Pfizer, OrbiMed back $40M Rhythm round for rare genetic disease R&D

Boston-based Rhythm has gone back to the venture well to draw up a fresh $40 million in backing from some A-list investors to fuel a mid-stage program for rare genetic disorders linked with a lethal level of obesity.

The money is being earmarked for setmelanotide (RM-493), an MC-4 agonist being studied in Phase IIa trials for Prader-Willi syndrome and POMC-deficiency obesity, rare genetic disorders linked to defects in the MC4 signaling pathway.

New investors OrbiMed, Deerfield Management, and Wellington Management Company came in on the round alongside an undisclosed public healthcare investment fund. They joined the gang of existing investors: MPM Capital, New Enterprise Associates, Third Rock Ventures, Pfizer Ventures and Ipsen. OrbiMed's Jonathan Silverstein is joining the board.

Rhythm has been keeping a very low profile since it was founded in 2010 by Bart Henderson and Liz Stoner. Merck ($MRK) R&D vet Keith Gottesdiener was recruited to take the helm in 2011, and the company had raised a total of $73 million by the end of 2012. Their lead drug is a Phase II ghrelin agonist (called relamorelin) for the treatment of diabetic gastroparesis, a GI complication of diabetes. Rhythm set up a separate subsidiary company to hold setmelanotide, a ploy often used to make it easier to do deals on individual assets.

Rhythm has slowly been expanding on its venture base with two targets with an orphan patient population. Prader-Willi syndrome is characterized by stunted growth and an occasionally insatiable appetite that triggers dangerous levels of obesity and diabetes.

"Setmelanotide is essentially replacement therapy in genetic MC4 pathway defects, so we are now evaluating its impact on the obesity and hyperphagia that is the hallmark of Prader-Willi and POMC deficiency obesity," said Dr. Keith Gottesdiener, CEO of Rhythm. 

- here's the release