Rhythm Rips Higher After Obesity Drug Aces Late-Stage Trials

Shares of the thinly traded small-cap biotech Rhythm Pharmaceuticals Inc RYTM were rallying by more than 15% Wednesday.

What Happened

Boston-based Rhythm, which focuses on therapies for rare genetic disorders of obesity, announced positive topline results from two pivotal Phase 3 trials that evaluated its setmelanotide for the treatment of pro-opiomelanocortin, or POMC, and leptin receptor, or LEPR, deficiency obesities.

Setmelanotide is Rhythm's melanocortin-4 receptor agonist.

The company said both studies met their primary endpoints and all key secondary endpoints, showing a statistically significant and clinically meaningfully effect on weight loss and reductions in insatiable hunger in patients with POMC and LEPR deficiency obesities.

"We believe these pivotal data are the first step towards making a positive impact for people affected by rare genetic disorders of obesity who have grown up with insatiable hunger and early onset, rapid weight gain that often leads to debilitating comorbidities," Rhythm CEO Keith Gottesdiener said in a statement. 

What's Next

Rhythm said it believes the milestone takes it closer to delivering a treatment for many MC4R pathway-driven disorders of obesity.

The company said it is working to advance setmelanotide to its first regulatory submission in POMC and LEPR deficiency obesities, with a likely timeline of the fourth quarter of 2019 or the first quarter of 2020 for the submission of a rolling NDA. It is also seeking priority status that would result in a six-month review process.

Rhythm also said it plans to submit a Marketing Authorization Application with the European Medicines Agency for the same indication.

Rhythm shares were trading up by 17.47% at $22.32 at the time of publication Wednesday. 

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