Rhythm Pharmaceuticals Secures $150 Million in Convertible Preferred Stock Financing

-- Proceeds from financing and existing cash on-hand sufficient to fund planned operations into 2026 --

BOSTON, April 01, 2024 (GLOBE NEWSWIRE) -- Rhythm Pharmaceuticals, Inc. (Nasdaq: RYTM), a commercial-stage biopharmaceutical company focused on transforming the lives of patients and their families living with rare neuroendocrine diseases, today announced that it has signed an investment agreement with current shareholders, led by Perceptive Advisors LLC and its Discovery Fund and a life-sciences focused institutional investor, for the sale of its series A convertible preferred stock (“Preferred Stock”) for gross proceeds of $150 million to the Company.

The Company intends to use the proceeds from the offering to fund its clinical development programs and commercialization activities, for working capital, and for general corporate purposes. The transaction is expected to close on or about April 15, 2024, subject to the satisfaction of customary closing conditions.

Based on its current operating plans, Rhythm expects the net proceeds from the sale of Preferred Stock, in addition to its cash, cash equivalents and short-term investments as of December 31, 2023, will be sufficient to fund its operating expenses and capital expenditure requirements into 2026.

“We are pleased to announce this convertible preferred stock offering, led by Perceptive Advisors and its Discovery Fund, and we are pleased to receive continued support from a second, existing shareholder who chose to participate in this financing,” said David Meeker, M.D., Chairman, Chief Executive Officer and President of Rhythm. “This financing is expected to extend our cash runway well into 2026 and beyond multiple potentially value-creating milestones including the topline data readout from our phase 3 trial in hypothalamic obesity in the first half of 2025.”

“Rhythm – with its lead asset IMCIVREE (setmelanotide) approved and available in 14 countries, including the United States, to treat certain rare melanocortin-4 receptor diseases – has executed very well against its development, regulatory and commercial strategies on a global level,” said Konstantin Poukalov, Managing Director and Perceptive Discovery Co-Head. “We believe the Company has a clear and achievable global vision to address the unmet needs in additional rare MC4R pathway diseases, including hypothalamic obesity, with setmelanotide and its additional pipeline assets.”