Rhythm Pharmaceuticals (RYTM) Q3 2024 earnings summary

Executive summary

• Q3 2024 product revenue reached $33.3 million, up 48% year-over-year and 14% sequentially, driven by IMCIVREE sales in both U.S. and international markets, with expanding access in over 15 countries and launches in new regions.

• Advanced clinical pipeline with progress in phase 3 hypothalamic obesity (HO) trials, positive DAYBREAK Phase 2 data, and new real-world results showing robust BMI reductions in adult HO patients from France.

• FDA accepted SNDA for IMCIVREE to treat children as young as 2 years old, with a PDUFA goal date of December 26, 2024; EMA and other regulatory reviews ongoing.

• Cash, cash equivalents, and short-term investments totaled $298.4 million as of September 30, 2024, expected to fund operations into 2026.

• Significant R&D investment continues, including acquisition of global rights to bivamelagon (LB54640) from LG Chem and ongoing clinical trials for setmelanotide and other candidates.

Financial highlights

• Q3 2024 product revenue was $33.3 million, up from $22.5 million in Q3 2023 and $29.2 million in Q2 2024; U.S. revenue was $23.3 million (70%), international $10 million (30%), with international sales up 35% sequentially.

• Q3 2024 net loss was $43.6 million to $45.0 million, or $(0.73) per share, a slight improvement from Q3 2023.

• R&D expenses were $37.9 million, up from $33.6 million year-over-year; SG&A expenses were $35.4 million, up from $30.5 million.

• Cost of sales was $3.8 million (11.5% of net revenue), with gross margin around 89%.

• Other income for the nine months was $7.4 million, mainly from a gain on settlement of a forward contract.

Outlook and guidance

• 2024 non-GAAP operating expenses expected to be $245–$255 million, with R&D at ~$137 million and SG&A at ~$113 million.

• Cash position expected to fund operations into 2026, covering key milestones including phase 3 HO data readout in H1 2025 and regulatory submissions.

• Top-line data from the Phase 3 trial in acquired hypothalamic obesity expected in H1 2025; PDUFA date for pediatric label expansion is December 26, 2024.

• On track to complete enrollment in Japanese HO cohort and two EMANATE sub-studies by year-end 2024.