Good morning, everyone, again. Thanks for joining us. I'm Whitney Ejim, one of the biotech analysts here at Canaccord, and it is my pleasure to be hosting Rhythm Pharmaceuticals this morning for this fireside chat. We will be speaking with Hunter Smith, CFO, so thanks for joining us, Hunter, and we'll dive right in. So if you could just start with a high-level overview of Rhythm for anybody in the audience who's not familiar, you know, what is Rhythm today, what is the drug, what's the pipeline, and where are you hoping to go over the next five, ten years? Sure.

Thanks so much, Whitney, and thank you very much to Canaccord Genuity for hosting this terrific conference. We look forward to this every August, and it's a nice way to put a bow on cue too. So it's really well-timed. So Rhythm Pharmaceuticals is a biotech company based in Boston with about just under 500 employees and operations in well over a dozen countries and approval and or market access in the US, Europe, and we have market access in about 24 countries total and are working on Japan at present. Our primary therapy is setmelanotide, brand name Imcivery. It is a melanocortin-4 receptor agonist, the first melanocortin-4 receptor agonist ever approved for treatment of rare diseases of obesity in the U.S. or anywhere. And we started with ultra-orphan biallelic forms of obesity that result from knockouts of certain genes that are associated with the production of alpha-melanocyte-simulating hormone, which is the hormone for which our drug is an analog. So patients without this hormone, which is produced in the hypothalamus, have very high levels of hunger, insatiable hunger, is not satisfied by caloric intake, it's centrally driven signal, and resulting obesity. And they are voracious as newborns, and they become obese as toddlers and continue a lifetime obesity. And we started treating them back around 2015, where we traded our first POMC patient. That patient had an over 40% reduction in BMI over the course of about 12 to 18 months. That case study was written up in the New England Journal of Medicine. and ultimately we treated another genetic knockout form called leptin receptor deficiency, and that led to ultimately our first approval. Those two disorders were so rare that we didn't launch the drug to treat them. We just made it commercially available. But ultimately we then achieved proof of concept in an indication with about 5,000 patients in the U.S., 5,000 patients in Europe called Barty-Bietel syndrome. And in that, we received approval for that in 2022 on the basis of a phase three, global phase three study that we ran. And that was the basis for launching the drug globally and has been the basis of building the company. So Q1, which was the last quarter with primarily BBS and some level of POMC, LEPR revenue, we had sort of a run rate of revenue around 60 million a quarter. There's some HO in there, and we'll talk about that in a minute, but that was sort of where we were. Then ultimately, I think the big change for the company was the proof of concept we achieved also in 2022 for acquired hypothalamic obesity, which results from damage to the hypothalamus due either to brain tumors, primarily pituitary tumors like craniofringioma, or through other forms of injury to the hypothalamus can be through blunt force trauma or radiation or things of that nature. That is a 10,000 patient opportunity in the U.S., we estimate, and we released phase three data last year which showed that patients on setmelanotide lost 18.8% of body weight as compared to placebo in a large 130-patient global randomized study. So that study was the basis for seeking approval. It was also a basis for a New England Journal of Medicine article that was just published in July with the results of the study, the data from the study, and an editorial about the importance of the MC4R pathway for treating obesity. That's MCIVRI. We've launched for HO in the U.S., and we're going to be launching in Europe and Japan relatively soon. We do it all ourselves. We have a pipeline of two clinical products. One is an oral MC4R agonist called Vivimeligon, where we've shown proof of concept in HO. And we are trying to start a Phase III in acquired HO by the end of the year. And then we have a weekly injectable product called RM718, where we've also just shown proof of concept in HO. Those products will not only have more convenient dosing, but they are more specific and therefore avoid one of the very specific AEs associated with the drug, which is hyperpigmentation that occurs when setanilanitide also hits the MC1 receptor. So that's where we are. We have a preclinical program going on in congenital hyperinsulinism. We can talk about that later. But that's where we are for the main area, which is a portfolio of three MC4R agonists and a growing set of diseases that we treat.

Awesome. So I like this idea of putting a bow on 2Q. So we'll stick with 2Q and talk about AHO. And so first full quarter of launch, what went well? Any learnings that you're implementing post this first full quarter?

So let's start. We are very, very pleased with the start of the AHO launch. It was, we think, strong across the board. All the indicators we have looked at were positive. So the first was we had over 400 start forms in the 14 weeks, so 13 plus the week between approval and the beginning of the second quarter. In those 14 weeks, over 400 start forms for new patients, having a script written for remsivory, we had, they were, those start forms were written by over 300 physicians. So that's terrific breadth. And even if you look within the physicians who wrote more than one script, there's very little concentration, so mostly twos and threes in terms of number of scripts per physician. And we have had nice progress getting payers to reimburse the drug. That progress is well ahead of where we were with BBS at this time, so about two-thirds of the scripts that did get approved as of quarter-end were approved on prior authorization. And we already have policies in place in the U.S. covering about 25% of commercial lives and about 35% of Medicaid lives. So very pleased with where we are. We expect that process of seeking additional reimbursement approvals to continue as P&T meetings go on through the balance of the year. So overall, very strong start. I think the one learning we have is that the reps are so busy with the AHO pipeline that the longer and more complex process of helping get BBS patients to therapy is challenging for them to do both at once. So we made the decision sort of early in the post-launch period to separate out a dedicated BBS field force of 10 territory managers, And we have a chunk of them in place and hope to have the full team out there and in place relatively soon. So that, I think, will allow us to continue to develop and grow the BBS opportunity, which is slower growing, but still very significant. And, of course, a major base of our existing revenue.

OK, that's helpful. So hiring more people, but like for good reasons. Yeah, OK. Got it. All right. And then just going to the ultimate size of HO, I guess you've, you know, A couple years ago, or during development, had been talking about 5,000 to 10,000 patients. Today, you just said 10,000 patients. So can you talk about what you're seeing out in the field that kind of is giving you confidence to anchor to the top end?

So one of the things that was interesting when we developed proof of concept in this indication was it was an indication where nobody on the street had a model. So it took a little while for people to appreciate the size of the unmet need. And it took us a lot. We've had a lot of learnings about it in the process, and some of those learnings relate to what are the contributors to acquired hypothalamic obesity. So we started with knowing that there were three tumor types, craniofringioma, hamartoma, and a third, which is escaping me at the moment, that are the primary contributors to AHO. But what we've realized with clinical experience, both in the Phase III study and with our early access program in France is that there are many other tumor types which can damage to the hypothalamus and result in AHO. So that was item number one. Item number two was that the overall survival of these patients had been measured quite conservatively when estimating the when estimating the epidemiology and number three is that there's just there are other contributors to AHO that are not tumor based. So those things have made us feel very confident in the upper end of that range. And then when you're out and you're actually, you have people in the field and you identify patients with physicians. So as of September of 2025, we said we had identified more than 2,000 diagnosed or suspected HO patients in the care of our tier one and tier two physicians. That was very validating because those are face-to-face interactions that validate things we might think are possible based on claims data. So to progress, we have progressed that very significantly since then, and that reinforces our confidence in the opportunity.

Okay, but you haven't updated the number.

We have not updated the number.

Okay, all right. Do you intend to at all, or is there any value there?

No specific plans to do so at this time. Okay, got it.

All right. Okay, and so then kind of going back to this like identified 2000 number, the question I think post-2Q was, well, if you'd already identified that many patients in September is the 2Q progress kind of representing a bolus, both because of that and just for some others, some precedent in the field. So I think you were pretty clear on the call. And I think the quote was, there's no bolus in this thing. So can you talk about what gives you confidence that there wasn't a bolus and how, to the extent that you can, speak about what you've been seeing since 2QN?

Sure. And so we genuinely believe this is a sustainable opportunity based on the Q2 results, and there are a variety of factors that give us confidence in that. First is we've seen no slowing of the incoming of new start forms since the end of the quarter, so that's, you know, the rate is continuing to go forward nicely. The second thing is that the breadth, 300 writers for 400 scripts does not indicate a high level of concentration, and as I said earlier, intimated earlier, The depth is also still pretty low in the sense that most of the writers who wrote more than one script wrote two or three, right? You don't have people that wrote 20 or 40 or anything like that. Third, our level of penetration of both the specialty centers where patients are treated for their tumor, and they may remain for treatment for their HO or they may not, as well as community physicians, still remains relatively in the early stages. So the numbers we've talked about in terms of the growth of suspected and diagnosed patients, they are concentrated at these Tier 1 and Tier 2 physicians, which some of whom practice at 45 specialty academic medical centers around the United States with a pituitary tumor specialization, and we haven't even reached every one of those centers yet, let alone activated all of them. So the same is true for our Tier 1 and Tier 2 physicians who are out in the community. So we know there are patients with those physicians, and we haven't reached all of them nor activated all of them yet. So there's a lot of opportunity in front of us.

Okay, got it. I think I'll move over to Japan, HO, given the time. But you talked about doing it yourself in Japan, and you're in a late-stage process with PMDA there. So can you talk about the patient numbers there and what you all need to build to be able to access that opportunity?

So Japan is interesting because it has an elevated incidence of cranial pharyngioma for reasons that we don't understand. But the result is that the prevalence of HO is estimated to be 50% to 80% of the U.S. prevalence despite a significantly lower population basis so it's a very it's a very significant Japanese opportunity and the the PMDA in general and Japanese regulatory policy and reimbursement policy has really made significant strides in trying to improve and or reduce the lag in getting therapies to their patients that they had been experiencing over the last 10 to 20 years. So they're sort of going in the opposite direction of European policymakers. And so they allowed us to include a, amend our phase three study after it had initiated to add, you know, a cohort of a dozen Japanese patients that they said would be sufficient for registration. So that was really exciting. So we added those patients. We submitted to Japan. And we expect both approval and reimbursement to be timed sort of around the end of the year, enabling us to launch. And we are fully staffed for that opportunity. So we have hospital affairs liaisons in place covering the major treatment centers around the country. And they are working like our U.S. team did to drive a high level of patient identification prior to launch sometime around the end of the year.

Okay. And how should we think about the pace of launch in Japan, maybe relative to the U.S. versus Europe?

So the U.S., the guardrails in the U.S. tend to be both the capacity of endocrinologists as a specialty. They're a very in-demand specialty where a lot of people are booking a year out for appointments. and then secondly, just the payer process, and people make a big deal about the differences in price between the US, Europe, et cetera, et cetera, but a lot of pharma companies cover a lot of, and we are no exception, cover a lot of non-reimbursed patients with free drug, and that's never somehow made into that calculation comparing the prices. But putting that to the side, those are the guardrails in the US, but we expect pretty rapid uptake in spite of that. And then Europe, you're at your country level reimbursement which is sort of staged and milestone. It's a gradual and sometimes can be extended because you don't reach agreement on negotiations in countries like France or the UK. So then Japan, national reimbursement occurs at once. And at the time of approval, pricing is indexed to the US and a couple other countries on the basis of a cost plus methodology and there's sort of some, you know, intractable disease components that allow you to get rare disease pricing. But another difference with Japan is prices once agreed are maintained. So there's no, oh, you know, it's been six months, so we're cutting your price again that you experience in certain European markets as well. So those are all attractive. Now, there are some guardrails in early launch in Japan that are mainly systemic to, you know, to make sure that it's a safety monitoring process, and I think it's allowing people to just gain experience with the drug, and those include a 14-day limit on prescriptions, so people have to go back for renewal every two weeks for a period of time. There are co-pays that are involved and things like that that are designed to keep the uptake a little bit more managed at the beginning before broad adoption takes place.

Okay, okay. So probably shouldn't be expecting a bolus in Japan. I don't think so.

Okay. All right.

Got it. All right. And then on EU for HO, you've talked about, well, there was some news yesterday, I think out of the UK. And then you've talked about launching in Germany in the first half. So I guess, can you remind us where you are in Europe there on the early access programs and then again, kind of help set expectations for what launch could look like as you go country by country?

Sure. So we were given paid early access on the Basis of our phase 2 data in France, which makes us one of two non-oncology drugs ever to get paid early access In in the French system. So that was very exciting for us And we have a significant a meaningful number of patients on treatment reimbursed in France With HO and that's also, you know, they it's a it's a governed process We cannot promote the patients have to apply their physicians apply to these certain specialty centers where they're approved for treatment, and that has allowed us to treat a great variety of different types of HO patients, including congenital HO patients, and our European label doesn't distinguish between acquired and congenital HO, so that's very exciting as well. So we've got a lot of treatment experience in France. That's been super exciting, and then in Italy, we were given paid early access for patients up to 24 years of age who had developed HO as a result of cranial pharyngioma specifically so we've you know had success getting a nice number of patients on treatment there but it's a narrower approval. We are approved in Europe and as of you know a couple days as of yesterday our announcement we are approved in the UK as well but as I think everybody knows you you get approved and then you go through a process of seeking reimbursement country by country and that can take a significant amount of time. Germany has a prohibition on the reimbursement of lifestyle therapies even though our drugs, our diseases are genetic and or, you know, caused by brain tumors. They do not distinguish formally between that and general obesity. So we have for the past several indications and will in this case gone to the GBA and requested an exemption from that restricted list, which we have previously received and we expect to receive again. And we hope that we will receive that by the end of the year, which will allow us to launch in Germany in the first quarter. And then the other countries in Europe, aside from the early access programs, will start happening as we get reimbursement country by country, and we'll update folks as those timelines become clearer.

Got it. Okay, perfect. And just maybe very briefly, moving the pipeline into HO as well. So just very quickly remind us kind of how you've talked about that in terms of the phase three and timelines, and then we'll switch over to Prader-Willi.

Sure, so we expect to start a global phase three for bivameligon, which is our daily oral form of MC4, daily oral MC4R agonist, before the end of the year. We have been doing a lot of CMC work to make those tablets smaller and more easier for patients to swallow, and we are just waiting on our chewable formulation for young kids. So we will probably start that with ages 12 and up first and then add the cohort for the kids when that's ready. And then 7-18, we've just announced phase three data, and we're going to then figure out, do we want to do that immediately? Do we want to stage it and do it later? I think we have, with BIVA proceeding so well, we have a little bit of optionality and flexibility in that regard.

Okay, excellent. So moving over to Prader-Willi, which has been kind of the new topic beyond the commercial progress, the new kind of indication expansion potential. So can you maybe talk about that disease just a little bit, help set the stage for what that is, and talk about the data you've shown so far?

Sure. So Prader-Willi syndrome is a very, very difficult disease. patients lose a significant portion of chromosome 15, and they have a variety of very difficult complications and comorbidities, two of which are severe and quite disturbed hyperphagia at a level that we don't quite see to the same extremis as many of the diseases we're treating currently, as well as the resulting obesity. And those two factors, as well as some others, lead to a lot of early mortality in PWS patients. And we did an 18-patient single-site open-label study with Dr. Jennifer Miller at the University of Florida, which we have data in 17 patients. One dropped out very early. But at the 17 patients, we showed six months of data several months ago when we were at the endoconference, and that indicated a very positive response on BMI, very positive response on HQCT, which is the primary score of hyperphagia used in Prader-Willi patients, significant reduction in adiposity, and significant reduction in anxiety as measured by the PADQ. None of the results were as dramatic or as uniformly consistent as the HO results, it's a more complex disease, but we believe, we've always believed fundamentally that there is a biological role for the MC4R pathway in treating the disease or restoring the pathway to treat the disease, and we believe this validates that. And we are thinking, okay, we would like to do a phase three on the basis of those results, and our decision now is which agent, setmelanotide, bivimeligon, or RM718 to use in a potential phase three study. So we're hopeful to be able to give an announcement sometime before the end of the year of what our plan is.

Okay. And that will include the design of the phase three study?

It would. And I think, you know, we want to do something that will allow us to get an endpoint of hyperphagia by itself, as well as a weight endpoint. So we expect that the hyperphagia improvement will lead to a weight improvement, but we know that the hyperphagia alone is an important endpoint, and if we can get that, we think it would be very meaningful to patients.

Okay, and have you talked about potential size of the study or duration or how you think about that?

Not really. It would be comparable, I think, maybe slightly larger than HO, but I think it's a little too early to tell.

Okay, got it. And then size of that opportunity as well, kind of how many patients?

So, you know, not all PWS patients are obese. Some of that may be due to behavioral controls, but not all of them are obese. So we think that the obese population today is in the 8,000 to 12,500 range. And that's a U.S. number. And then there are significant PWS populations globally.

Okay. And the concentration of these patients in terms of where they're managed or diagnosis rate, I guess, first, and kind of where they're managed.

Yeah, so the diagnosis rate is very high because they're so hypotonic at birth that it tends to trigger genetic testing that leads to that diagnosis. And then, so we think it's 85, 90% of all patients in the U.S. are diagnosed. And they tend to be concentrated for treatment purposes in group homes when they reach sort of later stages of adolescence and or adulthood.

Okay.

And it's a very well-organized and tightly networked community. Okay.

So we will be looking forward for more color on the path forward there. And then just finally in the last seconds, cash of roughly $330 million at the end of the quarter, operations, funds operations for 24 months. I guess what are the key milestones you can reach with that or just kind of how are you thinking about runway?

Well, we've given that as a general sort of rolling statement of liquidity and, you know, sort of it's our standard-going concern language. You know, we're very comfortable that we have enough cash that we won't require additional equity. We may require some additional financing, but it will be more to solve for balance sheet liquidity levels rather than milestones that, you know, we should be able to get to where we need to go.

Excellent. All right. Well, thank you so much for all of that good color, and thanks, everyone, for listening.