Analyst Michael Ulz of Morgan Stanley reiterated a Buy rating on Rhythm Pharmaceuticals (RYTM – Research Report), retaining the price target of $72.00.
Michael Ulz has given his Buy rating due to a combination of factors surrounding Rhythm Pharmaceuticals’ strategic moves and potential market opportunities. The reacquisition of setmelanotide rights in China, following the termination of their agreement with RareStone Group Ltd, positions the company to directly capitalize on this market, which includes mainland China, Hong Kong, and Macau. Additionally, the orphan drug designation for setmelanotide in Japan for acquired hypothalamic obesity (HO) is a significant milestone, given the estimated prevalence of 5,000 to 8,000 patients in the country.
These developments, coupled with the completion of patient enrollment in the Japanese cohort of their global Phase 3 trial, suggest a promising regulatory submission pathway in Japan. Ulz anticipates that investor attention will remain on the Phase 3 trial data expected in the second quarter of 2025, which presents a favorable risk/reward scenario and potential for substantial upside. These strategic advancements and market opportunities underpin Ulz’s optimistic outlook and Buy rating for Rhythm Pharmaceuticals.
In another report released on March 19, JMP Securities also reiterated a Buy rating on the stock with a $81.00 price target.