Rhythm Pharmaceuticals, Inc. (NASDAQ:RYTM) Q1 2024 Earnings Call Transcript

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So long story short is, again, there are many, many different often, as I said, patient-specific reasons why these patients discont. But some of those, we have very specific things we can do to work on, and I’ll let Jennifer speak to that here. In terms of HO, it is a different population. And what’s been striking about the HO is it’s cleaner, for lack of a better word. These are patients who where literally nothing’s worked and biologically, it seems that setmelanotide is addressing a very specific biologic abnormality. So mechanistically, it seems to be the solution. And that’s led to potentially a different level of engagement than we’ve had in our other populations. And I say that simply based on the fact that in running this Phase 3 trial as we’ve highlighted, patients seem to be staying on treatment, including whoever is on placebo.

We don’t know who they are, but they might be guessing. And in today’s world, if they truly felt there was another option, they would likely move to there, and they’re not. And why not? Because if they stay in the trial, then they know they can access the drug in the open-label portion of it. So I think there are differences with HO. I wouldn’t be surprised if the discontinuation rate was lower than HO, but obviously, we have a lot more to learn.

Corinne Johnson: Helpful. And then can you help us understand the size of the market opportunity for this under the two- to six-year-old patient population and how that kind of expands the commercial opportunity for BBS?

David Meeker: Yes. I mean what we said about that previously is that when we do our genetic screening, the frequency, the positivity rate in that zero to two specifically, but two to six tends to be higher than the rest of the other ages, the older age groups. And that’s not a surprise because parents will present with a child who has early onset obesity and uncontrolled hunger, they know something’s wrong. Genetic testing perhaps gets to be done a little earlier. And as a result, as opposed to a 20-year-old, for example, comes in and you’re asking them when their obesity started and the like, it’s just a different setting. So higher frequency hit rate, but the overall numbers are still small. So again, this will not dramatically increase the overall target population.

But it does from a signaling standpoint, reinforcing standpoint, when you’re treating two-year olds, some with your medication, that’s really a remarkable indication that, A, it’s important to do so, B, the drug must be safe. And as you know, most of the other available anti-obesity medications have not tested kids as young as two to six. And so we’ve gotten positive feedback from the field just from our willingness to take that on.

Operator: Next question comes from the line of Joseph Stringer from Needham & Company.

Joseph Stringer: I’m sorry if I missed this, but what were the discontinuation rates through the first quarter of this year? I believe it was around 20% as of the last quarterly update. And just given the discontinuation rates have ticked up a bit quarter-over-quarter, what gives you confidence that the rate will level out in that 20% to 30% range?

David Meeker: Yes. No, it has ticked up. We’re not going to break it out further. Again, I think that was part of the goal of today’s comments was we do think it’s going to level out in the 20% to 30%. Your question is what gives us confidence. I mean, that’s consistent, I think, with other chronic injectables, daily injectables, I mean, think insulin therapies and the like don’t necessarily have, they don’t discontinue per se, but compliance can be quite challenging in some of those areas. So in this age group, I think, again, it’s an estimate, Joe. We don’t know for sure, but I think it’s a reasonable 1 based on our experience, just working with rare disease populations and some of the challenges associated with this injectable chronic daily injectable. What was the second part of that question?

Joseph Stringer: [indiscernible]

David Meeker: Yes. Does that, cover me again. Yes. Yes. Actually, Jennifer, it’s a good opportunity, just to highlight what we’re doing.

Jennifer Lee: I think like one piece is we also learn as we go, just as we evaluate different parts of the business and think through if there’s opportunities for us to focus a bit more in. As David mentioned, the first couple of expenses is when there is the highest risk in terms of folks discontinuing. And when we look at different reasons, one example I’ll give is in terms of injection issues. We saw that that was an issue early on and through discussions have implemented an at-home nurse support for patients so that they feel very comfortable initiating therapy and being able to inject them themselves. And this has leveled or decreased that particular issue as a reason for disconts. We also, just through that example, that sort of high touch just in terms of the beginning to make sure that the patients are doing okay as they initiate therapy, realize it’s, we thought in terms of the structure that we had in place and the structure we had from patient support side was that there was one point of contact for the patient, but also was responsible in terms of being able to help through the reimbursement and reauthorization process, which was a lot for one person to be able to juggle both aspects.

So we have recently restructured that group. So we have specific team that focuses on the authorizations and maintaining the reauthorizations, while we have a separate patient team education team that then is able to once again have more time and ability to maintain close contact with the patients.

Operator: Our next question comes from the line of Michael Higgins of Ladenburg Thalmann.

Unidentified Analyst : This is Sohana [ph] on behalf of Michael. Congrats from us on the continued progress this quarter. Two questions from us. The first is, so we believe DAYBREAK Stage 2 could be read out separately or there was going to be a staggered update. So should we look for another update in Q4 than the update in Q3? And the second question is, any guidance on the start of the second trial route for LB54640?

David Meeker: Yes. So thank. The DAYBREAK study, we’ll get the results in quarter three. We haven’t, again, depends a little bit on what they are and how long it takes us to sort all this out. So whether we’re going to report this in Q3 or Q4, I don’t know, to be honest, right now. The second is, obviously, we try to connect these with a meeting and there you have to sniff as a late breaker. And so again, there’s just some things I don’t quite know yet. So let’s say our goal is to get this out this year for sure in terms of reporting it out to all of you, but I don’t know the vehicle. I don’t know the exact timing. And then second, with regard to the start, we’re making really good of the small molecule trial, the LB54640. We’re making really good progress.

And as I said, the number of sites that we need have virtually all been identified, and we’re working through the initiation part of that. So we will beginning in the quarter three and hopefully early in quarter three. But that’s as good as I can do today.

Operator: [Operator Instructions] Next question comes from the line of Whitney Ijem of Canaccord Genuity.

Whitney Ijem : First one, I guess, is just on the kind of steady-state dropout rate that you talked about, or discontinuation rate. Is that informed at all, I guess, by the age at which patients are starting? I’m just curious if you’re seeing patients or a higher discontinuation rate in patients who start when they’re older versus younger, and maybe there could be some shift in that average rate over time as patients start when they’re younger with the label expansion?

David Meeker: So short answer, Whitney is yes, and that was breaking out the three different age groups there. The key is it’s adolescents. So I don’t know if disproportionately, we have a number of adolescents. I mean we know we have about 60% adults versus 40% peds overall. So the adult group, we’re continuing to move to a more normal patient distribution and have a normal lifespan in that sense. But no, it’s just, it’s additional color, which says, yes, that adolescent group is more difficult, and we do see more higher disconts there.

Whitney Ijem : And then in France, and perhaps I just misunderstood, but I think I understood the comments to be that patients with HO have been getting treated via the early access program, but maybe not so much for the BBS program. Did I interpret those comments correctly? And if so, I guess, can you talk a little bit about what you’re seeing in I guess, maybe urgency to treat the process of getting patients through that to get to approval in BBS versus HO in France?

David Meeker: Yes. No, that’s not the case. Yann, do you want to make some comments?

Yann Mazabraud : Yes. No, that’s not the case. So we have currently three early access program running, one for POMC, LEPR, one for BBS and more recently for HO. So those three programs move in parallel, and we have been very pleased with the uptake of these three programs. And the most recent one is HO. It has started at the end of last year. And I can say that it is extremely rare in France to get this early access program based on Phase 2 data and 3 EMA approval. To be more precise, there are just two rare disease therapies with such status in France. And as I have mentioned during the call, we have now a number of patients which are commercially treated for HO. And back to the, maybe the second part of your question, BBS is moving nicely as well.

Hunter Smith: I think, Whitney, what we have said is when the HO program was approved, we had said for a while that it was very slow and bureaucratic to get patients approved within it, and that has only recently started. So that may have been the emphasis on the fact that we’ve started to get patients through the HO program despite it being approved a longer time ago may have caused that impression.

Operator: I am showing no further questions at this time. I would now like to turn it back to David Meeker for closing remarks.

David Meeker: Great. Well, thanks, everyone, for joining in this morning. And again, we look forward to our next earnings call and updating you on further progress over the next three months. Thanks all.

Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.

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