Rhythm Pharmaceuticals, Inc. Price & Performance (RYTM)

Actual results may differ materially from those indicated by these forward looking statements as a result of various important factors, including those discussed in our most recent annual or quarterly reports on file with the SEC. In addition, any forward looking statements represent our views of today and should not be relied upon as representing our views as of any subsequent dates. We specifically disclaim any obligation to update such statements. With that, I'll turn the call over to David Meeker, who will begin on Slide five.

Thank you, Dave.

Morning, everybody. Thank you for joining. So we pre announced strong fourth quarter earnings in advance of the JPM conference. We are entering 2025 well capitalized having recently raised $75,000,000 in gross proceeds from our ATM program, which extends our cash runway into 2027 through multiple inflection points, and we have completed enrollment in our Phase two daily oral bivamalagon study.

We feel incredibly positive about how the opportunity in genetically driven impairments to the MC4R pathway signaling is evolving. As we have highlighted many times, ultra rare disease opportunities like BBS where there is a significant unmet medical need, a high percentage of undiagnosed patients where the availability of a precision therapy can accelerate the number of patients getting to a diagnosis these opportunities will continue to grow at a steady pace for a decade or The U. S. Opportunity is taking shape and we will continue to expand internationally. We could build a business around the BBS opportunity alone. We are excited about the progress we are making with our next generation compound, bivamilagon, a once daily oral pill and the weekly subcu injection Rhythm Now our goal with the next generation opportunities is not just to extend patent life, but to actually make a better drug. Both products have robust activity in preclinical models and have no cardiovascular activity in the appropriate models. Both our MC1R sparing so no hyperpigmentation and significantly more convenient. Whether there is an opportunity to improve on efficacy remains to be seen. The bivamelagon Phase two study is fully enrolled this quarter and will readout in the third quarter and the seven eighteen program is beginning to enroll.

So on slide seven is a now familiar design slide for a Phase three trial of septalantide and acquired HO. And we continue to receive the majority of our [indiscernible] What is the timing of the readout? What is the expected percent change in BMI? We have guided to the trial reading out in the first half and we can now be more specific that it will be a second quarter readout. Our updates remain consistent with what we have said. Our dropout rate remains below 10%, which I think is a that'll be strong metric. Patients are rolling over into the open label extension. They do remain blinded to their original assignment.

And only one patient has not rolled over and because that patient wanted to start a family. With regard to the percent change in BMI, it is a blinded Phase three clinical trial. We have, however, reminded people that the current fervor around percent change comes out of the many trials being run-in the general obesity space with some version of a GLP-one. These trials have similar designs, so comparisons can be made across trials, although this is always imperfect. When we look at septmelanotide in HO, it is an apples and oranges comparison. The biology is fundamentally different. We are replacing a deficit in the hormone alpha melanocyte stimulating hormone the GLP-one approach is to provide pharmacologic doses on top of intact physiology. Our trial enrolls four year old patients and 60 year old patients and we measure the same endpoint, the percent change in BMI of fifty two weeks. In our Phase two trial, the youngest patient aged six whereas the oldest patient 24 years old lost 14%. Now the 24 year old patient actually lost more weight, but on a percent basis, it was a smaller change. So these are variables which will impact the final numbers.

That said, all of our data to date, the Phase two study, which was predominant in pediatric patients and the French preapproval early access data, which was all adults, suggests we will do well on the primary. The secondaries will break out the pediatric and adult patients, so the full story can be clearly under understood. The Japanese cohort of 12 patients for which we recently completed enrollment will readout independently from the pivotal cohort so there is no impact on timing of top line data and subsequent regulatory filings in The United States and Europe, We expect the Japanese cohort will readout in the first half of six. If successful, these data will enable us us to seek marketing authorization in Japan where there is a higher prevalence of certain brain tumors and hypothalamic obesity than in The U. S. Or Europe. A reminder on Slide eight that the opportunity in HO is significant and we continue to learn more. We affirm our original estimates, which we believe were appropriately conservative. The populations reflected on the slides with five thousand to ten thousand patients in The U. S. And a similar range in Europe and five thousand to eight thousand patients in Japan represent a pool of patients who may be largely diagnosed and concentrated in the endocrinology specialty call point.

There's an additional pool of patients with injury to the hypothalamus where the diagnosis is not so clear and they are likely to remain undiagnosed. We look forward to expanding our understanding of this patient population.

Now the path to building the future of Rhythm is clear. We have have opportunities to further explore genetically driven impairments in the MC4R pathway The M and A trial is enrolled and will read out in the first half of twenty twenty six. There are genes coming out of the DAYBREAK trial, which with a little more work can also be targeted. Rationale as to why an MC4R agonist can work in that disease. This quarter we have initiated, as you know, a new twenty six week open label Phase two trial to evaluate semilantitide and prader Willi syndrome. We plan to enroll up to 20 patients, six to 65 years old in the signal finding study and patients will be dose escalated to five milligrams day, which is significantly higher than the dose we used in the first attempt at prater willing and they'll be dose escalated to that five milligrams as tolerated. So we are conducting this trial at single U. S. Site under an investigator with deep experience in Pareto Willi syndrome and we look forward to updating you on that progress. The other pillar which is emerging as an incredibly exciting opportunity is that related to injury to the hypothalamus or failure of the hypothalamus to develop.

We have focused on tumors and their associated treatment, which may lead to injury. But there are clearly many more ways the hypothalamus may be injured leaving the patient with acquired HLS. We look forward to learning more about septimalanatide of of the brain and we are on track to enroll the first patients with congenital HO in an independent 39 patient thirty four week sub study in the first quarter of twenty twenty five. Finally, we anticipate doing much, if not all, of the supplemental indication expansion work with one or both for our next generation compounds with patent lives, which extend past 2040. We have completed enrollment in the Phase II bivamalagon trial and acquired HO this quarter and we anticipate the data readout to be in the second half of twenty twenty five. Also, we will begin enrolling patients with acquired HO in Part C of the Phase one trial of RM718 this quarter and are aiming for a data readout before the end of the year. So in summary, 2024 was a year of execution and 2025 is a year of readouts, which could prove to be transformative for Rhythm in addition to some critical trial initiations.

Will now turn the call over to Jennifer. Thank you, David. So 2024 was a solid year for MZVI sales in The U. S. With consistent growth throughout the year. Over the years, we have fine tuned our process to find patients get them to an accurate diagnosis and ensure access to therapy. Once on therapy, we work with patients and their healthcare providers. To support maintenance on therapy. More than two years in from launch, and will also help future potential launches. New prescriptions received in the fourth quarter were consistent quarter over quarter. We are seeing continued success in approvals and reauthorizations and our tailored support to patients and families are enabling patients to receive the long term benefits of maintaining on therapy. Within the fourth quarter, the increase in the number of patients attributable to a number of incrementally positive trends when combined added up to a strong growth. For example, in addition to the steady level of approvals for reimbursement [indiscernible] we saw fewer discontinuations from patients who are on reimbursed therapy. Several switches from our free drug program to reimbursed therapy and some later stage appeal wins during the quarter. While none of the quarterly metrics in each of these categories was stand out as a significant change on their own, when taken together, it resulted in a strong quarter.

Turning to Slide 12. In December, the FDA approved a label expansion for Imciferay to include children as young as two years of age with obesity due to BBS or PALM C PCSK1 or leopard deficiency, This approval sends a strong message that helps us differentiate the root cause and impact of these rare MC4R pathway diseases. With this insatiable hunger, most patients develop early on obesity before the age of five. Obesity in childhood, if left untreated, may lead to severe and long term health complications Intervention at a young age can be critical as treating obesity early lead to better health outcomes. We are excited about what this label expansion means for patients like Ben and their families. Ben was diagnosed with bileulic leopard deficiency when he was two years old. And up until then he was seen by approximately 20 different doctors. His mother outlined Ben was constantly crying for food. Even when he had a snack in his hand. Even though the doctors did not know it, she knew something was not right. Enrolled in our Phase III pediatric trial when he was 3.5 years old and his BMI went from thirty six point eight to 30.

Ben, who is now on commercial therapy, and his entire family have more freedom now. That their lives do not resolve around food. This story is one example of Ensifre making a positive impact on a young child and his family. Moving to Slide 13. Our teams are preparing for a positive outcome in our Phase three trial in acquired hep Violet. Obesity and the next potential launch. Market research, to gain insights from physicians, and patients and families is ongoing. We're actively engaging with patient advocacy groups and our teams are executing physician engagement efforts in 2025. We look forward to sharing more details with you as we progress with potential FDA submission and launch. Now I'll turn the call over to Jan.

Thank you, Jennifer. We are pleased with the growth in the international region for the fourth quarter of twenty twenty four and for the year of 2024. We have achieved access for Immcili in more than 15 countries outside The U. S. For patients with Pompey, Lipard, BBS and HO through either reimbursed access or named patient cells. [indiscernible] Germany, with the BBS launch now well established and France, with paid early access programs for Promsili Par, PBS and HO remain the main drivers for the region.

In Germany, our BBS launch is steady and mirrors the consistent growth pattern of The U. S. Continue to expand the number of centers treating BBS patients.

France is also contributing with both the pre EMEA approval paid early access program for HO and the paid early access programs for Promociliter and DBS. We continue to receive positive feedback from the physicians treating patients in France under these programs, Specifically, with either acquired or congenital hypothalamic obesity are responding well Also, like in The U. S, the marketing authorization for pediatric patients has led to reimbursement for patients as young as two years old in many countries including The UK, Spain and Italy. Today, we announced a new strategic partnership in Turkey where there is a significant unmet need The prevalence rates for rare diseases in general and POMCILI PAL and DBS in our case are greater than the rest of Europe. Providing us an incremental growth opportunity. Our partner is Prispera Pharma Solutions, an entity very well known to us. We began working with them as a consultancy a few years back and recently formalized the new partnership. Tristira has deep experience in relationship with rare disease community and MC4R pathway disease experts and centers of excellence in Turkey. Last but not least, in Japan, we are beginning to build out operation in anticipation of success in acquired hypothalamic obesity.

With a significant unmet need and a prevalence per capita greater than in The U. S. Or in Europe. Japan represents a major opportunity for tourism. Overall, 2024 has served a foundation all year in expanding access to InCRI across the international region. Met with enthusiasm among scientific and medical experts, clinicians and patient advocacy groups and recognized Insurea as a precision medicine for certain rare neuroendocrine diseases. Thank you, John.

Before getting into Q4 and the year end financial results, I want to start with our balance sheet beginning on Slide 17. Rhythm ended 2024 with $320,600,000 in cash and cash equivalents.

We raised gross proceeds of $75,000,000 through the sale of approximately 1,300,000.0 shares of common stock at a weighted average price of $56.3 under our at the market or ATM equity offering program. During the fourth quarter of twenty twenty four, and continuing into January of twenty twenty five, the $320,600,000 of cash on hand includes about $40,000,000 of gross proceeds raised in Q4, but not the additional gross proceeds $35,000,000 raised in January.

Expect this level of cash to be sufficient to fund planned operations into 2027. Pass several meaningful milestones and data readouts including the pivotal Phase three data readout in acquired hypothalamic obesity. As well as the data readouts for both the Phase two trial of bivameligone and HO and the Phase one Part C study of RM-seven eighteen in HO we also anticipate data from the single site PRADER WILI trial as well as data from the Phase III M and A trial within this timeframe. Let's now review the snapshot of the Q4 and full year P and L on Slide 18. Pre announced preliminary unaudited revenue from global sales of Obsivio in January reporting that net revenue from global sales of Obsivory came in at $41,800,000 in Q4 and $130,100,000 for the full year 2024. As compared to $24,200,000 and $77,400,000 for the fourth quarter and full year 2023. Gross to net in The U. S. Remained consistent at about 85% for both the third and fourth quarters of twenty twenty four. Cost of sales during the fourth quarter was $3,800,000 or dollars or the third quarter of 'twenty four and thirteen point four percent in fourth quarter of twenty twenty three.

COGS as a percentage of revenues decreased in part due to capitalized costs associated with higher inventory produced versus products sold in the quarter. The largest component of COGS remains the 5% royalty on commsibri, which we paid at Ipsit. R and D expenses were $41,200,000 for the fourth quarter compared to $29,900,000 in the fourth quarter of twenty twenty three. Sequentially quarter over quarter, we experienced a 9% increase in R and D expenses due to increased costs associated with the ongoing trials of bivamalagon and RM718 the new Phase two seven lantotype trial in PRADAWILLI, which began this quarter, The year over year increase was primarily due to acquisition costs related to Bivomelegan. SG and A expenses were 38,100,000.0 the fourth quarter of 'twenty four as compared to $32,400,000 for the fourth quarter of 'twenty three. Sequentially, SG and A expenses increased by almost 8% compared Q3, primarily driven by increased headcount and marketing costs. For the fourth quarter of twenty twenty four, weighted average common shares outstanding outstanding were $61,600,000 almost $61,000,000 for the full year of 2024. [indiscernible] Total stock based compensation of $10,600,000 for the quarter compared to $11,000,000 in the prior Reported GAAP EPS for the fourth quarter was a net loss per basic and diluted share of 0.7 and this includes $0.02 per share from accrued dividends on convertible preferred stock of $1,300,000 a reminder, this ongoing accrual will be $1,300,000 per quarter.

Some highlights from the quarter and the year are broken out on Slide 19. As mentioned, Q4 revenue from global sales of MMCIVRI was $41,800,000 U. S. Revenue in the fourth quarter was $31,700,000 of that accounting for 76% of revenue during the quarter. For the year, U. S. Sales accounted for 74% of revenue. As we detailed in January, the sequential quarter over quarter revenue growth of greater than $8,000,000 was evenly split an increase in the number of U. S. Patients on reimbursed therapy, which Jennifer spoke to, and increased inventory stocking during the fourth quarter by our specialty pharmacy. Such inventory moves are not unusual in the fourth quarter of a calendar year. Our U. S. GAAP OpEx for 2024 totaled $382,300,000 and that included $39,700,000 in stock based compensation as well as $9,092,400,000.0 dollars in consideration for the acquisition of the global rights to build a divomelagon from LG Chem. For the year, non GAAP OpEx came in at $250,200,000 which is at the low end of our $250,000,000 to $270,000,000 guidance range. Consistent with years past, we are not giving revenue guidance, but we are offering guidance on non GAAP operating expenses. For 2025, we anticipate approximately $285,000,000 to $315,000,000 in non GAAP OpEx comprised of non GAAP SG and A, expenses of $135,000,000 to $145,000,000 non GAAP R and D expenses of $150,000,000 to 170,000,000 We The overall increase in expected non GAAP OpEx for 2025 is due to anticipated increases in SG and A as we grow our organization.

In preparation for launching EmsiBri for the treatment of hypothalamic obesity in The United States and subsequently in Europe and Japan. Increased R and D spending is anticipated due to ongoing trials and development of bivamelagon and RM-seven eighteen in HO, semilantide in the new Prader Willi trial and expansion of our medical affairs programs We believe this increased level of investment in our business will drive long term growth and shareholder value. One final point, we will pay $40,000,000 in cash to LG Chem in July 2025. This is the second and final tranche of the license fee for Bivomelagon. This payment is included in our cash out guidance, but not our 2025 OpEx guidance as this amount was recognized as R and D expense 2024. With that, I'll hand the call back over to David. Thank you. Thanks, Hunter. So hopefully what you've heard is Rythm's in a really good place. We're established commercially and we're growing. We've got exciting developmental programs, which all potentially open up significant opportunities for us. And significantly strengthened our balance sheet putting us in a really strong position to execute on what's in front of So we feel good about where we are.

With that, we'll open it up to Q and A. Our first question comes from Derek Archila with Wells Fargo. Your line is open.

Hey, good morning and congrats on the progress. Just two questions from us.

Just first, could you comment on whether you're going to share the sad, mad portion of the RM728 study separately or that kind of be wrapped into the second half twenty twenty five update with Part C? And then just on IMCIVRIS Phase three trial in HO, I was wondering if you could just remind us the mix of adults and pediatric patients you expect and ultimately, will the split be the same in the Japanese cohort? Thanks.

Yes. So for the sad, mad piece of it, I think it is likely we will we don't have specific plans to present that as an independent breakout. So you're right, we'll probably do that in concert with the Part C of that trial. But what I will say about that is it's a little bit of no news For SADMAD opportunities, long as you're progressing, you can assume that things are going well there. So we're feel good about where we are with the data that's coming out so far on seven eighteen. For Phase three, the atrial adult PEDE split, we did not the regulators wanted more adults in the trial. So we were very focused on that and we multiple additional adult centers to participate. We're about fifty-fifty, but like I said, we did not tap the number of kids or adults to lock the number to have it be exactly the same. The split is going to be roughly even. Next question?

Thank you. Our next question comes from Seamus Fernandez with Guggenheim Securities. Your line is open.

Thanks so much for the question. So David, you're emphasizing a lot the market opportunity in HO being quite firm at the sort of 5,000 to 10,000 patient range Interested [indiscernible] get a sense of with success how you would see uptake in that population just more identifiable than the BBS patient population or perhaps even the genetic population. So interested to just get a better understanding there. And then as we've spoken with some thought leaders in the space, there's a little bit of a discussion around sort of the pre existing obesity set point as a potential contributor because of the the hormone replacement dynamics of treatment with semilantide. Just interested to know you feel like that could have an impact on the Phase three HO trial results in any direction given the mix of patients that you just talked about in the Phase three study? Thanks. Sorry, James. I didn't quite understand the second question there. So you're saying that The variations in endocrine replacement impact their outcomes?

More than that there was a pre existing set point prior to And that it could sort of limit the magnitude of benefit depending on the timing of that injury.

Yes. Let me take that question first. I mean that's a really interesting question. I think the way again, we're learning, right?

When we entered into HO, nothing really worked. Nobody really understood what the underlying biology was. And then then we have this result where essentially every patient who took the drug, small number of patients, took an MC4R agonist had a response, which suggests that the problem in HO is in fact, signaling through this melanocortin four pathway. And what I highlighted in my prepared remarks was one major difference between the GLP-1s and ourselves is we're replacing a deficit. So in a sense, in theory, restoring normal physiology. And we have examples of that, which is our lean mask, particularly in teenage boys where you'd expect them to be gaining muscle mass, they did. They gained well. And so I think there's some support for the idea that we're going to restore your normal physiology and then you are who you are. So back to your question of, if you were obese, prior to getting your tumor and developing your insult, in theory, we could get you back to where you were before, but our drug is not a drug for general obesity. So that underlying deficit or your underlying normal physiology aren't likely to be impacted. So I think that is true.

And I think what we've talked about internally and with experts and the like is our hope and we have some anecdotal evidence of this is we'd like to get you back to where you were before your injury. I think that's a very reasonable expectation and that would be a huge restoration of health. So hopefully that answered the question. [indiscernible] Okay.

And then on the uptake side of this. Yes, we're not guiding. And also, I mean, in San said, we're early. We're learning along with all of you, as we do our own research and the like. What we can say is this is fundamentally different than BBS. Meaning so yes, we expect a different uptake than we saw with BBS. These patients, as we've highlighted, are we know concentrated in an endocrinology point, the reason they're concentrated in the endocrinology pulp point is because the vast majority, eighty-eighty percent of these patients have pituitary insufficiency and they need to be managed by an endocrinologist make sure that that aspect of their health is being appropriately managed and that's also especially where they recognize this. Entity. So concentrated larger number of patients, higher percent diagnosed, [indiscernible] is always true, This is when you write a script and you go to your local pharmacy. So it's not going to launch like some drugs do. We'll have prior authorization. Still have to go through the reimbursement challenges that we have. It's a we're not changing the price. So it's still going to be priced at a level where payers are going to be looking at it carefully.

That said, we've been encouraged by the feedback from payers initially, and so we expect that to go well. But those are balancing factors that are what causes to be a little bit different from maybe a more easily accessible specialty opportunity.

Great. Thanks so much.

Thank you. Our next question comes from Phil Nadeau with TD Callen. Your line is open.

Good morning. Thanks for taking our questions. Two from us as well. Diving into the HO pivotal data a bit more deeply in your prepared remarks, you said you expect septalenotide to do well on the primary endpoint.

I'm sure the question we're going to get from investors is what does management think well is guess, in the spectrum of 5% weight loss, which is the regulatory hurdle 255% BMI reduction, which is what you saw in the the long term extension kind of where in that in that spectrum is quote well? That's the first question. Then second one for Hunter. In terms of Q1 trends, just trying to assemble other data points you gave us. It sounds like there was $4,000,000 of inventory build in Q4. Is that likely to be destocked in Q1 and therefore is a modestly down quarter over quarter possible or is that going to be absorbed in the channel and So I'll take the second question first.

And I would say, yes, we absolutely anticipate the destocking to occur in this quarter. Got it. Thanks. So you know how it is, Phil. I mean, Q1 for all companies like us, especially when you have a single specialty pharmacy can always be a little wonky. [indiscernible] of what does management think our percent change, I mean the reason I'm I highlighted, we've had this question in a sense endlessly and it's understandable And I tried to highlight that I think it's coming to a large extent out of the how we've all been conditioned by the GLP world and this world is fundamentally different and try to give you some examples as to why those comparisons are challenging. So that said, what do we know? We know that in a small number of patients patients in Phase two and in this early experience in the France and France. Essentially everybody has taken the drug and has responded well. And we know that the average numbers are twenty percent plus. At one year and for both of those groups.

We also know that we have patients who I gave you the example of the 24 year old who had sixteen weeks, right? He lost more subsequently, but at sixteen weeks had lost less on a percent basis than a very light a much lighter individual who lost a larger percent of his BMI, but smaller overall absolute amount. So those are just variables that are really hard predict. We have a larger number of adults in this trial. Now I have no fear The adults have looked like they respond well. I think that was an incredibly powerful part coming out of HL. So this long answer to your question is, I mean, what we've said is, 5% is the regulatory hurdle. We'd be incredibly disappointed for less than 10%. Feel incredibly good about I know this drug works. I have the ability to project what percent change we're likely to see becomes much more difficult. Beyond that.

Thank you. Our next question comes from Whitney Ijem with Canaccord Genuity. Your line is open.

Hey guys, thanks for taking the question. I just wanted to follow-up on Seamus' question around prevalence in HO. And I guess some of the commentary earlier on the the call, just around the prevalence numbers that have been quoted, I think largely being based on cranial parengeoma data.

So is there any work that I mean, I know there's work. So can you speak to any of the work ongoing in terms of the prevalence that might come from other etiology including the congenital form? [indiscernible] that it's a work in progress. You're hearing increased confidence around those numbers that we put out because this work is supporting the fact that we're at least that good, we believe. Early things which we can highlight, I will say that or aspects of that initial modeling we're looking at We entered with the assumption that cranial pharyngioma was going to be the majority of cases. That's not necessarily true. There's clearly many more tumors which are contributing significantly to this population and that's coming out of some of this early claims work, which we'll see where that takes the ultimate numbers. The other thing was we did our initial calculation with a taking a twenty year period post injury. We know these patients live longer. So if you have your tumor at age 15, you don't die at 35, you tend to live a much longer life. So and then seeing that the adults respond well also you see the up update these numbers as we get more confidence there.

And the last thing I will say, which I again highlighted briefly in the prepared remarks was we're measuring what we can see, what the system can see There's clearly an undiagnosed pool here and talked about injury and it's still weight. I mean, that's a case report world today and it's way too early to say, maybe it's not nothing more than a case [indiscernible] am quite confident that if you have a head injury and you suddenly start gaining weight, nobody's thinking you have acquired hypothalamic obesity. So that's a population that is likely undiagnosed today.

That's helpful.

Thanks.

Thank you. Our next question comes from Tazeen Ahmad with Bank of America. Your line is Hi, good morning. Thanks for taking my questions. David, I wanted to ask a little bit more detail about I know what you said about your thoughts, but not really being able to project what results you'll get other than knowing that this is an active drug and that it works over time. But what have doctors told you about what they'd like to see in terms of percent weight loss in order for them want to be using it right away in HO patients And then my second is more of a financial one. You can HO dataset readout coming up very soon. Would you rule out doing a cash raise after that dataset reads out assuming that it's positive? [indiscernible] Thanks, Tocino. And I'll answer that question, of course. But to be honest, we're not asking the doctors. That very direct question. Would you use it if we had a 12% or not use it if 12% and you would use it if it was 15% or 18%. What the doctors are telling us is nothing in general works in this. Now we all know there's case reports out there and small series would GLP-1s and quoted I've quoted what some of the doctors have said that about twenty percent of the HO patients will have some response to a GLP-one and that response tends to be less than ten percent.

So I think where the doctors are, certainly the doctors who are knowledgeable and actively understand this problem and following them is, If this is approved labeled and indicated for this indication and is anything like our experience to date It will be [indiscernible] Difference for these patients today in terms of what they're experiencing with experiencing. So I just can't give I have no idea when projecting a percent outcome in a clinical trial. Of course, incredibly difficult. But I really think it's the wrong question and I think it's not the majority of doctors who are treating these patients are focused on. They want to know does it work consistently and does it work better than what they've had in the past.

And Tazeen, to your second question and thank you very much for the question. First of all, I'm I'm sure you're hearing and I want to reiterate that we have very, very high confidence in this data readout that's coming up. At the same time, given the uncertainty of the broader market conditions as well as the vagaries of market reactions to data we thought it prudent to take to extend the runway to a period where we didn't absolutely have to do a following the data. And we're now in that position and we're very happy to be here and we think it benefits our overall operational flexibility. Our investment program for the coming years is generally associated with Bivamelagon and RM-seven 8018 and indication expansion So the need to invest more and the need to raise more will be driven largely which is exciting. And so we're not in a position today where we would say, no, we're done raising money or anything like that. Having said that, we want to be in a position which we are in where we don't have to do a raise following the rehab.

Thank you. Our next question comes from Joseph Stringer with Needham and Company. Your line is open. Hi, good morning. Thanks for taking our question. Just on the Phase three HO trial, the inclusion criteria has slightly different age groups compared to the open label Phase two where Phase three excluding four to six year olds and then also patients older than 40. So can you describe what impact the inclusion of each of these groups [indiscernible] could have on the Phase three BMI primary endpoint both in terms of magnitude of effect and overall data variability? Thanks. [indiscernible] None, again, and I say it cautiously, meaning that we had patients down to six. I think the difference between four and six is is negligible. I think the four year old will do as well as the six year old. The French data was incredibly helpful. These were the eight adult patients we reported out at TAS. They had you remember, they had a mean age of 30, so somewhere significantly older than 30. And on average, they were eleven years out from their insult that provided strong support for this concept that It isn't a problem that only works if you can get it in the first one to two years post injury.

It really looks like it doesn't matter. How far out you are.

Once you've injured your hypothalamus, you're living with impaired signaling to the MCG you're living with it. And if we can intervene with an MC4R agonist, then we've got a good chance of helping those people. So I don't think either end of the spectrum is going to have any impact on how we're going to do. And one other thing, I'm just going to offer up because I know again people are appropriately focused on sort of what could the percent change be Another thing to remember is in that Phase two trial, the patient who did least well at sixteen weeks, meaning they had about a 4% decrease in their BMI, that was the only patient who took the drug who did not lose 10% or more was on track to lose 10% or more by sixteen weeks. That patient when you look like they were the least good responder, when you look at the DEXA scan, they had like a 20 plus percent increase in their lean body mass and a 15% decrease in their fat mass. So from a health response standpoint, arguably that was one of our best responders. So again, back to this idea that we're replacing a deficit restoring more normal physiology and allowing you to do what you should do.

So teenage boys should put on lean muscle mass. Other groups will behave differently. [indiscernible] [indiscernible] Our next question comes from Leland Gershell with Oppenheimer. Your line is open.

Hey, good morning. Thanks for the update and we have two questions. First, Dave, just want to ask, it's early days, but since the label expansion to younger patients, just want to see what extent expansion of insulin to the younger ages is becoming a component of commercial uptake? And then also wanted to ask as you look to enroll patients with congenital HO if you could just review with us kind of maybe the similarities and differences in the way those patients are identified versus your other historical in general? [indiscernible] Yes. Let me take a second person and then Jennifer can comment on that. The two to six year old opportunity. So we're learning about the congenital HO. Opportunity. And again, this was brought to us by doctors who are following large pop area of the brain not developing appropriately and there's a variety of different syndromes, quote unquote, depending on how they present. But it's clear that there is some percentage of these patients who have obesity and the very early data in France suggests that some of those patients respond to an MC4R agonist. So our challenge and it's the literature just is not very helpful here yet.

Understanding the percent of patients with one of these congenital syndromes who have obesity and then one step further, which is that, that obesity is related to hypothalamic impairment. And I think the challenge here is unlike an injury setting where you have a before and after, these of course are congenital, they start at birth and they emerge over time. Their pituitary insufficiencies emerge over time. It's not like they're born with a full blown picture.

So as obesity might emerge, you can imagine that a doctor looking at patient wouldn't necessarily connect the two that you have this genital syndrome and all your obesity is In today's world, it's equally likely they just think you have obesity on top. So that's our challenge. I think we're going to learn a lot over the next next year. Like I said, there's a lot of enthusiasm around this as we talk to physicians again, it's a little bit like HO. Yes, I have these patients and yes, I would love to have something to do for them. So very early as you said.

And on the point about the the potential opportunity for the pediatric expansion, One, I would say that in Q4, really the indication came quite late in the year. So it didn't an impact in terms of the outline of the revenue that we released. Moving forward, we are very happy to have this as an option for patients who are two plus years of age and as I outlined during my story around Ben's background, the impact can be significant for these patients However, we don't feel like it's going to be a significant market opportunity just in terms of significant increase or impact on revenue. We are more happy to have this as an additional piece of information that really further differentiates our patient population in terms of the the need to be able which is shown by the ability to actually get approval for two year olds plus. So that consistency and differentiation of our patient Next question?

Thank you. Our next question comes from Dennis Ding with Jefferies. Your line is open.

Good morning. This is Anthea on for Dennis. Thank you for taking our question.

Two from us.

On the upcoming Phase three trial, could you talk a little bit about GLP-one use at baseline and if drop ins are allowed throughout the trial and how you anticipate that to impact efficacy? And then on the Phase two Do you see any read throughs from the semilunotide trial in terms of efficacy as well as enrollment and the adult pediatric fix? Thank you very much.

Sorry, which Phase two trial?

BIVA.

Oh, for BIVA.

So Read through in terms say it again. What's the question about the BIVA trial?

Yes. Do you see any read throughs from the seven olanotide trial in terms of efficacy and then also in terms of enrollment and the adult pediatric mix? [indiscernible] That's a twenty eight patient for ARM, so seven patients for ARM blinded trial. So no we have obviously no insight into the efficacy at this point.

We didn't restrict it. It's 12 and older.

So it's a slightly older population. We need to we're still developing the pediatric formulation for BIVA, which we're making great progress on and that will be part of our next trial, but we don't have that part of the population. So that's all I can say now about the mix of patients we're With regard to GLPPS, Phase three trial, so about twenty five percent of the patients had previously been on a GLP and or were continuing a GLP if they continued a GLIP, they could not have had weight loss of 2% or greater. In the prior three months. And so you had to be stable on it. And you cannot add a new weight loss medication during the trial. And that didn't happen, but that was excluded by protocol.

Got it. Thank you.

Thank you. Our next question comes from Ram Selvaraju with Eight Wainwright and Company. Your line is open.

Very much for taking my questions and I just wanted to ask if you could comment a little bit more on the recent impact of the label expansion for ensivary and what specific dynamics you're seeing in The U. S. Market regarding patient acquisition, patient adherence and how that compares to the ex U. S. Experience that you've had since that label has been in place for longer outside of The U. S?

And the second question is, if we think about the Trifera relationship that you have announced, To what extent is this likely to be a template or a model for future relationships in ex U. S. Territories? Is this like your future ex USBV activities or is it very much kind of individualized to the Turkish context? Thank you. Yes. So, Jan, can you comment on the your experience, international experience here with two to six? Jennifer just commented on The U. S. And how you see that impacting the overall opportunity. And then course, how we think about distributorships and partnerships. So yes, thank you. So pediatric in Europe, so we are now Rhythm patients younger than 16 in a few countries in France, in Germany, in The UK and Spain. And we'll continue to see more of that. As Jennifer said previously, the impact on revenues will not be significant, but the impact for the patients and for the caregivers and also for the the clinicians is a significant one. So in a nutshell, that's what I can say about the pediatric indication in Europe.

And then maybe you can build on this.

And Ramon, so way we think about a disbursement, it is country by country. I mean our general approach is to go direct where we can and then be practical and smart about where we need to leverage additional help. So maybe on just a little bit of thinking behind the decision to use that distributor in Turkey and how that might represent or be an indicative of our thinking going forward.

Yes, exactly as you said, David. So I think we we choose country approach country by country. Of course, in the main European countries, we are direct. For some specific territories, where we believe that the expertise in the ground is better with partners. That's what we do. And we have done such medicine in Israel, with GenFARM in The Middle East and now with Trespira in Turkey. And we have to say that we have been very happy with these three partnerships. Great.

Okay. Thank you. Next question? Thank you. Our next question comes from John Wallibin with Citizens JMP. Your line is open.

Hey, thanks for taking the question. Just wondering, in the Phase two, we did see some patients who dose reduced or due to AEs.

See a regain of BMI, which gives us confidence in the drug effect.

But wondering in the Phase three protocol, if you're allowing dose reductions for AEs during the fifty two week period or if everyone's set after the dose titration period?

Yes. No, good question. So the protocol is set, so everybody dose escalation to three as tolerated. If you can't tolerate it, then you stay a little longer at that dose to hopefully acclimate, most patients do. Then dose escalate again, and or if you truly are having trouble you can dose decrease. So it's a dosing paradigm that does allow titration to tolerance. Now the vast majority of patients get to the desired dose at three. Not everybody's needed to go to three. And I know this has been a question out there. I do think the HO world is going to end up somewhere between two and three. BBS weighs a little heavier to the three. I think HO will be more firmly in the two to three range. But individual patients and we had one in the trial who just couldn't tolerate it, and ended up stopping the drug. Yes, we may lose some like that, but that's quite uncommon. And again, I'll remind you, we've only had we've had fewer than ten percent dropouts in trials so far. So doesn't seem to be an issue in the Phase three.

Okay. And one more if I may. You talked a little bit about the bivomegalyon and seven eighteen being having less activity at MC1. Wondering can you talk about the relative activity at MC3 between the next gens and semilantide?

You say efficacy is kind of TBD if there's going to be a difference there, but you talk about the specificity at the MC4 receptor between those three candidates?

Yes. So the seven eighteen and septmelanotide in vitro assay is functional looking at potency are highly similar. We are the potency as it was assessed for bivamalagon was done in a different wasn't done head to head. We're actually running that now. I don't have those full results now, but so I can't comment on that within the same assay comparison. What I can say is the preclinical data and again, on a milligram per milligram base, obviously, an oral drug, got bio absorption and availability and the like, so a lot of factors. So you're dosing as much higher on a milligram basis, obviously. But we can get or they got in an extensive set of models similar results using dose of bibamelagon as we saw with septmelanotide and with seven and the doses that are being used in the trial were built off of that understanding. So I think we are likely to be in a therapeutic range I'm expecting that we're going to get adequate MC4 agonism across each one of these.

Got it. All right. Thanks, David. That's helpful.

Thank you. I'm showing no further questions at this time. Like to turn the call back over to David Meeker. Any closing remarks.

Okay. Well, great. Thanks all again for tuning in this morning. As you heard, we're excited about where we are and we look forward to our next calls, which we'll be updating you on some exciting information. Thanks, Paul.

Thank you for your participation. You may now disconnect. Everyone, have a great day.