Hunter Smith
RHYTHM PHARMACEUTICALSAbout Hunter Smith
Hunter C. Smith, age 57, is Rhythm Pharmaceuticals’ Chief Financial Officer since July 2017 and Treasurer since August 2017; he also served as Interim CEO (Mar–Jul 2020) and Secretary (Apr 2020–Mar 2021). He holds an MBA in Finance from NYU Stern and a BA in History, with honors, from Northwestern, with >30 years of global finance experience spanning business analysis, M&A, treasury, capital raising and investor relations . Company performance during his tenure has scaled rapidly: revenues rose to $130.126M in FY2024 from $23.638M in FY2022 , while shareholder return (SEC “value of $100 investment”) reached $188.27 by 2024 (from $33.57 in 2021) . Net income remained negative at $(260.602)M in FY2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Celgene Corporation | VP Finance & CFO, Inflammation & Immunology Business Unit | 2013–Jul 2017 | Led finance for a global biopharma business unit; experience in M&A, planning, treasury, capital raising, IR |
| Bunge Limited | Finance roles of increasing responsibility | 1999–2013 | Multi-industry global finance experience; business analysis, planning, treasury |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Vanqua Bio | Director | Current | External network and biotech insights |
| Avidicure BV | Director | Current | Industry and operational insights |
| Aeglea Biotherapeutics (through reverse merger to Spyre Therapeutics in Nov 2023) | Director | Until Nov 2023 | Public company board experience; transition oversight |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | $460,000 | $476,154 | $499,385 |
| Target Bonus % (of base) | — | — | 50% |
| Actual Bonus Paid ($) | $217,000 | $261,000 | $352,000 |
| All Other Compensation ($) | $15,200 | $20,166 | $13,800 |
- Current annualized base salary (effective Feb 24, 2024): $504,000 .
- 2024 bonuses based on 70% corporate goals and 30% individual goals; corporate achievement certified at 135% of target and average individual modifier at 146% .
Performance Compensation
Annual Cash Incentive (2024)
| Component | Weighting | Target | Actual Achievement | Payout ($) | Vesting |
|---|---|---|---|---|---|
| Corporate goals (commercial growth, clinical progress, regulatory milestones, patient ID programs, infrastructure) | 70% | 100% | 135% of target | Included in total | Cash (paid after year-end) |
| Individual goals | 30% | 100% | Avg. 146% (CFO-specific not disclosed) | Included in total | Cash (paid after year-end) |
| CFO Bonus | — | $252,000 | — | $352,000 | Cash |
2024 Equity Awards (Grant-date fair value under ASC 718)
| Award Type | Grant Date | Quantity | Grant-Date Fair Value ($) | Vesting |
|---|---|---|---|---|
| Stock Options | 2/16/2024 | 80,400 | $2,726,806 | 16 equal quarterly installments; subject to continued service |
| RSUs | 2/16/2024 | 26,400 | $1,299,672 | 4 equal annual installments; subject to continued service |
| PSUs (portion) | 4/26/2024 | Target 29,332; Max 34,664 | $158,747 | Vest post 3-year period upon certification of goals |
| PSUs (program) | Apr 2024 approval | Target 40,000 | Value computed based on probable outcomes; max value disclosed separately | 3-year performance period; payout 0–140% based on financial, commercial, clinical milestones; portions deemed granted Feb 2025 for 2025 revenue milestone and later for 2026 revenue milestone |
- PSU metrics include defined financial (net product revenue), commercial and clinical milestones; payouts 0–140% of target .
Multi-Year Compensation Mix (CFO)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Stock Awards ($) | $110,500 | $538,795 | $1,458,419 |
| Option Awards ($) | $412,425 | $1,011,892 | $2,726,806 |
| Total Compensation ($) | $1,215,125 | $2,308,007 | $5,050,410 |
Equity Ownership & Alignment
| Item | Value |
|---|---|
| Beneficially Owned Shares | 643,172 |
| Ownership % of Common Stock | 1.0% |
| Shares Outstanding (as of Apr 28, 2025) | 63,597,942 |
| Shares Pledged as Collateral | None (company-wide footnote) |
| Stock Ownership Policy | 1x annual base salary for executive officers; 3x for CEO; 3x cash retainer for directors; 5 years to comply; all current participants in compliance at adoption (Dec 2024) |
| Anti-hedging / Anti-pledging | Policy maintained under insider trading policy |
Outstanding Equity Awards (as of Dec 31, 2024)
| Vesting Commencement Date | Type | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration Date | Unvested RSUs (#) | Market Value of RSUs ($) | Unearned PSUs (#) | Market/Payout Value of PSUs ($) |
|---|---|---|---|---|---|---|---|---|---|
| 7/31/2017 | Option | 100,594 | — | 6.88 | 08/08/2027 | — | — | — | — |
| 2/14/2018 | Option | 61,000 | — | 25.79 | 02/13/2028 | — | — | — | — |
| 2/13/2019 | Option | 70,000 | — | 29.78 | 02/12/2029 | — | — | — | — |
| 2/14/2020 | Option | 82,000 | — | 17.87 | 02/13/2030 | — | — | — | — |
| 7/20/2020 | Option | 25,000 | — | 22.53 | 07/19/2030 | — | — | — | — |
| 2/11/2021 | Option | 52,734 | 3,516 | 30.66 | 02/10/2031 | — | — | — | — |
| 2/11/2021 | RSU | — | — | — | — | 2,343 | $131,161 | — | — |
| 2/9/2022 | Option | 67,031 | 30,469 | 6.80 | 02/08/2032 | — | — | — | — |
| 2/9/2022 | RSU | — | — | — | — | 8,124 | $454,782 | — | — |
| 2/1/2023 | Option | 23,450 | 30,150 | 27.35 | 02/01/2033 | — | — | — | — |
| 2/1/2023 | RSU | — | — | — | — | 14,775 | $827,105 | — | — |
| 2/16/2024 | Option | 15,074 | 65,326 | 49.23 | 02/16/2034 | — | — | — | — |
| 2/16/2024 | RSU | — | — | — | — | 26,400 | $1,477,872 | — | — |
| 4/26/2024 | PSU | — | — | — | — | — | — | 29,332 | $1,642,005 |
- Vesting schedules: options in 16 equal quarterly installments; RSUs in 4 equal annual installments; vesting subject to continued service .
Employment Terms
| Provision | Base Case | Change-in-Control (CIC) Case | Equity Treatment |
|---|---|---|---|
| Employment Agreement | Amended & restated offer letter dated Aug 3, 2023; ongoing until terminated per terms | ||
| Severance on Qualifying Termination (no CIC) | 9 months continued base salary + reimbursement for continued group medical plan coverage up to 9 months | — | — |
| Severance on Qualifying Termination within CIC Protection Period | 12 months base salary + 100% of target annual bonus, paid over 12 months + reimbursement for continued group medical plan coverage up to 12 months | Accelerated vesting of all unvested equity awards | |
| 2024 PSUs CIC Treatment | PSUs vest at 100% or greater if Committee determines sufficient milestones attained or probable; special rule if termination occurs within 3 months prior to CIC (remain outstanding eligible to vest) | ||
| 280G “Best Pay” Cutback | “Best pay” provision to avoid excise tax under Section 4999—full or reduced payments whichever is greater on after-tax basis | ||
| Clawback Policy | Nasdaq-compliant clawback for erroneously awarded compensation upon accounting restatements | ||
| Insider Trading Policy | Includes anti-hedging and anti-pledging provisions | ||
| Stock Ownership Policy | Required multiple: 1x salary for executive officers; five-year compliance window; all current participants in compliance at adoption (Dec 2024) |
Company Performance During Tenure
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($USD Millions) | $23.638 | $77.428 | $130.126 |
| Net Income ($USD Millions) | $(181.119) | $(184.678) | $(260.602) |
| EBITDA ($USD Millions) | $(177.485)* | $(182.599)* | $(263.940)* |
| EBITDA Margin (%) | — | -235.83%* | -202.83%* |
Values with * retrieved from S&P Global.
Pay vs Performance (SEC “Value of $100 Investment” and Revenues)
| Measure | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|
| Shareholder Return ($) | $33.57 | $97.94 | $154.61 | $188.27 |
| Total Revenues ($USD Thousands) | $3,154 | $23,638 | $77,428 | $130,126 |
Compensation Structure Observations
- 2024 pay mix for NEOs is highly at-risk (≈90% of total target comp via equity and incentive) .
- Defined long-term PSU metrics introduced in 2024 following shareholder feedback; say-on-pay support was 97.1% in 2024 .
- No tax gross-ups for CIC payments; no option repricing without shareholder approval; no SERP; NASDAQ-compliant clawback; anti-hedging/pledging .
Investment Implications
- Strong alignment: meaningful equity grants (options, RSUs, PSUs) with multi-year vesting and PSU financial/commercial/clinical hurdles tie pay to execution; anti-pledging and ownership guidelines further align interests .
- Retention dynamics: severance and double-trigger CIC acceleration reduce transition risk; PSU CIC provisions protect value realization, but RSU/option vesting cadence can create periodic selling/withholding flow around vest dates .
- Performance backdrop: revenues expanded to $130.126M in 2024 with shareholder return at $188.27 on a $100 base, while losses remain significant—equity-heavy pay keeps compensation sensitive to share price and milestone attainment .
- Governance signals: high say-on-pay support, clawback policy, and lack of gross-ups/option repricing are shareholder-friendly; no pledged shares reduce alignment red flags .