Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) Q1 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presents a mixed sentiment. The company has positive developments, such as the completion of Phase 2 study enrollment and international expansion, but lacks specific revenue guidance, which is a concern. The Q&A reveals some uncertainties, like the FDA filing process and unclear patient mix insights. However, there are no significant safety issues, and the company is exploring new market opportunities, like China. Considering the market cap, these factors suggest a neutral stock price movement over the next two weeks.
Key Financial Performance
EPS Reported EPS is $-0.81, a decrease from expectations of $-0.69.
Revenue Revenue from global sales of IMCIVREE was $37.7 million in Q1 2025, an increase of $11.7 million or 45% compared to Q1 2024.
R&D Expenses R&D expenses were $37 million for Q1 2025, down from $128.7 million in Q1 2024, primarily due to decreased spending on various trials.
SG&A Expenses SG&A expenses were $39.1 million for Q1 2025, compared to $34.4 million for Q1 2024, reflecting a modest increase.
Cash Used in Operations Cash used in operations was approximately $40.4 million, compared to $19 million in Q4 2024, due to seasonal increases and a $6.3 million payment to reacquire rights in China.
Cash on Hand Ended the quarter with $314.5 million in cash, sufficient to cover operations into 2027.
Weighted Average Common Shares Outstanding 63.1 million shares outstanding in Q1 2025, up from 60.1 million in Q1 2024, primarily due to shares sold under the ATM program.
US Revenue Percentage US revenue decreased to 65% of overall product revenue in Q1 from 74% in Q4 2024, affected by an inventory swing.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
IMCIVREE Demand: Demand for IMCIVREE remains strong, with a consistent number of new prescriptions and a 14% increase in patients on reimbursed therapy globally in Q1 2025.
Bivamelagon Phase 2 Readout: The Phase 2 readout for bivamelagon is expected in Q3 2025.
Setmelanotide Efficacy: Setmelanotide showed a 16.5% reduction in BMI in the treatment cohort, indicating its potential effectiveness for patients with hypothalamic obesity.
Medicaid Coverage Expansion: Secured IMCIVREE-specific policies in three additional states, now covering over 95% of Medicaid lives.
International Market Growth: International sales of IMCIVREE increased by $3.1 million, driven by growth in France, Germany, and Italy.
Cash Runway: Projected cash runway extends into 2027, with $314.5 million in cash on hand.
Operational Efficiency: R&D expenses decreased by approximately 10% from Q4 2024 due to reduced spending on trials.
FDA Interaction: Rhythm is on track for a Q3 filing with the FDA for acquired hypothalamic obesity, with positive interactions noted.
Focus on Endocrine Neurologists: The company is concentrating efforts on endocrine neurologists, who account for half of the prescribers for BBS.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Earnings Expectations: Rhythm Pharmaceuticals missed earnings expectations with a reported EPS of $-0.81, compared to expectations of $-0.69.
Regulatory Risks: The company is preparing for a Q3 filing with the FDA, but any delays or issues in the regulatory process could impact timelines and market entry.
Inventory Management: Significant inventory swings at the specialty pharmacy affected revenue recognition, with a $8.3 million inventory swing impacting Q1 results.
Patient Compliance: A modest decrease in patient compliance was noted, which could affect future revenue and treatment outcomes.
Market Access Challenges: Transition of patients to new insurance plans at the beginning of the year temporarily increased reliance on the Bridge program for free drug access.
Economic Factors: The company faces economic pressures that could impact pricing strategies and overall market demand for its products.
Operational Expenses: R&D expenses decreased but remain significant, and the company anticipates ongoing operational expenses that could affect profitability.
Cash Flow: The company reported cash used in operations of approximately $40.4 million, indicating a need for careful cash management moving forward.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Phase 3 Trial Filing: Rhythm Pharmaceuticals is on track for a Q3 filing regarding the Phase 3 trial on acquired hypothalamic obesity, with an in-person Type D meeting scheduled with the FDA.
IMCIVREE Demand: Demand for IMCIVREE remains strong, with a consistent number of new prescriptions and a 14% increase in patients on reimbursed therapy globally.
Medicaid Coverage Expansion: Secured IMCIVREE-specific policies in three additional states, now covering over 95% of Medicaid lives.
International Growth: Continued growth in the number of patients on paid therapy outside the U.S., particularly in France, Germany, and Italy.
Upcoming Data Presentations: Looking forward to presenting data from the Phase 2 study and real-world evidence at major European medical conferences.
Revenue Expectations: Revenue from global sales of IMCIVREE was $37.7 million in Q1 2025, with expectations for continued growth despite inventory swings.
Cash Runway: Projected cash runway into 2027, with $314.5 million in cash on hand.
Operating Expenses Guidance: Guidance for non-GAAP operating expenses remains unchanged at approximately $285 million to $315 million.
R&D Expenses: R&D expenses for Q1 2025 were $37 million, down from $128.7 million in Q1 2024.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Share Repurchase Program: None
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:Can you talk a little bit more about those non-responders you highlighted? What were the reasons for those discontinuations?
A:There were a variety of reasons for discontinuations, including patients withdrawing due to inability to keep up with the clinical trial and some due to reactions. One patient with a preexisting seizure disorder had uncontrolled seizures and died during the trial.
Q:Can you talk about real-world persistence and understanding of expectations for adverse events?
A:In general, around 30% of patients discontinue treatment. In the HO trial, the discontinuation rate was less than 10%, and compliance was extremely high overall.
Q:For Part C for RM-718, will you share any efficacy data for patients reaching 16 weeks before the end of the year?
A:Part C is just getting underway, and we hope to have enough patients treated for a long enough period of time to share something by the end of the year.
Q:Can you talk about the importance of continual data updates at conferences? What additional data do you think is necessary?
A:Every patient is incremental in the rare disease world. The data updates are important, even if they are small numbers, as they can highlight significant findings.
Q:Are you expecting to see any seasonality for the remaining quarters of the year?
A:Q1 had the biggest impact due to insurance changes. Beyond that, we haven’t experienced significant seasonality throughout the year.
Q:Can you discuss what elements of the filing need to be ironed out with the FDA?
A:The meeting is to clarify what we’re presenting in the filing and ensure alignment on how the data will be presented.
Q:Could you quantify the impact of insurance reauthorizations in Q4?
A:That was about a $700,000 impact.
Q:What is the payer mix for BBS between Medicare, Medicaid, and private pay?
A:The commercial and Medicaid population accounts for about 80%, with Medicare being a smaller portion.
Q:Can you discuss the bivamelagon opportunity and the expected profile?
A:The hope is for efficacy comparable to setmelanotide, with a threshold of being better than 10%.
Q:Can you talk about the PWS opportunity for MC4R-targeted agents?
A:The probability of success is around 50-50, and anything that moves the needle in PWS is of interest.
Q:Can you discuss the launch trajectory for HO in Europe compared to BBS?
A:The dynamics in Europe are similar to the US, with a focus on endocrinologists, but HO is a different opportunity than BBS.
Q:What are your thoughts on the label for HO?
A:We have had zero interaction around the label, but we expect it to be based on inclusion-exclusion criteria.
Q:Can you comment on the commercial rollout in hypothalamic obesity relative to other indications?
A:The trajectory is based on how quickly you can identify patients, and there is a high unmet need in the HO population.
Q:What is your strategy for the China market after the RareStone termination?
A:We are thrilled to have the rights back and are exploring our strategy for China, which may involve a partner.
Q:Can you comment on safety from the bivamelagon study?
A:There are no significant safety signals of concern, and we are not seeing any serious adverse events related to liver function.
Q:What is your level of confidence in the HO revenue ramp?
A:We cannot guide on revenue specifically, but the launch trajectory should be different from BBS due to the patient population.
Q:Should we expect lumpiness this year in quarterly revenue?
A:There may be some lumpiness due to stocking during the fourth quarter, but we don’t expect significant moves in days on hand.
Q:What factors limit repeat prescribers in BBS?
A:The repeat prescribers are limited by the number of patients who fall under IMCIVREE’s indications and the experience of the prescribers.
Q:Can you describe the patient mix in the congenital HO sub-study?
A:It’s too early to provide meaningful insights on the patient mix among different pituitary deficiency disorders.
Q:Can you disclose the number of written TRX and reimbursed TRX in the US in the first quarter?
A:We’re not breaking those out anymore; we’re relying on revenues for a holistic view.
Q:Can you comment on the qualitative differences in the commercial rollout for HO?
A:The unmet need is high, and we have gathered positive feedback from physicians about IMCIVREE’s efficacy.
Q:What are your thoughts on the China commercial opportunity?
A:We are excited about the opportunity in China and will explore our strategy moving forward.
Q:Review of Unclear Management Responses
A:Management avoided giving a direct answer regarding the specific elements that need to be ironed out with the FDA filing, stating it was more about ensuring alignment without providing detailed uncertainties. Additionally, there was a lack of clarity on the exact patient mix in the congenital HO sub-study, as management stated it was too early to provide meaningful insights.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
BMI
Bridge
Daybreak
IMCIVREE number
MCR pathway
Medicaid
Pharmaceuticals
Phase trial
RD
RareStone
SGA
Slide
States coverage
analysis
bivamelagon
color
consistency response
coverage IMCIVREE
day hand
decrease
demand IMCIVREE
difference
hyperphagia
interest
inventory day
inventory swing
label extension
meeting
month
non responder
patient caregiver
patient response
patient treatment
pharmacy patient
placebo
prescribers
reduction
result Phase
specialty pharmacy
visit
world
RYTM Transcript
Rhythm Pharmaceuticals, Inc. (RYTM) Q3 2025 Earnings Call Transcript
Positive11-4
The company shows strong financial performance with a 54% YoY revenue increase and sustainable growth plans for BBS sales. The upcoming launch of IMCIVREE in hypothalamic obesity and positive payer feedback suggest potential market expansion. However, management's lack of clarity on certain aspects and the absence of a go/no-go decision for the PWS Phase III trial may cause some uncertainty. Considering the market cap, the overall sentiment is positive, predicting a 2% to 8% stock price increase over the next two weeks.
Rhythm Pharmaceuticals, Inc. (RYTM) Presents At Morgan Stanley 23rd Annual Global Healthcare Conference Transcript
Neutral9-9
Rhythm Pharmaceuticals, Inc. (RYTM) Q2 2025 Earnings Call Transcript
Unknown8-5
The earnings call summary indicates mixed results. The company has strong financial metrics, with a significant cash runway and international expansion. However, the Q&A section reveals uncertainties in clinical trials and a lack of clear guidance, which could dampen investor sentiment. The equity offering and increased expenses may also weigh on the stock. Overall, the market cap suggests moderate volatility, leading to a neutral prediction for the stock price movement over the next two weeks.
Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) Q1 2025 Earnings Call Transcript
Unknown5-9
The earnings call presents a mixed sentiment. The company has positive developments, such as the completion of Phase 2 study enrollment and international expansion, but lacks specific revenue guidance, which is a concern. The Q&A reveals some uncertainties, like the FDA filing process and unclear patient mix insights. However, there are no significant safety issues, and the company is exploring new market opportunities, like China. Considering the market cap, these factors suggest a neutral stock price movement over the next two weeks.
RYTM Slides
RYTM Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
