Best Smidcap Ideas: Dancing To The Beat Of Imcivree's Launch In HO

研报英文原文证据摘录

Best Smidcap Ideas: Dancing To The Beat Of Imcivree's Launch In HO

39, a relatively conservative assumption since RM-718 has composition of matter

patent protection until 2041, and bivamelagon until 2045. With 13 years of growth projected, our

model estimates peak sales of over $4B.

What Is The Bear Case & The Risks To Our Call?

The bear case on Rhythm is that the stock is fully valued as Imcivree's market opportunity is

smaller than estimated. The bears argue that Imcivree's penetration into the HO market will be

more modest than assumed, and/or that the prevalence of HO is lower than appreciated. The

bears conclude that Imcivree's uptake into HO therefore will not be sufficient to support RYTM's

current $6B market cap, and certainly not increase it. We disagree as our own KOL checks

suggest a prevalence of HO consistent with that estimated by RYTM (10K in U.S., 10K in EU, 5-8K

in Japan) and much enthusiasm for adoption of Imcivree among HO specialists.

With the performance of Imcivree in the U.S. HO market a key investor focus, the most

prominent risk to the N-T performance of Rhythm is that the HO's launch disappoints. This could

be because HO patients are slower to seek the therapy than we anticipate, because it takes

longer for insurance to reimburse for Imcivree in HO, or because Imcivree's efficacy and safety

in the "real world" disappoints, causing patients to abandon therapy.

Longer term, a key risk to our call is the development of next-generation candidates

bivamelagon and RM-718. Should either or both not be successfully developed and approved

by regulatory agencies, the commercial life of RYTM's franchise could be shorter than we

anticipate.

A second key risk would be the emergence of potential competition to Rhythm's franchise