Analyst Joseph Stringer of Needham reiterated a Buy rating on Rhythm Pharmaceuticals (RYTM – Research Report), retaining the price target of $66.00.
Joseph Stringer has given his Buy rating due to a combination of factors, primarily driven by the promising results from the Phase 3 trial of setmelanotide for treating Hypothalamic Obesity (HO). The trial demonstrated a significant reduction in BMI, with patients on the drug experiencing an average decrease of 16.5%, compared to a 3.3% increase in the placebo group. This represents a placebo-adjusted difference of 19.8%, which is at the higher end of the anticipated range and surpasses the expectations of both investors and physicians.
The consistent treatment effect across different age groups and those with prior or current use of GLP-1 drugs further strengthens the case for setmelanotide’s efficacy. These results not only meet but exceed the expectations of healthcare professionals who considered a 10% BMI reduction as a success. Consequently, these findings support the likelihood of approval with a broad label, justifying the Buy rating and a price target of $66.
In another report released today, Bank of America Securities also upgraded the stock to a Buy with a $63.00 price target.