Scholar Rock's stock soars more than 315% on positive trial of treatment for spinal muscular atrophy

By Ciara Linnane

Wedbush cheered the data and said the focus now shifts to approval and commercialization

Scholar Rock Holding Corp.'s stock soared more than 315% Monday to put it on track for its biggest ever one-day gain, after the clinical-stage biotech company said a late-stage trial of a treatment for spinal muscular atrophy met its main goal.

The Phase 3 trial of apitegromab showed statistically significant improvement in motor function as measured by the Hammersmith Functional Motor Scale Expanded, or HFMSE, the gold standard scale for the disorder, versus placebo.

Some 30.4% of patients receiving apitegromab, which is a fully human monoclonal antibody, had a more than 3-point improvement in HFMSE, compared with 12.5% of patients on placebo. The improvement was seen across all age groups participating in the study, from 2 to 21 years old.

The Cambridge, Mass.-based company (SRRK) is now planning to submit a U.S. Biologics License Application and will seek a European Union marketing authorization application in the first quarter of 2025.

Spinal muscular atrophy is a rare genetic neuromuscular disease that afflicts an estimated 30,000 to 35,000 people in the U.S. and Europe. Symptoms include a loss of motor neurons, atrophy of the voluntary muscles of the limbs and trunk, and progressive muscle weakness.

Scholar Rock enrolled 156 patients in the trial and used two doses. The company has won fast-track, orphan-drug and rare-pediatric-disease designations from the U.S. FDA, as well as priority-medicines and orphan medicinal product designations from the European Medicines Agency.

The treatment was well tolerated across all age groups, with no differences in the adverse-event profile for the two doses used.

Scholar Rock is also reviewing whether the treatment can help preserve lean muscle that is often lost during rapid weight loss in patients taking the new class of GLP-1 drugs. If apitegromab wins approval, it will be Scholar Rock's first approved drug.

Wedbush analysts cheered the results in a bullish note, titled "For Those Who Owned This Rock: We Salute You."

"The conversation is now not whether apitegromab's SAPPHIRE study will succeed, but will focus on approval and commercialization, in addition to what these results mean for the prospects for '439 in obesity," analysts led by David Nierengarten wrote in a note to clients.

"We point to obesity proof-of-concept results in [the second quarter of 2025] with apitegromab as the next major upcoming catalyst," said the note.

Wedbush reiterated its outperform rating on the stock, the equivalent of buy, and raised its price target to $27 from $25.

Scholar Rock's stock is down 45% in the year through Friday's close, while the S&P 500 SPX has gained 20.6%.

-Ciara Linnane

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10-07-24 1045ET

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