Rhythm Pharmaceuticals (NASDAQ:RYTM) just pulled off its biggest move since Novemberand it wasn't by accident. The biotech name surged 14.5% at 14.32 pm today, after announcing that its obesity drug, setmelanotide, crushed the main goal in a pivotal Phase 3 trial. This wasn't a marginal win either. Patients with acquired hypothalamic obesityan ultra-rare conditionsaw a 16.5% drop in BMI after a year on the drug, compared to a gain in the placebo group. No new safety concerns popped up. And with regulators in the U.S. and Europe already on the radar, Rhythm is now prepping submissions for label expansion in Q3 2025.

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The Street didn't miss a beat. Bank of America upgraded the stock to Buy and bumped its price target to $63, calling the pullback a rare entry point. Wells Fargo, already overweight, hiked its target to $91 and said Rhythm is still one of its top picks. Analyst Derek Archilla believes shares could rally 2035% and even trade above $100 by year-end if the company hits upcoming catalysts. What caught analysts' attention? Beyond the headline BMI drop, 83% of patients on the drug lost at least 5% of their body weighta result that's both statistically sharp and clinically meaningful.

In a market laser-focused on GLP-1 blockbusters, Rhythm is quietly building a stronghold in an overlooked corner of obesity treatment. Unlike the general-purpose weight-loss meds, setmelanotide zeroes in on rare genetic and acquired formswhere the unmet need is high and competition is slim. If the company keeps its momentum and lands regulatory wins, Rhythm could become a standout in one of biotech's most promising verticals.