RBC Capital has initiated coverage of Rhythm Pharmaceuticals Inc. (NASDAQ: RYTM) with an Outperform recommendation and a price objective of $145.00, the firm said Tuesday. That target implies notable upside versus the recent share price of $101.27, even after the company’s shares have posted a strong run, returning roughly 78.16% over the previous year according to InvestingPro data.
Rhythm is a commercial-stage biotechnology company focused on treatments for rare genetic forms of obesity. The company’s lead approved therapy, Imcivree, is an MC4R agonist designed to address the underlying genetic drivers of these disorders. Rhythm carries a market capitalization of about $6.82 billion and has shown rapid revenue expansion, with reported growth of 54.92% over the trailing 12 months.
In its initiation note, RBC Capital assigned Rhythm a speculative risk label but pointed to substantial upside in the Imcivree franchise. The bank estimates the Imcivree base business could surpass $2 billion in annual revenue by 2030, a scenario that assumes a successful launch into hypothalamic obesity. That program is tied to a PDUFA date of March 20, 2026, a key regulatory milestone flagged by RBC.
RBC also highlighted Rhythm’s gross profit margin, which it cited at 89.4% as evidence of attractive unit economics for Imcivree. Despite that margin profile, InvestingPro data referenced by the initiating note indicates that sell-side analysts do not expect the company to be profitable this year.
The bank argued that the market may be underestimating the opportunity in Prader-Willi syndrome, a larger indication for which Rhythm is developing setmelanotide. RBC emphasized the company’s pipeline beyond Imcivree, describing next-generation assets aimed at improving convenience and tolerability compared with the first-generation therapy.
Shares of Rhythm recently fell about 16% following an update related to Prader-Willi syndrome, a move the initiation contrasted with a roughly 1% change in the XBI biotech exchange-traded fund over the same period. RBC framed the pullback as creating an attractive entry point ahead of upcoming regulatory and clinical catalysts.
The initiating stance from RBC sits within a broadly bullish analyst landscape. The wider sell-side consensus cited in the report lists price targets spanning from $125 to $167.
Recent financial and clinical developments
In related company disclosures, Rhythm reported preliminary unaudited fourth-quarter 2025 global net product revenues from sales of IMCIVREE of approximately $57 million, representing an 11% sequential increase from third-quarter 2025. The company also announced preliminary full-year 2025 net product revenue of about $194 million, a 50% rise compared with 2024. U.S. sales contributed roughly 68% of fourth-quarter revenues.
Those preliminary figures prompted a number of analyst reactions. TD Cowen raised its price target for Rhythm to $130 from $120, noting that fourth-quarter revenue exceeded both consensus expectations and TD Cowen’s own model. H.C. Wainwright adjusted its target to $125 from $123 and kept a Buy rating after the results.
Analysts also reacted to clinical updates in Prader-Willi syndrome. Rhythm’s Phase 2 setmelanotide data in PWS produced positive preliminary results, leading H.C. Wainwright to raise a prior target to $123 from $110. Guggenheim similarly increased its price target to $140 from $120, citing encouraging monotherapy activity and observed improvements in body mass index and hyperphagia measures in PWS patients.
Taken together, the revenue beat and the favorable early clinical signals in PWS have generated a period of heightened analyst attention and multiple upward revisions to price targets for Rhythm.
Outlook and considerations
RBC’s initiation highlights several potential growth drivers for Rhythm: continued commercialization and uptake of Imcivree, regulatory progress around hypothalamic obesity with the March 20, 2026 PDUFA date, and expansion into Prader-Willi syndrome. The firm also noted next-generation candidates as a mechanism to extend the company’s commercial opportunity through improved patient convenience and tolerability.
At the same time, RBC’s speculative risk designation and the note that analysts do not expect near-term profitability underscore ongoing uncertainties around execution, broader reimbursement dynamics and clinical development timelines.
Investors will likely continue to focus on quarterly revenue trends, progress in the PWS program, and the regulatory calendar leading into 2026.