Good day and thank you for standing by. Welcome to the Rhythm Pharmaceuticals Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Connolly, Investor Relations and Corporate Communications. Sir, please go ahead.

Thank you, Michelle. I'm Dave Connolly here at Rhythm Pharmaceuticals. For those of you participating on the conference call, our slides can be accessed and controlled by going to the Investors section on the Investors page of our website, ir.rhythmtx.com. This morning, we issued our press release that provides our second quarter 2024 financial results and business update, and that is available on our website. Listed on Slide 2 is our agenda. On the call are David Meeker, our Chairman and Chief Executive Officer and President; Jennifer Lee, Executive Vice President, Head of North America; Hunter Smith, our Chief Financial Officer; and Yann Mazabraud, Executive Vice President, Head of International, is on the line joining us from Europe. And on Slide 3, I'll remind you this call contains remarks concerning future expectations, plans and prospects, which constitute forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in our most recent annual or quarterly reports on file with the SEC. In addition, any forward-looking statements represent our views as of only today and should not be relied upon as representing our views as of any subsequent dates. We specifically disclaim any obligation to update such statements. With that, I'll turn the call over to David Meeker, who will begin on Slide 5.

Thank you, Dave. We are pleased to report another strong quarter with continued steady progress on our commercial opportunity both in North America and internationally. Another regulatory milestone with pediatric approval for IMCIVREE in patients ages two to younger than six in the EU, and broad progress across our development programs. We remain focused on our three main value drivers shown on Slides 5 and 6. In this quarter, we have made advancements in each. First, as noted, the team continues to execute on our global commercial strategy. Second, we remain excited about the hypothalamic obesity and the likelihood of success in our ongoing global Phase 3 trial. And third, we continue to make progress with two new MC4R agonists in Phase 1 and Phase 2 trials. We have completed the Phase 2 DAYBREAK trial, and the Phase 3 M&A trial remains on track to complete enrollment in the two leading cohorts by year-end. Revenues for the quarter were $29.1 million, driven predominantly by BBS. Two years post-approval in the U.S. and with increasing market access internationally, what remains most striking to me is the extent to which BBS presents a classic rare disease challenge. The obesity and the hunger are there for all to see, but the disease remains relatively invisible to those who are not experts. Two weeks ago, I attended the BBS Foundation International Conference in Minneapolis, the first in-person meeting at this level in more than four years. More than 200 patients and family members attended, along with a number of expert physicians. One common refrain was, 'Aren't you tired of having to explain to each new doctor that you see what Bardet-Biedl syndrome is?' In the opening session, the head of the foundation charged the attendees with one goal: meet someone they did not know from the community. Of the many challenges facing the rare disease patients and families, which include getting to a diagnosis, finding an expert physician, managing their disease, one of the biggest is simply feeling alone. Rhythm from the beginning has not focused on selling a drug. Instead, our focus has been on supporting community development with the goal of having more experts, more integrated care centers, and most importantly, more opportunities for patients and their families to interact with other members of the community. That meeting was one big family, and we, as Rhythm, were privileged to be part of it. How does all this relate to revenue growth? We do the right thing for each patient, their family, and the community, and the revenues will follow. In hypothalamic obesity, our ongoing Phase 3 pivotal trial remains on track for a first half readout in 2025, and our enthusiasm remains high. At this point, the first patients enrolled have completed their placebo-controlled portion and are rolling over into the open-label extension. A brief reminder, the pivotal cohort for this trial enrolled 120 patients randomized two to one drug to placebo, with the protocol calling for up to eight weeks for dose titration and 52 weeks on the therapeutic dose. The trial is over enrolled, the dropout rate remains exceedingly low, and the trial is 99% powered to show a 10% placebo-adjusted difference in BMI. Of note, we do not counsel these patients on diet or exercise as a formal part of the trial design. Patients receive only what is standard of care for that institution, recognizing almost all of these patients have tried diet and exercise previously without success. Of interest, approximately 25% of patients enrolled in this trial had tried GLP-1, and about 10% of enrolled patients entered the trial on active GLP-1 therapy. We did not exclude patients on or with GLP-1 experience from the trial. They were allowed to enroll as long as their weight was stable over the preceding three months. Our overall position on GLP-1 use in this population, informed partly by our engagement with the community but also by the research many of you have done, is that many patients with HO may have some initial response to GLP-1s, but the percent of patients with sustained benefit will be less than 20%, and the magnitude of that benefit may be 10% or less. In Japan, where we estimate the number of patients with hypothalamic obesity to be 5,000 to 8,000, which is on par with European and United States total patient estimates, despite Japan's overall population being much smaller. We have dosed the first patients in our 12-patient cohort and we are actively screening patients at four sites in Japan. This Japanese cohort will enable us to seek regulatory approval in Japan with data from these 12 patients plus the pivotal cohort and not affect timing for U.S. and European regulatory submissions. Our two next-generation MC4 agonists are designed to avoid the hyperpigmentation that comes with MC1R agonism and are advancing on schedule. Last month, we announced dosing of the first patient in our 28-patient Phase 2 placebo-controlled trial evaluating the oral MC4R agonist LB54640 in hypothalamic obesity. The Phase 1 study of RM-718, our weekly injectable built of setmelanotide, is progressing through the SAD, the single ascending dose, and MAD multiple ascending dose portions of the trial and normal healthy volunteers with obesity. We made the decision to add two additional higher dosing cohorts in the SAD portion with the goal of satisfying the regulatory requirements in this early Phase study, potentially avoiding the need for a dedicated QTC study measure of heart rhythm, thereby simplifying the regulatory development path. Finally, we were pleased to receive an expanded marketing authorization for IMCIVREE from the European Commission for patients two to less than six years old with Bardet-Biedl syndrome or POMC, LEPR deficiency. In the U.S., we completed submission of the supplemental new drug application to the FDA in the second quarter, which keeps us on track for potential label expansion towards the end of this year. As we have previously highlighted, this approval modestly expands the treatable population, but more importantly, it may offer patients fortunate enough to get a diagnosis at an early age potential for better outcomes. Two key takeaways from the Phase 3 trial were one, patients as young as two can be severely affected; and two, as shown on Slide 7, they responded uniformly and well to treatment with an 18.4% mean reduction in BMI at one year. These are genetic diseases and the defect is present at birth. Yann will share modeling data, which was presented at the European Congress of Obesity in May, that modeled the impact of early intervention on long-term comorbidities in patients with obesity. Given the potential benefit, why would you not want to start treatment as early as possible? So I now turn the call over to Jennifer to provide the North American update. Jennifer?

Thank you, David. This quarter marks the eighth full quarter of IMCIVREE sales for BBS since it was approved in June of 2022. Looking back over the last two years, it has been an amazing journey, in many instances better than we expected. Though we conducted our research and heard feedback regarding the need for a tailored therapy to address persistent hyperphagia and early onset obesity in BBS patients, we have learned so much more since our launch. What grounds us and gives us conviction every day are the stories we have heard with consistency relating to the benefits patients are receiving on IMCIVREE. In one story, there was a woman who weighed 210 pounds before initiating IMCIVREE. Now, coming up on two years on IMCIVREE, she reports a reduction in her hunger and her weight is now stable at approximately 135 pounds. While there is patient-by-patient variability in the amount of weight loss experienced, what stands out with consistency is the positive impact on both hunger and weight reduction. For this particular patient, after several years of not working, she recently started a job as a customer service representative working from home as the first visually impaired employee for this company. She also told us about her first solo plane trip to see a friend, and she's now looking forward to more trips in the future. Stories like this motivate everyone at Rhythm to ensure all eligible patients can access IMCIVREE, and we continue to make progress with a sense of urgency as a collective team. Now to the quarter, beginning on Slide 9. On a high level, our results for the second quarter are strong and consistent with our expectations. We're continuing to see steady growth in prescriptions and prescriber breadth and depth quarter-over-quarter, as well as ongoing positive reimbursement decisions for both initial and reauthorization approvals. On to Slide 10, here are the top-level metrics we've been sharing since launch. We received approximately 100 new prescriptions for IMCIVREE to treat patients with BBS here in the United States. In addition, we gained approximately 70 approvals for reimbursement, which is representative of the steady growth quarter-over-quarter. While not detailed on the slide, we had approximately 70 prescribers this quarter. Launch to date, more than 30% of prescribers have written two or more prescriptions. Lastly, the breakdown by physician specialty remains consistent with what we have reported in past quarters with endocrinologists being the lead prescribers of IMCIVREE. With access, the story is also consistent as we have seen positive reimbursement decisions by state Medicaid programs that represent more than 90% of Medicaid-covered lives. Our success in the reauthorization process continues to be strong. With reauthorizations, we are still seeing the vast majority approved right away. By the beginning of the second quarter, less than 10 had not yet been reauthorized. And we are working through the appeals process for these patients. With the consistency of these metrics over the last several quarters, and knowing what we know now, we look forward with confidence in the long-term BBS opportunity. On to Slide 11, we are pleased with the progress we have made across our areas of focus, and we are constantly evaluating to see if there are ways we may refine moving forward. One example we identified was within our patient support program with Rhythm InTune, we started with one group of patient education managers when we launched. As we have grown, we have evolved how our teams are organized and split out the responsibilities into a patient support services group by adding field access managers. This group focuses on gaining initial payer approvals and ensuring ongoing reimbursement through the reauthorization processes or insurance changes throughout the year. This change has freed up our patient education managers so they can focus on providing education and support directly to patients and their families to ensure they understand treatment expectations and help manage through the process of treatment initiation and long-term maintenance. On to physician engagement, we continue finding and engaging with new potential prescribers and see more physicians gaining experience with IMCIVREE and seeing their patients benefit from therapy. Through their experiences, there have been healthcare providers who have been inspired and motivated to optimize care of BBS patients, including the recognition of the benefit and need for multidisciplinary involvement in the diagnosis and care of patients. Each rare disease is unique and comes with its own opportunities and challenges. I am proud of the success and progress our teams have made to help increase awareness and build community through active education, engagement, and support. We are thrilled to see hundreds of patients and families benefiting from IMCIVREE every day. Now, I'll turn the call over to Yann.

Thank you, Jennifer. I begin on Slide 13 with the great news from last week that the European Commission expanded the marketing authorization for IMCIVREE to now include children with BBS, POMC, and LEPR deficiency who are as young as two years old. This decision to allow for pediatric use of IMCIVREE in patients this young, a decision that came one month before it was expected, underscores the severe impact of the disruption of the MC4R pathway and the significant unmet medical need for young children. In Germany, the exemption process, which will allow us to get federal reimbursement, has already started. We have also already submitted the reimbursement dossier to the French and Italian authorities, and we will do the same with several other key European countries in the coming weeks and months. This is an important milestone for IMCIVREE. We know it is important to diagnose patients with these diseases early in life before the comorbidities of severe obesity take hold, and now we look forward to working with the physicians and caregivers to provide access to IMCIVREE beginning at a young age and making a positive difference for the patients. On the next slide, and since we are talking about this topic in May, at the European Congress on Obesity, we presented research showing the negative impact early-onset obesity can have on comorbidities and life expectancy, and we also showed the positive impact early intervention on weight prediction has in reducing the risk of comorbidities and increasing life expectancy. As you can see in the table, the early onset of obesity modeled based on a detailed assessment of more than 200 published studies shows that a patient with a BMISD score of 2.5 at the age of 2 or a BMISD score of 4 at the age of 4, which is typical of patients with rare MC4R pathway diseases, has increased likelihood of several key comorbidities such as type 2 diabetes, cardiovascular disease, asthma, MASLD, and cancer. The life expectancy of such a patient is 37 years of age. With an intervention that reduces BMISD by 2 points, life expectancy almost doubles to 64 years old, and as you can see in the table, the risk of several comorbidities is greatly reduced, for example for cardiovascular events or asthma, or obstructive sleep apnea. Next slide, the organizer of the European Congress on Obesity selected this compelling research for inclusion in the conference's official press release. More than 30 media outlets reported on these results, and as our presenters told the British news outlet The Guardian, it is vital that treatment isn't put off until the development of type 2 diabetes, high blood pressure or other warning signs, but starts early. On the next slide, Slide 16, we are also pleased to share the news that NICE recommended that the National Health Service reimburse IMCIVREE for treatment of obesity and hyperphagia in patients with BBS between the ages of 6 and 17 years old. Patients who begin therapy before 18 years old can remain on reimbursed therapy if they continue to show benefit. We are very pleased with the successful negotiation and very grateful for the support we received from leading UK BBS experts and the UK BBS patient association. We now expect IMCIVREE to be funded for BBS in England and Wales in the third quarter, and we anticipate Northern Ireland authorities to follow and adopt the NICE guidance in the next several months and the Scottish Medicines Consortium to do the same in 2025. In terms of the two to six years indication, we expect an MHRA approval before the end of the year following the EMA approval from last week, which will then be followed by an automatic National Health Service funding for this expanded population. Lastly, on Slide 17, you can see the landscape of where we have achieved reimbursement for IMCIVREE for BBS and our POMC, LEPR deficiency, and where we have named patient sales in place, mostly reimbursed by the way. Germany and France remain the main drivers of revenues from the international region. The Germany launch continues as we expected, a typical rare disease launch not dissimilar to the steady trajectory in the United States. France is contributing with both the pre-EMA approval paid early access program for hypothalamic obesity and the paid early access program for BBS. We also now see increased commercial patient activity for BBS in both Italy and Spain. Importantly, and this is recent news, we received an exceptional pre-EMA marketing authorization from the Italian Ministry of Health for the inclusion of IMCIVREE under the Law 648 for the treatment of obesity and hunger control associated with hypothalamic obesity for patients between 6 and 24 years old. Similar to France, we will begin receiving reimbursement to treat these patients. This development speaks to the severity of the disease, significance of unmet medical needs in treating hypothalamic obesity, and just how compelling the data from the Phase 2 trial and its open-label extension are. Now, over to Hunter.

Thank you, Yann. Turning to Slide 19, net revenue from global sales of IMCIVREE in Q2 came in at $29.1 million, which represents almost 12% growth over the prior quarter. As we show here on this slide, net revenue has continued to grow steadily during the two years since the launch of IMCIVREE for BBS in the United States. IMCIVREE revenue generated in the United States accounted for 74% of net sales this quarter, consistent with the first quarter of the year. U.S. revenue of $21.6 million increased $2.2 million, or nearly 11% versus Q1. Driving U.S. revenue growth was an increase in the number of reimbursed patients on therapy and a resulting increase in vials dispensed. Changes in inventory levels at the specialty pharmacy did not have a meaningful impact on U.S. revenue. In Q2, the proportion of IMCIVREE net revenue generated outside the United States was 26%, or $7.5 million, the majority of which came from the BBS launch in Germany and from our two early access programs in France, including the AP1 program for hypothalamic obesity. Ex-U.S. revenue increased by 14% quarter-over-quarter. While quarterly revenue growth may be variable, the trend is steady, as we've described. This reinforces our confidence in the long-term growth prospects for IMCIVREE and BBS. On Slide 20 is a snapshot of the Q2 P&L. Q2's $29.1 million in net revenue compares to $19.2 million during the second quarter of last year. Gross-to-net for U.S. sales in the second quarter increased slightly quarter-over-quarter to 86% from 85% in the first quarter of the year. Cost of sales during the second quarter was almost $3 million or approximately 10.1% of net product revenue versus 10.8% of net product revenue in the first quarter and compared to 11.6% during the same quarter last year. The primary driver of COGS was the 5% royalty to Ipsen under our licensing agreement, as well as minor fluctuations due to product costs, volumes, and inventory. R&D expenses were $30.2 million for the second quarter, compared to $33.5 million during the second quarter of last year. Sequentially, Q1 R&D expenses were $128.7 million, driven by $92.4 million in costs related to LB54640. Separate from the consideration related to the licensing agreement in the first quarter, we experienced a decrease in R&D expenses due to a reduction in the cost of our DAYBREAK, M&A, and Phase 3 HO studies, as well as lower costs relating to our ongoing open-label extension trial. SG&A expenses were $36.4 million for the second quarter compared to $30 million for the same quarter last year. Q2 SG&A represents a 6% decrease in sequential quarterly basis versus $34.4 million for the first quarter of 2024. The quarter-over-quarter increase was due to increased levels of stock compensation. For the second quarter, weighted common shares outstanding were 61 million. Let's move to the next slide for a more fulsome discussion of EPS and cash on hand. As of June 30, 2024, we reported $319 million in cash and cash equivalents, which includes net proceeds from the convertible preferred financing that closed in April. Cash used in operations is approximately $28 million in Q2 and has averaged approximately $30 million in the previous four quarters. Second quarter operating expenses included total stock-based compensation of $10.4 million for the quarter, compared to $7.8 million in the previous quarter. Reported GAAP EPS for the second quarter of negative $0.55 reflects a one-time non-cash gain of $8.9 million, resulting from a decrease in fair value of the issued convertible preferred stock between the deal execution date of April 1 and the closing date of April 15. This is strictly a non-cash gain with no impact on the preferred shares issued. GAAP EPS also includes accrued dividends on convertible preferred stock of $1.3 million, while no cash dividends are payable prior to the end of the second quarter post-closed second year post-closing. U.S. GAAP classifies these pending payments as increasing rate dividends, i.e., 0% dividends in years one to two, and 6% dividends thereafter and requires that we accrue for a portion of those dividends payable in the future. For those of you modeling at home, this ongoing accrual will be $1.3 million per quarter or $0.02 per share at the current share count. Now on to Slide 22. Today, we reiterate our OpEx guidance of approximately $250 million to $270 million in non-GAAP operating expenses for 2024, comprised of R&D non-GAAP operating expenses of $145 million to $160 million and SG&A non-GAAP operating expenses of $105 million to $110 million. Lastly, with the convertible preferred financing of $150 million completed during the second quarter, we expect cash on hand to be sufficient to fund planned operations well into 2026. With that, I'll turn the call back over to David.

Thank you, Hunter. So, as I was reflecting, listening to our update here, it was almost two years ago to-date when we presented the first six weeks of data on the BBS launch in August of 2022. At that point, I mean, there were a ton of questions. You had questions, we had many questions. And two years later, it's quite remarkable. I think you've heard quarter-on-quarter, as we've reported, really, how, in a way, thrilled and at some level a bit unsurprised by the extent of approval, the extent of progress that we've made and the number of approvals we've had around the world. So from a BBS standpoint, we're in a really good place. We're incredibly excited about the progress to-date, and we're increasingly excited about what is ahead. So with that, I will open it up for questions.

Thank you. Our first question comes from Jeff Hung with Morgan Stanley. Your line is open. Please go ahead.

Thanks for taking my questions. The first is the number of new prescriptions for BBS has been consistent over the last three quarters with 100 new scripts and 70 payer approvals for reimbursement per quarter. What remaining levers do you have to further increase the numbers of new scripts per quarter, or proportion of payer approvals? Or is the launch fairly mature for BBS, where numbers are likely to remain consistent or decrease over time? And then I have a follow-up?

Jeff, maybe I'll make one comment and then turn it over to Jennifer for any color. I think, yes, to be honest, the 'approximately 100' for the past few quarters is a bit almost remarkably consistent for a rare disease. We've highlighted from the beginning that these ultra-rare opportunities, of course, tend to be lumpy. I would not necessarily anticipate a pure trend line even now that we're two years out, but we acknowledge the fact that it's been somewhat consistent. But with that, I'll turn it over to Jennifer for any additional color on the numbers we have.

So I think like relating to the prescriptions in terms of that steady number, even two years out from launch, we're actually very happy with. We also recognize that there's still a lot of opportunity that remains out there. And I think one example was just in terms of the patient meeting that David had outlined, there were many patients there that had also just recently been diagnosed, many patients that were already diagnosed, and hearing about IMCIVREE for the first time. So we know that the patients are out there in terms of those that have been diagnosed already and may not have yet understood there's a tailored therapy for them, as well as the opportunity to get patients to a quicker diagnosis moving forward. I think that we get better over time in terms of understanding where to have our field teams target in terms of their education and we also get more information in terms of our non-personal promotion efforts, just to be able to most effectively and efficiently use our resources moving forward and are constantly looking for new ways to actually supplement these efforts. I think one example is that more recently; there are other labs that actually have BBS testing done and genetic results. And there are opportunities for us to understand who are the physicians with positive BBS patients. So when new opportunities like that pop up, those are opportunities that we explore and evaluate in terms of if it's worth being able to execute on. From a payer perspective, I would say, that we're very happy in terms of our current status and the number across each of the different payer types of folks who have IMCIVREE specific policies in place. I think the one lever that still remains and still ongoing dialogue is this space around Medicare, which has been a challenge for many other drugs as well.

Great. And then second question is, can you just remind us of what you hope to see in Stage 2 of DAYBREAK later this year? And what kind of placebo-adjusted benefit would be considered clinically meaningful? Would there be sufficient numbers of patients to get a sense by gene? And if not, like, how do you decide which genotypes to advance? Thanks so much.

Yes, Jeff. Yes, that is a challenge with DAYBREAK. Again, as we've said, that was a very ambitious effort starting out with a very large number of genes. And we knew that as we went through this, we would likely have a relatively small number of patients per gene. So with that qualification, we presented the data in December. What happened in Stage 1? And so by definition, patients who went into Phase 2 of DAYBREAK had had a 5% or more loss or decrease in their BMI. So they were responders by that definition. I think that the data was encouraging. What you should expect to see coming out of this is that of those genes that look interesting, there will provide more color on two things. One, did the DAYBREAK trial design work, meaning that definition of responder, if you went on a placebo, did you regain weight? If you continued on IMCIVREE, did you continue to lose more? And so that additional color on the genes you had there. And again, I think what we would expect and hope coming out of this is that out of that big effort, there are minimally one to three additional genes that we might find interesting to pursue.

Thank you. And one moment, as we move on to our next question. And our next question is going to come from the line of Phil Nadeau with TD Cowen. Your line is open. Please go ahead.

Good morning. Thanks for taking our question and congrats on a solid quarter. A few commercial questions. First, in North America, can you give us your most recent estimates for the persistence and compliance on therapy? Have the rates of compliance in particular or persistence changed over the last few quarters?

Yes, we are still in the 20% to 30% range for the discontinuation rate, and we are moving toward the upper end, which is where we've been. That seems to be holding steady. However, we have less insight into overall compliance, which is more difficult to assess. With that, I will turn it over to Jennifer.

From a compliance perspective, my experience in other diseases suggests that when patients start to experience symptoms and do not take the medication, they often have a higher overall compliance rate. We're pleased to see that this trend is reflected in our area as well, particularly with the compliance rate we are observing today with IMCIVREE.

That's helpful. And then one international question on the use of IMCIVREE for HO in France. Can you talk about the kinetics of the uptake in the HO community in France? How quickly is it being adopted? Do you have any sense of the number of HO patients on therapy? And should we expect a similar rate of adoption in Italy now that early access is opening?

Thank you for your question. I want to remind you about our status in France, which is significant. We gained pre-EMA approval access based on Phase 2 data, a rare achievement with only two similar therapies in the last decade. While I cannot provide an exact number of patients, we are pleased with the uptake and the enthusiasm from the rare endocrine disease community for treatment. As for Italy, we anticipate that the first patient will likely begin treatment by the end of the year. We are optimistic about significant progress there, having engaged with multiple stakeholders and experts. The population size is slightly different, as they are ages 6 to 24, but it's comparable to France. We expect patients to start by the year's end and early next week.

Yes, thanks.

That's helpful. Thanks again for taking our questions.

Thank you. And one moment, as we move on to our next question. And our next question is going to come from the line of Whitney Ijem with Canaccord Genuity. Your line is open. Please go ahead.

Congratulations on the quarter. Following up on Phil's question about the HO patients in France, is there any data being collected on those patients to compile some real-world data that could assist with reimbursement or any other aspects in the near term?

Yann?

Thank you. There is indeed a national data collection led by the French Ministry of Health. We don't have direct access to these clinical data yet, but we know that the healthcare professionals and the Federal Joint Committee plan to publish them soon. Beyond the data, what we hear from the physicians is that they are very pleased with the drug's efficacy.

Great. Thanks. And then just on RM-718, can you expand, I guess, on the progress of that study and timelines? And I guess, thinking through, are there any updated thoughts on your side about if the timeline of the oral and RM-718 end up being more similar, kind of the value of moving them both forward versus maybe just the oral?

Yes. I mean, the answer to the second part of that is, we, assuming success in both trials, will continue to move both of them forward. I mean, again, the goal all along here is to have two options, a weekly injectable and a daily oral. So yes, if they're successful, we'll move both of them forward. In terms of additional color around RM-718, as we said, it's progressing well through the SAD, MAD. I mean, the decision to add a couple of additional cohorts is obviously predicated on having done well up through the cohorts treated to-date. And that decision to go to two higher dosing cohorts is, if we can avoid having to do a PPC study, it saves both some time and expense. Those studies are not cheap. So that's the reason for that. I think in terms of Part C, we'll complete these two additional higher dosing cohorts. The other thing is that we need to finish the six-month talk study to be able to treat patients for longer than the four weeks. And so that will be a key aspect. And so that will finish up in mid to late fall here and will be a key trigger for moving on into Part C.

Got it. Super helpful. Thanks again.

Thank you.

Thank you. And one moment, as we move on to our next question. And our next question is going to come from the line of Dae Gon Ha with Stifel. Your line is open. Please go ahead.

Hey guys, good morning. Thanks for taking our questions. Two from our side as well. One, if I could maybe get Yann's take on Italy, just to kind of clarify for that access, what additional data were submitted to get that reimbursement and early access and how does it show beyond the Phase 2 data. I guess what we've seen from obesity week last year? And then second question is, ex-U.S. commercial question for Yann as well. As you look at Germany, I think in the prepared remarks, you talked about sort of similar trajectory as the U.S. I mean, is there anything unique about Germany that whether it's compliance or persistence or even the way the healthcare system is structured such that the uptake could be more robust than the U.S.? Just kind of curious on that. Thanks so much.

Thank you for the question. Regarding Italy, the process is driven by requests from physicians, which is different from France where we submit a dossier that is evaluated by authorities. In Italy, after being requested by a physician, we submit a dossier for evaluation and the final decision is published in the official journal. The data we provide is the same in both cases. As for the market, France is very centralized while the U.S. is more decentralized. We currently have 15 university hospitals in Germany treating BBS patients, and there is a significant center in the West with a large number of BBS patients. Decentralization is key to our success, as we need to engage more hospitals and physicians. We also have a strong patient support program in place, with nurses providing tailored support. They connect with patients through calls and texts, helping ensure high adherence rates. Germany has one of the best adherence rates globally because of this program. These are the main points about Germany that I can share.

Okay. Great. Thanks so much.

Thank you. And one moment, as we move on to our next question. And our next question is going to come from the line of Corinne Johnson with Goldman Sachs. Your line is open. Please go ahead.

Yes. Good morning. You talked a little bit about adherence and compliance in the BBS launch. I'm curious if you could talk to us about how we should think about read across from what you see in BBS to the HO population and note any key similarities or differences between those two groups. And then, on a similar note, I think you mentioned a number of prescribers with 30% of those having written two or more scripts in BBS. I'm curious if you could talk again about the overlap between the prescriber population that you've had come on board in BBS to the potential prescribers for an HO launch coming hopefully in the next couple of years. Thank you.

So maybe I'll take the first one, and Jennifer take the second one. So I think the read-through to HO, again, they're very different diseases as we know. They both have significant comorbidities which make them challenging diseases in general. On top of that, they're dealing with this MC4 pathway defect. So hard to say, Corinne, I think the hyperpigmentation aspect will be similar in both groups. Now, to the extent that they find it's all a benefit weight against that and we'll see. But that's one aspect that might be somewhat similar. If you remember this on the order of 5% of patients are discontinuing because of concern over the hyperpigmentation. I think we're getting better and better at managing the other side effects of the drug. As Jennifer said, talking, helping set expectations at the patient level in terms of what to expect early on, in terms of the nausea and the like. I think physicians are getting more experience in terms of titrating the drug, maybe going a little slower if patients are again struggling with that. The general approach in terms of our patient support system, patient education managers, and the like, Jennifer highlighted, we've continued to get better at that, and so we'll bring all of that experience to the HO world. So I'm optimistic we do better, but there's obviously a lot more to learn. Jennifer, feel free to add any color to that answer, as well as talking about the prescriber base.

Yes. To reiterate what David mentioned, our product remains consistent, and everything we have learned about educating, onboarding, and supporting patients through therapy, along with the challenges and lessons we've encountered, will be applicable to any future indications. We have established a strong foundation with our teams. Additionally, as I noted earlier, we have gained insights into the benefits of focusing on our patient support team, which is responsible for two crucial areas: securing and maintaining reimbursement for patients, and providing educational support for onboarding and persistence. This learning allows us to have two dedicated teams that will support ongoing efforts with BBS and any future launches. This is a valuable opportunity for learning and implementation as we adapt. Similarly, regarding our prescriber base, we haven't discussed HO within our field organizations because we do not have approval yet. However, these patients are being treated by endocrinologists and obesity specialists, who are our primary targets for field efforts and education related to BBS. I anticipate a greater overlap in targets as we advance with BBS and any potential future indications.

Thank you. And one moment, as we move on to our next question. And our next question comes from the line of Tazeen Ahmad with BofA Securities. Your line is open. Please go ahead.

Hi guys, good morning, and thank you for taking my questions. I maybe wanted to go back and ask about the Basket Study. You talked earlier about the potential of finding a few more amenable mutations. But do you have a sense on how big the opportunities of the mutations could be in general if we wanted to frame it size-wise, let's say between BBS and HO? We'd love to know if you have any idea of how big those would be.

Yes. So, Yann, I'll let you take the pricing question in Europe.

Yes, the question was just around pricing in Europe as we go to other countries whether they think differently about pricing as we get into smaller markets in terms of what the pricing we might expect to get?

Exactly. So the question is, as they develop their models, should we think differently as we move from Germany's and France's to some of the smaller markets in terms of what the pricing might look like?

Okay. Okay. So yes, no, so it's an interesting question because, in fact, sometimes we have higher prices where we don't expect them, and we end with lower prices when we were expecting maybe medium-type of prices. So I would say first that there is not a rule, especially in the last years where there have been a lot of changes in terms of negotiation dynamics, etc. So I would say that, as usual, we know that there are some countries with higher prices and this has not changed. This has not changed, and Germany is one of them. There are some countries with prices that are a bit lower, Spain is one example. But I mean, yes, we've had good surprises with other countries. So I cannot really precisely answer this question. It's really country by country. What I can say in general about pricing in Europe, or with our pricing in Europe is that we are pleased with where we are. And I think it's really because PPL and BBS have been recognized as rare diseases distinct from general obesity, and priced as such. So I cannot answer country by country, but for sure, we are in the same range as other more typical rare disease therapies.

And Tazeen, I realize this isn't necessarily so helpful, but our original guidance, if you will, that the discount on a country by country basis was somewhere between zero and 50%, not zero, not 50%, I mean, it still basically holds.

Thank you. And one moment, as we move on to our next question. And our next question comes from the line of Joseph Stringer with Needham & Company. Your line is open. Please go ahead.

Hi, good morning. Thanks for taking our question. Just wondering if you could remind us of the two to six-year-old addressable BBS patient population, assuming label expansion, U.S. approval by year-end, how soon should we expect an impact on sales, and how much of an impact do you think this will have?

So I characterize it as modest. Jennifer is going to provide some more color.

In terms of the label expansion, I think one of the best benefits, honestly, is just the ability to outline the approval in this patient population, which further distinguishes our population and the need versus that of the patient population with general obesity. We have not once again talked about this piece, but just in terms of numbers, what we do know is that approximately less than 10% of the patients represented in the CRIBBS registry are younger than seven years of age. And there are patients that are young that are being treated by some of our prescribers. So there may be some, but I would not say that it's a significant number at this point in time.

Great. Thank you for taking our questions.

Thank you, Joe.

Thank you. And one moment, as we move on to our next question. And our next question comes from the line of Michael Higgins with Ladenburg Thalmann. Your line is open. Please go ahead.

All right, guys. Congrats on the strong results. Looking forward to seeing pivotal HO data first half of 2025. In regards to IMCIVREE, earlier this year, you had an issue with one of your Medicaid state programs and reimbursement. Any update for us on the progress in getting that business to return?

Yes. Jennifer?

Yes. So one thing that I will reiterate in terms of that particular state is that they were one of the first to come on Board with a specific policy for IMCIVREE. They still remain in terms of having an IMCIVREE policy in place. We do have patients that are being covered under this particular Medicaid state, and we are still working through trying to regain approvals for patients. They do have a much more stringent requirement in terms of the amount of information. So it is a slow ongoing process. But I think the other piece that I will also iterate is that while those are all positive and still work in progress, this has had absolutely no read-through in terms of any other state or policy that we have seen, and even the new policies that we have also been able to put directly in place have been much more consistent with our label.

Thank you for that. And just wanted to follow up on it. Based on your working through the more stringent requirements, do you think you'll ever get back to that prior level and the growth that you had prior to that decision earlier this year?

So the guidance in the past had been that for us, we really didn't put in our forecast that we were going to regain all of those patients back. And that was also our guidance for others just in terms of considerations. We still do get prescriptions from that state. And like I said, it may be a slow process, but our teams are very actively working through to try to gain approvals for these patients.

Michael, I think that's the key. This state is working. It's just starting out with one of the more liberal policies. Clearly, there were more patients being treated, but it is functioning, and we're continuing to bring in patients. So we're feeling positive about that.

Thank you. And I'm showing no further questions at this time, and I would like to turn the conference back over to David Meeker for any further remarks.

Okay. Well, thanks, everybody, for tuning in this morning. As you can hear, 2024 has been a year of execution, and we feel really good about how we're executing to date. So look forward to updating you at the next quarter.

This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day.