RYTM
Rhythm Pharmaceuticals
What it means
RYTM pays its CEO consistently above target every year on record (119%–143% of target bonus, FY21–FY25) on a plan that is almost entirely non-financial execution objectives — pipeline, clinical/regulatory milestones, and US/international commercial launch — rather than margin or shareholder-return metrics, which never appear anywhere in the window. The one financial lever, Total Net Revenue, has been rising in weight (10.5%→21% of the AIP) as Imcivree commercializes, and the FY24–26 LTIP grant introduced the plan's first-ever financial long-term metric (Net Product Revenue) alongside hypothalamic-obesity milestones — though FY25–27 reverted to a pure time-vested RSU/option grant with no performance condition at all. Watch two things: whether the open FY24–26 Net Product Revenue tranches pay out when disclosed, and whether the board responds to the unusually high ~18.5% say-on-pay dissent at the June 2026 annual meeting by adding a profitability or TSR metric in the next cycle.
RYTM's annual plan blends non-financial execution goals (pipeline advancement, US/international commercial launch, patient starts, talent) with a single financial metric, Total Net Revenue, whose weight has grown from 10.5% in FY22 to 21% in FY24-25. The long-term plan carried a broad milestone metric in the FY21 grant, then ran with no performance condition at all (100% stock options or RSU/option mix) across the FY22 and FY23 grants. The FY24-26 grant reintroduced metrics and added the plan's first true financial LTIP measure, Net Product Revenue, alongside hypothalamic-obesity clinical milestones; the FY25-27 grant reverted to a pure RSU/option split with no performance condition. No cycle on file has ever weighted profitability (margin/EPS/FCF) or relative TSR.
CEO
David P. Meeker, M.D.FY21–FY25 (continuing; re-elected to the Board June 2026)
Incentive orientation strategic posture of the pay plan
Incentive orientation — AIP and the active LTIP grant blended 50/50 per fiscal year
FY22/FY23/FY25 LTIP grants carried no weighted performance metric (100% options, or RSU/option mix with no condition), so those years use the AIP blend alone. FY21 and FY24 blend AIP 50/50 with that year's LTIP grant. No cycle at any point weights profitability or relative TSR — the plan has never used a margin, EPS, free-cash-flow, or stock-return metric.
Targets vs outcomes disclosed bands, by fiscal year
Targets vs. outcomes — the plan's two financial metrics
thr–max, notch=target
≥ max
in band
< threshold
Total Net Revenue (AIP)10.5%–21% wt% of target payout curve — dollar band disclosed only for FY25 (target $185M, actual $191M)
Net Product Revenue — Year 1 of 3 (LTIP FY24–26 PSU)13.3% of the 40%-weighted, 3-tranche Net Product Revenue metric$ millions — performance period Jan–Dec 2024; outcome not yet disclosed as of the FY25 proxy
Metric persistence weight · realized payout, % of target, by fiscal year
Every metric used in any year is a row; the cell carries its weight (top) and realized payout (bottom). Gaps mark absence; “open” marks unfinished cycles.
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Annual incentive (AIP) | |||||
Individual Goals Other · non-financial | 30%119% | 30%135% | 30%148% | 30%160% | 30%197% |
Total Net Revenue Growth · financial | · | 10.5%75% | 10.5%200% | 21%122% | 21%111% |
Corporate Goals (single broad bucket: pipeline + regulatory + commercial) Other · non-financial | 70%119% | · | · | · | · |
Pipeline / R&D execution (aggregate of named clinical & regulatory sub-goals) Other · non-financial | · | 38.5%78% | 35%95% | 28%88% | 28%91% |
Commercial execution — NA / international / launch (aggregate) Other · non-financial | · | 17.5%127% | 21%157% | 14%158% | 14%100% |
Talent Development / People & Organization Other · non-financial | · | 3.5%100% | 3.5%126% | 3.5%188% | 3.5%100% |
Operational Excellence Other · non-financial | · | · | · | 3.5%200% | 3.5%100% |
| AIP total payout | 119% | 119% | 136% | 142% | 129% |
| Long-term incentive (LTIP) — metrics only in the FY21 and FY24–26 grants | |||||
Clinical Development, Regulatory & Commercial Performance Events Other · non-financial | 100% | · | · | · | · |
Net Product Revenue (3-year tranche, FY24–26 grant) Growth · financial | · | · | · | 40% | · |
Hypothalamic Obesity Readout / Approval + Next-Gen Program Milestones Other · non-financial | · | · | · | 60% | · |
"Pipeline / R&D execution" and "Commercial execution" rows aggregate several distinct named sub-goals disclosed each year under one line for space (e.g. FY22 aggregates seven separately-weighted items including FDA Approval, EMANATE enrollment, and DAYBREAK enrollment; FY23–FY25 aggregate North America and International regional goals). Payout shown is the weighted average across the aggregated items, marked "~" in spirit. LTIP rows marked payout "p:null" are open/undisclosed cycles — Verity has not reported an actual outcome for the FY21 milestone bucket or the FY24–26 metrics as of this run. FY22, FY23 and FY25 LTIP grants carried no weighted performance metric at all (100% stock options, or RSU/option split with no condition) and so contribute no LTIP row.
Pay structure LTIP grant mix
LTIP grant mix by grant year
● PSU ● RSU (time-vested) ● Stock options (time-vested)PSU share in FY21 and FY24 corresponds to the metric-bearing grants shown in the matrix above; FY22, FY23 and FY25 carried no PSU tranche at all — 100% options in FY22, an RSU/option split with no performance condition in FY23 and FY25.
Bonus realization CEO annual cash incentive · opportunity vs delivered
Bar fills realized payout against each year’s opportunity ceiling (the AIP maximum); notch is target.
| FY | Base | Target | Payout | Realized $ | vs opportunity | ×base |
|---|---|---|---|---|---|---|
| FY21 | $630K | $378K | 119% | $451K | 0.72× | |
| FY22 | $652K | $424K | 119% | $505K | 0.78× | |
| FY23 | $717K | $466K | 136% | $634K | 0.88× | |
| FY24 | $746K | $522K | 142% | $744K | 1.00× | |
| FY25 | $785K | $589K | 129% | $759K | 0.97× |
Base 21→25+25%
Target opp. 21→25+56%
Realized bonus 21→25+68%
Bonus/base 21→250.72→0.97×
No overall AIP payout cap (maximum multiplier on total target bonus) is disclosed in the plan data — individual metric maxima range 100%–350% of their own target. Bars are shown as closeness to a 142.5%-of-target reference (the highest payout realized in the window, FY24), not a disclosed cap; treat widths as relative, not absolute. Company multiplier realized every year in the 119%–143% range — targets have not bound (no year cleared below 100% of target).
Metrics are bucketed by underlying measure. Total Net Revenue (AIP) and Net Product Revenue (LTIP) → growth (top-line financial metrics). Every other disclosed metric — pipeline/clinical/regulatory milestones, US and international commercial execution, patient starts, talent/people, operational excellence, and individual objectives — → other (non-financial execution and discretionary goals), since RYTM's plan has never disclosed a profitability (margin/EPS/FCF) or relative-TSR metric in any AIP year or LTIP cycle on file. AIP and LTIP blended equally (50/50) in years where both carry a weighted metric; years where the active LTIP grant has no metric use the AIP blend alone.
Filed since the proxy post-proxy compensation events
Nothing filed since the proxy changes the incentive package. The DEF 14A was filed April 29, 2026 (FY25 data). Three 8-Ks have followed: a Q1 2026 earnings release (May 5), clinical-data presentations at ENDO 2026 and a PWS Phase 2 interim readout (June 13–15), and the June 24, 2026 Annual Meeting results (Item 5.07). No Item 5.02 executive-compensation event (new award, retention grant, or plan amendment) has been filed post-proxy, and no Verity research brief on RYTM comp was found. The annual meeting say-on-pay vote drew ~18.5% against (11,467,157 against vs. 50,368,659 for, of 61,872,498 votes cast excluding broker non-votes) — notable dissent for a Nasdaq biotech and the most visible pushback on this plan on record.
Sources: Verity / InsiderScore annual and long-term incentive plan data, DEF 14A (filed April 29, 2026, FY25 data), and Form 8-K filings through June 25, 2026. Figures are for CEO David P. Meeker. LTIP outcomes for the FY21 milestone bucket and the FY24–26 Net Product Revenue / clinical-milestone metrics are not yet disclosed (open). Describes incentive-plan design, not company quality or stock merit. Not investment advice.