0001558370-25-001889 | 10-K | XBRL Viewer | Rhythm Pharmaceuticals INC

Income Taxes - Deferred tax assets and liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Deferred tax assets:
Net operating loss carryforwards	$ 167,375	$ 153,685
Research and development credits	17,604	16,139
Orphan drug credit	34,603	25,484
Capitalized license fee	21,661	2,311
Stock-based compensation	5,113	13,159
Section 174 Costs	67,624	50,688
Deferred revenue	336	350
Section 163(j) Interest Limitation	4,417
Accrued Expenses & Other	7,971	5,680
Total deferred tax assets	326,704	267,496
Valuation allowance	(325,503)	(267,158)
Net deferred tax assets	1,201	338
Deferred tax liabilities:
Operating lease right-of-use asset and other	(1,201)	(338)
Total deferred tax liabilities:	$ (1,201)	$ (338)

Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Fair Value of Financial Assets and Liabilities
Carrying amount of cash and cash equivalents and short term investments	$ 320,565	$ 275,846
Fair value of financial assets and liabilities
Marketable securities	$ 231,428	215,765
Derivative Asset, Statement of Financial Position [Extensible Enumeration]	Other Long-Term Investments
Derivative liability		1,150
Recurring \| Estimated fair value
Fair value of financial assets and liabilities
Fair value of assets	$ 306,016	261,612
Derivative asset	270
Derivative liability		1,150
Recurring \| Money market funds \| Estimated fair value
Fair value of financial assets and liabilities
Cash equivalents	71,334	45,847
Recurring \| US treasury securities \| Estimated fair value
Fair value of financial assets and liabilities
Marketable securities	65,118
Recurring \| Corporate debt securities and commercial paper \| Estimated fair value
Fair value of financial assets and liabilities
Marketable securities	166,310	215,765
Recurring \| Commercial Paper \| Estimated fair value
Fair value of financial assets and liabilities
Cash equivalents	2,984
Recurring \| Level 1 \| Estimated fair value
Fair value of financial assets and liabilities
Fair value of assets	136,452	40,868
Recurring \| Level 1 \| Money market funds \| Estimated fair value
Fair value of financial assets and liabilities
Cash equivalents	71,334	40,868
Recurring \| Level 1 \| US treasury securities \| Estimated fair value
Fair value of financial assets and liabilities
Marketable securities	65,118
Recurring \| Level 2 \| Estimated fair value
Fair value of financial assets and liabilities
Fair value of assets	169,294	220,744
Recurring \| Level 2 \| Money market funds \| Estimated fair value
Fair value of financial assets and liabilities
Cash equivalents		4,979
Recurring \| Level 2 \| Corporate debt securities and commercial paper \| Estimated fair value
Fair value of financial assets and liabilities
Marketable securities	166,310	215,765
Recurring \| Level 2 \| Commercial Paper \| Estimated fair value
Fair value of financial assets and liabilities
Cash equivalents	2,984
Recurring \| Level 3 \| Estimated fair value
Fair value of financial assets and liabilities
Fair value of assets	270
Derivative asset	$ 270
Derivative liability		$ 1,150

Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Accrued Expenses
Research and development costs	$ 17,871	$ 12,925
Professional fees	4,280	3,833
Payroll related	18,216	15,439
Royalties	2,091	1,180
Sales allowances	15,850	9,475
Other	4,350	5,410
Accrued expenses and other current liabilities	$ 62,658	$ 48,262

Fair Value of Financial Assets and Liabilities

12 Months Ended

Dec. 31, 2024

Fair Value of Financial Assets and Liabilities

Fair Value of Financial Assets and Liabilities

5. Fair Value of Financial Assets and Liabilities

The following tables present information about the Company's financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values:


	Fair Value Measurements as of
	December 31, 2024 using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Commercial Paper	$	—	$	2,984	$	—	$	2,984
Money market funds		71,334		—		—		71,334
Marketable securities:
US treasury securities		65,118		—		—		65,118
Corporate debt securities and commercial paper		—		166,310		—		166,310
Derivative asset		—		—		270		270
Total	$	136,452	$	169,294	$	270	$	306,016


	Fair Value Measurements as of
	December 31, 2023 using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds		40,868		4,979		—		45,847
Marketable securities:
Corporate debt securities and commercial paper		—		215,765		—		215,765
Total	$	40,868	$	220,744	$	—	$	261,612
Liabilities:
Derivative liability	$	—	$	—	$	1,150	$	1,150
Total	$	—	$	—	$	1,150	$	1,150

As of December 31, 2024 and 2023 the carrying amount of cash and cash equivalents and short-term investments was $320,565 and $275,846, respectively, which approximates fair value. Cash and cash equivalents and short-term investments includes investments in U.S. treasury securities and money market funds that invest in U.S. government securities that are valued using quoted market prices. Accordingly, money market funds and government funds are categorized as Level 1. The financial assets valued based on Level 2 inputs consist of corporate debt securities and commercial paper, which consist of investments in highly-rated investment-grade corporations.

The embedded derivative (asset) or liability associated with our deferred royalty obligation, as discussed further in Note 12, “Long-Term Obligations”, is measured at fair value using an option pricing Monte Carlo simulation model and is included as a component of the deferred royalty obligation. The embedded derivative (asset) or liability is subject to remeasurement at the end of each reporting period, with changes in fair value recognized as a component of other (expense) income, net. The assumptions used in the option pricing Monte Carlo simulation model include: (1) our estimates of the probability and timing of related events; (2) the probability-weighted net sales of IMCIVREE, including worldwide net product sales, upfront payments, milestones and royalties; (3) our risk-adjusted discount rate that includes a company specific risk premium; (4) our cost of debt; (5) volatility; and (6) the probability of a change in control occurring during the term of the instrument.

The forward contract associated with our Series A Convertible Preferred Stock, as discussed further in Note 9, “Series A Preferred Stock”, is measured at fair value. In order to value the forward contract, a binomial lattice model was used to determine the fair value of the Series A Preferred Stock. The fair value of the forward contract was measured as the difference between the consideration payable of $150,000 and the fair value of the Series A Preferred Stock. The fair value of the forward contract was determined to be $0 at initial issuance and the change in the fair value from initial issuance to settlement of $8,900 was recognized as other income in the condensed consolidated statements of operation for the year ended December 31, 2024. The significant assumptions used in the binomial lattice model include: (1) the Company’s common stock price on the issuance and settlement dates; (2) the Conversion Price as of $48.00 as per the Agreement; (3) a 20-year term to maturity; (4) risk free rates (4.6% - 5%); and (5) volatility (68% and 67%).

The following tables set forth a summary of the changes in the estimated fair value of our embedded derivative liability (asset) (in thousands):


	Year ended
	December 31,
	2024		2023
Beginning aggregate estimated fair value of Level 3 liability (asset)	$	1,150	$	1,340
Change in fair value of embedded derivative		(1,420)		(190)
Fair value of forward contract - Series A Convertible Preferred Stock		8,900		—
Settlement of forward contract		(8,900)		—
Ending aggregate estimated fair value of Level 3 liability (asset)	$	(270)	$	1,150

The estimated fair value of the derivative (asset) or liability related to our Royalty Interest Financing Agreement (RIFA) with HealthCare Royalty was determined using Level 3 inputs. The fair value measurement of the derivative (asset)

or liability is sensitive to changes in the unobservable inputs used to value the financial instrument. Changes in the inputs could result in changes to the fair value of each financial instrument.

Marketable Securities

The following tables summarize the Company's marketable securities:


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Assets
Corporate debt securities and commercial paper (due within 1 year)	$	166,255	$	147	$	(92)	$	166,310
U.S. Treasury Securities		65,074		79		(35)		65,118
	$	231,329	$	226	$	(127)	$	231,428


	December 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Assets
Corporate debt securities and commercial paper (due within 1 year)	$	215,491	$	282	$	(7)	$	215,765
	$	215,491	$	282	$	(7)	$	215,765

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
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-Name Accounting Standards Codification
-Section 55
-Paragraph 107
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-URI https://asc.fasb.org/1943274/2147482078/820-10-55-107

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
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-URI https://asc.fasb.org/1943274/2147482078/820-10-55-100

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Common stock, par value per share	$ 0.001	$ 0.001
Common stock, authorized	120,000,000	120,000,000
Common stock, issued	62,390,654	59,426,559
Common stock, outstanding	62,390,654	59,426,559
Convertible preferred stock
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, authorized	150,000	150,000
Convertible preferred stock, issued	150,000	0
Convertible preferred stock, outstanding	150,000	0
Liquidation preference	$ 150,000

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Operating activities
Net loss	$ (260,602)	$ (184,678)	$ (181,119)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	39,682	32,553	19,831
Depreciation and amortization	1,563	1,758	1,672
Non-cash interest expense	20,603	13,360	5,389
Non-cash accretion & amortization of short-term investments	(8,165)	(9,835)	(2,314)
Non-cash rent expense	400	401	(267)
Loss on RareStone equity investment			1,040
Change in fair value of embedded derivative liability	(1,420)	(190)	(250)
Gain on settlement of forward contract	(8,900)
Acquired IPR&D assets classified as investing activities	92,385	5,667
Changes in operating assets and liabilities:
Accounts receivable	(3,645)	(8,643)	(5,199)
Inventory	(10,117)	(5,707)	(2,806)
Prepaid expenses and other current assets	(5,524)	2,876	498
Deferred revenue		(148)	(6,606)
Other long-term assets, net	7,943	1,656	(4,840)
Accounts payable, accrued expenses and other liabilities	21,918	14,773	1,543
Net cash used in operating activities	(113,879)	(136,157)	(173,428)
Investing activities
Purchases of short-term investments	(268,313)	(354,918)	(251,937)
Maturities of short-term investments	260,640	354,967	284,247
Acquisition of IPR&D assets	(40,500)	(5,667)
Payment of milestone obligation under license agreement			(4,000)
Purchases of property and equipment		(47)	(281)
Net cash (used in) provided by investing activities	(48,173)	(5,665)	28,029
Financing activities
Repayment of deferred royalty obligation	(12,900)	(7,398)
Proceeds from the exercise of stock options	15,976	7,468	9,752
Proceeds from issuance of common stock from ESPP	1,270	1,053	626
Net proceeds from issuance of common stock	39,146	48,875	131,112
Proceeds from royalty financing agreement, net of issuance costs		24,370	72,338
Gain on settlement of forward contract	8,900
Proceeds from Series A Preferred Stock, net of issuance costs	138,850
Net cash provided by financing activities	191,242	74,368	213,828
Effect of exchange rates on cash	2	(142)
Net increase (decrease) in cash, cash equivalents and restricted cash	29,192	(67,596)	68,429
Cash, cash equivalents and restricted cash at beginning of period	60,409	128,005	59,576
Cash, cash equivalents and restricted cash at end of period	89,601	$ 60,409	$ 128,005
Supplemental disclosure of non-cash investing and financing activities:
Non-current liability issued in exchange for the acquisition of IPR&D	$ 33,669
Issuance of common stock in exchange for IPR&D	18,716
Accretion of preferred stock dividends	$ 3,970

Fair Value of Financial Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2024

Fair Value of Financial Assets and Liabilities

Schedule of financial assets and liabilities measured at fair value on a recurring basis


	Fair Value Measurements as of
	December 31, 2024 using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Commercial Paper	$	—	$	2,984	$	—	$	2,984
Money market funds		71,334		—		—		71,334
Marketable securities:
US treasury securities		65,118		—		—		65,118
Corporate debt securities and commercial paper		—		166,310		—		166,310
Derivative asset		—		—		270		270
Total	$	136,452	$	169,294	$	270	$	306,016


	Fair Value Measurements as of
	December 31, 2023 using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds		40,868		4,979		—		45,847
Marketable securities:
Corporate debt securities and commercial paper		—		215,765		—		215,765
Total	$	40,868	$	220,744	$	—	$	261,612
Liabilities:
Derivative liability	$	—	$	—	$	1,150	$	1,150
Total	$	—	$	—	$	1,150	$	1,150

Schedule of estimated fair value of embedded derivative liabilities (assets)

The following tables set forth a summary of the changes in the estimated fair value of our embedded derivative liability (asset) (in thousands):


	Year ended
	December 31,
	2024		2023
Beginning aggregate estimated fair value of Level 3 liability (asset)	$	1,150	$	1,340
Change in fair value of embedded derivative		(1,420)		(190)
Fair value of forward contract - Series A Convertible Preferred Stock		8,900		—
Settlement of forward contract		(8,900)		—
Ending aggregate estimated fair value of Level 3 liability (asset)	$	(270)	$	1,150

Schedule of marketable securities


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Assets
Corporate debt securities and commercial paper (due within 1 year)	$	166,255	$	147	$	(92)	$	166,310
U.S. Treasury Securities		65,074		79		(35)		65,118
	$	231,329	$	226	$	(127)	$	231,428


	December 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Assets
Corporate debt securities and commercial paper (due within 1 year)	$	215,491	$	282	$	(7)	$	215,765
	$	215,491	$	282	$	(7)	$	215,765

Commitments and Contingencies

12 Months Ended

Dec. 31, 2024

Commitments and Contingencies.

Commitments and Contingencies

12. Commitments and Contingencies

Legal Proceedings

The Company, from time to time, may be party to various litigation arising in the ordinary course of business. The Company is not presently subject to any pending or threatened litigation that it believes, if determined adversely to the Company, individually, or taken together, would reasonably be expected to have a material adverse effect on its business or financial results.

Other

The Company is party to various agreements, principally relating to licensed technology, that require future payments relating to milestones that may be met in subsequent periods, or royalties on future sales of specified products. See Note 10 for discussion of these arrangements. Additionally, the Company is party to various contracts with CROs and CMOs that generally provide for termination on notice, with the exact amounts in the event of termination to be based on the timing of the termination and the terms of the agreement.

Based on the Company’s current development plans as of December 31, 2024, the Company does not expect to make milestone payments due to third parties during the next 12 months from the filing of this Annual Report on Form 10-K, in connection with our license agreements. These milestones generally become due and payable upon achievement of such milestones or sales and achievement of development milestones. When the achievement of these milestones or sales have not occurred, such contingencies are not recorded in the Company’s consolidated financial statements.

Stock-based Compensation - Black Scholes option pricing (Details)	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Weighted average assumptions
Risk-free interest rate	4.29%	2.35%	2.19%
Expected term (in years)	6 years 1 month 17 days	6 years 1 month 9 days	6 years 1 month 9 days
Expected volatility	74.59%	76.11%	69.16%

Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2024

Accrued Expenses

Schedule of accrued expenses


	December 31,		December 31,
	2024		2023
Research and development costs	$	17,871	$	12,925
Professional fees		4,280		3,833
Payroll related		18,216		15,439
Royalties		2,091		1,180
Sales allowances		15,850		9,475
Other		4,350		5,410
Accrued expenses and other current liabilities	$	62,658	$	48,262

Fair Value of Financial Assets and Liabilities - Forward Contract (Details) - USD ($) $ / shares in Units, $ in Thousands	Apr. 15, 2024	Apr. 01, 2024	Dec. 31, 2023
Series A Convertible Preferred Stock
Derivative liability			$ 1,150
Minimum
Series A Convertible Preferred Stock
Fair value risk free rates (as a percent)	4.60%
Volatility (as a percent)	68.00%
Maximum
Series A Convertible Preferred Stock
Fair value risk free rates (as a percent)	5.00%
Volatility (as a percent)	67.00%
Convertible preferred stock \| Forward Contracts
Series A Convertible Preferred Stock
Consideration payable	$ 150,000
Derivative liability	$ 8,900	$ 0
Per share or per unit amount of temporary equity issued	$ 48
Term to maturity per share or per unit amount of temporary equity issued	P20Y

Segment and Geographic Information (Details)	12 Months Ended
Segment and Geographic Information (Details)	Dec. 31, 2024 segment
Segment and Geographic Information
Number of operating segments	2
Number of reporting segments	1

Series A Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands					12 Months Ended
	May 07, 2024 $ / shares shares	Apr. 15, 2024 USD ($) $ / shares shares	Apr. 01, 2024 USD ($) $ / shares shares	Mar. 02, 2023 shares	Dec. 31, 2024 USD ($) $ / shares	Dec. 31, 2023 USD ($) $ / shares	Oct. 18, 2022 $ / shares	Sep. 19, 2022 $ / shares	Feb. 09, 2021 $ / shares
Series A Convertible Preferred Stock
Derivative liability						$ 1,150
Price per share \| $ / shares							$ 26	$ 26	$ 30
Accretion of preferred stock dividends					$ 3,970
Carrying value of convertible preferred stock					$ 142,820
Convertible preferred stock
Series A Convertible Preferred Stock
Issuance and sale of shares of a new series \| shares			150,000	3,124,995
Temporary equity, par value per share \| $ / shares			$ 0.001		$ 0.001	$ 0.001
Aggregate purchase price			$ 147,750
Issuance costs			$ 2,250		$ 2,250
Price per share \| $ / shares			$ 1,000
Multiplier factor to liquidation preference per share		1.75
Initial Liquidation Preference of per share \| $ / shares	$ 1,000	$ 1,000
Annual rate of convertible preferred stock		6.00%
Accretion of preferred stock dividends					3,970
Carrying value of convertible preferred stock					142,820
Conversion price \| $ / shares		$ 48
Shares issued upon conversion \| shares		20.8333
Limited voting rights of convertible preferred stock to common stock shares \| shares	24.9438
Step up interest rate	1.00%
Convertible preferred stock \| One holder of Series A convertible preferred stock
Series A Convertible Preferred Stock
Percentage ownership after conversion of preferred stock		4.99%
Convertible preferred stock \| Separate holder of Series A convertible preferred stock
Series A Convertible Preferred Stock
Percentage ownership after conversion of preferred stock		9.99%
Convertible preferred stock \| Forward Contracts
Series A Convertible Preferred Stock
Issuance and sale of shares of a new series \| shares		150,000
Per share or per unit amount of temporary equity issued \| $ / shares		$ 48
Term to maturity per share or per unit amount of temporary equity issued		P20Y
Derivative liability		$ 8,900	$ 0
Fair value of convertible preferred stock		$ 141,100
Issuance costs					$ 2,250

Stock-based Compensation - 2017 Employee Stock Purchase Plan (Details) - shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Stock-based Compensation
Number of common stock options granted	983,643
Expected term	6 years 1 month 17 days	6 years 1 month 9 days	6 years 1 month 9 days
2017 Employee Stock Purchase Plan
Stock-based Compensation
Common stock reserved for issuance	1,872,738
Percentage increase in authorized shares under the plan	1.00%
Number of shares issued	44,554	49,819	92,932
Purchase price of ESPP meeting certain criteria as of the offering period (as a percent)	85.00%
Discount recognized as compensation expense	15.00%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480483/718-10-35-1D

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 3
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+ Details

Stock-based Compensation - Compensation expense in Consolidated Statements of Operations and Comprehensive Loss (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Stock-based Compensation
Stock based compensation expense	$ 39,682	$ 32,553	$ 19,831
Research and development
Stock-based Compensation
Stock based compensation expense	10,514	8,449	5,814
Selling, general and administrative
Stock-based Compensation
Stock based compensation expense	$ 29,168	$ 24,104	$ 14,017

Asset Acquisitions

12 Months Ended

Dec. 31, 2024

Asset Acquisitions

Asset Acquisitions

3. Asset Acquisitions

LG Chem, Ltd.

On January 4, 2024, the Company entered into a license agreement and share issuance agreement with LG Chem, Ltd. (“LGC”). Under the terms of the license agreement, the Company obtained worldwide rights to LGC’s proprietary compound bivamelagon and assumed sponsorship of two ongoing LGC Phase 2 studies designed to evaluate safety, tolerability, pharmacokinetics and weight loss efficacy of bivamelagon.

The total purchase consideration of $92.4 million consisted of cash payments with a present value of $73.7 million and $18.7 million in the Company’s common shares. At closing, $40.0 million of cash paid was paid and shares were issued at a per share price equal to the ten-day volume weighted average closing price for our common stock, calculated as of the trading day immediately prior to January 4, 2024. The total purchase consideration also includes an additional $40.0 million license fee payable 18 months from the date of execution, whose present value at closing was $33.7 million and is being accreted to its full value through interest expense. The company recorded $0.8 million of transaction costs associated with this transaction, which are recorded as selling, general and administrative expenses. The carrying value of the license fee payable is $37.7 million as of December 31, 2024.

In addition, under the terms of the license agreement, we agreed to pay LGC up to $205 million in cash upon achieving various regulatory and sales milestones based on net sales of bivamelagon. In addition and subject to the completion of Phase 2 development of bivamelagon, the Company has agreed to pay LGC royalties of between low-to-mid single digit percent of net revenues from its MC4R portfolio, including bivamelagon, commencing in 2029 and dependent upon achievement of various regulatory and indication approvals, and subject to customary deductions and anti-stacking. Royalties may further increase to a low double digit percent royalty, though such royalty would only be applicable on net sales of bivamelagon in a region if bivamelagon is covered by a composition of matter or method of use patent controlled by LGC in such region and the Company’s MC4R portfolio is not covered by any composition of matter or method of use patents controlled by the Company in such region. Such increased rate would only apply on net sales of bivamelagon for the limited remainder of the royalty term in the relevant region.

The assets acquired were In-Process Research and Development (“IPR&D”) assets. However, since the IPR&D assets were determined to have no alternative future use, the Company recognized the $92.4 million of purchase consideration as research and development expense in the year ended December 31, 2024.

The Company determined that the additional contingent consideration did not meet the definition of a derivative as of the acquisition date. Therefore, the Company did not record a contingent consideration liability on the acquisition date. The Company will recognize any future contingent consideration payments related to the LGC transaction in the period in which the achievement of the underlying milestones becomes probable.

Xinvento B.V.

On February 27, 2023, the Company, through its wholly-owned Dutch subsidiary, Rhythm Pharmaceuticals Netherlands B.V., a Dutch private limited liability company (“Rhythm BV”), entered into a Share Purchase Agreement (the “Purchase Agreement”) with Xinvento B.V., a Dutch private limited liability company based in the Netherlands (“Xinvento”), and the other parties named therein, pursuant to which, and concurrently with the execution thereof, Rhythm BV acquired all of the issued and outstanding shares of Xinvento. The aggregate consideration at closing was approximately $5.7 million, inclusive of transaction costs, as adjusted pursuant to the terms of the Purchase Agreement and subject to the distribution and payment terms set forth therein (the “Closing Purchase Price”).

In addition to the Closing Purchase Price, the Purchase Agreement provides for the payment of additional contingent consideration totaling up to $206 million upon achievement of certain development, regulatory and commercial milestones by Xinvento, as follows: (i) up to an aggregate of $6 million in clinical development milestones; (ii) up to an aggregate of $125 million in regulatory approval and commercial milestones; and (iii) up to an aggregate of $75 million in sales milestones in the event a second molecule is selected, developed and approved.

The total purchase consideration of $5.7 million was composed of $4.5 million of cash paid at closing, a $0.5 million holdback, payable on the one-year anniversary of the acquisition, and $0.6 million of acquisition-related costs. The $0.5 million holdback was paid in the quarter ended March 31, 2024, and is reflected in investing activities in the consolidated statement of cash flow for the year ended December 31, 2024. The Company determined that substantially all of the value as of acquisition date related to Xinvento’s In-Process Research and Development. As a result, the Company determined this transaction should be accounted for as an asset acquisition.

The assets acquired were In-Process Research and Development (IPR&D) assets. However, since the IPR&D assets were determined to have no alternative future use, the Company recognized the $5.7 million of purchase consideration as research and development expense in the year ended December 31, 2023.

The Company determined that the additional contingent consideration did not meet the definition of a derivative as of the acquisition date. Therefore, the Company did not record a contingent consideration liability on the acquisition date. The Company will recognize any future contingent consideration payments related to the Xinvento transaction in the period in which the achievement of the underlying milestones becomes probable.

Xinvento's results of operations are included in the consolidated financial statements from the date of acquisition. For the years ended December 31, 2024 and 2023, the net loss associated with the operations of Xinvento was de minimis in the Company’s consolidated statements of operations.

Significant Agreements (Details) $ in Thousands		1 Months Ended		3 Months Ended		12 Months Ended
Significant Agreements (Details) $ in Thousands	Jan. 04, 2024 USD ($) D	Dec. 31, 2021 USD ($) item shares	Jan. 31, 2016 USD ($)	Sep. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2024 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)	Feb. 26, 2010 USD ($)
Significant Agreements
Revenue						$ 130,126	$ 77,428	$ 23,638
Equity issued in conjunction with license agreement						18,716
RareStone Group Ltd.
Significant Agreements
Upfront payment		$ 7,000
RareStone Group Ltd. \| License agreement
Significant Agreements
Number of independent sub studies in patients \| item		4
Upfront payment		$ 7,000
Issuance of common stock as consideration for LGC license (in shares) \| shares		1,077,586
Aggregate payment upon achievement of development and commercial milestones		$ 62,500
Equity recorded at fair value		1,040			$ 1,040				$ 2,440
Realized loss on RareStone equity				$ 1,040	1,040
Loss on RareStone equity investment					$ 300
Upfront consideration		$ 8,040
Number of performance obligations \| item		2
License agreement commercial manufacturing supply discount						1,286
Ipsen Pharma S.A.S. \| License agreement
Significant Agreements
Amount of commercial milestone capitalized									$ 4,000	$ 5,000
Milestone expenses						0	0	0
Ipsen Pharma S.A.S. \| License agreement \| Maximum
Significant Agreements
Aggregate payment upon achievement of development and commercial milestones											$ 40,000
Ipsen Pharma S.A.S. \| Sublicense agreement \| Minimum
Significant Agreements
Payment based on revenue received, as percentage											10.00%
Ipsen Pharma S.A.S. \| Sublicense agreement \| Maximum
Significant Agreements
Payment based on revenue received, as percentage											20.00%
Camurus \| License agreement
Significant Agreements
Non-refundable and non-creditable signing fee			$ 500
Royalty payment period			10 years
Milestone expenses						0	0	1,000
Camurus \| License agreement \| Maximum
Significant Agreements
One-time non-refundable development milestone payment			$ 7,750
One-time non-refundable non-creditable sales milestone payment			$ 57,000
LG Chem, LTD.
Significant Agreements
Aggregate payment upon achievement of development and commercial milestones	$ 205,000
License agreement consideration payment received in cash	$ 40,000
Lock up period for subsequent cash payment	18 months
LG Chem, LTD. \| License agreement and share issuance agreement
Significant Agreements
Period for calculating weighted average closing price per share \| D	10
License revenue
Significant Agreements
Revenue								6,754
License revenue \| RareStone Group Ltd. \| License agreement
Significant Agreements
Revenue						$ 0	$ 0	$ 6,754

Related-Party Transactions

12 Months Ended

Dec. 31, 2024

Related-Party Transactions

Related-Party Transactions

13. Related-Party Transactions

Expenses paid directly to related parties for the years ended December 31, 2024 and 2023, were immaterial. Outstanding payments due to related parties as of December 31, 2024 and December 31, 2023 were immaterial.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

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+ Details

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2024 USD ($)
At-the-market offering
Net offering costs	$ 1,125
Common stock reserved for the conversion of Series A convertible preferred stock
Issuance costs	$ 2,250

Pay vs Performance Disclosure - USD ($) $ in Thousands	12 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ (260,602)	$ (184,678)	$ (181,119)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock At-the-market offering	Common Stock	Additional Paid-In Capital At-the-market offering	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Common stock reserved for the conversion of Series A convertible preferred stock	At-the-market offering	Total
Beginning balance at Dec. 31, 2021		$ 50		$ 813,041	$ (1)	$ (528,939)			$ 284,151
Beginning balance (in shares) at Dec. 31, 2021		50,283,574
Increase (Decrease) in Stockholders' Equity
Stock compensation expense				19,831					19,831
Issuance of common stock in connection with ESPP				626					626
Issuance of common stock in connection with ESPP (in shares)		92,932
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units		$ 1		9,751					9,752
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units (in shares)		855,923
Issuance of common stock upon completion of public offering, net of offering costs		$ 5		131,107					131,112
Issuance of common stock upon completion of public offering, net of offering costs (in shares)		5,380,000
Net unrealized loss on marketable securities					(91)				(91)
Net loss						(181,119)			(181,119)
Ending balance at Dec. 31, 2022		$ 56		974,356	(92)	(710,058)			264,262
Ending balance (in shares) at Dec. 31, 2022		56,612,429
Ending balance (in shares) at Dec. 31, 2023							0
Increase (Decrease) in Stockholders' Equity
Stock compensation expense				32,553					32,553
Issuance of common stock in connection with ESPP				1,053					1,053
Issuance of common stock in connection with ESPP (in shares)		49,819
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units		$ 1		7,467					7,468
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units (in shares)		745,066
Issuance of common stock upon completion of public offering, net of offering costs		$ 2		48,873					48,875
Issuance of common stock upon completion of public offering, net of offering costs (in shares)		2,019,245
Foreign currency translation adjustment					(140)				(140)
Net unrealized gain on marketable securities					366				366
Net loss						(184,678)			(184,678)
Ending balance at Dec. 31, 2023		$ 59		1,064,302	134	(894,736)			169,759
Ending balance (in shares) at Dec. 31, 2023		59,426,559
Temporary Equity
Issuance of Series A Preferred Stock, net of $2,250 of issuance costs (in shares)							0
Issuance of Series A Preferred Stock, net of $2,250 of issuance costs							$ 138,850
Accretion of preferred stock dividends							3,970		3,970
Ending balance at Dec. 31, 2024							$ 142,820		142,820
Ending balance (in shares) at Dec. 31, 2024							150,000
Increase (Decrease) in Stockholders' Equity
Stock compensation expense				39,682					39,682
Issuance of common stock in connection with ESPP				1,270					1,270
Issuance of common stock in connection with ESPP (in shares)		44,554
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units		$ 2		15,972					15,974
Issuance of common stock in connection with exercise of stock options and vesting of restricted stock units (in shares)		1,742,803
Accretion of preferred stock dividends				(3,970)					(3,970)
Issuance of common stock as consideration for LGC license				18,716					18,716
Issuance of common stock as consideration for LGC license (in shares)		432,143
Issuance of common stock upon completion of public offering, net of offering costs			$ 41,073					$ 41,073
Issuance of common stock upon completion of public offering, net of offering costs (in shares)	744,595
Foreign currency translation adjustment					2				$ 2
Issuance of common stock in connection with exercise of stock options (in shares)									818,658
Net unrealized loss on marketable securities					(175)				$ (175)
Net loss						(260,602)			(260,602)
Ending balance at Dec. 31, 2024		$ 61		$ 1,177,045	$ (39)	$ (1,155,338)			$ 21,729
Ending balance (in shares) at Dec. 31, 2024		62,390,654
Temporary Equity
Issuance of Series A Preferred Stock, net of $2,250 of issuance costs (in shares)							150,000

Series A Convertible Preferred Stock

12 Months Ended

Dec. 31, 2024

Series A Convertible Preferred Stock

Series A Convertible Preferred Stock

9. Series A Convertible Preferred Stock

On April 1, 2024, the Company entered into the Investment Agreement with certain affiliates of Perceptive Advisors LLC (“Perceptive”) and certain other investors (each, an “Investor” and collectively, the “Investors”), relating to the issuance and sale of 150,000 shares of a new series of the Company’s Series A Convertible Preferred Stock, par value $0.001 per share, titled the “Series A Convertible Preferred Stock” (the “Convertible Preferred Stock”), for an aggregate purchase price of $147,750, net of $2,250 of issuance costs, or $1,000 per share (the “Issuance”). The Issuance closed on April 15, 2024.

The Company determined the obligation to issue 150,000 shares of Convertible Preferred Stock to Perceptive and Investors in the future at a set price represented a forward contract which was required to be accounted for at fair value. The fair value of the forward contract was measured as the difference between the fair value of the Convertible Preferred Stock, as determined using a binomial lattice valuation model, and the consideration payable to the Company. The assumptions used in the binomial lattice model include: (1) the Company’s common stock price on the issuance and settlement dates; (2) the Conversion Price as of $48.00 as per the Agreement; (3) a 20-year term to maturity; (4) risk-free rates; and (5) volatility. The fair value of the forward contract upon issuance was determined to be $0. Upon closing, the value of the forward contract was determined to be $8,900 and the fair value of the Convertible Preferred Stock was determined to be $141,100. The Convertible Preferred Stock was recorded at its fair value on the Issuance and the change in fair value of the forward contract was recorded as other income in its consolidated statement of operations for the year ended December 31, 2024. Issuance costs of $2,250 were incurred and recorded as a reduction in the carrying value of the Convertible Preferred Stock in the year ended December 31, 2024.

The Company classifies its Convertible Preferred Stock outside of stockholders’ equity as the redemption of such shares is outside the Company’s control. The Company did not adjust the carrying values of the Convertible Preferred Stock to redemption value as the shares are not probable of becoming redeemable as of December 31, 2024.

The Convertible Preferred Stock has the following rights and privileges:

Liquidation:

The Series A Preferred Stock will rank senior to the Company’s common stock with respect to the distribution of assets upon the Company’s liquidation, dissolution or winding up.

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary (“Liquidation”), each holder of Convertible Preferred Stock shall be entitled to receive payment for the greater of (i) 1.75 multiplied by the sum of the Liquidation Preference (i.e., Initial Liquidation Preference of $1,000 per share plus Paid-in-Kind (“PIK”) Dividends) plus unpaid Regular Dividends (to the extent such accumulated and unpaid Regular Dividends are not included in such Liquidation Preference) or (ii) the amount such holder would have received if the Convertible Preferred Stock were fully converted to common stock. If the assets available for distribution are not sufficient to pay the holders of the Convertible Preferred Stock pursuant to the preceding sentence, the assets will be distributed ratably to the holders of the Convertible Preferred Stock.

Voting:

Holders of the Convertible Preferred Stock have the right to vote with the holders of common stock on each matter submitted for a vote on an as-converted basis, subject to the terms of the Convertible Preferred Stock as specified in the Amended and Restated Certificate of Designations.

The holders of the Convertible Preferred Stock shall also have certain protective voting rights. Specifically, as long as the Convertible Preferred Stock are outstanding, each of the following events require at least a two thirds affirmative vote of the Convertible Preferred Stock holders: (a) any amendment or modification of the Certificate of Incorporation to authorize or create, or to increase the authorized number of shares of, any class or series of Dividend Parity Stock, Liquidation Parity Stock, Dividend Senior Stock or Liquidation Senior Stock, (b) any amendment, modification, repeal or waiver of any provision of the Certificate of Incorporation or the Amended and Restated Certificate

of Designations that adversely affects the rights, preferences, privileges or powers of the Convertible Preferred Stock, (c) increase or decrease the number of authorized shares of Convertible Preferred Stock or issue additional shares of Convertible Preferred Stock, (d) the Company’s consolidation or combination with, or merger with or into, another Person, or any binding or statutory share exchange or involving the Convertible Preferred Stock, in each case unless: (i) the Convertible Preferred Stock either (x) remains outstanding after such consolidation, combination, merger, share exchange or reclassification; or (y) is converted or reclassified into, or is exchanged for, or represents solely the right to receive, preference securities of the continuing, resulting or surviving Person of such consolidation, combination, merger, share exchange or reclassification, or the parent thereof; (ii) the Convertible Preferred Stock that remains outstanding or such preference securities, as applicable, have rights, preferences and voting powers that, taken as a whole, are not materially less favorable to the Holders or the holders thereof, as applicable, than the rights, preferences and voting powers, taken as a whole, of the Convertible Preferred Stock immediately before the consummation of such consolidation, combination, merger, share exchange or reclassification; and (iii) the issuer of the Convertible Preferred Stock that remains outstanding or such preference securities, as applicable, is a corporation duly organized and existing under the laws of the United States of America, any State thereof or the District of Columbia that, if not the Company, will succeed to the Company under the Amended and Restated Certificate of Designations and the Convertible Preferred Stock.

Redemption:

The Company has the right to redeem all Convertible Preferred Stock after the Redemption Trigger Date, which is the fifth anniversary of the Initial Issue Date of April 15, 2024. The amount payable on the redemption date is equal to the Liquidation Preference (i.e., Initial Liquidation Preference of $1,000 per share plus PIK Dividends) plus any unpaid Regular Dividends (to the extent such accumulated and unpaid Regular Dividends are not included in such Liquidation Preference).

If a change of control occurs, each holder shall have the right to require the Company to repurchase all, or any whole number of shares that is less than all, of the holder’s Convertible Preferred Stock at an amount equal to 1.75 multiplied by the sum of the Liquidation Preference (i.e., Initial Liquidation Preference of $1,000 per share plus PIK Dividends) plus any unpaid Regular Dividends (to the extent such accumulated and unpaid Regular Dividends are not included in such Liquidation Preference). As of December 31, 2024, the Company does not consider a change of control to be probable and therefore the Convertible Preferred Stock is not considered redeemable.

Dividends:

After the second anniversary, dividends on the Convertible Preferred Stock accrue quarterly, at a 6% annual rate, and if not paid out in cash before the quarter end, will become PIK Dividends and added to the liquidation preference, or original issue price plus PIK Dividends. Since dividends do not commence until the second anniversary of the Issuance, the Convertible Preferred Stock is considered increasing rate preferred stock. Accordingly, the Company accretes the dividends, using the effective interest method, from Issuance to the first contractual call date, April 15, 2029. The Company accrued dividends of $3,970 for the year ended December 31, 2024, as a reduction to Additional Paid-In Capital and an increase to the carrying value of Convertible Preferred Stock. The carrying value of Convertible Preferred Stock as of December 31, 2024 is $142,820.

Conversions:

Holders of Convertible Preferred Stock have the option to convert any number of whole shares at any time. The conversion is based on the sum of the Liquidation Preference plus unpaid Dividends divided by the $48.00 Conversion Price. Given the Initial Liquidation Preference of $1,000, each share of Convertible Preferred Stock would be convertible into 20.8333 shares of common stock, prior to any adjustments such as PIK Dividends, unpaid Dividends, stock splits, or voluntary conversion rate increases. Upon conversion, cash will be paid in lieu of any fractional share of common stock. However, based on certain restrictions on the conversion of the Convertible Preferred Stock specified in the Amended and Restated Certificate of Designations, a holder of Convertible Preferred Stock is not entitled to effect a conversion of any portion of its shares of Convertible Preferred Stock, or to vote in its capacity as a holder of shares of Convertible Preferred Stock with respect to matters submitted to holders of the common stock if, after giving effect to such conversion, that holder would beneficially own in excess of 4.99%, in the case of one holder, or 9.99%, in the case

of the other holder, of the number of shares of common stock outstanding immediately after giving effect to such exercise.

On May 7, 2024, the Company filed an Amended and Restated Certificate of Designations in respect of the Convertible Preferred Stock containing certain technical amendments to the terms of the Convertible Preferred Stock. The amendments contained in the Amended and Restated Certificate of Designations (x) limited the voting rights of the Convertible Preferred Stock to 24.9438 shares of the Company’s common stock per $1,000 liquidation preference of Convertible Preferred Stock and (y) eliminated a 1% step up in the interest rate that otherwise would have applied in the unlikely event that the Company was required to obtain and failed to obtain stockholder approval for certain conversion shares underlying the Convertible Preferred Stock.

On July 10, 2024, the Company filed with the SEC a prospectus supplement to the prospectus included in the Company’s registration statement on Form S-3ASR filed with the SEC on March 2, 2023, covering the resale from time to time by the Investors of up to an aggregate of 3,124,995 shares of common stock, to satisfy registration rights that the Company granted to such stockholders in connection with the Issuance.

Stock-based Compensation - Common stock option activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Number of Options
Outstanding at beginning of the period	6,551,025
Granted	983,643
Exercised	(818,658)
Cancelled	(104,619)
Outstanding at end of the period	6,611,391	6,551,025
Options exercisable at end of the period	4,578,779
Weighted-Average Exercise Price
Outstanding at beginning of the period	$ 19.19
Granted	47.17
Exercised	19.51
Cancelled	20.97
Outstanding at end of the period	23.29	$ 19.19
Options exercisable at end of the period	$ 20.36
Weighted-Average Remaining Contractual Term
Outstanding at end of the period	6 years 7 months 28 days	7 years 2 months 23 days
Options exercisable at end of the period	5 years 11 months 12 days
Aggregate Intrinsic Value
Exercised	$ 24,745
Options vested and expected to vest	216,413
Options exercisable	$ 163,090
2017 Equity Incentive Plan
Number of Options
Granted	926,543	842,528	1,929,345

Long-Term Obligations (Details) - Revenue Interest Financing Agreement - USD ($) $ in Thousands					12 Months Ended
	Sep. 12, 2023	Sep. 29, 2022	Jun. 29, 2022	Jun. 16, 2022	Dec. 31, 2024	Dec. 31, 2023	Jun. 30, 2022
Long-Term Obligations
Remaining Investment Amount	$ 24,370	$ 37,500	$ 37,500		$ 100,000
Repayment of debt					20,430
Revenue interest payment period				12 years
Fair value of embedded derivative liability						$ 1,150	$ 1,590
Fair value of embedded derivative asset					270
Remeasurement of the embedded derivative liability					1,420	$ 190
Deferred royalty obligation					$ 109,810
Effective interest rate					16.02%
Debt issuance costs					$ 3,287
Annual net revenues up to 125 million
Long-Term Obligations
Royalty interest (as a percent)				11.50%
Threshold annual net revenues				$ 125,000
Annual net revenues between 125 million and 300 million
Long-Term Obligations
Royalty interest (as a percent)				7.50%
Annual net revenues exceeding 300 million
Long-Term Obligations
Royalty interest (as a percent)				2.50%
Threshold annual net revenues				$ 300,000
March 31, 2027
Long-Term Obligations
Threshold cumulative minimum payments (as a percent)				60.00%
March 31, 2029
Long-Term Obligations
Threshold cumulative minimum payments (as a percent)				120.00%
Current liabilities
Long-Term Obligations
Deferred royalty obligation					1,541
Noncurrent liabilities
Long-Term Obligations
Deferred royalty obligation					$ 108,269
Minimum
Long-Term Obligations
Revenue interest cap (as a percent)				185.00%
Minimum \| Annual net revenues between 125 million and 300 million
Long-Term Obligations
Threshold annual net revenues				$ 125,000
Maximum
Long-Term Obligations
Aggregate investment amount				$ 100,000
Revenue interest cap (as a percent)				250.00%
Maximum \| Annual net revenues between 125 million and 300 million
Long-Term Obligations
Threshold annual net revenues				$ 300,000

Summary of Significant Accounting Policies - Net loss per share (Details) - shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Shares excluded from the computation of diluted net loss per share
Potential common shares	11,791,120	8,211,653	7,933,507
Employee Stock Option
Shares excluded from the computation of diluted net loss per share
Potential common shares	6,611,391	6,551,025	6,354,544
Restricted stock units
Shares excluded from the computation of diluted net loss per share
Potential common shares	1,805,412	1,079,382	774,166
Performance stock units
Shares excluded from the computation of diluted net loss per share
Potential common shares	249,322	581,246	804,797
Common stock reserved for the conversion of Series A convertible preferred stock
Shares excluded from the computation of diluted net loss per share
Potential common shares	3,124,995

Income Taxes - Components of provision for income taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Current:
U.S. State and Local		$ 1
Foreign	$ 346	563
Current Income Tax Expense (Benefit), Total	$ 346	$ 564

Asset Acquisitions (Details) - USD ($) $ in Thousands			12 Months Ended
Asset Acquisitions (Details) - USD ($) $ in Thousands	Jan. 04, 2024	Feb. 27, 2023	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022	Mar. 31, 2024
Asset Acquisitions
Issuance of stock				$ 48,875	$ 131,112
Issuance of common stock as consideration for LGC license			$ 18,716
LG Chem, LTD.
Asset Acquisitions
Purchase consideration	$ 92,400
Cash consideration	73,700
Issuance of stock	18,700
License agreement consideration payment received in cash	$ 40,000
Lock up period for subsequent cash payment	18 months
License fee payable	$ 33,700
Carrying value of license fee payable			37,700
Aggregate payment upon achievement of development and commercial milestones	205,000
Aggregate consideration at closing	40,000
LG Chem, LTD. \| Research and development
Asset Acquisitions
Purchase consideration			$ 92,400
LG Chem, LTD. \| Selling, general and administrative
Asset Acquisitions
Acquisition related costs	$ 800
Xinvento B.V.
Asset Acquisitions
Purchase consideration		$ 5,700
Cash consideration		4,500
Acquisition related costs		600
Aggregate payment upon achievement of development and commercial milestones		206,000
Clinical development milestone payments		6,000
Regulatory approval and commercial milestones milestone payments		125,000
Sales milestone payments		75,000
Holdback, payable on the one-year anniversary of the acquisition		$ 500				$ 500
Xinvento B.V. \| Research and development
Asset Acquisitions
Purchase consideration				$ 5,700

Document and Entity Information - USD ($) $ in Billions	12 Months Ended
Document and Entity Information - USD ($) $ in Billions	Dec. 31, 2024	Feb. 24, 2025	Jun. 28, 2024
Document and Entity Information
Document Type	10-K
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2024
Securities Act File Number	001-38223
Entity Registrant Name	RHYTHM PHARMACEUTICALS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-2159271
Entity Address, Address Line One	222 Berkeley Street
Entity Address, Address Line Two	12th Floor
Entity Address, City or Town	Boston
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02116
City Area Code	857
Local Phone Number	264-4280
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	RYTM
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float			$ 2.4
Entity Common Stock, Shares Outstanding		63,223,727
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	FY
Entity Central Index Key	0001649904
Amendment Flag	false
Auditor Firm ID	42
Auditor Name	Ernst & Young LLP
Auditor Location	Boston, Massachusetts

Subsequent Events

12 Months Ended

Dec. 31, 2024

Subsequent Events

Subsequent Events

16. Subsequent Events

The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than as disclosed within the above notes to these consolidated financial statements, and except as described below.

From January 1, 2025 to January 21, 2025 the Company sold approximately 0.6 million shares of its common stock in the ATM Program for net proceeds of approximately $32.1 million.

Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Summary of Significant Accounting Policies
Raw Materials	$ 6,776	$ 4,625
WIP	1,250	1,104
Finished Goods	10,715	2,895
Total Inventory	$ 18,741	$ 8,624

Stock-based Compensation - RSU and PSU activity (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended		12 Months Ended
	Apr. 30, 2024	Nov. 30, 2021	Dec. 31, 2024
Restricted stock units
Number of Units
Outstanding unvested at beginning of the period			1,104,607
Granted			1,210,654
Vested			(321,392)
Cancelled			(167,160)
Outstanding unvested at end of the period			1,826,709
Weighted Average Grant Date Fair Value
Outstanding unvested at beginning of the period			$ 17.44
Granted			44.22
Vested			15.48
Cancelled			20.08
Outstanding unvested at end of the period			$ 36.4
Aggregate intrinsic value			$ 102,259
Performance stock units
Number of Units
Outstanding unvested at beginning of the period			581,346
Granted			249,322
Vested			(581,346)
Outstanding unvested at end of the period			249,322
Weighted Average Grant Date Fair Value
Outstanding unvested at beginning of the period			$ 13.24
Granted			38.92
Vested			40.6
Outstanding unvested at end of the period			$ 13.24
Number of shares of common stock shares issued upon vesting		956,145
Performance stock units \| Granted in 2021
Number of Units
Vested			(581,346)
Performance stock units \| Granted in 2024
Number of Units
Vested			0
2017 Equity Incentive Plan \| Performance stock units
Weighted Average Grant Date Fair Value
Number of shares of common stock shares issued upon vesting	340,000

Fair Value of Financial Assets and Liabilities - Marketable Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Fair Value of Financial Assets and Liabilities
Amortized Cost	$ 231,329	$ 215,491
Gross Unrealized Gains	226	282
Gross Unrealized Losses	(127)	(7)
Fair Value	231,428	215,765
Corporate debt securities and commercial paper (due within 1 year)
Fair Value of Financial Assets and Liabilities
Amortized Cost, Current	166,255	215,491
Gross Unrealized Gains, Current	147	282
Gross Unrealized Losses, Current	(92)	(7)
Fair Value, Current	166,310	$ 215,765
U.S. Treasury Securities
Fair Value of Financial Assets and Liabilities
Amortized Cost, Current	65,074
Gross Unrealized Gains, Current	79
Gross Unrealized Losses, Current	(35)
Fair Value, Current	$ 65,118

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2024

Summary of Significant Accounting Policies

Schedule of product revenue allowance and reserve categories



	Provision for Cash Discounts		Fees, Rebates and Other Incentives		Total
Beginning Balance at December 31, 2022	$	99	$	2,710	$	2,809
Provision related to sales in the current year		1,672		17,351		19,023
Credit and payments made		(1,572)		(10,586)		(12,158)
Ending balance December 31, 2023	$	199	$	9,475	$	9,674
Provision related to sales in the current year		2,317		27,315		29,632
Credit and payments made		(2,263)		(20,940)		(23,203)
Ending balance December 31, 2024	$	253	$	15,850	$	16,103

Schedule of inventory


	December 31,		December 31,
	2024		2023
Raw Materials	$	6,776	$	4,625
WIP		1,250		1,104
Finished Goods		10,715		2,895
Total Inventory	$	18,741	$	8,624

Schedule of prepaid expenses and other current assets


	December 31,
	2024		2023
Prepaid research and development costs	$	7,580	$	2,259
Other current assets		8,802		6,672
Prepaid expenses and other current assets	$	16,382	$	8,931

Schedule of other long-term assets


	December 31,
	2024		2023
Long-term research and development costs	$	6,209	$	12,594
Other long-term assets		1,117		2,405
Other long-term assets	$	7,326	$	14,999

Schedule of property, plant and equipment


	Useful	December 31,
	Life	2024		2023
Leasehold improvements	*	$	2,705	$	2,705
Office equipment	5 years		154		155
Computers and software	3 years		1,291		1,291
Furniture, fixtures and equipment	5 years		1,249		1,249
			5,399		5,400
Less accumulated depreciation and amortization			(4,767)		(4,059)
Property and equipment, net		$	632	$	1,341

*Shorter of asset life or lease term.

Schedule of potential common shares, presented based on amounts outstanding at each period end, excluded from computation of diluted net loss per share attributable to common stockholders


	Year Ended
	December 31,
	2024		2023		2022
Stock options		6,611,391		6,551,025		6,354,544
Restricted stock units		1,805,412		1,079,382		774,166
Performance stock units		249,322		581,246		804,797
Common stock reserved for the conversion of Series A convertible preferred stock		3,124,995
Potential common shares		11,791,120		8,211,653		7,933,507

Segment and Geographic Information (Tables)

12 Months Ended

Dec. 31, 2024

Segment and Geographic Information

Schedule of segment profit or loss, including significant segment expenses

The table below is a summary of the segment profit or loss, including significant segment expenses (in thousands):

Segment Analysis


	2024		2023		2022

Net product revenue - U.S.	$	96,108	$	62,425	$	14,324
Net product revenue - International		34,018		15,002		2,560
Total net product revenue		130,126		77,428		16,884
License revenue		-		-		6,754
Total net revenue		130,126		77,428		23,638

Cost of sales		13,368		9,302		2,133
Global headcount expense		119,084		96,413		70,777
Preclinical, clinical and development expense		82,180		74,465		66,013
Commercial & medical affairs		55,767		47,905		41,756
Corporate, general & administrative		32,135		27,154		20,220
Other segment expenses		93,094		6,571		1,896
Other (income) expense, net		(11,139)		317		1,179
Interest (income) expense, net		5,893		(585)		783
Income taxes		346		564		(0)
Net loss	$	(260,602)	$	(184,678)	$	(181,119)

Schedule of revenue by geographic area


	Year ended December 31,
	2024			2023		2022
US	$	96,108	$	62,425	$	21,078
International		34,018		15,003		2,560
Total revenues	$	130,126	$	77,428	$	23,638

Nature of Business

12 Months Ended

Dec. 31, 2024

Nature of Business

Nature of Business

1. Nature of Business

Rhythm Pharmaceuticals, Inc. (the “Company” or “we”) is a global, commercial-stage biopharmaceutical company dedicated to transforming the lives of patients and their families living with rare neuroendocrine diseases. We are focused on advancing our melanocortin-4 receptor agonists, including our lead asset, IMCIVREE^® (setmelanotide), as a precision medicine designed to treat hyperphagia and severe obesity caused by MC4R pathway diseases. While obesity affects hundreds of millions of people worldwide, we are developing therapies for a subset of individuals who have hyperphagia, a pathological hunger, and severe obesity due to an impaired MC4R pathway, which may be caused by traumatic injury or genetic variants. The MC4R pathway is an endocrine pathway in the brain that is responsible for regulating hunger, caloric intake and energy expenditure, which consequently affect body weight. IMCIVREE, an MC4R agonist for which we hold worldwide rights, is the first-ever therapy developed for patients with certain rare diseases that is approved or authorized in the United States, European Union (EU), Great Britain, Canada and other countries and regions.

The Company is a Delaware corporation organized in February 2013 under the name Rhythm Metabolic, Inc., and as of October 2015, under the name Rhythm Pharmaceuticals, Inc. The Company has wholly owned subsidiaries in the US, Ireland, the United Kingdom, the Netherlands, France, Germany, Italy, Spain, Japan and Canada.

The Company is subject to risks and uncertainties common to commercial-stage companies in the biotechnology industry, including but not limited to, risks associated with the commercialization of approved products, completing preclinical studies and clinical trials, receiving regulatory approvals for product candidates, development by competitors of new biopharmaceutical products, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations. Commercialization of approved products will require significant resources and in order to market IMCIVREE, the Company must continue to build its sales, marketing, managerial and other non-technical capabilities or make arrangements with third parties to perform these services. Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even though the Company has an approved product, and even if the Company’s further product development efforts are successful, it is uncertain when, if ever, the Company will realize sufficient revenue from product sales to fund operations.

Liquidity

The Company has incurred operating losses and negative cash flows from operations since inception. As of December 31, 2024, the Company had an accumulated deficit of $1,155,338. The Company has primarily funded these losses through the proceeds from the sales of our common stock and preferred stock, asset sales, royalty financing, out-license arrangements, as well as capital contributions received from the former parent company, Rhythm Holdings LLC. To date, the Company has minimal product revenue and management expects operating losses to continue for the foreseeable future. The Company has devoted substantially all of its resources to its drug development efforts, comprising of research and development, the acquisition of in process research and development assets, manufacturing, conducting clinical trials for its product candidates, protecting its intellectual property, commercialization activities and general and administrative functions relating to these operations. The future success of the Company is dependent on its ability to develop its product candidates and ultimately upon its ability to attain profitable operations.

At December 31, 2024, the Company had $320,565 of cash and cash equivalents and short-term investments on hand. In the future, the Company will be dependent on obtaining funding from third parties, such as proceeds from the

issuance of debt, sale of equity, proceeds from out license arrangements, product sales and funded research and development programs to maintain the Company's operations and meet the Company's obligations. There is no guarantee that additional equity or other financings will be available to the Company on acceptable terms, or at all. If the Company fails to obtain additional funding when needed, the Company would be forced to scale back, terminate its operations or seek to merge with or be acquired by another company. Management believes that the Company's existing cash resources will be sufficient to fund the Company's operations through at least the next twelve months from the filing of this Annual Report on Form 10-K with the SEC.

Stock-based Compensation (Tables)

12 Months Ended

Dec. 31, 2024

Stock-based Compensation

Schedule of significant assumptions used to compute the fair values of employee and director stock options awarded


	Year ended
	December 31,
	2024		2023		2022
Risk‑free interest rate	4.29	%	2.35	%	2.19	%
Expected term (in years)	6.13		6.11		6.11
Expected volatility	74.59	%	76.11	%	69.16	%
Expected dividend yield	—		—		—

Summary of common stock option activity


				Weighted‑
		Weighted-		Average
		Average		Remaining		Aggregate
	Number of	Exercise		Contractual		Intrinsic
	Options	Price		Term		Value
Outstanding as of December 31, 2023	6,551,025	$	19.19	7.23	$	—
Granted	983,643	$	47.17	—	$	—
Exercised	(818,658)	$	19.51	—	$	24,745
Cancelled	(104,619)	$	20.97	—	$	—
Outstanding as of December 31, 2024	6,611,391	$	23.29	6.66	$	216,413
Options exercisable at December 31, 2024	4,578,779	$	20.36	5.95	$	163,090

Summary of restricted stock unit activity




		Weighted-
		Average
	Number of	Grant Date
	RSUs	Fair Value
Unvested as of December 31, 2023	1,104,607	$	17.44
Granted	1,210,654		44.22
Vested	(321,392)		15.48
Cancelled	(167,160)		20.08
Unvested as of December 31, 2024	1,826,709	$	36.40

Summary of performance stock unit activity




		Weighted-
		Average
	Number of	Grant Date
	PSUs	Fair Value
Unvested as of December 31, 2023	581,346	$	13.24
Granted	249,322		38.92
Vested	(581,346)		40.60
Cancelled	—		—
Unvested as of December 31, 2024	249,322	$	13.24

Summary of stock-based compensation expense



	Year Ended
	December 31,
	2024		2023		2022
Research and development	$	10,514	$	8,449	$	5,814
Selling, general, and administrative		29,168		24,104		14,017
Total	$	39,682	$	32,553	$	19,831

Summary of stock-based compensation expense by award type



	Year Ended
	December 31,
	2024		2023		2022
Stock options	$	21,788	$	17,671	$	15,477
Employees stock purchase plan		538		581		408
Restricted stock units		16,886		5,998		2,918
Performance stock units		470		8,303		1,028
Total	$	39,682	$	32,553	$	19,831

Significant Agreements

12 Months Ended

Dec. 31, 2024

Significant Agreements

Significant Agreements

10. Significant Agreements

License Agreements

RareStone Group Ltd.

In December 2021, the Company entered into an Exclusive License Agreement with RareStone Group Ltd., or the RareStone License. Pursuant to the RareStone License, we granted to RareStone an exclusive, sublicensable, royalty-bearing license under certain patent rights and know-how to develop, manufacture, commercialize and otherwise exploit any pharmaceutical product that contains setmelanotide in the diagnosis, treatment or prevention of conditions and diseases in humans in China, including mainland China, Hong Kong and Macao. RareStone has a right of first negotiation in the event that the Company chooses to grant a license to develop or commercialize the licensed product in Taiwan. The arrangement includes a license and an additional performance obligation to supply product upon the request of RareStone.

According to the terms of the RareStone License, RareStone has agreed to seek local approvals to commercialize IMCIVREE for the treatment of obesity and hyperphagia due to biallelic POMC, PCSK1 or LEPR deficiency, as well as Bardet-Biedl and Alström syndromes. Additionally, RareStone has agreed to fund efforts to identify and enroll patients from China in the Company’s global EMANATE trial, a Phase 3, randomized, double-blind, placebo-controlled trial to evaluate setmelanotide in four independent sub-studies in patients with obesity due to a heterozygous variant of POMC/PCSK1 or LEPR; certain variants of the SRCI gene, and certain variants of the SH2B1 gene. In accordance with the terms of the RareStone License, RareStone made an upfront payment to Rhythm of $7,000 and issued Rhythm 1,077,586 ordinary shares. The Company is eligible to receive development and commercialization milestones of up to $62,500, as well as tiered royalty payments on annual net sales of IMCIVREE.

The Company initially estimated the fair value of the RareStone equity to be $2,440 based on a preliminary valuation during the first quarter of 2022. Upon completion of the valuation procedures during the second quarter of 2022, the Company concluded the initial fair value of the RareStone equity to be $1,040. During the third quarter of 2022, the Company estimated the fair value of the RareStone equity to be de minimis based upon the results of an updated valuation and recorded an other-than-temporary impairment of $1,040 related to the decline in fair value as a component of other expense in our consolidated statements of operations and other comprehensive loss for the year ended December 31, 2022. The other-than-temporary impairment of $1,040 included the reclassification of a $300 unrealized loss previously recorded as a component of accumulated other comprehensive income (loss) in our consolidated statement of stockholders’ equity during the second quarter of 2022.

The Company received total upfront consideration of $8,040 comprised of an upfront payment of $7,000, and the estimated fair value of the RareStone equity of $1,040. The Company determined that the RareStone License contains two

performance obligations, the delivery of the license and the supply of clinical and commercial product. The Company further determined the supply of commercial product to RareStone contains a significant future discount and estimates the discount to be $1,286, which is recorded as a component of deferred revenue on the consolidated balance sheet at December 31, 2024.

Based on a relative fair-value allocation between the license and the manufacture of clinical and commercial product, the Company recognized $6,754 of license revenue in the consolidated statements of operations and comprehensive loss during the year ended December 31, 2022. The discount related to commercial manufacturing supply will be deferred and recognized over the commercial supply period or upon termination of the agreement. No license revenue was recognized during the years ended December 31, 2023 or 2024.

On October 28, 2022, we delivered written notice, or the October 2022 Notice, to RareStone that we have terminated the RareStone License for cause. In accordance with the October 2022 Notice, we maintain that RareStone has materially breached its obligations under the RareStone License to fund, perform or seek certain key clinical studies and waivers, including with respect to our global EMANATE trial, among other obligations. On December 21, 2022, RareStone provided written notice to us that it objects to the claims in the October 2022 Notice, including our termination of the RareStone License for cause. On March 16, 2023, we provided written notice, or the March 2023 Notice, to RareStone reaffirming our position that RareStone has materially breached its obligations under the RareStone License and that we have terminated the RareStone License for cause, and also requested documentation supporting RareStone’s purported dispute notice objecting to the claims in the October 2022 Notice.

On May 10, 2023, RareStone provided written notice to the Company reaffirming its objections to the claims in our October 2022 Notice and March 2023 Notice, including to the Company’s termination of the RareStone License for cause. On November 29, 2023, RareStone wrote to us seeking to negotiate and execute a commercial supply agreement as contemplated under the Exclusive License Agreement, and on January 19, 2024, we responded in writing again reaffirming our position that RareStone has materially breached its obligations under the RareStone License and that we have terminated the RareStone License for cause.

Since our last written response in January 2024, we have engaged in discussions with RareStone in an effort to reach a resolution, however, we cannot predict whether a resolution will ever be reached.

Ipsen Pharma S.A.S.

Pursuant to our March 21, 2013 license agreement with Ipsen Pharma, S.A.S., or Ipsen, the Company has an exclusive, sublicensable, worldwide license to certain patents and other intellectual property rights to research, develop, and commercialize compounds that were discovered or researched by Ipsen in the course of conducting its MC4R program or that otherwise were covered by the licensed patents. Under the terms of the setmelanotide Ipsen license agreement, assuming that setmelanotide is successfully developed, receives regulatory approval and is commercialized, Ipsen may receive aggregate payments of up to $40,000 upon the achievement of certain development and commercial milestones and royalties on future product sales in the mid-single digits. Substantially all of such aggregate payments of up to $40,000 are for milestones that may be achieved no earlier than first commercial sale of setmelanotide. In the event that the Company executes a sublicense agreement, it shall make payments to Ipsen, depending on the date of such sublicense agreement, ranging from 10% to 20% of all revenues actually received under such sublicense agreement.

The Company capitalized a $5,000 and $4,000 commercial milestone as a finite-lived intangible asset, as a result of the first commercial sales of IMCIVREE in the U.S. and Europe during March 2021 and March 2022, respectively. There were no research and development expenses related to milestones recorded in each of the years ended December 31, 2024, 2023 and 2022.

Camurus

In January 2016, the Company entered into a license agreement with Camurus AB, or Camurus, for the use of Camurus' drug delivery technology. The contract includes a non-refundable and non-creditable signing fee of $500. The Camurus agreement also includes up to $7,750 in one-time, non-refundable development milestones achievable upon

certain regulatory successes. The Company is also required to pay to Camurus, mid to mid-high single digit royalties, on a product-by-product and country-by-country basis of annual net sales, until the later of (i) 10 years after the date of first commercial sale of such product in such country; or (ii) the expiration of the last to expire valid claim of all licensed patent rights in such country covering such product. The Company is also required to pay one-time, non-refundable, non-creditable sales milestones upon the achievement of certain sales levels for such product that cannot be in excess of $57,000. The Company recorded development milestone expenses related to this license agreement of $1,000 during the year ended December 31, 2022. The expenses were recorded as research and development expenses when the milestone criteria were met in full during 2022. There are no research and development expenses related to milestones recorded in 2023 or 2024.

Long-Term Obligations

12 Months Ended

Dec. 31, 2024

Long-Term Obligations

Long-Term Obligations

11. Long-Term Obligations

On June 16, 2022, we entered into a RIFA with entities managed by HealthCare Royalty Management, LLC, collectively referred to as the Investors. Pursuant to the RIFA and subject to customary closing conditions, the Investors have agreed to pay the Company an aggregate investment amount of up to $100,000, or the Investment Amount. Under the terms of the RIFA, we received $37,500 on June 29, 2022 upon FDA approval of IMCIVREE in BBS, referred to as the Initial Investment Amount, and we received an additional $37,500 on September 29, 2022 of the Investment Amount upon EMA approval for BBS. On September 12, 2023, we received the remaining $24,370 of the Investment Amount, net of debt issuance costs, following the achievement of a specified amount of cumulative net sales of IMCIVREE between July 1, 2022 and September 30, 2023.

As consideration for the Investment Amount and pursuant to the RIFA, we agreed to pay the Investors a tiered royalty on our annual net revenues, or Revenue Interest, including worldwide net product sales and upfront payments and milestones. The applicable tiered percentage will initially be 11.5% on annual net revenues up to $125,000, 7.5% on annual net revenues of between $125,000 and $300,000 and 2.5% on annual net revenues exceeding $300,000. If the Investors have not received cumulative minimum payments equal to 60% of the amount funded by the Investors to date by March 31, 2027, or 120% of the amount funded by the Investors to date by March 31, 2029, we must make a cash payment immediately following each applicable date to the Investors sufficient to gross the Investors up to such minimum amounts after giving full consideration of the cumulative amounts paid by us to the Investors through each date, referred to as the Under Performance Payment. As the repayment of the funded amount is contingent upon worldwide net product sales and upfront payments, milestones, and royalties, the repayment term may be shortened or extended depending on actual worldwide net product sales and upfront payments, milestones, and royalties. As of December 31, 2024 we have made $20,430 of payments.

The Investors’ rights to receive the Revenue Interests will terminate on the date on which the Investors have received payments equal to a certain percentage of the funded portion of the Investment Amount including the aggregate of all payments made to the Investors as of such date, each percentage tier referred to as the Hard Cap, unless the RIFA is earlier terminated. The total Revenue Interests payable by us to the Investors is capped between 185% and 250% of the Investment Amount paid, dependent on the aggregate royalty paid between 2028 and 2032. If a change of control of occurs, the Investors may accelerate payments due under the RIFA up to the Hard Cap plus any other obligations payable under the RIFA.

The repayment period commenced on July 8, 2022 for the Initial Investment Amount, and expires on the earlier of (i) the date at which the Investors received cash payments totaling an aggregate of a Hard Cap ranging from 185% to 250% of the Initial Investment Amount or (ii) the legal maturity date of July 8, 2034. If the Investors have not received payments equal to 250% of the Investment Amount by the twelve-year anniversary of the initial closing date, we will be required to pay an amount equal to the Investment Amount plus a specific annual rate of return less payments previously received by Investors. In the event of a change of control, we are obligated to pay Investors an amount equal to the Hard Cap in effect at the time, ranging from 185% to 250% plus any Under Performance Payment of the Investment Amount less payments previously received by Investors. In addition, upon the occurrence of an event of default, including, among others, our failure to pay any amounts due to Investors under the deferred royalty obligation, insolvency, our failure to pay indebtedness when due, the revocation of regulatory approval of IMCIVREE in the U.S. or our breach of any covenant contained in the RIFA and our failure to cure the breach within the prescribed time frame, we are obligated to pay Investors an amount equal to the Hard Cap in effect at the time of default ranging from 185% to 250% plus any Under Performance

Payment of the Investment Amount less payments previously received by Investors. In addition, upon an event of default, Investors may exercise all other rights and remedies available under the RIFA, including foreclosing on the collateral that was pledged to Investors, which consists of all of our present and future assets relating to IMCIVREE.

We have evaluated the terms of the RIFA and concluded that the features are similar to those of a debt instrument. Accordingly, we have accounted for the transaction as long-term debt and presented it as a deferred royalty obligation on our consolidated balance sheets. We have further evaluated the terms of the RIFA and determined that the repayment of the Hard Cap in effect at the time which ranges from 185% to 250% of the Investment Amount, less any payments made to date, upon a change of control is an embedded derivative that requires bifurcation from the debt instrument and fair value recognition. We determined the fair value of the derivative using an option pricing Monte Carlo simulation model taking into account the probability of change of control occurring and potential repayment amounts and timing of such payments that would result under various scenarios, as further described in Note 5, “Fair Value of Financial Instruments” to our consolidated financial statements. During the second quarter of 2022, the Company recorded $1,590 for the initial fair value of the embedded derivative liability (asset). The fair value of the embedded derivative liability (asset) was ($270) and $1,150 as of December 31, 2024 and December 31, 2023, respectively. We will remeasure the embedded derivative to fair value each reporting period until the time the features lapse and/or termination of the deferred royalty obligation. For the years ended December 31, 2024 and December 31, 2023, we recognized other income of $1,420 and $190, due to the remeasurement of the embedded derivative liability. The carrying value of the deferred royalty obligation at December 31, 2024 was $109,810 based on $100,000 of proceeds, net of the initial fair value of the bifurcated embedded derivative liability upon execution of the RIFA, and debt issuance costs incurred. The carrying value is classified as $1,541 within current liabilities and $108,269 within long-term liabilities on the consolidated balance sheet as of December 31, 2024. The carrying value of the deferred royalty obligation approximated fair value at December 31, 2024. The effective interest rate as of December 31, 2024 was 16.02%. In connection with the deferred royalty obligation, we incurred debt issuance costs totaling $3,287. Debt issuance costs have been netted against the debt and are being amortized over the estimated term of the debt using the effective interest method, adjusted on a prospective basis for changes in the underlying assumptions and inputs. The assumptions used in determining the expected repayment term of the debt and amortization period of the issuance costs requires that we make estimates that could impact the classification of these costs, as well as the period over which these costs will be amortized.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
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+ Details

Segment and Geographic Information - Revenues (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Segment and Geographic Information
Total revenues	$ 130,126	$ 77,428	$ 23,638
United States
Segment and Geographic Information
Total revenues	96,108	62,425	21,078
International
Segment and Geographic Information
Total revenues	$ 34,018	$ 15,003	$ 2,560

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

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+ Details

Income Taxes - Operating loss carryforward (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Operating loss carryforwards
Increase in valuation allowance	$ 58,344	$ 49,901
Federal net operating loss carryforwards	610,234
State net operating loss carryforwards	694,029
Net operating loss indefinite carryforwards	537,214
Foreign net operating loss carryforwards	2,566
Federal orphan drug credit related to qualifying research	34,603
Unremitted earnings of foreign subsidiaries	250
Accrued interest or penalties related to uncertain tax positions	0	$ 0
Research tax credits \| Federal
Operating loss carryforwards
Research tax credits	13,802
Research tax credits \| State
Operating loss carryforwards
Research tax credits	$ 4,812

Segment and Geographic Information - Profit (loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Segment and Geographic Information
Total revenues	$ 130,126	$ 77,428	$ 23,638
Cost of sales	13,368	9,302	2,133
Net Income (Loss)	(260,602)	(184,678)	(181,119)
Product revenue, net
Segment and Geographic Information
Total revenues	130,126	77,428	16,884
License revenue
Segment and Geographic Information
Total revenues			6,754
US
Segment and Geographic Information
Total revenues	96,108	62,425	21,078
International
Segment and Geographic Information
Total revenues	34,018	15,003	2,560
Single reportable segment
Segment and Geographic Information
Total revenues	130,126	77,428	23,638
Cost of sales	13,368	9,302	2,133
Global headcount expense	119,084	96,413	70,777
Preclinical, clinical and development expense	82,180	74,465	66,013
Commercial & medical affairs	55,767	47,905	41,756
Corporate, general & administrative	32,135	27,154	20,220
Other segment expenses	93,094	6,571	1,896
Other (income) expense, net	(11,139)	317	1,179
Interest (income) expense, net	5,893	(585)	783
Income taxes	346	564	0
Single reportable segment \| Product revenue, net
Segment and Geographic Information
Total revenues	130,126	77,428	16,884
Single reportable segment \| License revenue
Segment and Geographic Information
Total revenues			6,754
Single reportable segment \| US \| Product revenue, net
Segment and Geographic Information
Total revenues	96,108	62,425	14,324
Single reportable segment \| International \| Product revenue, net
Segment and Geographic Information
Total revenues	$ 34,018	$ 15,002	$ 2,560

Income Taxes

12 Months Ended

Dec. 31, 2024

Income Taxes

Income Taxes

14. Income Taxes

The components of loss before income taxes are as follows:


		As of
		December 31,
		2024		2023		2022
United States	$	(258,927)	$	(178,669)	$	(181,119)
Foreign		(1,329)		(5,445)		—
Loss before income taxes	$	(260,256)	$	(184,114)	$	(181,119)

Components of provision for income taxes are as follows:


		As of
		December 31,
Current:		2024		2023		2022
U.S. Federal	$	—	$	—	$	—
U.S. State and Local		—		1		—
Foreign		346		563		—
Total Current Expense	$	346	$	564	$	—

Deferred:
U.S. Federal	$	—	$	—	$	—
U.S. State and Local		—		—		—
Foreign		—		—		—
Total Deferred Expense	$	—	$	—	$	—

A reconciliation of the income tax benefit at the federal statutory tax rate to the Company's effective income tax rate is as follows:


	As of
	December 31,
	2024		2023		2022
Statutory tax rate	21.00	%	21.00	%	21.00	%
State tax, net of federal benefit	5.61		10.24		9.83
Research and development credit	0.25		0.65		0.78
Orphan drug credit	3.50		3.37		2.15
Stock compensation	(0.57)		(1.37)		(0.29)
Other	(1.61)		(0.16)		(0.02)
Rate changes	(2.04)		(6.52)		—
Executive Compensation	(2.26)		(0.32)		(0.01)
License Agreement	(1.51)		—		—
Change in valuation allowance	(22.50)		(27.10)		(33.44)
Effective tax rate	(0.13)	%	(0.21)	%	—	%

The principal components of the Company's deferred tax assets and liabilities are as follows:


	As of
	December 31,
	2024		2023
Deferred tax assets:
Net operating loss carryforwards	$	167,375	$	153,685
Research and development credits		17,604		16,139
Orphan drug credit		34,603		25,484
Capitalized license fee		21,661		2,311
Stock-based compensation		5,113		13,159
Section 174 Costs		67,624		50,688
Deferred revenue		336		350
Section 163(j) Interest Limitation		4,417
Accrued Expenses & Other		7,971		5,680
Total deferred tax assets		326,704		267,496
Valuation allowance		(325,503)		(267,158)
Net deferred tax assets		1,201		338
Deferred tax liabilities:
Operating lease right-of-use asset and other		(1,201)		(338)
Total deferred tax liabilities	$	(1,201)	$	(338)

ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. After consideration of all the evidence, both positive and negative, the Company has recorded a full valuation allowance against its deferred tax assets at December 31, 2024 and 2023, because the Company's management has determined that is it more likely than not that these assets will not be realized. The increase in the valuation allowance of $58,344 in 2024 and $49,901 in 2023 primarily relates to the net loss incurred by the Company during each period.

As of December 31, 2024, the Company had federal and state net operating loss carryforwards of approximately $610,234 and $694,029, respectively, which are available to reduce future taxable income. The net operating loss carryforwards expire at various times beginning in 2033 for federal and state purposes. Of the federal net operating loss carryforwards at December 31, 2024, $537,214 can be carried forward indefinitely. As of December 31, 2024, the Company had gross foreign net operating loss carryforwards of approximately $2,566 which have an indefinite carryforward period.

As of December 31, 2024, the Company had federal and state research tax credits of approximately $13,802 and $4,812, respectively, which may be used to offset future tax liabilities. Additionally, as of 2024, the Company had a federal orphan drug credit related to qualifying research of $34,603. These tax credit carryforwards will begin to expire at various times beginning in 2033 for federal purposes and 2028 for state purposes.

The net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant stockholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions and other provisions within the Internal Revenue Code. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years.

The Company has not provided U.S. deferred income taxes or foreign withholding taxes on unremitted earnings of foreign subsidiaries of approximately $250 as such amounts are considered to be indefinitely reinvested in these jurisdictions. The accumulated earnings in the foreign subsidiaries are primarily utilized to fund working capital

requirements as its subsidiaries continue to expand their operations. The amount of any unrecognized deferred tax liability related to undistributed foreign earnings is immaterial.

The Company has not recorded any reserves for uncertain tax positions as of December 31, 2024 and 2023. The Company has not, as yet, conducted a study of research and development credit carryforwards. This study may result in an adjustment to the Company's research and development credit carryforwards; however, until a study is completed and any adjustment known, no amounts are being presented as an uncertain tax position. A full valuation allowance has been provided against the Company's research and development credits and, if an adjustment is required, this adjustment would be offset by an adjustment to the valuation allowance. Thus, there would be no impact to the balance sheets or statements of operations and comprehensive loss if an adjustment were required.

Interest and penalty charges, if any, related to unrecognized tax benefits will be classified as provision for income taxes in the accompanying statements of operations and comprehensive loss. As of December 31, 2024 and 2023, the Company had no accrued interest or penalties related to uncertain tax positions.

The Company is subject to examination by the U.S. federal, state, local, and foreign income tax authorities for tax years 2013 forward. The Company is not currently under examination by the Internal Revenue Service or any other jurisdictions for any tax years.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

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-Name Accounting Standards Codification
-Section 55
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+ Details

Common Stock

12 Months Ended

Dec. 31, 2024

Common Stock.

Common Stock

7. Common Stock

Common Stock

On February 29, 2024, the Company and Cowen entered into Amendment No. 1 to Sales Agreement (the “Amendment”) to increase the aggregate offering price of the shares of common stock that may be issued and sold pursuant to the Sales Agreement to $200,000,000 (excluding the aggregate offering price of shares of common stock issued and sold pursuant to the Sales Agreement prior to February 29, 2024). In connection with the Amendment, on February 29, 2024, the Company filed with the Securities Exchange Commission a prospectus supplement, dated February 29, 2024, which, combined with the Base Prospectus (together, the “New Prospectus”), amended the Prior Prospectus in its entirety. The issuances and sales under the Sales Agreement, as amended by the Amendment, will be made pursuant to the Registration Statement and the New Prospectus.

In the quarter ended December 31, 2024 the Company sold 744,595 shares of common stock in the ATM program for net proceeds of $41.2 million. The Company also sold an additional 587,510 shares of common stock in the ATM program through January 21, 2025 for net proceeds of approximately $32.1 million.

On September 19, 2022, the Company completed a public offering of 4,800,000 shares of common stock at a price to the public of $26.00 per share. The Company received $116,887 in net proceeds after deducting underwriting discounts, commissions and offering expenses. In addition, the Company granted the underwriters a 30-day option to purchase up to an additional 720,000 shares of its common stock at the price to the public, less underwriting discounts and commissions. On October 18, 2022, the Company completed the sale of an additional 580,000 shares of common stock at a price to the public of $26.00 per share pursuant to the partial exercise of the underwriters’ option to purchase additional shares, for aggregate net proceeds of approximately $14,175, after deducting underwriting discounts, commissions and offering expenses.

On November 2, 2021, the Company entered into a Sales Agreement with Cowen and Company, LLC (“Cowen”), pursuant to which the Company may issue and sell shares of its common stock, having an aggregate offering price of up to $100.0 million, from time to time through an “at the market” equity offering program under which Cowen acts as sales agent (the “ATM Program”). Between August 10, 2023 and August 21, 2023, the Company sold approximately two million shares of its common stock in the ATM Program for net proceeds of approximately $48.9 million.

On February 9, 2021 the Company completed a public offering of 5,750,000 shares of common stock at an offering price of $30.00 per share, which included the exercise in full by the underwriters of their option to purchase up to 750,000 additional shares of common stock. The Company received approximately $161,550 in net proceeds after deducting underwriting discounts, commissions and estimated offering expenses.

- Definition

The entire disclosure for equity.

+ References

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-Topic 505
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-Section 50
-Paragraph 13
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+ Details

Intangible Assets, Net - Amortization expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Definite-lived intangible assets
2025	$ 854
2026	855
2027	854
2028	855
2029	855
Thereafter	1,901
Total	$ 6,174	$ 7,028
Finite-Lived Intangible Assets, Remaining Amortization Period	11 years
Cost of sales
Definite-lived intangible assets
Amortization expense	$ 855	$ 855	$ 774

Stock-based Compensation - 2022 Inducement Plan (Details) - shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Feb. 09, 2022
Stock-based Compensation
Stock options outstanding	6,611,391	6,551,025
2022 Employment Inducement Plan
Stock-based Compensation
Authorized shares			1,000,000
Vesting period	4 years
Stock options outstanding	495,978
Restricted stock unit awards outstanding	317,554
Shares available for future grant	14,586
2022 Employment Inducement Plan \| Maximum
Stock-based Compensation
Expiration period	10 years

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Intangible Assets, Net

12 Months Ended

Dec. 31, 2024

Intangible Assets, Net

Intangible Assets, Net

6. Intangible Assets, Net

As of December 31, 2024, the Company’s definite-lived intangible assets, which totaled $6,174, resulted from the capitalization of certain milestone payments made to Ipsen Pharma, S.A.S., or Ipsen, in accordance with the terms of the Company’s license agreement with Ipsen, in connection with the Company’s first commercial sale of IMCIVREE in the U.S. in March 2021.

As of December 31, 2024, amortization expense for the next five years and beyond is summarized as follows:


2025	$	854
2026		855
2027		854
2028		855
2029		855
Thereafter		1,901
Total	$	6,174

The Company began amortizing its finite-lived intangible assets in April 2021 over an 11 year period based on IMCIVREE’s expected patent exclusivity period. Amortization expense totaled $855, $855 and $774 for the years ended December 31, 2024, 2023 and 2022, respectively. Amortization expense is recorded as a component of cost of sales on the consolidated statements of operations and comprehensive loss.

Income Taxes - Components of income taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Components of loss before income taxes
United States	$ (258,927)	$ (178,669)	$ (181,119)
Foreign	(1,329)	(5,445)
Loss before income taxes	$ (260,256)	$ (184,114)	$ (181,119)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

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+ Details

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Dec. 31, 2024 shares
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Yann Mazzabraud
Trading Arrangements, by Individual
Material Terms of Trading Arrangement	On December 13, 2024, Yann Mazabraud, the Company’s EVP, Head of International, adopted a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act for the sale of up to 99,495 shares of the Company’s common stock until November 11, 2025.
Name	Yann Mazabraud
Title	EVP, Head of International
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	December 13, 2024
Expiration Date	November 11, 2025
Aggregate Available	99,495
Pamela Cramer
Trading Arrangements, by Individual
Material Terms of Trading Arrangement	On December 16, 2024, Pamela Cramer, the Company’s Chief Human Resources Officer, adopted a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act for the sale of up to 50,394 shares of the Company’s common stock until March 17, 2026.
Name	Pamela Cramer
Title	Chief Human Resources Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	December 16, 2024
Expiration Date	March 17, 2026
Aggregate Available	50,394

Income Taxes - Reconciliation of income tax rate (Details)	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Reconciliation of the income tax benefit
Statutory tax rate	21.00%	21.00%	21.00%
State tax, net of federal benefit	5.61%	10.24%	9.83%
Research and development credit	0.25%	0.65%	0.78%
Orphan drug credit	3.50%	3.37%	2.15%
Stock compensation	(0.57%)	(1.37%)	(0.29%)
Other	(1.61%)	(0.16%)	(0.02%)
Rate changes	(2.04%)	(6.52%)
Executive compensation	(2.26%)	(0.32%)	(0.01%)
License agreement	(1.51%)
Change in valuation allowance	(22.50%)	(27.10%)	(33.44%)
Effective tax rate	(0.13%)	(0.21%)

Insider Trading Policies and Procedures	12 Months Ended
Insider Trading Policies and Procedures	Dec. 31, 2024
Insider Trading Policies and Procedures [Line Items]
Insider Trading Policies and Procedures Adopted	true

Summary of Significant Accounting Policies - Property and equipment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Property and equipment
Property and equipment, gross	$ 5,399	$ 5,400
Less accumulated depreciation and amortization	(4,767)	(4,059)
Property and equipment, net	632	1,341
Depreciation and amortization expense	710	903	$ 896
Leasehold improvements
Property and equipment
Property and equipment, gross	$ 2,705	2,705
Office equipment
Property and equipment
Useful Life	5 years
Property and equipment, gross	$ 154	155
Computers and software
Property and equipment
Useful Life	3 years
Property and equipment, gross	$ 1,291	1,291
Furniture, fixtures and equipment
Property and equipment
Useful Life	5 years
Property and equipment, gross	$ 1,249	$ 1,249

Summary of Significant Accounting Policies - Other Long-Term Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Summary of Significant Accounting Policies
Long-term research and development costs	$ 6,209	$ 12,594
Other long-term assets	1,117	2,405
Other long-term assets	$ 7,326	$ 14,999

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 89,137	$ 60,081
Short-term investments	231,428	215,765
Accounts receivable, net	18,512	14,867
Inventory	18,741	8,624
Prepaid expenses and other current assets	16,382	8,931
Total current assets	374,200	308,268
Property and equipment, net	632	1,341
Right-of-use asset	3,477	781
Intangible assets, net	6,174	7,028
Restricted cash	464	328
Other long-term assets	7,326	14,999
Total assets	392,273	332,745
Current liabilities:
Accounts payable	12,328	4,885
Accrued expenses and other current liabilities	62,658	48,262
Other current liability - LG Chem	37,704
Deferred revenue	1,286	1,286
Deferred royalty obligation, current	1,541
Lease liability		770
Total current liabilities	115,517	55,203
Long-term liabilities:
Deferred royalty obligation	108,269	106,143
Lease liability, non-current	3,938	490
Derivative liability		1,150
Total liabilities	227,724	162,986
Commitments and contingencies (Note 12)
Series A convertible preferred stock, $0.001 par value: 150,000 shares authorized; 150,000 and 0 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively. Liquidation preference of $150,000 as of December 31, 2024.	142,820
Stockholders' equity:
Common stock, $0.001 par value: 120,000,000 shares authorized; 62,390,654 and 59,426,559 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively	61	59
Additional paid-in capital	1,177,045	1,064,302
Accumulated other comprehensive (loss) income	(39)	134
Accumulated deficit	(1,155,338)	(894,736)
Total stockholders' equity	21,729	169,759
Total liabilities, convertible preferred stock and stockholders' equity	$ 392,273	$ 332,745

Stock-based Compensation - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Stock-based Compensation
Number of common stock options granted	983,643
Total intrinsic value of stock options exercised	$ 24,745
Employees stock purchase plan
Stock-based Compensation
Grant cliff vesting period	1 year
Employees stock purchase plan \| Minimum
Stock-based Compensation
Vesting period of stock option awards	1 year
Employees stock purchase plan \| Maximum
Stock-based Compensation
Vesting period of stock option awards	4 years
2017 Equity Incentive Plan
Stock-based Compensation
Number of common stock options granted	926,543	842,528	1,929,345
Weighted average grant date fair value relating to outstanding stock options		$ 32.69	$ 17.72	$ 4.14
2022 Employment Inducement Plan
Stock-based Compensation
Vesting period of stock option awards	4 years
Number of common stock options granted	57,100	229,360	347,985
Weighted average grant date fair value relating to outstanding stock options	$ 29.16	$ 15.3	$ 13.05

Subsequent Events (Details) - USD ($) $ in Thousands					1 Months Ended	3 Months Ended	12 Months Ended
Subsequent Events (Details) - USD ($) $ in Thousands	Oct. 18, 2022	Sep. 19, 2022	Nov. 02, 2021	Feb. 09, 2021	Jan. 21, 2025	Dec. 31, 2024	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Subsequent events
Issuance of stock (in shares)	580,000	4,800,000		5,750,000
Issuance of stock								$ 48,875	$ 131,112
At-the-market offering
Subsequent events
Issuance of stock							$ 41,073
At-the-market offering \| Common stock
Subsequent events
Issuance of stock (in shares)						744,595
Issuance of stock			$ 2,000			$ 41,200	$ 48,900
Subsequent events \| At-the-market offering \| Common stock
Subsequent events
Issuance of stock (in shares)					587,510
Issuance of stock					$ 32,100

- Definition

Equity impact of the value of new stock issued during the period. Includes shares issued in an initial public offering or a secondary public offering.

+ References + Details

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2024

Summary of Significant Accounting Policies

Basis of Presentation

The Company's consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. This process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. Significant estimates relied upon in preparing these financial statements include but are not limited to, estimates related to determining our net product revenue, and accruals related to research and development expenses. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ materially from those estimates.

Principles of Consolidation

The consolidated financial statements include the accounts of Rhythm Pharmaceuticals, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

Segment Information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company currently operates in two business segments, which are U.S. and international segments for the development and commercialization of therapies for patients with rare diseases. A single management team that reports to the Chief Executive Officer comprehensively manages the entire business. The Company meets the aggregation criteria of ASC 280 and therefore has one reportable segment for the year ended December 31, 2024.

In November 2023, the FASB issued ASU 2023-07 – Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, which improves segment disclosure requirements, primarily through enhanced disclosure requirements for significant segment expenses. The improved disclosure requirements apply to all public entities that are required to report segment information, including those with only one reportable segment. The Company adopted the guidance in the fiscal year beginning January 1, 2024. There was no impact on the Company’s reportable segments identified and additional required disclosures have been included in Note 15.

Off-Balance Sheet Risk and Concentrations of Credit Risk

Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist primarily of cash and cash equivalents and short-term investments, which are maintained at two federally insured financial institutions. The deposits held at these two institutions are in excess of federally insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements.

The Company is exposed to risks associated with extending credit to customers related to the sale of products. The Company does not require collateral to secure amounts due from its customers. For the years ended December 31, 2024 and 2023, approximately 74% and 77%, respectively, of all of the Company’s revenue was generated from a single customer in the United States. As of December 31, 2024 and 2023, approximately 67% and 67%, respectively, of the Company’s accounts receivable was outstanding from a single customer in the United States.

The Company relies on third-party manufacturers and suppliers for manufacturing and supply of its product. The inability of the suppliers or manufacturers to fulfill supply requirements of the Company could materially impact future operating results. A change in the relationship with the suppliers or manufacturer, or an adverse change in their business, could materially impact future operating results.

The Company relies on separate third parties to perform genetic testing in the United States and Europe, respectively. The inability of the vendor to fulfill testing services for the Company could materially impact future operating results and adversely impact our ability to further develop setmelanotide. A change in the relationship with the genetic testing service providers, or an adverse change in their business, could materially impact future operating results.

Cash and Cash Equivalents

The Company considers all highly liquid investments with remaining maturity from the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents includes bank demand deposits, U.S. treasury bills and money market funds that invest primarily in U.S. government treasuries.

Short-Term Investments

Short-term investments consist of investments with maturities greater than 90 days, as of the date of purchase. The Company has classified its investments with maturities beyond one year as short term, based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. The Company considers its investment portfolio available-for-sale. Accordingly, these investments are recorded at fair value, which is based on quoted market prices. Unrealized gains and losses are reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. To the extent the amortized cost basis of the available-for-sale debt securities exceeds the fair value, management assesses the debt securities for credit loss; however, management considers the risk of credit loss to be minimized by the Company's policy of investing in financial instruments issued by highly-rated financial institutions. When assessing the risk of credit loss, management considers factors such as the severity and the reason of the decline in value (i.e., any changes to the rating of the security by a rating agency or other adverse conditions specifically related to the security) and management's intended holding period and time horizon for selling. During the years ended December 31, 2024, 2023, and 2022, the Company did not recognize any credit losses related to its available-for-sale debt securities. Further, as of December 31, 2024 and 2023, the Company did not record an allowance for credit losses related to its available-for-sale debt securities.

Restricted Cash

Restricted cash consists of security deposits in the form of letters of credit placed in separate restricted bank accounts as required under the terms of the Company’s lease arrangement for its corporate office in Boston, Massachusetts and the Company’s corporate travel credit card.

Accounts Receivable, net

Accounts receivable consists of amounts due from customers, net of customer allowances for cash discounts and any estimated expected credit losses. The Company's measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. To date, the Company has not experienced any material credit losses. The Company's contracts with its customers have customary payment terms that generally require payment within 90 days. The Company analyzes amounts that are past due for collectability, and periodically evaluates the creditworthiness of its customer. At December 31, 2024 and 2023, the Company determined an allowance for doubtful account was not required based upon its review of contractual payments and its customer payment histories.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers, or ASC 606. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

Product Revenue, Net

In the United States, which accounts for the largest portion of our total revenues, the Company sells its product to one material specialty pharmacy. The product is distributed through third-party logistics, or 3PL, distribution agent that does not take title to the product. Once the product is delivered to the Company’s specialty pharmacy provider, our customer in the United States, the customer (or “wholesaler”) takes title to the product. The wholesaler then distributes the product to patients. In our distribution agreement with the 3PL company, the Company acts as principal because we retain control of the product. Internationally, we make sales primarily to specialty distributors and retail pharmacy chains, as well as hospitals, many of which are government-owned or supported. The Company offers returns of product sold to the customer on a limited basis, however, no material returns have been recognized to date.

Revenue from product sales is recognized when the customer obtains control of our product, which occurs at a point in time, upon transfer of title to the customer because at that point in time we have no ongoing obligations to the customer. There are no other performance obligations besides the sale of product. We classify payments to our customers or other parties in the distribution channel for services that are distinct and priced at fair value as selling, general and administrative expenses in our consolidated statements of operations and comprehensive loss. Otherwise, payments to a customer or other parties in the distribution channel that do not meet those criteria are classified as a reduction of revenue, as discussed further below. Taxes collected from the customer relating to product sales and remitted to governmental authorities are excluded from revenue. Because our payment terms are generally ninety days or less, the Company concluded there is not a significant financing component because the period between the transfer of a promised good or service to the customer and when the customer pays for that good or service will be one year or less. The Company expenses incremental costs of obtaining a contract as and when incurred since the expected amortization period of the asset that we would have recognized is one year or less.

Reserves for Variable Consideration

Revenues from product sales are recorded at the net sales price, or the transaction price, which includes estimates of variable consideration for which reserves are established and which result from discounts, rebates, and co-pay assistance that are offered within contracts between us and our customers, health care providers and other indirect customers relating to the sale of IMCIVREE. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect our best estimates of the amount of consideration to which we are entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is considered probable that a significant reversal

in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from our estimates. If actual results in the future vary from our estimates, we will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known.

The following are the components of variable consideration related to product revenue:

Government rebates: The Company is subject to discount obligations under government programs, including U.S. Medicaid programs, Medicare and Tricare in the United States as well as certain government rebates and pricing adjustments in certain international markets that we operate. We estimate these rebates based upon a range of possible outcomes that take into consideration the estimated payer mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a liability that is included in accrued expenses and other current liabilities on our condensed consolidated balance sheets. On a quarterly basis, we update our estimates and record any necessary adjustments in the period that we identify the adjustments.

Trade discounts and allowances: The Company provides customary invoice discounts on IMCIVREE sales to certain of our customers for items such as prompt payment. These are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, we receive and pay for various distribution services from our customers in the distribution channel. For services that are not distinct from the sale of our product, such fees are classified as a reduction of product revenue.

Product returns: Our customers have limited return rights related to the product’s damage or defect. The Company estimates the amount of product sales that may be returned and records the estimate as a reduction of revenue and a refund liability in the period the related product revenue is recognized. Based on the distribution model for IMCIVREE, the Company believes there will be minimal returns and these reserves have not been material to date.

Other incentives: Other incentives include co-payment assistance the Company provides to patients with commercial insurance that have coverage and reside in states that allow co-payment assistance. The calculation of the accrual for co-pay assistance is based on an estimate of claims and the cost per claim that we expect to receive associated with product that has been recognized as revenue. The estimate is recorded as a reduction of revenue in the same period the related revenue is recognized.

Provisions for trade discounts, chargebacks and allowances are recorded as reductions to accounts receivable, and returns, government rebates, and other incentives are recorded as a component of accrued expenses.

The table below summarizes balances and activity in each of the product revenue allowance and reserve categories as follows:



	Provision for Cash Discounts		Fees, Rebates and Other Incentives		Total
Beginning Balance at December 31, 2022	$	99	$	2,710	$	2,809
Provision related to sales in the current year		1,672		17,351		19,023
Credit and payments made		(1,572)		(10,586)		(12,158)
Ending balance December 31, 2023	$	199	$	9,475	$	9,674
Provision related to sales in the current year		2,317		27,315		29,632
Credit and payments made		(2,263)		(20,940)		(23,203)
Ending balance December 31, 2024	$	253	$	15,850	$	16,103

Provision for cash discounts are recorded as reductions of accounts receivable, and fees, rebates, and other incentives are recorded as components of accrued expenses.

License Agreements

We generate revenue from license or similar agreements with pharmaceutical companies for the development and commercialization of certain of our products and product candidates. Such agreements may include the transfer of intellectual property rights in the form of licenses, transfer of technological know-how, delivery of drug substances, research and development services, and participation on certain committees with the counterparty. Payments made by the customers may include non-refundable upfront fees, payments upon the exercise of customer options, payments based upon the achievement of defined milestones, and royalties on sales of products and product candidates if they are approved and commercialized.

If a license to our intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, we recognize the transaction price allocated to the license as revenue upon transfer of control of the license. We evaluate all other promised goods or services in the agreement to determine if they are distinct. If they are not distinct, they are combined with other promised goods or services to create a bundle of promised goods or services that is distinct. Optional future services where any additional consideration paid to us reflects their standalone selling prices do not provide the customer with a material right and, therefore, are not considered performance obligations. If optional future services are priced in a manner which provides the customer with a significant or incremental discount, they are material rights, and are accounted for as separate performance obligations.

We utilize judgment to determine the transaction price. In connection therewith, we evaluate contingent milestones at contract inception to estimate the amount which is not probable of a material reversal to include in the transaction price using the most likely amount method. Milestone payments that are not within our control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received and therefore the variable consideration is constrained. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which we recognize revenue as or when the performance obligations under the contract are satisfied. At the end of each reporting period, we re-evaluate the probability of achieving development milestone payments that may not be subject to a material reversal and, if necessary, adjust our estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect license and other revenue, as well as earnings, in the period of adjustment.

We then determine whether the performance obligations or combined performance obligations are satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, upfront fees. We evaluate the measure of progress, as applicable, for each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.

When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded within deferred revenue. Contract liabilities within deferred revenue are recognized as revenue after control of the goods or services is transferred to the customer and all revenue recognition criteria have been met.

For arrangements that include sales-based royalties, including sales-based milestone payments, and a license of intellectual property that is deemed to be the predominant item to which the royalties relate, we recognize revenue at the later of when the related sales occur or when the performance obligation to which some or all of the royalties have been allocated has been satisfied (or partially satisfied). Refer to Note 10 “Significant Agreements”, for discussion related to the Company’s accounting for the RareStone Group, Ltd. agreement.

Deferred Royalty Obligation

We treat the debt obligation to HealthCare Royalty Management, LLC as discussed further in Note 11, “Long-Term Obligations”, as a deferred royalty obligation, amortized using the effective interest rate method over the estimated life of the revenue streams. We recognize interest expense thereon using the effective rate, which is based on our current estimates of future revenues over the life of the arrangement. In connection therewith, we periodically assess our expected revenues using internal projections, impute interest on the carrying value of the deferred royalty obligation, and record interest expense using the imputed effective interest rate. To the extent our estimates of future revenues are greater or less

than previous estimates or the estimated timing of such payments is materially different than previous estimates, we will account for any such changes by adjusting the effective interest rate on a prospective basis, with a corresponding impact to the reclassification of our deferred royalty obligation. The assumptions used in determining the expected repayment term of the deferred royalty obligation and amortization period of the issuance costs requires that we make estimates that could impact the classification of such costs, as well as the period over which such costs will be amortized.

Inventory

Prior to receiving approval from the FDA in November 2020 to sell IMCIVREE in the United States, the Company expensed all costs incurred related to the manufacture of IMCIVREE as research and development expense because of the inherent risks associated with the development of a drug candidate, the uncertainty about the regulatory approval process and the lack of history for the Company of regulatory approval of drug candidates. The Company values inventories at the lower of cost or estimated net realizable value. The Company determines the cost of inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. Raw materials and work in process includes all inventory costs prior to packaging and labelling, including raw materials, active pharmaceutical ingredient, and drug product. Finished goods include packaged and labelled products. Raw materials and work in process that may be used for either research and development or commercial sale are classified as inventory until the material is consumed or otherwise allocated for research and development. If the material is intended to be used for research and development, it is expensed as research and development once that determination is made.

Inventory consists of the following:


	December 31,		December 31,
	2024		2023
Raw Materials	$	6,776	$	4,625
WIP		1,250		1,104
Finished Goods		10,715		2,895
Total Inventory	$	18,741	$	8,624

Cost of Product Sales

Cost of product sales consists of manufacturing costs, transportation and freight, amortization of capitalized intangibles, royalty payments and indirect overhead costs associated with the manufacturing and distribution of IMCIVREE. Cost of product sales may also include periodic costs related to certain manufacturing services and inventory adjustment charges. Finally, cost of sales may also include costs related to excess or obsolete inventory adjustment charges, abnormal costs, unabsorbed manufacturing and overhead costs, and manufacturing variances.

Intangible Assets, Net

Intangible Assets, net

Definite-lived intangible assets related to capitalized milestones under license agreements are amortized on a straight-line basis over their remaining useful lives, which are estimated to be the remaining patent life. If our estimate of the product’s useful life is shorter than the remaining patent life, then a shorter period is used. Amortization expense is recorded as a component in cost of sales in the consolidated statements of operations and comprehensive loss.

Impairment of Long-Lived Assets

The Company evaluates its long-lived assets, which consist primarily of property and equipment and finite lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. The Company measures recoverability of assets to be held and used by comparing the carrying amount of an asset to the future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the Company measures the impairment to be recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset, less the cost to

sell. No events or changes in circumstances existed to require an impairment assessment during the years ended December 31, 2024, 2023 and 2022.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist primarily of costs incurred in advance of services being received, including services related to clinical trial programs. Prepaid expenses and other current assets consists of the following:


	December 31,
	2024		2023
Prepaid research and development costs	$	7,580	$	2,259
Other current assets		8,802		6,672
Prepaid expenses and other current assets	$	16,382	$	8,931

Other Long-Term Assets

Other long-term assets consist primarily of costs incurred in advance of services being received, including services related to clinical trial programs. Since the Company will not receive services within one year of the balance sheet date, these assets are considered long-term. Other long-term assets consists of the following:


	December 31,
	2024		2023
Long-term research and development costs	$	6,209	$	12,594
Other long-term assets		1,117		2,405
Other long-term assets	$	7,326	$	14,999

Property and Equipment

Property and equipment consists of the following:


	Useful	December 31,
	Life	2024		2023
Leasehold improvements	*	$	2,705	$	2,705
Office equipment	5 years		154		155
Computers and software	3 years		1,291		1,291
Furniture, fixtures and equipment	5 years		1,249		1,249
			5,399		5,400
Less accumulated depreciation and amortization			(4,767)		(4,059)
Property and equipment, net		$	632	$	1,341

*Shorter of asset life or lease term.

Depreciation and amortization expense related to property and equipment for the years ended December 31, 2024, 2023 and 2022 was $710, $903, and $896 respectively.

Property and equipment are recorded at cost. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the assets. Upon disposal, retirement or sale, the cost of assets disposed of and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations. Expenditures for repairs and maintenance that do not improve or extend the lives of the respective assets are charged to expense as incurred.

Acquired IPR&D and Milestone Expense

In an asset acquisition, payments incurred prior to regulatory approval to acquire rights to in-process research and development projects are expensed as acquired IPR&D and recorded as a component of research and development expense in the consolidated statements of operations and comprehensive net loss unless the project has an alternative future use. These costs include upfront and development milestone payments related to licensing arrangements, or other asset acquisitions that provide rights to develop, manufacture and/or sell pharmaceutical products. Where contingent development milestone payments are due to third parties, prior to regulatory approval, the payment obligations are expensed when the milestone results are achieved. Regulatory and commercial milestone payments made to third parties subsequent to regulatory approval are capitalized as intangible assets and amortized to cost of products sold over the remaining useful life of the related product.

Foreign Currency Translation

The assets and liabilities of the Company’s subsidiaries with functional currencies other than the U.S. dollar are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Revenue and expense amounts for these subsidiaries are translated using the average exchange rates for the period. Changes resulting from foreign currency translation are included in accumulated other comprehensive income (loss) on the Company’s consolidated statement of stockholders’ equity. Net foreign currency exchange transaction gains (losses), which are included in other (expense) income, net on our consolidated statements of operations, were immaterial for the years ended December 31, 2024, 2023 and 2022.

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories:

Level 1 — Quoted market prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s cash equivalents and marketable securities and derivative liability at December 31, 2024 and 2023 were carried at fair value, determined according to the fair value hierarchy. See Note 5 for further discussion.

The carrying amounts reflected in the consolidated balance sheets for accounts payable and accrued expenses and other current liabilities approximate their fair values due to their short-term maturities at December 31, 2024 and 2023, respectively.

Research and Development Expenses

Costs incurred in the research and development of the Company’s products are expensed to operations as incurred. Research and development expenses consist of costs incurred in performing research and development activities, including salaries and benefits, facilities costs, overhead costs, contract services and other outside costs. The value of goods and services received from contract research organizations, or CROs, or contract manufacturing organizations, or CMOs, in the reporting period are estimated based on the level of services performed and progress in the period for which the Company has not yet received an invoice from the supplier. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any

reporting period. Actual results could differ from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs.

Nonrefundable advance payments for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses, and expensed as the related goods are delivered or the services are performed.

Income Taxes

The Company is taxed as a C corporation for federal income tax purposes. Income taxes for the Company are recorded in accordance with FASB ASC Topic 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and liability approach. Income taxes have been calculated on a separate tax return basis.

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, it would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority.

The Company recognizes interest and penalties related to unrecognized tax benefits as provision for income taxes in the accompanying consolidated statements of operations. As of December 31, 2024 and 2023, no accrued interest or penalties are included as a component of accrued expenses in the consolidated balance sheets.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted-average number of common shares outstanding during the period, without consideration of potential dilutive securities. Diluted net loss per share is computed by adjusting the weighted-average shares outstanding for the potential dilutive effects of common stock equivalents outstanding during the period calculated in accordance with the more dilutive of the if-converted or treasury stock method. For purposes of the diluted net loss per share calculation, stock options, restricted stock units and performance stock units are considered to be common stock equivalents but have been excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive for all periods presented. Therefore, basic and diluted net loss per share were the same for all periods presented.

The following table includes the potential common shares, presented based on amounts outstanding at each period end, that were excluded from the computation of diluted net loss per share due to their anti-dilutive effect, under either the treasury stock or if-converted method for the periods indicated:


	Year Ended
	December 31,
	2024		2023		2022
Stock options		6,611,391		6,551,025		6,354,544
Restricted stock units		1,805,412		1,079,382		774,166
Performance stock units		249,322		581,246		804,797
Common stock reserved for the conversion of Series A convertible preferred stock		3,124,995
Potential common shares		11,791,120		8,211,653		7,933,507

Comprehensive Loss

Comprehensive loss represents the net change in stockholders’ equity during a period from sources other than transactions with shareholders. As reflected in the accompanying consolidated statements of operations and comprehensive loss, our comprehensive loss is comprised of net losses, foreign currency translation adjustments and unrealized gains and losses on marketable debt securities. These changes in equity are reflected net of tax.

Patent Costs

Costs to secure and defend patents are expensed as incurred and are classified as general and administrative expenses. Patent costs were $1,311, $555 and $406 for the years ended December 31, 2024, 2023 and 2022, respectively.

Subsequent Events

Application of New or Revised Accounting Standards

From time to time, new accounting pronouncements are issued by the FASB and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, or ASU 2023-09. The new guidance requires that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid. The amendments in the ASU are intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in this update are effective for us beginning in fiscal year ending December 31, 2025. We are currently evaluating the impact of the new standard on our consolidated financial statements which is expected to result in enhanced disclosures, however, we do not otherwise expect the adoption of the new guidance to have a material impact on our financial condition or results of operations.

In November 2023, the FASB issued ASU 2023-07 – Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures, which improves segment disclosure requirements, primarily through enhanced disclosure requirements for significant segment expenses. The improved disclosure requirements apply to all public entities that are required to report segment information, including those with only one reportable segment. The Company adopted the guidance in the fiscal year beginning January 1, 2024. There was no impact on the Company’s reportable segments identified and additional required disclosures have been included in Note 15.

Stock-based Compensation

12 Months Ended

Dec. 31, 2024

Stock-based Compensation

Stock-based Compensation

8. Stock-based Compensation

2017 Equity Incentive Plan

The Rhythm Pharmaceuticals, Inc. 2017 Equity Incentive Plan (the “2017 Plan”) provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, performance units, restricted stock awards, restricted stock units and stock grants to employees, consultants, advisors and directors of us or our affiliates, as determined by the board of directors. The number of shares authorized under the 2017 Plan increases on the first day of each calendar year, commencing on January 1, 2018 and ending on (and including) January 1, 2027, by an amount equal to 4% of the outstanding shares of stock outstanding as of the end of the immediately preceding fiscal year. On January 1, 2025, 2024 and 2023, 2,495,626, 2,377,062, and 2,264,497 shares, respectively, were added to the 2017 Plan. Notwithstanding the foregoing, the board of directors may act prior to January 1 for a given year to provide that there will be no such January 1 increase in the number of shares authorized under the 2017 Plan for such year, or that the increase in the number of shares authorized under the 2017 Plan for such year will be a lesser number than would otherwise occur pursuant to the preceding sentence.

Shares of common stock issued upon the exercise of stock options are generally issued from new shares of the Company. The 2017 Plan provides that the exercise price of incentive stock options cannot be less than 100% of the fair market value of the common stock on the date of the award for participants who own less than 10% of the total combined voting power of stock of the Company, and not less than 110% for participants who own more than 10% of the Company's voting power. Awards granted under the 2017 Plan will vest over periods as determined by the Company's board of directors. For options granted to date, the exercise price equaled the fair value of the common stock as determined by the board of directors on the date of grant.

As of December 31, 2024, an aggregate of 12,475,344 shares of common stock were authorized for issuance under the 2017 Plan, of which a total of approximately 4,622,751 shares of common stock remained available for future awards. In addition, a total of 7,852,593 shares of common stock reserved for issuance were subject to currently outstanding stock options, performance share units and restricted stock units granted under the Plan.

2022 Inducement Plan

On February 9, 2022, the Company’s board of directors adopted the Rhythm Pharmaceuticals, Inc. 2022 Employment Inducement Plan (the “2022 Inducement Plan”), which became effective on such date without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Stock Market LLC listing rules (“Rule 5635(c)(4)”). The 2022 Inducement Plan provides for the grant of non-qualified stock options, stock appreciation rights, performance units, restricted stock awards, restricted stock units and stock grants. In accordance with Rule 5635(c)(4), awards under the 2022 Inducement Plan may only be made to a newly hired employee who has not previously been a member of the Company’s board of directors, or an employee who is being rehired following a bona fide period of non-employment by the Company or a subsidiary, as a material inducement to the employee’s entering into employment with the Company or its subsidiary. An aggregate of 1,000,000 shares of the Company’s common stock have been reserved for issuance under the 2022 Inducement Plan.

The exercise price of stock options granted under the 2022 Inducement Plan will not be less than the fair market value of a share of the Company’s common stock on the grant date. Other terms of awards, including vesting requirements, are determined by the Company’s board of directors and are subject to the provisions of the 2022 Inducement Plan. Stock options granted to employees generally vest over a four-year period but may be granted with different vesting terms. Certain options may provide for accelerated vesting in the event of a change in control. Stock options granted under the 2022 Inducement Plan expire no more than 10 years from the date of grant. As of December 31, 2024, there were 495,978 stock option awards outstanding, 317,554 restricted stock unit awards outstanding and 14,586 shares of common stock available for future grant under the 2022 Inducement Plan.

2017 Employee Stock Purchase Plan

The Company maintains the Rhythm Pharmaceuticals, Inc. 2017 Employee Stock Purchase Plan, (the “2017 ESPP”), which became effective in connection with the completion of the Company’s IPO in October 2017. As of December 31, 2024, a total of 1,872,738 shares of common stock were reserved for issuance under the 2017 ESPP. In addition, the number of shares authorized under the 2017 ESPP increases on the first day of each calendar year, commencing on January 1, 2019 and ending on (and including) January 1, 2027, by an amount equal to the lesser of 1% of outstanding shares as of the end of the immediately preceding fiscal year. On January 1, 2025, 2024 and 2023, no shares were added to the 2017 ESPP. Notwithstanding the foregoing, the board of directors may act prior to January 1 of a given year to provide that there will be no such January 1 increase in the number of shares authorized under the 2017 ESPP for such year, or that the increase in the number of shares authorized under the 2017 ESPP for such year will be a lesser number than would otherwise occur pursuant to the preceding sentence. During the years ended December 31, 2024, 2023 and 2022, shares of 44,554, 49,819, and 92,932 were issued under the 2017 ESPP.

The purchase price of common stock under our ESPP is equal to 85.0% of the lower of (i) the market value per share of the common stock on the first business day of an offering period or (ii) the market value per share of the common stock on the purchase date. The fair value of the discounted purchases made under our ESPP is calculated using the Black-

Scholes model. The fair value of the look-back provision plus the 15.0% discount is recognized as compensation expense over the 6 month purchase period.

Stock Options

The Company estimates the fair value of stock option awards to employees and non-employees using the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including (a) the expected volatility of the underlying common stock, (b) the expected term of the award, (c) the risk-free interest rate, and (d) expected dividends. The Company bases its estimate of expected volatility using a blend of its stock price history for the length of time it has market data for its stock and using the historical volatility of a group of companies in the pharmaceutical and biotechnology industries in a similar stage of development as the Company that are publicly traded. For these analyses, the Company selected companies with comparable characteristics to its own including enterprise value, risk profiles and with historical share price information sufficient to meet the expected life of the stock-based awards. The Company computes the historical volatility data using the daily closing prices for the selected companies' shares during the equivalent period of the calculated expected term of its stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available.

The Company estimated the expected life of its employee stock options using the “simplified” method, whereby, the expected life equals the average of the vesting term and the original contractual term of the option. The risk-free interest rates for periods within the expected life of the option are based on the U.S. Treasury yield curve in effect during the period the options were granted. We have elected to account for forfeitures as they occur.

The grant date fair value of awards subject to service-based vesting is recognized ratably over the requisite service period, which is generally the vesting period of the respective awards. The Company's stock option awards typically vest over a service period that ranges from one to four years and includes awards with one year cliff vesting followed by ratable monthly and quarterly vesting thereafter and ratable monthly and quarterly vesting beginning on the grant date.

During the years ended December 31, 2024, 2023 and 2022, the Company granted 926,543, 842,528, and 1,929,345 stock option awards pursuant to the 2017 Plan to certain directors, employees and non-employees, respectively. Using the Black-Scholes option pricing model, the weighted-average grant date fair value relating to outstanding stock options granted under the 2017 Plan during the years ended December 31, 2024, 2023, and 2022 was $32.69, $17.72, and $4.14, respectively.

During the years ended December 31, 2024, 2023 and 2022, the Company granted 57,100, 229,360, and 347,985 stock option awards pursuant to the 2022 Inducement Plan. Using the Black-Scholes option pricing model, the weighted-average grant date fair value relating to outstanding stock options granted under the Company’s stock option plan during the years ended December 31, 2024, 2023 and 2022 was $29.16, $15.30, and $13.05, respectively.

The fair value of stock options granted to employees and directors was estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:


	Year ended
	December 31,
	2024		2023		2022
Risk‑free interest rate	4.29	%	2.35	%	2.19	%
Expected term (in years)	6.13		6.11		6.11
Expected volatility	74.59	%	76.11	%	69.16	%
Expected dividend yield	—		—		—

A summary of the Company's stock option activity for the year ended December 31, 2024 is as follows:


				Weighted‑
		Weighted-		Average
		Average		Remaining		Aggregate
	Number of	Exercise		Contractual		Intrinsic
	Options	Price		Term		Value
Outstanding as of December 31, 2023	6,551,025	$	19.19	7.23	$	—
Granted	983,643	$	47.17	—	$	—
Exercised	(818,658)	$	19.51	—	$	24,745
Cancelled	(104,619)	$	20.97	—	$	—
Outstanding as of December 31, 2024	6,611,391	$	23.29	6.66	$	216,413
Options exercisable at December 31, 2024	4,578,779	$	20.36	5.95	$	163,090

Restricted Stock Units

The Company may grant restricted stock units (“RSUs”) to employees and nonemployee directors under the 2017 Plan and to employees under the 2022 Inducement Plan. Each RSU represents a right to receive one share of the Company's common stock upon the completion of a specific period of continued service. RSU awards granted are valued at the market price of the Company's common stock on the date of grant. The Company recognizes stock-based compensation expense for the fair values of these RSUs on a straight-line basis over the requisite service period of these awards.

A summary of the Company's restricted stock unit activity for the year ended December 31, 2024 is as follows:




		Weighted-
		Average
	Number of	Grant Date
	RSUs	Fair Value
Unvested as of December 31, 2023	1,104,607	$	17.44
Granted	1,210,654		44.22
Vested	(321,392)		15.48
Cancelled	(167,160)		20.08
Unvested as of December 31, 2024	1,826,709	$	36.40

As of December 31, 2024, the aggregate intrinsic value of unvested RSUs was $102,259.

Performance Stock Units

In November 2021, the Company granted a maximum of 956,145 performance stock units (“PSUs”) to employees under the 2017 Plan. Each PSU represents a right to receive one share of the Company's common stock upon vesting. The performance-based stock units granted in 2021 vested on December 31, 2023 based upon i) continued service through the vesting date and (ii) the achievement of specific clinical development and regulatory performance events, as approved by the compensation committee. PSU awards are valued at the market price of the Company's common stock on the date of grant. The Company recognizes stock-based compensation expense for the fair value of these PSUs for the awards that are probable of vesting over the service period. During each financial period, management estimates the probable number of PSU’s that would vest until the ultimate achievement of the performance goal is known. In the year ended December 31, 2024, 581,346 of the PSUs granted in 2021 vested.

In April 2024, the Company granted a maximum of 340,000 PSUs to employees under the 2017 Plan. Each PSU represents a right to receive one share of the Company's common stock upon vesting. The performance-based stock units granted in 2024 will vest annually based on the achievement of the following milestones i) continued service through the vesting date, ii) the achievement of annual net product revenue amounts, and iii) the achievement of specific clinical development and regulatory performance events, as approved by the compensation committee. The Company recognizes

stock-based compensation expense for the fair value of these PSUs for the awards that are probable of vesting over the service period. The Company granted 249,322 PSU’s as of December 31, 2024. During each financial period, management estimates the probable number of PSU’s that would vest until the ultimate achievement of the performance goal is known. As of December 31, 2024 none of these PSU’s have vested.

A summary of the Company's performance stock unit activity for the year ended December 31, 2024 is as follows:




		Weighted-
		Average
	Number of	Grant Date
	PSUs	Fair Value
Unvested as of December 31, 2023	581,346	$	13.24
Granted	249,322		38.92
Vested	(581,346)		40.60
Cancelled	—		—
Unvested as of December 31, 2024	249,322	$	13.24

The following table summarizes the classification of the Company's stock-based compensation expenses related to stock options, restricted stock units, performance stock units and the employee stock purchase plan recognized in the Company's consolidated statements of operations and comprehensive loss.



	Year Ended
	December 31,
	2024		2023		2022
Research and development	$	10,514	$	8,449	$	5,814
Selling, general, and administrative		29,168		24,104		14,017
Total	$	39,682	$	32,553	$	19,831

Stock-based compensation expense by award type recognized during the years ended December 31, 2024 , 2023 and 2022 was as follows:



	Year Ended
	December 31,
	2024		2023		2022
Stock options	$	21,788	$	17,671	$	15,477
Employees stock purchase plan		538		581		408
Restricted stock units		16,886		5,998		2,918
Performance stock units		470		8,303		1,028
Total	$	39,682	$	32,553	$	19,831

As of December 31, 2024, the Company has unrecognized compensation cost of $36,031 related to non-vested employee, non-employee and director stock option awards under all equity plans that are expected to be recognized over a weighted-average period of 2.04 years. The Company has unrecognized compensation cost of $51,615 related to non-vested employee restricted stock unit and performance stock unit awards under all equity plans that are expected to be recognized over a weighted-average period of 2.46 years.

Accrued Expenses

12 Months Ended

Dec. 31, 2024

Accrued Expenses

Accrued Expenses

4. Accrued Expenses

Accrued expenses consists of the following:


	December 31,		December 31,
	2024		2023
Research and development costs	$	17,871	$	12,925
Professional fees		4,280		3,833
Payroll related		18,216		15,439
Royalties		2,091		1,180
Sales allowances		15,850		9,475
Other		4,350		5,410
Accrued expenses and other current liabilities	$	62,658	$	48,262

Segment and Geographic Information

12 Months Ended

Dec. 31, 2024

Segment and Geographic Information

Segment and Geographic Information

15. Segment and Geographic Information

Operating segments are defined as components of an entity about which separate discrete information is available for evaluation by the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. The Company currently operates in two business segments, which are U.S. and international segments for the development and commercialization of therapies for patients with rare diseases. A single management team that reports to the Chief Executive Officer comprehensively manages the entire business. The Company meets the aggregation criteria of ASC 280 and therefore has one reportable segment for the year ended December 31, 2024.

The table below is a summary of the segment profit or loss, including significant segment expenses (in thousands):

Segment Analysis


	2024		2023		2022

Net product revenue - U.S.	$	96,108	$	62,425	$	14,324
Net product revenue - International		34,018		15,002		2,560
Total net product revenue		130,126		77,428		16,884
License revenue		-		-		6,754
Total net revenue		130,126		77,428		23,638

Cost of sales		13,368		9,302		2,133
Global headcount expense		119,084		96,413		70,777
Preclinical, clinical and development expense		82,180		74,465		66,013
Commercial & medical affairs		55,767		47,905		41,756
Corporate, general & administrative		32,135		27,154		20,220
Other segment expenses		93,094		6,571		1,896
Other (income) expense, net		(11,139)		317		1,179
Interest (income) expense, net		5,893		(585)		783
Income taxes		346		564		(0)
Net loss	$	(260,602)	$	(184,678)	$	(181,119)

Geographic Data

The Company allocates, for the purpose of geographic data reporting, its revenue based upon the location of its customers. Total revenue by geographic area was as follows:


	Year ended December 31,
	2024			2023		2022
US	$	96,108	$	62,425	$	21,078
International		34,018		15,003		2,560
Total revenues	$	130,126	$	77,428	$	23,638

As of December 31, 2024 and 2023, long-lived assets at locations outside the United States were not material.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147482810/280-10-50-31

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Income Taxes

Components of loss before income taxes


		As of
		December 31,
		2024		2023		2022
United States	$	(258,927)	$	(178,669)	$	(181,119)
Foreign		(1,329)		(5,445)		—
Loss before income taxes	$	(260,256)	$	(184,114)	$	(181,119)

Components of provision for income taxes


		As of
		December 31,
Current:		2024		2023		2022
U.S. Federal	$	—	$	—	$	—
U.S. State and Local		—		1		—
Foreign		346		563		—
Total Current Expense	$	346	$	564	$	—

Deferred:
U.S. Federal	$	—	$	—	$	—
U.S. State and Local		—		—		—
Foreign		—		—		—
Total Deferred Expense	$	—	$	—	$	—

Schedule of reconciliation of the income tax benefit at the federal statutory tax rate to effective income tax rate


	As of
	December 31,
	2024		2023		2022
Statutory tax rate	21.00	%	21.00	%	21.00	%
State tax, net of federal benefit	5.61		10.24		9.83
Research and development credit	0.25		0.65		0.78
Orphan drug credit	3.50		3.37		2.15
Stock compensation	(0.57)		(1.37)		(0.29)
Other	(1.61)		(0.16)		(0.02)
Rate changes	(2.04)		(6.52)		—
Executive Compensation	(2.26)		(0.32)		(0.01)
License Agreement	(1.51)		—		—
Change in valuation allowance	(22.50)		(27.10)		(33.44)
Effective tax rate	(0.13)	%	(0.21)	%	—	%

Schedule of principal components of deferred tax assets


	As of
	December 31,
	2024		2023
Deferred tax assets:
Net operating loss carryforwards	$	167,375	$	153,685
Research and development credits		17,604		16,139
Orphan drug credit		34,603		25,484
Capitalized license fee		21,661		2,311
Stock-based compensation		5,113		13,159
Section 174 Costs		67,624		50,688
Deferred revenue		336		350
Section 163(j) Interest Limitation		4,417
Accrued Expenses & Other		7,971		5,680
Total deferred tax assets		326,704		267,496
Valuation allowance		(325,503)		(267,158)
Net deferred tax assets		1,201		338
Deferred tax liabilities:
Operating lease right-of-use asset and other		(1,201)		(338)
Total deferred tax liabilities	$	(1,201)	$	(338)

Stock-based Compensation - Compensation expense by award type (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Stock-based Compensation
Stock based compensation expense	$ 39,682	$ 32,553	$ 19,831
2017 Equity Incentive Plan \| Employee
Stock-based Compensation
Unrecognized compensation expense related to non-vested portion of awards	$ 51,615
Weighted average period for recognition of unrecognized compensation expense	2 years 5 months 15 days
2017 Equity Incentive Plan \| Employees, directors and nonemployees
Stock-based Compensation
Unrecognized compensation expense related to non-vested portion of awards	$ 36,031
Weighted average period for recognition of unrecognized compensation expense	2 years 14 days
Stock options.
Stock-based Compensation
Stock based compensation expense	$ 21,788	17,671	15,477
Employees stock purchase plan
Stock-based Compensation
Stock based compensation expense	538	581	408
Restricted stock units
Stock-based Compensation
Stock based compensation expense	16,886	5,998	2,918
Performance stock units
Stock-based Compensation
Stock based compensation expense	$ 470	$ 8,303	$ 1,028

Common Stock (Details)									1 Months Ended	3 Months Ended	12 Months Ended
Common Stock (Details)	Apr. 01, 2024 USD ($) $ / shares shares	Feb. 29, 2024 USD ($)	Jan. 04, 2024 USD ($) D	Mar. 02, 2023 shares	Oct. 18, 2022 USD ($) $ / shares shares	Sep. 19, 2022 USD ($) $ / shares shares	Nov. 02, 2021 USD ($)	Feb. 09, 2021 USD ($) $ / shares shares	Jan. 21, 2025 USD ($) shares	Dec. 31, 2024 USD ($) $ / shares shares	Dec. 31, 2024 USD ($) $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 USD ($)	Apr. 15, 2024 $ / shares
Stock
Issuance of common stock as consideration for LGC license											$ 18,716,000
Fair value of common stock issued										$ 61,000	61,000	$ 59,000
Issuance of stock (in shares) \| shares					580,000	4,800,000		5,750,000
Issuance of stock												48,875,000	$ 131,112,000
Price per share \| $ / shares					$ 26	$ 26		$ 30
Net proceeds from issuance of common stock					$ 14,175,000	$ 116,887,000		$ 161,550,000			$ 39,146,000	$ 48,875,000	$ 131,112,000
Period for option to purchase additional shares by underwriter						30 days
2017 Equity Incentive Plan
Stock
Common stock reserved for issuance \| shares										7,852,593	7,852,593
Shares available for future grant \| shares										4,622,751	4,622,751
2017 Employee Stock Purchase Plan
Stock
Common stock reserved for issuance \| shares										1,872,738	1,872,738
2022 Employment Inducement Plan
Stock
Vesting period											4 years
Shares available for future grant \| shares										14,586	14,586
Underwriter option to purchase
Stock
Issuance of stock (in shares) \| shares						720,000
Issuance of stock								$ 750,000
At-the-market offering
Stock
Issuance of stock											$ 41,073,000
Common stock reserved for the conversion of Series A convertible preferred stock
Stock
Convertible Preferred Stock \| shares	150,000			3,124,995
Price per share \| $ / shares	$ 1,000
Temporary equity, par value per share \| $ / shares	$ 0.001									$ 0.001	$ 0.001	$ 0.001
Convertible preferred stock, outstanding \| shares										150,000	150,000	0
Aggregate purchase price	$ 147,750,000
Conversion price \| $ / shares														$ 48
Common stock \| At-the-market offering
Stock
Issuance of stock (in shares) \| shares										744,595
Issuance of stock							$ 2,000,000			$ 41,200,000	$ 48,900,000
Aggregate proceeds		$ 200,000,000
Common stock \| At-the-market offering \| Subsequent events
Stock
Issuance of stock (in shares) \| shares									587,510
Issuance of stock									$ 32,100,000
Maximum \| 2022 Employment Inducement Plan
Stock
Expiration period											10 years
Maximum \| At-the-market offering
Stock
Aggregate proceeds							$ 100,000,000
LG Chem, LTD.
Stock
Purchase consideration			$ 92,400,000
Issuance of stock			$ 18,700,000
License agreement and share issuance agreement \| LG Chem, LTD.
Stock
Period for calculating weighted average closing price per share \| D			10
Employee Stock Option \| Maximum
Stock
Vesting period											4 years

Intangible Assets, Net (Tables)

12 Months Ended

Dec. 31, 2024

Intangible Assets, Net

Schedule of finite-lived intangible assets


2025	$	854
2026		855
2027		854
2028		855
2029		855
Thereafter		1,901
Total	$	6,174

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2024

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Presentation

Use of Estimates

Principles of Consolidation

Segment Information

Off-Balance Sheet Risk and Concentrations of Credit Risk

Cash and Cash Equivalents

Short-Term Investments

Restricted Cash

Accounts Receivable, net

Revenue Recognition

Product Revenue, Net

Reserves for Variable Consideration

The following are the components of variable consideration related to product revenue:

The table below summarizes balances and activity in each of the product revenue allowance and reserve categories as follows:



	Provision for Cash Discounts		Fees, Rebates and Other Incentives		Total
Beginning Balance at December 31, 2022	$	99	$	2,710	$	2,809
Provision related to sales in the current year		1,672		17,351		19,023
Credit and payments made		(1,572)		(10,586)		(12,158)
Ending balance December 31, 2023	$	199	$	9,475	$	9,674
Provision related to sales in the current year		2,317		27,315		29,632
Credit and payments made		(2,263)		(20,940)		(23,203)
Ending balance December 31, 2024	$	253	$	15,850	$	16,103

Provision for cash discounts are recorded as reductions of accounts receivable, and fees, rebates, and other incentives are recorded as components of accrued expenses.

License Agreements

Deferred Royalty Obligation

Inventory

Inventory consists of the following:


	December 31,		December 31,
	2024		2023
Raw Materials	$	6,776	$	4,625
WIP		1,250		1,104
Finished Goods		10,715		2,895
Total Inventory	$	18,741	$	8,624

Cost of Product Sales

Intangible Assets, net

Impairment of Long-Lived Assets

sell. No events or changes in circumstances existed to require an impairment assessment during the years ended December 31, 2024, 2023 and 2022.

Prepaid Expenses and Other Current Assets


	December 31,
	2024		2023
Prepaid research and development costs	$	7,580	$	2,259
Other current assets		8,802		6,672
Prepaid expenses and other current assets	$	16,382	$	8,931

Other Long-Term Assets


	December 31,
	2024		2023
Long-term research and development costs	$	6,209	$	12,594
Other long-term assets		1,117		2,405
Other long-term assets	$	7,326	$	14,999

Property and Equipment

Property and equipment consists of the following:


	Useful	December 31,
	Life	2024		2023
Leasehold improvements	*	$	2,705	$	2,705
Office equipment	5 years		154		155
Computers and software	3 years		1,291		1,291
Furniture, fixtures and equipment	5 years		1,249		1,249
			5,399		5,400
Less accumulated depreciation and amortization			(4,767)		(4,059)
Property and equipment, net		$	632	$	1,341

*Shorter of asset life or lease term.

Depreciation and amortization expense related to property and equipment for the years ended December 31, 2024, 2023 and 2022 was $710, $903, and $896 respectively.

Acquired IPR&D and Milestone Expense

Foreign Currency Translation

Fair Value Measurements

Level 1 — Quoted market prices in active markets for identical assets or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Research and Development Expenses

reporting period. Actual results could differ from the Company’s estimates. The Company’s historical accrual estimates have not been materially different from the actual costs.

Income Taxes

Net Loss Per Share


	Year Ended
	December 31,
	2024		2023		2022
Stock options		6,611,391		6,551,025		6,354,544
Restricted stock units		1,805,412		1,079,382		774,166
Performance stock units		249,322		581,246		804,797
Common stock reserved for the conversion of Series A convertible preferred stock		3,124,995
Potential common shares		11,791,120		8,211,653		7,933,507

Comprehensive Loss

Patent Costs

Subsequent Events

Application of New or Revised Accounting Standards

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Total revenues	$ 130,126	$ 77,428	$ 23,638
Costs and expenses:
Cost of sales	13,368	9,302	2,133
Research and development	237,957	134,951	108,630
Selling, general, and administrative	144,304	117,532	92,032
Total costs and expenses	395,629	261,785	202,795
Loss from operations	(265,503)	(184,357)	(179,157)
Other income (expense):
Other income (expense), net	2,239	190	(790)
Gain on settlement of forward contract	8,900
Interest expense	(20,603)	(13,892)	(5,201)
Interest income	14,711	13,945	4,029
Total other income (expense), net	5,247	243	(1,962)
Loss before income taxes	(260,256)	(184,114)	(181,119)
Provision for income taxes	346	564
Net loss	(260,602)	(184,678)	(181,119)
Accrued dividends on convertible preferred stock	(3,970)
Net loss attributable to common stockholders	$ (264,572)	$ (184,678)	$ (181,119)
Net loss per share attributable to common stockholders, basic (in dollars per share)	$ (4.34)	$ (3.2)	$ (3.47)
Net loss per share attributable to common stockholders, diluted (in dollars per share)	$ (4.34)	$ (3.2)
Weighted-average common shares outstanding, basic (in shares)	60,995,204	57,673,128	52,120,701
Weighted-average common shares outstanding, diluted (in shares)	60,995,204	57,673,128
Other comprehensive loss:
Net loss attributable to common stockholders	$ (264,572)	$ (184,678)	$ (181,119)
Foreign currency translation adjustment	2	(140)
Unrealized (loss) gain, net on marketable securities, net of tax	(175)	366	(91)
Comprehensive loss	(264,746)	(184,452)	(181,210)
Product revenue, net
Total revenues	$ 130,126	$ 77,428	16,884
License revenue
Total revenues			$ 6,754

Summary of Significant Accounting Policies - Prepaid expenses and other current assets (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Summary of Significant Accounting Policies
Prepaid research and development costs	$ 7,580	$ 2,259
Other current assets	8,802	6,672
Prepaid expenses and other current assets	$ 16,382	$ 8,931

Summary of Significant Accounting Policies - Product revenue allowance and reserve categories (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Product revenue allowance and reserve categories
Beginning Balance	$ 9,674	$ 2,809
Provision related to sales in the current year	29,632	19,023
Credit and payments made	(23,203)	(12,158)
Ending balance	16,103	9,674
Provision for Cash Discounts
Product revenue allowance and reserve categories
Beginning Balance	199	99
Provision related to sales in the current year	2,317	1,672
Credit and payments made	(2,263)	(1,572)
Ending balance	253	199
Fees, Rebates and Other Incentives
Product revenue allowance and reserve categories
Beginning Balance	9,475	2,710
Provision related to sales in the current year	27,315	17,351
Credit and payments made	(20,940)	(10,586)
Ending balance	$ 15,850	$ 9,475

Fair Value of Financial Assets and Liabilities - Changes in Embedded Derivative Liability (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Roll forward of the fair value of financial liabilities and assets
Beginning aggregate estimated fair value of Level 3 liability (asset)	$ 1,150	$ 1,340
Ending aggregate estimated fair value of Level 3 liability (asset)	(270)	1,150
Level 3 \| Embedded Derivative Financial Instruments
Roll forward of the fair value of financial liabilities and assets
Change in fair value of embedded derivative	(1,420)	$ (190)
Fair value of forward contract - Series A Convertible Preferred Stock	8,900
Settlement of forward contract	$ (8,900)

Nature of Business (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Nature of Business
Accumulated deficit	$ 1,155,338	$ 894,736
Carrying amount of cash and cash equivalents and short term investments	$ 320,565	$ 275,846

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Summary of Significant Accounting Policies (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2024 USD ($) item Institution segment	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
Segment Information
Number of operating segments \| segment	2
Number of reporting segments \| segment	1
Off Balance Sheet Risk and Concentrations of Credit Risk
Number of federally insured financial institutions \| Institution	2
Impairment of Long-Lived Assets
Tangible asset impairment charges	$ 0	$ 0	$ 0
Income Taxes
Accrued interest or penalties	0	0
Patent Costs
Patent costs	$ 144,304	117,532	92,032
Revenue Recognition
Number of pharmacies to which the company sells product \| item	1
Patents
Patent Costs
Patent costs	$ 1,311	$ 555	$ 406
Customer concentration risk \| Customer one \| Revenue benchmark
Off Balance Sheet Risk and Concentrations of Credit Risk
Concentration risk percentage	74.00%	77.00%
Customer concentration risk \| Customer one \| Accounts receivable
Off Balance Sheet Risk and Concentrations of Credit Risk
Concentration risk percentage	67.00%	67.00%

Stock-based Compensation - 2017 Equity Incentive Plan (Details) - 2017 Equity Incentive Plan - shares				12 Months Ended
	Jan. 01, 2024	Jan. 01, 2023	Jan. 01, 2022	Dec. 31, 2024
Stock-based Compensation
Percentage increase in authorized shares under the plan				4.00%
Number of additional shares added	2,495,626	2,377,062	2,264,497
Authorized shares				12,475,344
Shares available for future grant				4,622,751
Common stock reserved for issuance				7,852,593
Exercise Price Not Less Than 100% Of Fair Market Value
Stock-based Compensation
Exercise price of incentive stock options over fair market value of the common stock				100.00%
Voting power of stock				10.00%
Exercise Price Not Less Than 110% Of Fair Market Value
Stock-based Compensation
Exercise price of incentive stock options over fair market value of the common stock				110.00%
Voting power of stock				10.00%