaning of Rule 14d-10(d)(2) under the Exchange Act and satisfy the requirements of the non-exclusive safe harbor set forth in Rule 14d-10(d) of the Exchange Act.

Section 145 of the DGCL permits a Delaware corporation to include in its charter documents and in agreements between the corporation and its directors and officers, provisions expanding the scope of indemnification beyond that specifically provided by current law.

Zynerba’s sixth amended and restated certificate of incorporation includes provisions that limit the liability of its directors for monetary damages for breach of their fiduciary duty as directors, except for liability that cannot be eliminated under the DGCL. Accordingly, Zynerba’s directors will not be personally liable for monetary damages for breach of their fiduciary duty as Zynerba directors, except for liabilities:

Zynerba’s sixth amended and restated certificate of incorporation and amended and restated bylaws provide for the indemnification of Zynerba’s directors and officers to the fullest extent permitted under the DGCL.

Pursuant to the terms of the Merger Agreement, Zynerba’s directors and executive officers will be entitled to certain ongoing indemnification and coverage under directors’ and officers’ liability insurance policies from the Surviving Corporation as follows.

For six (6) years after the Offer Acceptance Time, Harmony Biosciences shall, and shall cause the Surviving Corporation to, maintain directors’ and officers’ liability insurance in respect of any acts, errors, omissions, facts or events occurring on or before the Offer Acceptance Time, including in respect of the Transactions, covering each such person currently covered by Zynerba’s directors’ and officers’ liability insurance policies on terms with respect to coverage and amount no less favorable than those of such policies in effect on the date of the Merger Agreement, except that that neither Harmony Biosciences nor the Surviving Corporation shall be obligated to pay annual premiums in excess of 300% of the annual premium most recently paid by Zynerba prior to the date of the Offer Acceptance Time for such insurance (the “Current Premium”) and if such premiums for such insurance would at any time exceed 300% of the Current Premium, then Harmony Biosciences shall, and shall cause the Surviving Corporation to, maintain policies of insurance that, in Harmony Biosciences’ and the Surviving Corporation’s good faith judgment, provide the maximum coverage available at an annual premium equal to 300% of the Current Premium. The provisions of the immediately preceding sentence shall be deemed to have been satisfied if prepaid “tail” or “runoff” policies have been obtained by Zynerba in its discretion prior to the Offer Acceptance Time, which policies provide such persons currently covered by such policies with coverage for an aggregate period of six (6) years with respect to claims arising from any acts, errors, omissions, facts or events that occurred on or before the Offer Acceptance Time (including matters that continue after the Offer Acceptance Time that are interrelated to claims arising on or before the Offer Acceptance Time), including in respect of the Transactions, except that the amount paid for such prepaid policies does not exceed 300% of the Current Premium. If any such prepaid policies have been obtained prior to the Offer Acceptance Time, the Surviving Corporation shall (and Harmony Biosciences shall cause the Surviving Corporation to) maintain any and all such policies in full force and effect for their full term, and continue to honor the obligations thereunder.

In addition, for six (6) years from and after the Offer Acceptance Time, each of Harmony Biosciences and the Surviving Corporation shall:

connection with any other corporation or organization for which he, she or they serves or has served as a director, officer, employee, agent, trustee, or fiduciary at the request of Zynerba (including in any capacity with respect to any employee benefit plan) whether or not the Indemnified Party continues in such position at the time such Indemnified Party Proceeding is brought or threatened and at, or at any time prior to, the Offer Acceptance Time (including any Indemnified Party Proceeding relating in whole or in part to the Transactions or relating to the enforcement of this provision or any other indemnification or advancement right of any Indemnified Party), to the fullest extent permitted under applicable law; and

The Surviving Corporation’s obligations under the foregoing clauses (i) and (ii) shall continue in full force and effect for a period of six (6) years from the Offer Acceptance Time.

Prior to the Effective Time, Zynerba and the Zynerba Board will take all such steps as may reasonably be necessary to cause the Transactions, including any dispositions of Shares (including any Company Options or Company RSAs) by each person who is or will be subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Zynerba, to be exempt under Rule 16b-3 under the Exchange Act.

At a meeting of the Zynerba Board held on August 12, 2023, the Zynerba Board unanimously (i) approved, adopted and declared advisable the execution, delivery and performance by Zynerba of the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger; (ii) determined that the transactions contemplated by the Merger Agreement, including the Offer and the Merger, are in the best interests of Zynerba and its stockholders; (iii) resolved that the Merger Agreement will be governed by and effected under Section 251(h) of the DGCL; and (iv) recommended that the Zynerba’s stockholders accept the Offer and tender their Shares to Purchaser pursuant to the Offer.

Accordingly, and for other reasons described in more detail below, the Zynerba Board unanimously recommends that Zynerba’s stockholders accept the Offer and tender their Shares to Purchaser pursuant to the Offer.

On August 14, 2023, Zynerba and Harmony Biosciences issued a joint press release announcing the Offer. The joint press release of Zynerba and Harmony Biosciences is included as Exhibit (a)(5)(B) hereto, and is incorporated herein by reference.

The following chronology summarizes the key meetings and events that led to the signing of the Merger Agreement. The chronology does not purport to catalogue every conversation among the Zynerba Board or committees thereof or the representatives of Zynerba and other parties.

The Zynerba Board, together with Zynerba’s management team, regularly reviews its research and development programs, business opportunities and potential transactions to protect and enhance the value of its business and enhance stockholder value. Zynerba considers its strategic options in light of the totality of the circumstances, including current and anticipated business and industry trends, regulatory conditions, future growth prospects, the current and expected financing environment and overall strategic direction of its business, in each case, with the goal of maximizing short-term and long-term value for its stockholders.

In particular, in arriving at the transactions contemplated by the Merger Agreement, Zynerba followed a careful process assisted by experienced outside financial and legal advisors to rigorously examine potential transactions and transaction candidates through broad outreach to life sciences companies and a thorough process of evaluation of prospective strategic partners and strategic alternatives. The terms of the Merger Agreement are the result of extensive arm’s-length negotiations among members of the management teams of Zynerba and Harmony Biosciences along with their respective advisors and under the guidance and direction of each of the Zynerba Board and the board of directors of Harmony Biosciences, respectively.

During the third quarter of 2021 and into the first half of 2022, representatives of Zynerba and Harmony Biosciences engaged in intermittent informal discussions regarding Harmony Biosciences’ interest in Zynerba’s Zygel program and a potential strategic partnership transaction between the two companies. These discussions on occasion involved exchanging confidential information pursuant to a mutual confidentiality agreement executed on November 17, 2021. This confidentiality agreement did not include a standstill obligation.

On May 16, 2022, Zynerba publicly announced its financial results for the three months ended March 31, 2022. The closing price per Share on Nasdaq on that date was $0.93, which represented a 57% decline from the closing price of $2.16 on March 1, 2022 (the day on which Zynerba announced its financial results for the twelve months ended December 31, 2021).

During the second half of 2022, the Zynerba Board held meetings at which members of senior management were present and discussed the strategic, financial and operational challenges of operating Zynerba’s business in the then-current environment, including the macro-economic, industry and market conditions negatively impacting late-stage clinical biopharmaceutical companies such as Zynerba. The Zynerba Board discussed the need for meaningful capital investment to advance Zygel expeditiously in Fragile X Syndrome (“FXS”) and chromosome 22q11.2 deletion syndrome (“22q”), and explore additional indications, fund its research and development efforts, expand its organization, and operate as a public company, as well as the risks and uncertainties associated with conducting clinical trials for Zygel, pursuing related regulatory approvals and, if successful, launching and commercializing Zygel. The Zynerba Board also discussed the risks and uncertainties associated with

the timeline for completion of the RECONNECT trial, Zynerba’s cash requirements and its ability to raise sufficient capital through equity financing, as well as developments in the biotechnology and pharmaceutical industries, including the financing challenges associated with the weakness in biotechnology and pharmaceutical stock prices. The Zynerba Board also discussed the potential delisting of Zynerba’s common stock from the Nasdaq Global Select Market due to failure to comply with applicable listing standards, and the dilution that Zynerba’s stockholders would likely experience in connection with the implementation of Zynerba’s long-term strategic plan, including planned equity capital fundraising in order to finance Zynerba’s ongoing and planned clinical trials evaluating Zygel in the treatment of behavioral symptoms of FXS and 22q and other preclinical and clinical development activities.

During this period, Harmony Biosciences and Zynerba continued to exchange due diligence information and engage in periodic informational discussions between members of their respective senior management. The financial terms of any potential transaction were not discussed during any of these meetings.

On August 9, 2022, the Zynerba Board held a meeting at which members of Zynerba senior management were also present. Armando Anido, Zynerba’s Chief Executive Officer, provided a status update regarding discussions to date with Harmony Biosciences. Following discussion, the Zynerba Board requested that Mr. Anido continue to provide timely updates regarding any meaningful developments as appropriate.

On August 10, 2022, Zynerba publicly announced its financial results for the three months ended June 30, 2022. The closing price per Share on Nasdaq on that date was $1.25, which represented a 42% decline from the closing price of $2.16 on March 1, 2022 (the day on which Zynerba announced its financial results for the twelve months ended December 31, 2021).

On August 26, 2022, Harmony Biosciences sent an initial indication of interest to acquire Zynerba at a valuation that could be in excess of $100,000,000, with transaction consideration that could be comprised of both cash and Harmony Biosciences stock.

On August 29, 2022, members of Zynerba’s and Harmony Biosciences’ senior management met by teleconference to discuss the indication of interest. Zynerba management indicated that Zynerba would be interested in exploring a potential transaction with Harmony Biosciences and requested that Harmony Biosciences provide a more specific proposal.

On September 15, 2022, Mr. Anido provided the Zynerba Board with a written update concerning, among other things, the status of discussions with Harmony Biosciences.

During September and October of 2022, Zynerba and Harmony Biosciences continued to exchange due diligence information and meet informally to discuss regulatory and other matters related to Zynerba’s business.

On November 1, 2022, Zynerba received a deficiency letter from the Listing Qualifications Department of the Nasdaq Stock Market LLC notifying Zynerba that, for the last 30 consecutive business days, the closing bid price for Zynerba’s common stock has been below the minimum $1.00 per share required for continued listing on The Nasdaq Global Market.

On November 8 and 9, 2022, the Zynerba Board held a meeting at which members of Zynerba senior management and representatives of Troutman Pepper Hamilton Sanders LLP (“Troutman”), Zynerba’s outside legal counsel, were also present. At the meeting, among other things, Zynerba management provided an update on recent communications and due diligence activities regarding a potential transaction with Harmony Biosciences and other strategic business development opportunities, as well as the legal developments related to the Nasdaq delisting notice and related next steps. The Zynerba Board and senior management then discussed Zynerba’s long-term strategic plans and priorities. As part of this long-term strategic discussion, the Zynerba Board discussed with senior management potential cases for long-term revenue projections and reviewed a preliminary long-term financial projection prepared by senior management and related assumptions. Following discussion, the Zynerba Board instructed senior management to refine such projections for further review by the Zynerba Board in light of management’s assessment of the timing for completion of the RECONNECT trial, progress of patient enrollment in the RECONNECT trial and Zynerba’s cash position. Representatives of Troutman then provided an overview of the Zynerba Board’s fiduciary duties in connection with the evaluation of acquisition proposals and the Zynerba Board’s potential consideration of various strategic opportunities.

On November 14, 2022, Zynerba publicly announced its financial results for the three months ended September 30, 2022. The closing price per Share on Nasdaq on that date was $0.63, which represented a 71% decline from the closing price of $2.16 on March 1, 2022 (the day on which Zynerba announced its financial results for the twelve months ended December 31, 2021).

Throughout the third quarter of 2022 and into the first quarter of 2023, Zynerba and Harmony Biosciences continued to exchange due diligence information and engage in discussions concerning Zynerba’s business, operations, product candidates and clinical programs.

On January 30, 2023, Harmony Biosciences and Zynerba senior management met via videoconference, during which Harmony Biosciences senior management indicated its interest in proceeding with a potential business combination transaction. In a follow up call on February 1, 2023 between Harmony Biosciences and Zynerba senior management, Zynerba senior management requested that Harmony Biosciences provide a letter of intent containing proposed transaction terms, including the specific CVR milestones that Harmony Biosciences contemplated. Zynerba management noted that it would not expect Harmony Biosciences’ valuation proposal to be inclusive of Zynerba’s cash position.

On February 23, 2023, Harmony Biosciences sent a revised non-binding indication of interest reiterating Harmony Biosciences’ interest in a potential transaction with Zynerba at a valuation of in excess of $100,000,000, not taking into account Zynerba’s cash position or material liabilities, with transaction consideration consisting of an unspecified combination of cash, Harmony Biosciences stock and unregistered CVRs based upon the achievement of future development milestones (the “February 23 Proposal”). Later that day, senior management of Harmony Biosciences and Zynerba exchanged email correspondence in which Zynerba management indicated that it was not prepared to respond to the terms of the February 23 Proposal as written, and would require a more specific proposal with respect to the potential business combination. Nonetheless, Zynerba agreed to continue facilitating Harmony Bioscience’s due diligence activities.

On March 7, 2023, the Zynerba Board held a meeting at which members of Zynerba senior management and representatives of MTS Health were also present. At the meeting, management reviewed and the Zynerba Board discussed Zynerba’s financial results for the fourth quarter of 2022 and the fiscal year 2023 budget, including matters related to the cash runway and the timing of topline data from the RECONNECT trial, as well as potential ex-U.S. partnering opportunities for Zygel, reviewing the approach for engaging with potential partners, as well as timing and financial objectives. The Zynerba Board engaged in discussions of strategic business development priorities, including a potential out-license of Zygel outside of the United States, the impact of RECONNECT timelines on partnering discussions, analogs for recent transactions, and other related topics. The Zynerba Board then met in executive session with selected members of senior management and representatives of MTS Health to further discuss the overall strategy with respect to the February 23 Proposal and Zynerba’s evaluation of other strategic opportunities. The Zynerba Board then directed senior management and MTS Health to continue discussions with Harmony Biosciences and simultaneously initiate a market-check process to determine if other third parties might be interested in pursuing a potential business combination transaction with Zynerba and to seek additional indications of value in response to Harmony Biosciences’ proposal.

On March 8, 2023, Zynerba granted access to a virtual data room, which was established by Zynerba in connection with the pending market-check process and in light of the ongoing discussions with Harmony Biosciences, to members of Harmony Biosciences senior management. Over the course of that month, Zynerba and Harmony Biosciences continued to exchange due diligence materials and meet informally to discuss Zynerba’s business.

On March 10, 2023, Zynerba and MTS Health entered into an amendment to Zynerba’s existing engagement letter with MTS Health setting forth the terms and conditions of the engagement by MTS Health as financial advisor with respect to a potential M&A transaction.

On March 28, 2023, Zynerba publicly announced its financial results for the twelve (12) months ended December 31, 2022. The closing price per Share on Nasdaq on that date was $0.41, which represented a 81% decline from the closing price of $2.16 on March 1, 2022 (the day on which Zynerba announced its financial results for the twelve months ended December 31, 2021).

Throughout March and April of 2023, representatives of MTS Health, at the direction of Zynerba, initiated outreach to representatives of 48 additional biotechnology and pharmaceutical companies identified by MTS Health as companies whose technologies and/or pipeline products could potentially be complementary to Zynerba’s portfolio

and which had the relevant expertise necessary to continue developing and obtaining regulatory approval for Zygel, for the purpose of gauging such companies’ potential interest in pursuing a transaction with Zynerba. During this period, Zynerba received preliminary exploratory responses concerning such potential strategic transaction with approximately 13 parties, and exchanged preliminary information with five such parties pursuant to new or existing confidentiality agreements, including (i) a publicly traded global biopharmaceutical company, referred to herein as “Party A,” (ii) a mid-sized privately-held global biopharmaceutical company referred to herein as “Party B,” (iii) a global publicly traded pharmaceutical company referred to herein as “Party C,” (iv) a privately held clinical stage biotechnology company referred to herein as “Party D,” and (v) a publicly traded international pharmaceutical company referred to herein as “Party E”. None of the confidentiality agreements executed or otherwise in effect with such parties at this time contained a standstill provision. These discussions focused on exploring such parties’ potential interest in pursuing a business combination with Zynerba. These discussions did not address the value or terms of any potential business combination transaction, nor did these contacts progress to the point of substantive discussions with respect to a potential business combination at that time. After preliminary exploratory discussions, each of Party A, Party B, Party C, Party D and Party E declined to pursue any potential business combination transaction with Zynerba.

On April 5, 2023, members of Zynerba and Harmony Biosciences’ senior management held an in-person meeting during which, among other things, Harmony Biosciences presented an overview of its business and operations and introduced key department leads to Zynerba management. No financial or other terms of a potential transaction were discussed at this meeting.

Later that day, the Zynerba Board held a meeting at which members of Zynerba’s senior management and representatives of MTS Health were also present. Members of Zynerba management provided an overview of recent business development and strategic discussions, including the recent meeting with Harmony Biosciences and the status of the potential transaction with Harmony Biosciences as well as discussion of potential out-licensing opportunities for Zygel outside of the United States. MTS Health provided an update on the status of outreach activities by representatives of MTS Health soliciting interest from other third parties in a potential transaction with Zynerba and other strategic opportunities.

On April 14, 2023, Harmony Biosciences provided Zynerba with an addendum to its February 23, 2023 non-binding indication of interest (the “April 14 Proposal”), which provided for a valuation of Zynerba of up to $150,000,000, or $2.81 per Share, with transaction consideration comprised of (i) upfront cash consideration of $75,000,000, or $1.41 per Share, and (ii) up to $75,000,000 in CVRs based on obtaining FDA approval for Zygel in FXS, 22q and Autism Spectrum Disorder.

On April 19, 2023, the Zynerba Board held a meeting at which representatives of MTS Health and members of Zynerba senior management were also present. Mr. Anido and representatives of MTS Health led a discussion regarding recent activities concerning a potential business combination with Harmony Biosciences, including the terms of the April 14 Proposal. A representative of MTS Health then provided an overview of current public market conditions and reviewed the fundamental valuation analysis of Zynerba given certain assumptions under various scenarios and analysis frameworks. Members of Zynerba’s senior management then reviewed the Management Projections, summarizing Zynerba’s long-range forecasts for 2023 through 2031 with the Zynerba Board (as more fully described under the heading titled “— Certain Financial Projections”), which the Zynerba Board agreed should be used by MTS Health in connection with its evaluation of the terms of a proposed transaction with Harmony Biosciences. Members of Zynerba’s senior management also described the most recent communications with Harmony Biosciences. A representative of MTS Health then provided a summary financial analysis of the April 14 Proposal. The Zynerba Board, members of senior management and representatives of MTS Health engaged in extended discussion regarding next steps with Harmony Biosciences and broader strategic considerations. Following that discussion, the Zynerba Board instructed management to continue to provide timely updates and to reconvene the Zynerba Board as needed to review any material developments with Harmony Biosciences.

On April 24, 2023, members of Harmony Biosciences and Zynerba senior management met by videoconference to discuss the terms of the April 14 Proposal. Zynerba management communicated that the CVRs should include a potential milestone payment based on positive data resulting from the RECONNECT trial and include commercial milestone triggers with respect to future sales of Zygel.

On April 28, 2023, Harmony Biosciences provided Zynerba with an updated addendum to its February 23, 2023 non-binding indication of interest (the “April 28 Proposal”), which provided for the same upfront and aggregate

consideration as the April 14 Proposal but revised the CVRs to cover positive data resulting from the RECONNECT trial, FDA approval of Zygel in FXS, FDA approval of Zygel in any second indication, and achievement of at least $500,000,000 in aggregate net sales of Zygel. Later that day, representatives of Harmony Biosciences and Zynerba senior management engaged in telephonic discussions to clarify the terms of the April 28 Proposal.

On May 2, 2023, the Zynerba Board held a meeting at which members of Zynerba management and representatives of MTS Health were also present. Mr. Anido summarized the recent correspondence received from Harmony Biosciences indicating potential interest in a strategic transaction, and members of Zynerba senior management summarized recent communications with Harmony Biosciences following receipt of the April 28 Proposal. Following discussion by the Zynerba Board regarding the April 28 Proposal, a representative of MTS Health reviewed the valuation analyses conducted by MTS Health under various scenarios and assumptions, provided a summary of market comparators, and answered numerous questions from the Zynerba Board. Mr. Anido and a representative of MTS Health then reviewed potential options for responding to the April 28 Proposal, and the Zynerba Board engaged in extended discussion regarding each of the options presented. The Zynerba Board directed Zynerba management to continue to pursue discussions with Harmony Biosciences and keep the Zynerba Board appraised of material updates as those discussions continued to develop.

On May 10, 2023, Zynerba delivered to Harmony Biosciences a response letter (the “May 10 Counterproposal”) indicating that the April 28 Proposal required meaningful improvement in order to obtain the support of the Zynerba Board to proceed with a transaction between the parties and containing a counterproposal to the terms of the April 28 Proposal. The May 10 Counterproposal set forth a proposal for aggregate merger consideration valued at a maximum of $245,000,000, or approximately $4.50 per Share, consisting of (i) upfront cash consideration of $110,000,000, or $2.04 per Share, plus (ii) up to $135,000,000, or approximately $2.46 per Share, in CVR consideration based on the achievement of clinical milestones set out in the April 28 Proposal plus additional CVR milestones based on the achievement of at least $300,000,000 and $600,000,000 in cumulative net revenue from sales of Zygel, respectively.

On May 18, 2023, members of senior management of Harmony Biosciences and Zynerba corresponded by e-mail and teleconference concerning the terms of the May 10 Counterproposal. Later that day, Harmony Biosciences delivered to Zynerba a revised addendum to its February 23, 2023 non-binding indication of interest (the “May 18 Proposal”), setting forth transaction terms consisting of aggregate merger consideration valued at a maximum of $200,000,000, or approximately $3.73 per Share, consisting of (i) upfront cash consideration of $80,000,000, or approximately $1.68 per Share, and (ii) up to $120,000,000, or approximately $2.05 per share, in CVR consideration, based on the achievement of the clinical and commercial milestones set forth in the May 10 Counterproposal, with scaling levels of merger consideration based upon the timing of achievement of certain regulatory events.

On May 24, 2023, the Zynerba Board convened a meeting at which members of senior management of Zynerba and representatives of MTS Health were also present. A representative of MTS Health provided an update to the prior reports prepared by MTS Health summarizing the process overview and valuation analyses conducted by MTS Health under various scenarios and assumptions, and discussing other related items with the Zynerba Board. Mr. Anido and a representative of MTS Health then reviewed the May 18 Proposal with the Zynerba Board and engaged in extended discussion and analysis with the Zynerba Board regarding the terms contemplated in the letter and potential counters. At the conclusion of that discussion, Mr. Anido reviewed the proposed next steps with Harmony Biosciences and potential responses to the May 18 Proposal. The Zynerba Board authorized Mr. Anido to continue negotiating the terms of a potential transaction with Harmony Biosciences in order to obtain the most favorable terms reasonably available.

On June 1, 2023, members of senior management of Zynerba and Harmony Biosciences met to discuss the status of Zynerba’s ongoing RECONNECT clinical trial and other clinical and preclinical programs.

On June 8, 2023, Mr. Anido met with Dr. Jeffrey Dayno, M.D., Chief Executive Officer of Harmony Biosciences, and certain other members of senior management of Zynerba and Harmony Biosciences held an in person meeting to discuss the May 18 Proposal. During the course of that discussion, the parties came to an agreement in principal on the proposed terms of the Offer, consisting of a valuation for Zynerba of up to $205 million, or approximately $3.82 per Share, consisting of (i) an upfront payment of $80,000,000, or approximately $1.49 per Share and (ii) up to $125 million, or approximately $2.33 per Share, in CVR milestones, payable upon the achievement of the regulatory events set forth in the April 28 Proposal plus additional CVR milestones based on the achievement of at least $250,000,000 and $500,000,000 in cumulative net revenue from sales of Zygel, respectively.

On June 11, 2023, the parties entered into a non-binding letter of intent reflecting the agreement reached by Zynerba and Harmony Biosciences senior management during their meeting on June 8, 2023 (the “June 11 Letter of Intent”).

On June 13, 2023, the Zynerba Board held a meeting at which members of Zynerba management and representatives of MTS Health were also present. Mr. Anido provided the Zynerba Board with a summary of recent discussions with Harmony Biosciences and the terms of the June 8 Proposal, and discussion ensued. Members of Zynerba’s senior management provided an overview of other business development opportunities to date, including discussions with third parties concerning a potential out-license of Zygel outside of the United States. A representative of MTS Health then summarized the preliminary valuation materials and offer analysis materials prepared by MTS Health, Zynerba’s stock performance over the past year, and the valuation methodologies utilized in connection with the preliminary analysis performed by MTS Health with respect to the terms of the June 11 Letter of Intent, including discounted cash flow, comparable publicly traded companies, and precedent transactions.

On June 15, 2023, representatives of Goodwin Procter LLP, outside legal counsel to Zynerba (“Goodwin”), met by videoconference with members of Zynerba’s senior management and representatives of MTS Health to discuss the initial draft of the Merger Agreement prepared by Goodwin, which contemplated, among other things, (i) a “no-shop” provision requiring Zynerba to cease solicitation of alternative proposals following the execution of the Merger Agreement, (ii) the ability of Zynerba to negotiate with counterparties in connection with an unsolicited superior proposal and/or terminate the Merger Agreement to accept a superior proposal and (iii) a termination fee of $1,600,000 in favor of Harmony Biosciences if Zynerba terminated the Merger Agreement under certain circumstances (the “Termination Fee”). The draft Merger Agreement also provided, among other things, that the parties would not be permitted to consider the outcome of any clinical data or the timing or results of any clinical trial or any regulatory filings or approvals with respect to any of Zynerba’s product candidates in determining whether a “Company Material Adverse Effect” (as defined in the Merger Agreement) has occurred. Later that day, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells US LLP, counsel to Harmony Biosciences (“Hogan Lovells”), the draft Merger Agreement.

On June 19, 2023, representatives of Goodwin met by videoconference with members of Zynerba’s senior management and representatives of MTS Health to discuss the initial draft of the CVR Agreement prepared by Goodwin, which contemplated, among other things, the inclusion of a “commercially reasonable efforts” standard with respect to Harmony Biosciences’ obligation to develop and commercialize Zygel. The draft CVR Agreement did not include a deadline by which the CVR milestones must be achieved.

On June 20, 2023, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells the draft CVR Agreement.

On June 22, 2023, representatives of Goodwin and representatives of Hogan Lovells met by videoconference to discuss certain material terms of the Merger Agreement and the CVR Agreement as well as certain diligence items.

Also on June 22, 2023, the Compensation Committee of the Zynerba Board (the “Compensation Committee”) met to discuss certain executive compensation matters, including the establishment of a “change in control” policy and certain amendments to the terms of certain executive employment agreements intended to, among other reasons, bring the terms of those employment agreements in line with other Zynerba executives’ employment agreements, as further described in the section under the caption “— Arrangements Between Zynerba and its Executive Officers, Directors and Affiliates.” Members of senior management of Zynerba were also present at the meeting. Following discussion, the Compensation Committee approved the “change in control” policy and reviewed the proposed employment agreement amendments and recommended that such proposals be submitted to the Zynerba Board for approval. Interested members of Zynerba management did not participate in the discussions and deliberations of the Compensation Committee regarding the employment agreement amendments.

On June 26, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed to representatives of Goodwin a due diligence request list soliciting certain information concerning Zynerba and its business in connection with its legal due diligence review. Zynerba management continued to provide due diligence information in response to such requests.

On July 7, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed to representatives of Goodwin a revised draft of the Merger Agreement, reflecting, among other things, (i) a revised “no shop” covenant that did not permit Zynerba to terminate the Merger Agreement in response to a superior proposal, (ii) a company termination fee of $3,200,000, (iii) a revised definition of “Company Material Adverse Effect” which did not exclude

the timing or outcome of Zynerba’s preclinical or clinical studies or the timing or results of regulatory filings or approvals for Zynerba’s product candidates in determining whether a “Company Material Adverse Effect” has occurred, and (iv) a post-closing right of offset against the CVR consideration for any losses incurred by Harmony Biosciences due to breaches of Zynerba’s representations, warranties and covenants under the Merger Agreement.

On July 10, 2023, representatives of Goodwin and MTS Health met by videoconference with members of Zynerba senior management to discuss the revised drafts of the Merger Agreement and CVR Agreement and proposed responses to Harmony Biosciences.

On July 12, 2023, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells a revised draft of the Merger Agreement, which draft reflected, among other things, (i) the reinstatement of Zynerba’s right to terminate the Merger Agreement in response to a superior proposal, (ii) a proposed Termination Fee of $2,400,000, (iii) the reinstatement of Zynerba’s proposal to exclude certain preclinical, clinical and other regulatory events related to Zynerba’s product candidates from consideration in the determination of whether a “Company Material Adverse Effect” has occurred, and (iv) the removal of Harmony Biosciences’ right of offset for breaches of Zynerba’s representations, warranties and covenants under the Merger Agreement.

On July 13, 2023, Mr. Albert Parker, Zynerba’s Chief Legal Officer, met telephonically with Mr. Christian Ulrich, Harmony Biosciences’ Senior Vice President and General Counsel, and Mr. Andrew Serafin, Harmony Biosciences’ Chief Strategy Offer, to inform them of the proposed amendments to certain of Zynerba’s executive employment agreements previously approved by the Compensation Committee, as further described in the section under the caption “— Arrangements Between Zynerba and its Executive Officers, Directors and Affiliates” to, among other reasons, bring the terms of those employment agreements in line with other Zynerba executives’ employment agreements.

On July 19, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed a revised draft of the Merger Agreement to representatives of Goodwin, on behalf of Zynerba. The revised Merger Agreement reflected, among other things, (i) the removal of Zynerba’s right to terminate the Merger Agreement in response to a superior proposal, (ii) a proposed Termination Fee of $3,200,000, (iii) the removal of Zynerba’s proposal to exclude certain preclinical, clinical and other regulatory events related to Zynerba’s product candidates from consideration in the determination of whether a “Company Material Adverse Effect” has occurred, and (iv) the re-insertion of Harmony Biosciences’ post-closing right of offset against the CVR consideration for any losses incurred by Harmony Biosciences due to breaches of Zynerba’s representations, warranties and covenants under the Merger Agreement.

Also on July 19, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed a revised draft of the CVR Agreement to representatives of Goodwin, on behalf of Zynerba, reflecting, among other things, (i) the removal of Harmony Biosciences’ obligation to use diligent efforts to develop and commercialize Zygel, and (ii) certain deadlines by which CVR milestones must be achieved, including requirement that all milestones be achieved by December 31, 2032.

On July 21, 2023, representatives of Goodwin and MTS Health met by videoconference with members of Zynerba senior management to discuss the revised drafts of the Merger Agreement and CVR Agreement and proposed responses to Harmony Biosciences, including Zynerba’s position on the size of the proposed Termination Fee and “fiduciary out” protections and the removal of the diligent efforts covenant in the CVR Agreement.

On July 24, 2023, Mr. Anido met virtually with Dr. Dayno to discuss the results of Harmony Biosciences’ financial due diligence to date and certain proposed revisions to the terms of Harmony Biosciences’ June 11 Proposal resulting from Harmony Biosciences’ review of additional information concerning cost of goods and supply chain expenses and the enrollment pace and timing of the RECONNECT trial. Later that day, representatives of Harmony Biosciences distributed to Zynerba management a revised letter of intent (the “July 24 Proposal”) revising the terms of the June 11 Proposal to provide for up to $200,000,000 in aggregate merger consideration, consisting of (i) $60,000,000 in aggregate upfront merger consideration and (ii) an additional CVR milestone payment of $15,000,000, payable upon completion of the RECONNECT trial on or prior to June 30, 2026, in addition to up to $125,000,000 in CVR milestone payments as described in the June 11 Proposal.

On July 27, 2023, the Zynerba Board held a meeting at which members of Zynerba’s senior management and representatives of MTS Health were also present. Mr. Anido summarized his recent conversations with Harmony Biosciences management and reviewed the terms of the July 24 Proposal. A representative of MTS Health provided a detailed analysis of the terms of the July 24 Proposal, and discussion ensued concerning the financial terms, valuation impact, and other related topics. Mr. Parker then reviewed certain legal issues and key drafting provisions

under consideration, and the Zynerba Board discussed at length various items concerning the response to the July 24 Proposal, including potential business and legal terms, timing, and other matters. The Zynerba Board directed Zynerba management to continue negotiations concerning the potential transaction with Harmony Biosciences and to keep the Zynerba Board apprised of the timing, status and terms thereof.

On July 28, 2023, representatives of Zynerba distributed to Harmony Biosciences management a written response to the July 24 Proposal indicating Zynerba’s acceptance of the terms of the July 24 Proposal subject to agreement on certain outstanding key points in the Merger Agreement and the CVR Agreement, including (i) the re-insertion of Zynerba’s right to terminate the Merger Agreement in response to a superior proposal, (ii) the removal of any post-closing right of offset against the CVR Agreement due to breaches of Zynerba’s representations, warranties and covenants under the Merger Agreement, (iii) the inclusion of a “commercially reasonable efforts” standard with respect to Harmony Biosciences’ efforts to achieve the CVR milestones, and (iv) the removal of milestone deadlines under the CVR Agreement (collectively, the “July 28 Key Terms”).

On August 1, 2023, the Zynerba Board convened a meeting at which members of Zynerba’s senior management and representatives of MTS Health were also present. At the meeting, Mr. Anido provided an update regarding his recent discussions with Harmony Biosciences management and the terms of the July 24 Proposal. Mr. Parker then provided additional information regarding recent discussions with Harmony Biosciences’ legal counsel, and reviewed the anticipated timeline and expected response from Harmony Biosciences. Following discussion, the Zynerba Board directed Mr. Anido and Zynerba management to continue updating the Zynerba Board on the progress of the potential transaction with Harmony Biosciences.

On August 2, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed revised drafts of the Merger Agreement and the CVR Agreement to representatives of Goodwin, on behalf of Zynerba. The revised Merger Agreement reflected, among other things, (i) the acceptance of the July 28 Key Terms, (ii) the re-insertion of Harmony Biosciences’ previous position permitting Harmony Biosciences to consider clinical, regulatory and related events in determining whether a “Company Material Adverse Effect” has occurred, and (iii) a proposed increase in the size of the Termination Fee to $8,000,000. The revised CVR Agreement reflected, among other things, a commercially reasonable efforts standard with respect to the achievement by Harmony Biosciences of the CVR milestones.

On August 4, 2023, representatives of Goodwin and MTS Health met by videoconference with members of Zynerba senior management to discuss Harmony Biosciences’ revised draft of the Merger Agreement and the CVR Agreement. Later that day, following such discussion among Zynerba management and its legal and financial advisors, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells a revised draft of the Merger Agreement, reflecting, among other things, (i) a proposed Termination Fee of $2,400,000 and (ii) the reinstatement of a more narrowly targeted proposal to exclude certain preclinical, clinical and other regulatory events related to Zynerba’s product candidates from the definition of “Company Material Adverse Effect.” Also on August 4, 2023, Mr. Anido met with Dr. Dayno by teleconference to discuss the outstanding items in the Merger Agreement and the CVR Agreement.

On August 5, 2023, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells a revised draft of the CVR Agreement.

On August 7, 2023, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed revised drafts of the Merger Agreement and the CVR Agreement to representatives of Goodwin, on behalf of Zynerba. The revised Merger Agreement reiterated Harmony Biosciences’ previous positions with respect to (i) Harmony Biosciences’ ability to consider clinical, regulatory and related events in the determining whether a “Company Material Adverse Effect” has occurred and (ii) an $8,000,000 proposed Termination Fee.

On the morning of August 8, 2023, representatives of Goodwin met with members of Zynerba management and representatives of MTS Health to discuss the revised terms of the Merger Agreement and the CVR Agreement and proposed responses to Harmony Biosciences. Later that day, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells an issues list setting forth counterproposals of Zynerba with respect to certain key open issues in the draft Merger Agreement and the draft CVR Agreement, including (i) a proposed Termination Fee of $3,600,000, (ii) a more limited carve-out to the definition of “Company Material Adverse Effect” for certain regulatory and clinical events and (iii) a deadline of December 31, 2040 for the achievement of all milestones under the CVR Agreement.

In the evening of August 8, 2023, representatives of Goodwin, on behalf of Zynerba, met with representatives of Hogan Lovells, on behalf of Harmony Biosciences, to discuss Zynerba’s counterproposals and expectations with respect to the timeline to execution of the Merger Agreement.

On August 9, 2023, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells a revised draft of the Merger Agreement reflecting Zynerba’s counterproposals as discussed during the August 8, 2023 meeting between representatives of Goodwin and Hogan Lovells.

Throughout the morning and afternoon of August 10, 2023, representatives of Hogan Lovells and Goodwin met by videoconference to discuss certain outstanding diligence items and open issues in the draft Merger Agreement and the draft CVR Agreement. Later that day, representatives of Hogan Lovells, on behalf of Harmony Biosciences, distributed a revised draft of the Merger Agreement to representatives of Goodwin, on behalf of Zynerba, reflecting, among other things, a proposed Termination Fee of $6,000,000. Following telephonic discussions between representatives of Goodwin, representatives of MTS Health and members of Zynerba senior management, representatives of Goodwin, on behalf of Zynerba, distributed to representatives of Hogan Lovells a revised Merger Agreement proposing a proposed Termination Fee of $4,200,000. In making such proposal, Zynerba management considered the size of the proposed Termination Fee relative to the upfront transaction equity value plus near-term milestone payments. Representatives of Goodwin, on behalf of Zynerba, also delivered a revised draft of the CVR Agreement reflecting the December 31, 2040 deadline for the achievement of the CVR milestones.

During the course of the day on August 11, 2023, representatives of Goodwin and representatives of Hogan Lovells engaged in discussions by videoconference and exchanged drafts of the Merger Agreement, the CVR Agreement and the Support Agreements. During this time, Dr. Dayno and Mr. Anido also exchanged emails concerning certain outstanding financial due diligence questions.

On the morning of August 12, 2023, the Zynerba Board held a virtual meeting at which representatives of Goodwin and representatives of MTS Health, as well as members of Zynerba’s senior management, were also present, to consider approval of the proposed transaction with Harmony Biosciences. Representatives of MTS Health reviewed with the Zynerba Board MTS Health’s financial analyses of the Offer Price, and rendered to the Zynerba Board MTS Securities’ oral opinion, which was subsequently confirmed by delivery of a written opinion dated August 12, 2023, that, as of such date and based upon and subject to various assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken in preparing its opinion, the Offer Price to be paid in the Offer and the Merger to the holders of Shares (other than Excluded Shares) pursuant to the Merger Agreement was fair, from a financial point of view, to such holders. For a detailed discussion of MTS Securities’ opinion, please see below under the caption “— Opinion of Zynerba’s Financial Advisor.” Representatives of Goodwin then reviewed the terms of the final proposed transaction documentation with Harmony Biosciences, including the Merger Agreement and the CVR Agreement. Representatives of Goodwin and the Zynerba Board also discussed certain amendments to certain executive employment agreements, as further described in the section under the caption “— Arrangements Between Zynerba and its Executive Officers, Directors and Affiliates.” After discussion, the independent members of the Zynerba Board unanimously approved the amendments to such executive employment agreements in accordance with the recommendation of the Compensation Committee. Following additional discussion and consideration of the Merger Agreement and the Offer, the Merger, the CVR Agreement and the other transactions contemplated by the Merger Agreement (including the factors described in “—Reasons for the Recommendation”), the Zynerba Board unanimously adopted resolutions (1) approving, adopting and declaring advisable the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger, (2) determining that the transactions contemplated by the Merger Agreement, including the Offer and the Merger, were in the best interests of Zynerba and its stockholders, (3) resolving that the Merger Agreement will be governed by and effected under Section 251(h) of the DGCL, and (4) recommending that the Zynerba stockholders accept the Offer and tender their Shares to Merger Sub pursuant to the Offer. The approval of the Zynerba Board was contingent upon the parties reaching agreement on the size of the Termination Fee, which the Zynerba Board authorized to be up to $4,500,000.

Later in the afternoon on August 12, 2023, Mr. Anido, Dr. Dayno and other representatives of senior management of Zynerba and Harmony Biosciences, as well as representatives of Goodwin, Hogan Lovells and MTS Health, met by videoconference to discuss certain confirmatory financial due diligence questions with respect to Zynerba.

On the morning of August 13, 2023, Mr. Anido and Dr. Dayno met by teleconference to discuss the size of the company termination fee and anticipated timing for signing the Merger Agreement, during which they agreed to a

Termination Fee of $4,500,000 and to proceed with finalizing the transaction documents and executing the Merger Agreement as of 12:01 a.m. Eastern Time on August 14, 2023. Over the course of the afternoon and evening on August 13, 2023, Mr. Anido and Dr. Dayno exchanged emails concerning the transaction, and representatives of Goodwin and Hogan Lovells engaged in discussions telephonically and by videoconference and exchanged comments to the draft Merger Agreement and the draft CVR Agreement. At 12:01 a.m. Eastern Time on August 14, 2023, Harmony Biosciences, Merger Sub and Zynerba entered into the Merger Agreement, and Harmony Biosciences, Merger Sub and the Supporting Stockholders entered into the Support Agreements.

Before the opening of trading of the U.S. stock markets on August 14, 2023, Harmony Biosciences and Zynerba issued a joint press release announcing the execution of the Merger Agreement.

In evaluating the Merger Agreement and the Transactions, including the Offer and the Merger, the Zynerba Board consulted with Zynerba’s senior management and legal and financial advisors. In the course of reaching its determination that the Transactions, including the Offer and the Merger, are in the best interests of Zynerba and its stockholders, and unanimously recommending that Zynerba’s stockholders accept the Offer and tender all of their Shares in the Offer, the Zynerba Board reviewed, evaluated, and considered a wide and complex range of factors discussed below. The Zynerba Board also consulted with its legal advisors regarding their fiduciary duties, legal due diligence matters and the terms of the Merger Agreement. Based on these consultations, considerations and analyses, and the factors discussed below, the Zynerba Board approved and declared advisable the execution, delivery, and performance by the Company of the Merger Agreement with Harmony Biosciences and Purchaser and the consummation of the Transactions and determined that the Transactions are in the best interests of Zynerba’s stockholders.

Offer Price. The Zynerba Board considered:

Zynerba’s Operating and Financial Condition and Prospects. The Zynerba Board considered Zynerba’s historical and projected ability to execute on its long-term stand-alone plan, operating and financial performance and its prospects, including certain prospective forecasts for Zynerba prepared by Zynerba’s senior management, which reflect an application of various assumptions of senior management. The Zynerba Board considered the inherent uncertainty of achieving management’s prospective forecasts, as set forth under the heading titled “— Certain Financial Projections,” and that, as a result, Zynerba’s actual financial results in future periods could differ materially from senior management’s forecasts. The Zynerba Board considered, among other factors, that the holders of the Shares would continue to be subject to the risks and uncertainties of Zynerba executing on its short and long-range plan if it remained independent. These risks and uncertainties included risks relating to the macro-economic, industry and market conditions negatively impacting valuations of clinical pharmaceutical and biotechnology companies such as Zynerba, the need for meaningful capital investment to fund Zynerba’s continued operations, the uncertainty in obtaining marketing approval for Zygel, the need to successfully commercialize and gain market acceptance of Zygel, the need to build a sales and marketing infrastructure, the risks and costs associated with partnerships to assist in the global development and commercialization of Zygel outside of the United States, the development by other companies of competitive products, the dependence on the success of a single lead product candidate, the dependence on key personnel and compliance with government regulations, the risk that Zynerba is unable to satisfy the continued listing requirements of Nasdaq in order to permit Zynerba to maintain the listing of its common stock on Nasdaq, and the general risk of market conditions that could reduce Zynerba’s stock price. The Zynerba Board also considered the risks and challenges facing Zynerba as a result of its current cash position and that, as a standalone company, Zynerba would need to seek substantial additional funding through future equity, royalty and/or debt financings or additional collaborations or strategic partnerships, and any such fundraising could have a highly dilutive effect on Zynerba’s existing stockholders, could require Zynerba to enter into restrictive covenants, might only be

available on unfavorable terms or might not be available at all. The Zynerba Board weighed the certainty of realizing a substantial value for Shares in the Offer and the Merger compared to the uncertainty that trading values would approach the Offer Price in the foreseeable future and the substantial risk and uncertainty associated with Zynerba and its business as a clinical-stage pharmaceutical company (including the risk factors set forth in Zynerba’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, and subsequent quarterly reports on Form 10-Q).

Potential Strategic Alternatives. The Zynerba Board reviewed the possible alternatives to the Offer and the Merger, including the execution of management’s stand-alone plan. The Zynerba Board considered the risks inherent in the development of drug products, the risks related to designing, conducting and compiling data from clinical trials, the risks related to seeking approval for marketing from the FDA and other regulatory authorities, competition, and other factors affecting the revenues and profitability of pharmaceutical and biotechnology companies generally. The Zynerba Board also considered the fact that Zygel has not yet been approved for marketing by the FDA or any similar non-U.S. regulatory body in any indication, as well as the status and prospects for the RECONNECT trial and Zynerba’s other clinical and pre-clinical development programs.

Product Commercialization and Development Risks; Existing Resources. The Zynerba Board considered the status and prospects for Zynerba’s current pipeline, including the fact that Zynerba is heavily dependent on the regulatory approval and commercial success of Zygel, its lead product candidate. The Zynerba Board considered the risk of failure of Zynerba’s ongoing clinical trials, the risk that Zygel will not be approved or, if approved, successfully commercialized for any indication. The Zynerba Board considered the fact that Zynerba will require significant additional capital in order to complete the remaining clinical development for Zygel in the treatment of behavioral symptoms of Fragile X syndrome and chromosome 22q11.2 deletion syndrome, expand development to additional indications to maximize the value of Zygel, obtain marketing approval for and commercialize Zygel, as well as fund other clinical and pre-clinical programs and otherwise execute on its business plan. The Zynerba Board also considered that, while Zynerba may seek additional funding through future debt and equity financing or additional collaborations or strategic partnerships, any such fundraising could have a highly dilutive effect on Zynerba’s existing stockholders, might only be available on unfavorable terms, or might not be available at all.

Negotiation Process. The Zynerba Board considered the fact that the terms of the Offer and Merger were the result of robust arm’s-length negotiations conducted by Zynerba with the knowledge and at the direction of the Zynerba Board and with the assistance of its financial and legal advisors. The Zynerba Board also considered the enhancements that Zynerba and its advisors were able to obtain as a result of robust arm’s-length negotiations with Harmony Biosciences, including the increase in the valuation offered by Harmony from the time of its initial expression of interest to the end of the negotiations and the inclusion of provisions in the Merger Agreement that increase the likelihood of completing the Offer and consummating the Merger and allow the Zynerba Board to consider unsolicited superior acquisition proposals from third parties.

Potentially Interested Counterparties. The Zynerba Board, with the assistance of members of its senior management and its legal and financial advisors, considered the process conducted by Zynerba, with the assistance of representatives of MTS Health Partners, L.P. (“MTS Health Partners”), to identify potential buyers taking into account the expected interest of parties in Zygel generally, their financial capability to consummate a transaction of this size, and their ability to move quickly and efficiently in a process, the outcome of those discussions, and the fact that none of these parties, other than Harmony Biosciences, had expressed interest in a strategic transaction such as the Offer and the Merger. In connection with the foregoing, the Zynerba Board reviewed potential strategic alternatives for Zynerba in light of its current and projected financial position and results of operations, the challenges it faces in growing its core business operations as a stand-alone company (including its projected need to raise additional capital in the near term), and its historical and projected ability to execute on its long-term stand-alone plan, in order to identify the course of action that would, in the Zynerba Board’s opinion, create the most value for its stockholders. The Zynerba Board believes, after such review of potential strategic alternatives and Zynerba’s prospects and challenges as a stand-alone company, that the Offer and the Merger represent a superior alternative to the other alternatives available to Zynerba, including remaining a stand-alone public company, considering the potential stockholder value that might result from such alternatives, the feasibility of such alternatives and the risks and uncertainties associated with pursuing such alternatives relative to the Offer and the Merger.

Opinion of Financial Advisor. The Zynerba Board considered the opinion of MTS Securities, LLC rendered to the Zynerba Board on August 12, 2023, which was subsequently confirmed by delivery of a written opinion dated August 12, 2023 that, as of such date and based upon and subject to the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by MTS Securities, LLC in

preparing its opinion, the Offer Price to be paid in the Offer and the Merger to the holders of Shares (other than Excluded Shares) pursuant to the Merger Agreement, was fair, from a financial point of view, to such holders, as more fully described below under the caption “— Opinion of Zynerba’s Financial Advisor.” The full text of the written opinion, dated August 12, 2023, of MTS Securities, LLC has been included as Annex I to this Schedule 14D-9 and are incorporated herein by reference.

The Merger Agreement; Ability to Consider, Receive and Respond to Unsolicited Proposals. The Zynerba Board considered the provisions of the Merger Agreement, including:

Conditions to the Consummation of the Offer and Merger; Likelihood of Completion. The Zynerba Board considered the likelihood of completing the Offer and the Merger, particularly in light of the terms of the Merger Agreement, including (1) the conditions to the Offer and the Merger being specific and limited and (2) the exceptions contained within the “Company Material Adverse Effect” definition, which generally defines the standard for closing risk. The Zynerba Board also considered the fact that there is no financing condition to the completion of the Offer and consummation of the Merger. The Zynerba Board also considered the Support Agreements, pursuant to which certain directors and executive officers of Zynerba have agreed, solely in their capacity as stockholders of Zynerba, to tender their shares in the Offer.

Tender Offer Structure; Timing of Completion. The Zynerba Board considered the anticipated timing of the consummation of the Transactions, and the structure of the Transactions as a cash tender offer for all outstanding Shares, with the anticipated result of allowing Zynerba’s stockholders to receive the Offer Price in a relatively short time frame, followed by the Merger (to be effected pursuant to Section 251(h) of the DGCL) in which Zynerba’s stockholders who do not validly exercise appraisal rights will receive the same consideration received by those stockholders who tender their Shares in the Offer. The Zynerba Board noted that Harmony Biosciences would require no additional financing and, instead, would fund the purchase price from existing cash resources. The Zynerba Board also considered that the potential for closing in a relatively short timeframe could reduce the amount of time in which Zynerba’s business would be subject to the potential uncertainty of closing and related disruption.

Extension of Offer Period. The Zynerba Board considered that, under certain circumstances set forth in the Merger Agreement, Purchaser is required to extend the Offer beyond the initial expiration date of the Offer or, if applicable, subsequent expiration dates, if the conditions to the consummation of the Offer are not satisfied or waived as of such date.

End Date. The Zynerba Board considered the termination date under the Merger Agreement on which either Harmony Biosciences or Zynerba, subject to certain exceptions, can terminate the Merger Agreement, which is anticipated to allow for sufficient time to consummate the Offer and the Merger while minimizing the length of time during which Zynerba would be required to operate subject to the restrictions on interim operations set forth in the Merger Agreement.

Appraisal Rights. The Zynerba Board considered the availability of statutory appraisal rights to Zynerba’s stockholders (and certain beneficial owners, as the case may be) who do not tender their Shares in the Offer and otherwise comply with all required procedures under the DGCL.

Business Reputation of Harmony Biosciences. The Zynerba Board considered the business reputation and capabilities of Harmony Biosciences and its management and the substantial financial resources of Harmony Biosciences and, by extension, Purchaser, which the Zynerba Board believed supported the conclusion that a transaction with Harmony Biosciences and Purchaser could be completed relatively quickly and in an orderly manner.

Certainty of Consideration. The Zynerba Board considered the nature of the consideration to be paid in the Offer and the Merger, which allows holders of Shares to realize immediate value, in cash, for their investment in Zynerba, while avoiding Zynerba’s regulatory, commercialization and other business risks, and while also providing such holders of Shares with certainty of value and liquidity for their Shares.

Opportunity to Realize Additional Value. The Zynerba Board considered that in addition to the Closing Amount, the holders of Shares will receive a CVR, which provides the holders of Shares with opportunities to realize additional value through additional cash payments to the extent that the Milestones are achieved within the time periods described therein. The Zynerba Board also took into account the fact that, while Harmony has the right, in its discretion, to direct and control the research, development, commercialization and other exploitation of Zygel™, Harmony Biosciences must use “Commercially Reasonable Efforts” (as described in the CVR Agreement) to achieve the Milestones and the experience and resources of Harmony Biosciences in pharmaceutical product development and commercialization, particularly as such commercial experience and resources relate to the potential achievement of the Milestones.

In the course of its deliberations, the Zynerba Board also considered a variety of material risks and other countervailing factors related to entering into the Merger Agreement, including, but not limited to, the following:

The foregoing discussion of the information and factors considered by the Zynerba Board in reaching its conclusions and recommendations is intended to be illustrative and not exhaustive, but includes the material reasons and factors considered by the Zynerba Board. In view of the wide variety of reasons and factors considered, the Zynerba Board did not find it practicable to, and did not, quantify, rank or otherwise assign any relative or specific weights to the various specific factors considered in reaching its determination and making its recommendation. In addition, the Zynerba Board did not reach any specific conclusion with respect to any of the factors or reasons considered. Instead, the Zynerba Board conducted an overall review of the factors and reasons described above and determined that, in the aggregate, the potential benefits considered outweighed the potential risks or possible negative consequences of the Offer and the Merger.

The foregoing discussion of the reasoning of the Zynerba Board and certain information presented in this section is forward-looking in nature and, therefore, the information should be read in light of the factors discussed in “Item 8. Additional Information—Cautionary Note Regarding Forward-Looking Statements.” For the reasons described above, and in light of other factors that the Zynerba Board believed were appropriate to consider, the Zynerba Board approved the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger, and unanimously recommends that Zynerba’s stockholders tender their Shares to Purchaser pursuant to the Offer.

To Zynerba’s knowledge, after making reasonable inquiry, all of Zynerba’s executive officers and directors currently intend to tender or cause to be tendered pursuant to the Offer all of their Shares (other than unvested Company RSAs) held of record or beneficially owned by such persons immediately prior to the expiration of the Offer, as it may be extended (other than Shares for which such holder does not have discretionary authority). The foregoing does not include any Shares over which, or with respect to which, any such executive officer or director acts in a fiduciary or representative capacity or is subject to the instructions of a third party with respect to such tender.

In addition, Harmony Biosciences and Purchaser entered into Support Agreements with certain Zynerba directors and executive officers pursuant to which each such director and executive officer has agreed to tender all of their Shares in the Offer.

Zynerba does not yet have any marketed products and does not, as a matter of course, publicly disclose forecasts or projections as to future performance, earnings or other results due to the inherent unpredictability of the underlying assumptions, estimates and projections. However, in connection with its strategic planning process and at the direction of the Zynerba Board in connection with its evaluation of the proposed transaction with Harmony Biosciences, Zynerba management prepared long-range projections of revenue and costs for fiscal years 2023 through 2031 based on its view of the prospects for Zynerba on a stand-alone basis with respect to Zynerba’s

programs for Zygel (“Management Projections”), and directed MTS Health Partners to extrapolate such projections for fiscal years 2032 through 2038 (holding earnings before interest and taxes, or EBIT, in fiscal year 2031 constant through fiscal year 2038) and to adjust such projections based on probabilities of success provided by Zynerba management (such projections for fiscal year 2023 through 2038, as more fully described below are referred to as the “Forecasts”). The Forecasts reflect a non-risk-adjusted outlook and risk-adjusted outlook, as applicable, and were based on certain internal assumptions about the probability of technical success and regulatory approval, timing of completion of clinical studies and commercial launch, a successful equity capital raise of up to $17 million to sustain the company through completion of its current phase 3 trial of Zygel in patients with Fragile X Syndrome, sales ramp, commercial reach, market size and prevalence, diagnosis rates, market share, compliance and persistence, pricing, market access, expected cash burn rate, competition, partnering and licensing arrangements, market exclusivity, estimated costs and expenses, effective tax rate and utilization of net operating losses, ability to raise future capital, and the impact of future capital raises on current stockholders, and other relevant factors relating to Zynerba and Zygel. The Forecasts were developed solely using the information available to Zynerba management at the time they were created.

The Management Projections were presented to and considered by the Zynerba Board in connection with their evaluations of the Transactions in comparison to Zynerba’s other strategic alternatives. The Management Projections also were provided to MTS Health Partners, and the Zynerba Board directed MTS Health Partners to use the Forecasts, including the Management Projections, in its financial analyses and opinion (as summarized above under “— Opinion of Zynerba’s Financial Advisor”). The Forecasts, including the Management Projections, were not provided to Harmony Biosciences.

The summaries of the Forecasts are not being included in this Schedule 14D-9 to influence any stockholder’s decision whether to tender his, her or its Shares in the Offer. The summaries of the Forecasts are being included in this Schedule 14D-9 because the Forecasts were presented to the Zynerba Board to evaluate strategic transactions considered by the Zynerba Board, including the transactions contemplated by the Offer and the Merger Agreement and to MTS Health Partners for its financial analyses and MTS Securities’ opinion. The Forecasts may differ from publicized analyst estimates and forecasts and, in each instance, do not take into account any events or circumstances after the date they were prepared, including the announcement of the Offer and Merger.

Each of the Forecasts, although presented with numerical specificity, are necessarily based on numerous variables, estimates and assumptions that are inherently uncertain, including as a result of Zynerba not currently having any marketed products, and many of which are beyond Zynerba’s control. Because the Forecasts cover multiple years, by their nature they will become subject to greater uncertainty with each successive year and are unlikely to anticipate each circumstance that will have an effect on Zynerba’s business and its results of operations. Each of the Forecasts was prepared by Zynerba’s management, or extrapolated by MTS Health Partners as described above, based on certain estimates and assumptions with respect to general business, economic, competitive, regulatory, reimbursement and other market and financial conditions and other future events, all of which are difficult to predict and many of which are beyond Zynerba’s control. As a result, there can be no assurance that any of the Forecasts accurately reflect future trends or accurately estimate the future market for Zygel. Each of the Forecasts was developed solely using the information available to Zynerba management at the time they were created and reflect assumptions as to certain business decisions that are subject to change. Important factors that may affect actual results or that may result in any of the Forecasts not being achieved include, but are not limited to: (1) the success of clinical trials (including the funding therefor, anticipated patient enrollment, clinical outcomes, timing or associated costs); (2) regulatory approvals and related timelines; (3) the market acceptance of Zynerba’s potential products; (4) Zynerba’s development of potential products and product candidates for different indications; (5) the availability of third-party reimbursement; (6) the impact of competitive products and pricing; (7) the effect of regulatory actions; (8) the availability of partnering arrangements on favorable terms or at all; (9) the effect of global economic conditions; (10) conditions in the financing markets and access to sufficient capital; (11) changes in applicable laws, rules and regulations; (12) accuracy of certain accounting assumptions; (13) changes in actual or projected cash flows; and (14) other risk factors described in Zynerba’s annual report on Form 10-K for the fiscal year ended December 31, 2022, subsequent quarterly reports on Form 10-Q, and current reports on Form 8-K, as well as the section titled “Cautionary Note Regarding Forward-Looking Statements” in this Schedule 14D-9. In addition, the Forecasts may be affected by Zynerba’s ability to achieve strategic goals, objectives and targets over the applicable period. Accordingly, there can be no assurance that any of the Forecasts will be realized, and actual results may vary materially from those shown.

Modeling and forecasting the future development and commercialization of drug candidates by a clinical-stage company is a highly speculative endeavor. In addition to the various limitations described above, there can be no assurance of the approval, or timing of approval, of Zynerba’s lead product candidate, and it is possible that other therapeutic scenarios will be preferable. There also can be no assurance that Zynerba will obtain the regulatory approvals necessary for the commercialization of Zygel, or that Zynerba’s competitors will not commercialize products that are safer, more effective or more successfully marketed and sold than any product that Zynerba may market or commercialize. Since the Forecasts cover a long period of time, the Forecasts by their nature are unlikely to anticipate each circumstance that will have an effect on Zynerba’s product candidate.

The Forecasts were not prepared with a view toward complying with U.S. generally accepted accounting principles (“GAAP”), the published guidelines of the SEC regarding projections or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. Neither Zynerba’s independent registered public accounting firm nor any other independent accountant, has audited, reviewed, compiled or performed any procedures with respect to any of the Forecasts or expressed any opinion or any form of assurance related thereto.

The Forecasts were not prepared with a view toward public disclosure. The inclusion of the Forecasts in this Schedule 14D-9 should not be regarded as an indication that any of Zynerba, Harmony Biosciences, Purchaser or any of their respective affiliates, officers, directors, advisors or other representatives considered or consider any of the Forecasts necessarily predictive of actual future events, and none of the Forecasts should be relied upon as such or construed as financial guidance. None of Zynerba, Harmony Biosciences, Purchaser or any of their respective affiliates, officers, directors, advisors or other representatives assumes any responsibility for the accuracy of this information. None of Zynerba, Harmony Biosciences, Purchaser or any of their respective affiliates, officers, directors, advisors or other representatives can give any assurance that actual results will not differ from any of the Forecasts, and none of them undertakes any obligation to update or otherwise revise or reconcile any of the Forecasts to reflect circumstances existing after the date any of the Forecasts were generated or to reflect the occurrence of future events even in the event that any or all of the assumptions underlying such Forecasts are shown to be in error. None of Zynerba, Harmony Biosciences, Purchaser or any of their respective affiliates, officers, directors, advisors or other representatives has made or makes any representation or warranty to any Zynerba stockholders or Harmony Biosciences stockholders regarding the ultimate performance of Zynerba compared to the information contained in any of the Forecasts, the likelihood that the Forecasts will be achieved consistent with any of the Forecasts or at all, the results of Zynerba’s clinical trials, the potential timing and approval of commercial launch of any of Zynerba’s future products, the effectiveness or marketability of Zygel, or the overall future performance of Zynerba. The Forecasts are subjective in many respects and, thus, are subject to interpretation. Accordingly, there can be no assurance that any of the Forecasts will be realized, and actual results may vary materially from those shown. None of Zynerba, Harmony Biosciences, Purchaser or any of their respective affiliates, officers, directors, advisors or other representatives can give any assurance that actual results will not differ materially from any of the Forecasts.

The Forecasts were reasonably prepared by Zynerba management and extrapolated by MTS Health Partners at the direction of Zynerba management on bases reflecting the best currently available estimates and judgments of Zynerba management as to the matters covered thereby. The Forecasts were prepared assuming Zynerba’s continued operation as a stand-alone, publicly traded company, and therefore do not give effect to the Offer or the Merger or any changes to Zynerba’s operations or strategy that may be implemented following the consummation of the Offer and the Merger or to any costs incurred in connection with the Offer or the Merger, including the potential synergies that may be achieved by the combined company as a result of the Merger or the effect of any business or strategic decision or action that has been or will be taken as a result of the execution of the Merger Agreement. Zynerba management believed the assumptions used in the preparation of these Forecasts to be reasonable at the time they were made, including, but not limited to, assumptions relating to the probability of technical success and regulatory approval, timing of completion of clinical studies and commercial launch, sales ramp commercial reach, market size and prevalence, diagnosis rates, market share, compliance and persistence, pricing, market access, expected cash burn rate, competition, partnering and licensing arrangements, market exclusivity, estimated costs and expenses, effective tax rate and utilization of net operating losses, ability to raise future capital, and the impact of future capital raises on current stockholders, and other relevant factors relating to Zynerba and Zygel. The foregoing is a summary of certain key assumptions and does not purport to be a comprehensive overview of all assumptions reflected in each of the Forecasts.

Certain of the measures included in the Forecasts, including EBIT and unlevered free cash flow in the Forecasts, are financial measures that are not calculated in accordance with GAAP. Such non-GAAP financial measures should not be viewed as a substitute for GAAP financial measures, and may be different from non-GAAP financial measures used by other companies. Furthermore, there are limitations inherent in non-GAAP financial measures, because they exclude charges and credits that are required to be included in a GAAP presentation. Accordingly, non-GAAP financial measures should be considered together with, and not as an alternative to, financial measures prepared in accordance with GAAP. EBIT and unlevered free cash flow should not be considered as an alternative to operating income or net income or as a measure of operating performance, cash flow or liquidity. The summary of the Forecasts below is included solely to give Zynerba’s stockholders access to the information that was made available to the Zynerba Board and MTS Health Partners, and is not included in this Schedule 14D-9 in order to influence any Zynerba stockholder to make any investment decision with respect to Offer and the Merger or as to whether or not such holder should tender shares in connection with the Offer or otherwise act with respect to the Transaction or any other matter.

Financial measures provided to a financial advisor are excluded from the definition of non-GAAP financial measures and, therefore, are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure. Reconciliations of non-GAAP financial measures were not relied upon by MTS Health Partners for purposes of its financial analysis as described above in the section titled “—Opinion of Zynerba’s Financial Advisor” or by the Zynerba Board in connection with its consideration of the Offer and the Merger. Accordingly, Zynerba has not provided a reconciliation of any financial measures included in any of the Forecasts.

Zynerba undertakes no obligation to update or otherwise revise or reconcile any of the Forecasts to reflect circumstances existing after the date such Forecasts were generated or to reflect the occurrence of future events even in the event that any or all of the assumptions underlying such Forecasts are shown to be in error. None of Zynerba, or, to the knowledge of Zynerba, Harmony Biosciences or Purchaser, intends to make publicly available any update or other revisions to any of the Forecasts, except as otherwise required by law.

The Forecasts below vary based on the assumed completion date of the RECONNECT trial and such Forecasts should not be understood as an indication of when the RECONNECT trial will be completed or if it will be completed all.

Set forth below is a summary of the Management Projections, which are selected projected financial information for Zynerba for fiscal years 2023 through 2031 and reflect the following key assumptions: (1) the completion of the RECONNECT trial, a pivotal, multi-national, confirmatory Phase 3 trial of Zygel in patients with Fragile X Syndrome (“FXS”) by March of fiscal year 2024, (2) the commercial launch of Zygel for patients with FXS in the first quarter of fiscal year 2026, (3) the initiation of the Phase 3 clinical trial of Zygel in patients with chromosome 22q11.2 deletion syndrome (“22q”) (“22Q Phase 3 Trial”), contingent upon the success of the completed RECONNECT trial, (4) completion of the 22q Phase 3 Trial in the first quarter of fiscal year 2027, (5) the commercial launch of Zygel for patients with 22q in the third quarter of 2028, (6) no further development of Zygel with respect to autism spectrum disorder (“ASD”), and (7) upfront licensing revenue from outside the U.S. of $25.0 million prior to commercial launch of Zygel in patients with FXS and ongoing licensing milestone and royalty revenues from 2026 through 2031 (the “Q1 Results Forecasts”).

The Q1 Results Forecasts vary based on three different assumptions with respect to Zygel’s expected pricing as more fully described below.

The Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced at a slight premium to Epidiolex ®, an FDA-approved cannabidiol developed and marketed by Jazz Pharmaceuticals.

The Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced higher than Epidiolex ®, but lower than a rare disease drug.

The Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced as a rare disease drug.

The Q1 Results Forecasts were extrapolated by MTS Health Partners, at the direction of Zynerba management, through fiscal year 2038 (holding EBIT in fiscal year 2031 constant through fiscal year 2038) and risk-adjusted to reflect Zynerba management’s assessment of the probability of: (1) positive results of the RECONNECT trial (56.3%), (2) approval by the FDA of the NDA for Zygel in highly methylated patients with FXS (91.2%), (3) positive results of the 22q Phase 3 Trial (56.3%), which trial is dependent on the positive results of the RECONNECT trial, and (4) approval by the FDA of the NDA for Zygel in patients with 22q (91.2%) (such adjustments, the “Probability Adjustments” and such Forecasts, the “Adjusted Q1 Results Forecasts”). In arriving at the Probability Adjustments, Zynerba management consulted various industry publications containing aggregate risk adjustment statistics and applied their professional judgement based on their familiarity with Zygel’s existing clinical data.

The Adjusted Q1 Results Forecasts vary based on three different assumptions with respect to Zygel’s expected pricing as more fully described below.

The Adjusted Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced at a slight premium to Epidiolex ® (the “Adjusted Q1 Results (Comparable Pricing) Forecast”). (The Adjusted Q1 Results (Comparable Pricing) Forecast is referred to as “Case 1” in the section titled “—Opinion of Zynerba’s Financial Advisor”).

The Adjusted Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced higher than Epidiolex ®, but lower than a rare disease drug (the “Adjusted Q1 Results (Mid-Pricing) Forecast”). (The Adjusted Q1 Results (Mid-Pricing) Forecast is referred to as “Case 2” in the section titled “—Opinion of Zynerba’s Financial Advisor”).

The Adjusted Q1 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced as a rare disease drug (the “Adjusted Q1 Results (Rare Disease Pricing) Forecast”). (The Adjusted Q1 Results (Rare Disease Pricing) Forecast is referred to as “Case 3” in the section titled “—Opinion of Zynerba’s Financial Advisor”).

Set forth below is a summary of the Management Projections, which are selected projected financial information for Zynerba for fiscal years 2023 through 2031 and reflect the following key assumptions: (1) the completion of the RECONNECT trial by June of fiscal year 2024, (2) the commercial launch of Zygel for patients with FXS in the second quarter of fiscal year 2026, (3) the initiation of the 22Q Phase 3 Trial, contingent upon the success of the completed RECONNECT trial, (4) completion of the 22q Phase 3 Trial in the second quarter of fiscal year 2027, (5) the commercial launch of Zygel for patients with 22q in the fourth quarter of 2028, (6) no further development of Zygel with respect to autism spectrum disorder (“ASD”), and (7) upfront licensing revenue from outside the U.S. of $25.0 million prior to commercial launch of Zygel in patients with FXS and ongoing licensing milestone and royalty revenues from 2026 through 2031(the “Q2 Results Forecasts”).

The Q2 Results Forecasts vary based on three different assumptions with respect to Zygel’s expected pricing as more fully described below.

The Q2 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced at a slight premium to Epidiolex ®.

The Q2 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced higher than Epidiolex ®, but lower than a rare disease drug.

The Q2 Results Forecast summarized immediately below reflect the assumption that Zygel will be priced as a rare disease drug.

The Q2 Results Forecasts were extrapolated by MTS Health Partners, at the direction of Zynerba management, through fiscal year 2038 (holding earnings before interest and taxes, or EBIT, in fiscal year 2031 constant through fiscal year 2038) and risk-adjusted to reflect the Probability Adjustments (such Forecasts, the “Adjusted Q2 Results Forecasts”).

The Adjusted Q2 Results Forecasts vary based on three different assumptions with respect to Zygel’s expected pricing as more fully described below.

The Adjusted Q2 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced at a slight premium to Epidiolex ® (the “Adjusted Q2 Results (Comparable Pricing) Forecast”). (The Adjusted Q2 Results (Comparable Pricing) Forecast is referred to as “Case 4” in the section titled “—Opinion of Zynerba’s Financial Advisor”).

The Adjusted Q2 Results Forecast summarized immediately below reflects the assumption that Zygel will be priced higher than Epidiolex ®, but lower than a rare disease drug (the “Adjusted Q2 Results (Mid-Pricing) Forecast”). (The Adjusted Q2 Results (Mid-Pricing) Forecast is referred to as “Case 5” in the section titled “—Opinion of Zynerba’s Financial Advisor”).