Reportedly receives a US$10 billion acquisition offer from AstraZeneca PLC Sponsored ADR (AZN.US)! Shares of obesity drug developer Rhythm (RYTM.US) surge in response.

AstraZeneca PLC Sponsored ADR (AZN.US) reportedly made an offer to acquire obesity drug developer Rhythm Pharmaceuticals (RYTM.US) for about US$10 billion, according to three people familiar with the matter. The AstraZeneca PLC Sponsored ADR proposal, which is non-binding, offered up to US$134 per share including payments tied to hitting milestone targets, the people said. Rhythm shares closed up 28% at US$110.68 on Wednesday following the report. The move comes after a turbulent few months during which AstraZeneca PLC Sponsored ADR Chief Executive Officer Pascal Soriot is seeking to refocus investors on the company's growth prospects. The drugmaker, which has a market value of US$292 billion, has suffered some clinical trial setbacks, while reports of a potentially transformative deal with US rival Bristol-Myers Squibb Company (BMY.US) have also weighed on the shares. AstraZeneca PLC Sponsored ADR would pursue the acquisition through its rare disease unit Alexion, two of the people said. AstraZeneca PLC Sponsored ADR bought Alexion for US$39 billion in 2021 as it sought to expand beyond its core oncology and biopharmaceuticals businesses. Rhythm develops therapies for rare metabolic diseases and severe obesity. Alexion focuses on rare disease medicines and has become a central plank of AstraZeneca PLC Sponsored ADR's strategy to expand in high-growth specialty drugs. AstraZeneca PLC Sponsored ADR looking for rare disease assets that fit with its "existing footprint" is entirely logical, according to Jefferies Financial Group Inc. analyst Michael Leuchten. AstraZeneca PLC Sponsored ADR had previously expressed interest in Rhythm and revived its pursuit in recent months, the report said. In March, the US Food and Drug Administration (FDA) expanded the label of Rhythm's drug Imcivree to treat a rare form of obesity caused by brain injury, making it the first drug approved in the US for the condition. "Historically, one could view the company as mainly offering a treatment for ultra-rare genetic obesity. But the March 2026 approval for acquired hypothalamic obesity ... fundamentally changes that positioning," Michael Leuchten added. The obesity drug market has become one of the most sought-after areas of the pharmaceutical industry, driven by strong demand for therapies from Novo Nordisk A/S Sponsored ADR Class B (NVO.US) and Eli Lilly (LLY.US). Annual sales in the field are expected to potentially exceed US$100 billion over the next decade. While Rhythm's therapy targets rare genetic obesity rather than the broader weight-loss drug market, the acquisition would give AstraZeneca PLC Sponsored ADR an established commercial footprint in the fast-growing area while further expanding its rare disease portfolio.