Rhythm Pharmaceuticals (NASDAQ:RYTM) Announces Earnings Results, Beats Estimates By $0.10 EPS

Rhythm Pharmaceuticals (NASDAQ:RYTM) released its quarterly earnings data on Tuesday. The company reported ($0.61) earnings per share for the quarter, beating analysts’ consensus estimates of ($0.71) by $0.10, Zacks reports. Rhythm Pharmaceuticals had a negative net margin of 69.03% and a negative return on equity of 159.32%. The business had revenue of $92.13 million during the quarter, compared to analyst estimates of $85.56 million. During the same period in the previous year, the business earned ($0.82) EPS. Rhythm Pharmaceuticals’s revenue was up 79.6% compared to the same quarter last year.

Here are the key takeaways from Rhythm Pharmaceuticals’ conference call:

• Strong U.S. acquired hypothalamic obesity launch: Q3 global IMCIVREE revenue rose 29% sequentially to $92.1 million, with U.S. revenue of $67.5 million. Rhythm reported more than 700 acquired HO patient start forms, over 500 prescribers, and continued demand growth entering Q4.
• Encouraging market access: Approximately 60% of Medicaid-covered lives and 75% of commercial-covered lives were covered by acquired HO policies at quarter-end, while more than 80% of reimbursement approvals were obtained within 60 days of receiving a start form.
• International expansion is underway: IMCIVREE launched in Japan on October 14 at a price of approximately $2,200 per vial, with more than 1,000 potentially eligible patients identified. Rhythm expects Japan to become its second-largest market, although two-week prescription limits may constrain first-year revenue; European launches are expected to begin in 2027.
• Pipeline expansion: Rhythm plans to initiate a phase III bivamelagon study in hypothalamic obesity in early 2027 and pursue a six-month phase III Prader-Willi syndrome study focused on hyperphagia. Management also expects to develop next-generation MC4R therapies and potential combination approaches.
• Higher financing obligations: Rhythm amended its LG Chem agreement to reduce potential royalties to a 1% flat rate, but committed to $350 million in payments over four years and took an initial $250 million term loan at SOFR plus 4.6%. The company ended Q3 with about $321 million in cash and investments, excluding these transaction-related cash flows.

Rhythm Pharmaceuticals Stock Performance

NASDAQ RYTM traded down $4.93 on Thursday, hitting $105.75. The stock had a trading volume of 2,236,339 shares, compared to its average volume of 811,779. Rhythm Pharmaceuticals has a 52-week low of $74.50 and a 52-week high of $122.20. The company has a market capitalization of $7.25 billion, a price-to-earnings ratio of -36.39 and a beta of 2.17. The firm has a 50-day moving average of $96.29 and a 200-day moving average of $97.18.

Insider Transactions at Rhythm Pharmaceuticals

In other news, CFO Hunter C. Smith sold 62,774 shares of the company’s stock in a transaction on Monday, August 31st. The shares were sold at an average price of $105.46, for a total value of $6,620,146.04. Following the transaction, the chief financial officer owned 114,024 shares of the company’s stock, valued at approximately $12,024,971.04. This represents a 35.51% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Yann Mazabraud sold 57,000 shares of the stock in a transaction on Wednesday, August 12th. The stock was sold at an average price of $116.15, for a total value of $6,620,550.00. Following the completion of the sale, the executive vice president owned 55,655 shares in the company, valued at $6,464,328.25. This trade represents a 50.60% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders sold 258,450 shares of company stock worth $28,796,497. 5.90% of the stock is owned by corporate insiders.

Trending Headlines about Rhythm Pharmaceuticals

Here are the key news stories impacting Rhythm Pharmaceuticals this week:

• Positive Sentiment: Reported takeover offer: AstraZeneca’s reported offer would value Rhythm at roughly $10 billion and add its rare-disease treatments to AstraZeneca’s portfolio. The report triggered a sharp move in RYTM shares and a temporary trading halt. Reuters article on reported AstraZeneca offer
• Positive Sentiment: Expanded UK treatment access: NICE issued positive updated guidance extending IMCIVREE use to adults with genetically confirmed Bardet-Biedl syndrome, potentially broadening access to the treatment. Rhythm Pharmaceuticals NICE guidance announcement
• Positive Sentiment: Sales potential: RBC said IMCIVREE could reach $2 billion in worldwide sales by 2030, reinforcing the commercial-growth case for Rhythm. RBC sales forecast article
• Positive Sentiment: Analyst support: Citizens JMP raised its price target to $166 and maintained a market-outperform rating. Citizens JMP rating information
• Neutral Sentiment: Quarterly results were mixed for sentiment: Rhythm reported a smaller-than-expected Q3 loss and revenue above estimates, but shares had slipped after the earnings announcement. Q3 earnings flash
• Negative Sentiment: Lower target from Needham: Needham cut its price target from $130 to $114, while retaining a Buy rating—an offsetting caution amid the takeover speculation. Needham rating information

Wall Street Analysts Forecast Growth

RYTM has been the topic of several recent research reports. Oppenheimer restated a “market perform” rating on shares of Rhythm Pharmaceuticals in a research report on Wednesday. Canaccord Genuity Group set a $154.00 price target on Rhythm Pharmaceuticals in a research report on Wednesday, August 5th. Wolfe Research started coverage on Rhythm Pharmaceuticals in a research note on Thursday, September 17th. They set an “outperform” rating on the stock. Weiss Ratings reissued a “sell (d-)” rating on shares of Rhythm Pharmaceuticals in a report on Thursday, October 15th. Finally, National Bank Financial set a $160.00 price objective on Rhythm Pharmaceuticals in a report on Wednesday, August 5th. Eighteen research analysts have rated the stock with a Buy rating, three have given a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, Rhythm Pharmaceuticals currently has an average rating of “Moderate Buy” and an average price target of $141.94.

Rhythm Pharmaceuticals Company Profile

Rhythm Pharmaceuticals, Inc is a biopharmaceutical company focused on developing and commercializing therapies for rare genetic diseases of obesity and related metabolic disorders. The company’s work is based on the melanocortin-4 receptor (MC4R) pathway, which plays an important role in regulating hunger and energy balance.

Rhythm’s principal product is IMCIVREE (setmelanotide), a targeted therapy designed to restore impaired MC4R pathway signaling. In the United States, IMCIVREE is approved for chronic weight management in adults and children at least 6 years old with obesity caused by certain genetic deficiencies, including POMC, PCSK1, or LEPR deficiency, as well as Bardet-Biedl syndrome.