JWCA advises Rhythm Pharmaceuticals on its $150 million convertible preferred stock issuance led by Perceptive Advisors

APRIL 2024 | read press release

Transaction Background

Rhythm Pharmaceuticals, Inc. (“Rhythm” or “the Company”) successfully raised $150 million through a convertible preferred stock issuance at attractive terms

Rhythm’s objectives included:

• Extend cash runway, fund continued commercialization efforts for IMCIVREE, and fund clinical trials past several important upcoming milestones

• Minimize market and stock price risk

• Raise capital at a premium to current stock price

• Minimize equity dilution and restrictive covenants

The Company engaged J. Wood Capital Advisors (“JWCA”) to assist in the structuring, negotiation, documentation, and execution of this transaction

JWCA worked closely with Rhythm to analyze various financing vehicles and structures that could meet the company’s objectives. Upon receiving terms from investors, JWCA:

• Provided analysis around cost of capital, structuring, and comparison against common equity & publicly marketed convertible alternatives

• Provided insight for Rhythm in its negotiations with investors to optimize pricing and terms

Results

Rhythm was able to raise $150 million at attractive pricing and terms without any stock price risk

Achieved a financing outcome that balanced the company’s objectives, including size of proceeds raised, cost of capital, and flexibility