JMP Securities analyst Jonathan Wolleben reiterated a Buy rating on Rhythm Pharmaceuticals (RYTM – Research Report) today and set a price target of $81.00.
Jonathan Wolleben has given his Buy rating due to a combination of factors, primarily driven by the promising results of the Phase 3 TRANSCEND trial for Rhythm Pharmaceuticals’ drug, Setmelanotide. The trial demonstrated a significant and clinically meaningful reduction in BMI for patients with hypothalamic obesity, which not only supports the efficacy of the drug but also opens up a substantial market opportunity estimated between $2 billion and $4 billion in the U.S. alone.
Furthermore, the success of Setmelanotide in this trial reduces the risk associated with Rhythm’s pipeline of next-generation MC4R agonists, including bivamelagon and RM-718, which are in earlier stages of development. The market has already recognized some of this potential, as reflected in Rhythm’s market capitalization, but the recent data could drive the stock price higher, potentially reaching the $60+ range. The high level of patient enthusiasm and low discontinuation rates due to adverse effects further bolster confidence in the drug’s commercial prospects.
In another report released on April 1, Wells Fargo also reiterated a Buy rating on the stock with a $80.00 price target.