2019 Annual Report
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Rhythm Pharmaceuticals Rhythm | 2019 Annual Report 2019 Cautionary Note Regarding Forward-Looking Statements 2019 Annual Report This Annual Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, Dedicated to transforming the care of people and is subject to the “safe harbor” created by those sections. Any statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be living with rare genetic disorders of obesity forward-looking. Some of the forward-looking statements can be identified by the use of forward-looking terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “likely,” “plans,” “potential,” “predicts,” “projects,” “seeks,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms include forward-looking statements that involve risks and uncertainties. Forward-looking statements include, but are not limited to, statements regarding our expectations regarding timing and enrollment of clinical trials, timing for the announcement of data and filing of regulatory applications, expectations regarding our indications for our product candidates, expectations regarding our strategy and commercial sales, expectations regarding prevalence, expectations regarding our patient identification efforts, anticipated expenses, the sufficiency of cash, and the impact of accounting pronouncements. We cannot guarantee future results, levels of activity, performance or Solomon and Adalissa, siblings achievements, and you should not place undue reliance on our forward-looking statements. Our actual living with Bardet-Biedl syndrome results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, risks related to the ongoing COVID-19 pandemic, and those set forth in “Item 1A. Risk Factors” and elsewhere in this Annual Report. Except as may be required by law, we have no plans to update our forward-looking statements to reflect events or circumstances after the date of this Annual Report. We caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Unless the content requires otherwise, references to “Rhythm Pharmaceuticals,” “Rhythm,” “the Company,” “we,” “our,” and “us,” in this Annual Report refer to Rhythm Pharmaceuticals, Inc. and its subsidiaries. © 2020, Rhythm Pharmaceuticals, Inc. All rights reserved. Rhythm and its logo are registered trademarks of Rhythm Pharmaceuticals, Inc. rhythmtx.com Rhythm is a late-stage biopharmaceutical company that is leading the transformation of care for people living with rare genetic disorders of obesity. Rare genetic disorders of obesity can be caused by genetic deficiencies within the melanocortin-4 receptor (MC4R) pathway, and they are characterized by early-onset, severe obesity and insatiable Alström syndrome has a hunger, also known as hyperphagia. These disorders may not be high impact on her weight… sufficiently managed by diet, exercise or lifestyle changes alone. Currently, there are no approved therapies for these rare conditions. “She constantly wants to eat and can’t get enough. Founded in 2008, Rhythm is developing setmelanotide as a potential treatment for multiple rare genetic disorders of obesity. In 2020, we Breezy, mother of Leigha, living with Alström ” are seeking approval from the U.S. Food and Drug Administration syndrome (FDA) for setmelanotide to treat patients with proopiomelanocortin (POMC) deficiency obesity and leptin receptor (LEPR) deficiency obesity. Rhythm is evaluating setmelanotide in an ongoing pivotal Phase 3 trial for the treatment of obesity and hyperphagia in patients with Alström syndrome and Bardet-Biedl syndrome, and expects to announce topline data at the end of 2020 or early in 2021. Rhythm is currently assessing setmelanotide in several additional disorders in our Phase 2 Basket Study. 2 RHYTHM PHARMACEUTICALS 2019 ANNUAL REPORT 11 Focusing on the MC4R Pathway While general obesity is an epidemic in the United convertase 1/3 (PC1/3) enzyme, encoded by the States and around the world, Rhythm is focused on proprotein convertase subtilisin/kexin 1 (PCSK1) gene, the rare subset of individuals whose obesity arises into melanocyte stimulating hormones (MSH), the as a result of genetic deficits in critical genes within activators of the MC4R. MSH is released by POMC the MC4R pathway, a component of the central neurons in response to satiety signals and goes on melanocortin pathway in the hypothalamus. This to activate second-order MC4R neurons to reduce pathway regulates body weight through modulation of hunger and body weight. Genetic variants in pathway appetite (hunger and satiety). It has been a significant relevant genes can cause overall pathway dysfunction focus of both industry and academic research for due to insufficient MC4R activation, leading to a decades. We believe that by leveraging our deep severe disruption in overall energy balance, resulting in understanding of the pathway and the genetics of body hyperphagia and early-onset obesity. weight regulation, Rhythm is uniquely positioned to make a meaningful impact on the treatment of these We are focused on developing setmelanotide, an MC4R patient populations. agonist, for the treatment of rare genetic disorders of obesity that arise due to defects in this pathway The MC4R pathway is illustrated in the figure below, upstream of the MC4R. In these cases, setmelanotide highlighting how its normal activation results in has the potential to restore impaired pathway activity a decrease in food intake, an elevation in energy by mimicking the function of the natural ligand (MSH) expenditure and a consequential decrease in body to activate the MC4R. In reestablishing downstream weight. Under these conditions, POMC neurons are functionality in this way, setmelanotide has the capacity activated by satiety signals, such as the hormone to reduce hunger and energy intake, and increase leptin acting on LEPR. POMC neurons produce a energy expenditure, thereby reducing body weight. protein, which is specifically processed by prohormone HYPOTHALAMUS Ag/RP/NPY Neuron AgRP ADIPOSE Hunger TISSUE MC4R- Food Intake MC4R Expressing Weight Neuron Energy LEPTIN Expenditure PCSK1 BLOOD-BRAIN BARRIER POMC a-MSH LEPR POMC Neuron UPSTREAM PCSK1 MC4R LEPR POMC ACTITIVATIONT LEPTIN y-MSH ACTH β-MSHa-MSH β-MSH MC4R-Expressing POMC Neuron Neuron 2019 ANNUAL REPORT 3 Setmelanotide: Potent Agonist of MC4R Setmelanotide is an eight-amino acid peptide associated with genetic defects upstream of the analog of MSH and a potent agonist of the MC4R, MC4R, which include POMC deficiency obesity, with lesser activity at the MC3R and MC1R. It LEPR deficiency obesity, Bardet-Biedl syndrome is administered as a subcutaneous injection (BBS), and Alström Syndrome. The European and has the capacity to restore MC4R pathway Medicines Agency (EMA) has also granted function in rare genetic obesity disorders in which PRIority MEdicines (PRIME) designation for pathway dysfunction is a causal or contributing setmelanotide for the treatment of obesity and factor in the severe obesity and insatiable the control of hunger associated with deficiency hunger demonstrated by these patients. The disorders of the MC4R pathway. Both the FDA U.S. Food and Drug Administration (FDA) has and EMA have granted orphan drug status to granted Breakthrough Therapy designation to setmelanotide for POMC and LEPR deficiency setmelanotide for the treatment of obesities obesities, BBS and Alström syndrome. Eight-amino acid cyclic peptide that has shown the potential to restore function of an impaired MC4R pathway Retains the specificity and functionality of the naturally Setmelanotide occuring hormone that activates MC4R Designed to reestablish weight and appetite control Administered by daily subcutaneous injection 4 RHYTHM PHARMACEUTICALS Focused on MC4R Pathway Disorders Our clinical development pipeline is focused on currently in preclinical development for the treatment using setmelanotide to treat rare genetic disorders of of hyperphagia and obesity in Prader Willi Syndrome obesity that are caused by variants in genes within the (PWS). PWS is a rare genetic disorder that results in MC4R pathway. hyperphagia and early onset, severe obesity, for which there are no approved therapeutic options. We expect In addition, we also are developing RM-853, an orally to file an investigational new drug (IND) application for available ghrelin o-acyltransferase (GOAT) inhibitor RM-853 with the FDA in 2020. Early-stage Disorder development Phase 2 Phase 3 Registration POMC deficiency obesity Setmelanotide LEPR deficiency obesity Pivotal Studies Bardet-Biedl syndrome Alström syndrome POMC or LEPR heterozygous deficiency obesity SRC1 deficiency obesity Setmelanotide SH2B1 deficiency obesity Basket Study MC4R deficiency obesity Smith-Magenis syndrome Additional disorders* RM-853 Prader-Willi syndrome** * Rhythm is currently assessing setmelanotide in additional disorders, including POMC epigenetic disorders and leptin deficiency obesity, or LEP, and Carboxy- peptidase E deficiency obesity, or CPE, as part of investigator-initiated protocols within the basket study. Given the recent discovery of these rare disorders of the MC4R