Rhythm Pharma Posts 50% Revenue Growth, Eyes Key FDA Milestone
Preliminary results show $194 million in full-year sales for its obesity drug Imcivree, but shares fell as investors look ahead to a pivotal regulatory decision.
Rhythm Pharmaceuticals (NASDAQ: RYTM) announced robust preliminary financial results for 2025, reporting a roughly 50% year-over-year surge in net product revenue. Despite the strong performance, which handily beat analyst expectations, the company’s shares saw a downturn in trading, closing down 4.07% at $97.46 in a potential “sell the news” reaction from investors.
The Boston-based biopharmaceutical firm reported preliminary, unaudited full-year 2025 revenue of approximately $194 million, a significant leap from the prior year. Fourth-quarter revenue alone was approximately $57.0 million, surpassing consensus estimates of $50.7 million by over 12%. The growth was driven entirely by sales of its flagship therapy, Imcivree (setmelanotide), approved for treating rare genetic diseases of obesity.
While the financial results point to successful commercial execution, market attention is intensely focused on the company’s next major catalyst: a U.S. Food and Drug Administration (FDA) decision for Imcivree in a new indication. The agency has set a Prescription Drug User Fee Act (PDUFA) goal date of March 20, 2026, to complete its review of the drug for treating hypothalamic obesity (HO).
This potential label expansion is significant as HO is a rare, severe form of obesity resulting from injury to the hypothalamus, for which no FDA-approved therapies currently exist. An approval would make Imcivree the first-ever targeted treatment for this patient population, addressing a major unmet medical need.
The path to this decision has not been entirely smooth. The FDA originally set a PDUFA date for December 2025 but extended the review period by three months. According to a company press release, the extension was to allow the agency time to review “additional sensitivity analyses of clinical efficacy data” from the pivotal Phase 3 trial. Rhythm noted that the FDA did not request any new data on safety or manufacturing, a detail that may reassure investors about the underlying strength of the application.
Wall Street analysts remain broadly optimistic on Rhythm’s prospects, a sentiment that contrasts with Friday's stock decline. The company holds a strong consensus buy rating, with 14 out of 15 analysts recommending 'Buy' or 'Strong Buy'. The average analyst price target sits near $139, suggesting a significant upside of over 40% from its current trading level. This disconnect highlights a valuation gap between the market's current caution and analysts’ confidence in the company’s long-term growth trajectory, though some investor hesitation may be tied to the company’s ongoing lack of profitability.
Looking ahead, Rhythm Pharmaceuticals stands at a critical juncture. It has successfully commercialized Imcivree for its initial indications, delivering substantial revenue growth. Now, the company and its investors await the FDA’s verdict on a key pipeline expansion that could unlock a new and underserved market, solidifying the drug’s blockbuster potential.