Late-stage biopharma Scholar Rock (SRRK) is approaching a pivotal catalyst: the FDA decision on apitegromab, its investigational muscle-targeted therapy for spinal muscular atrophy (SMA). A verdict is expected on September 22, and the company appears well-positioned for approval.
Scholar Rock at a glance
Scholar Rock focuses on treatments for neuromuscular diseases. The company is preparing for a U.S. commercial launch of apitegromab later this year (pending FDA approval), followed by a European rollout in 2026 (upon approval).
Financials remain pre-commercial. In Q2, the company reported no revenue and a cash balance of $295 million. With a second-quarter cash burn of about $112 million, the company is running a tight ship. However, management expects the cash runway to extend into 2027 through:
- $50 million available under its debt facility,
- $16 million expected from warrant exercises.
Plans to monetize its priority review voucher after drug approval should also generate proceeds.
Scholar Rock is banking on the approval of apitegromab and estimates a greater than $2 billion market opportunity for the drug.
SMA and the Unmet Need
SMA is a rare, genetic neuromuscular disease marked by the loss of motor neurons – the nerve cells that control muscle movement – and progressive muscle wasting. This results in a steady decline in motor function throughout life, reducing independence for both children and adults.
SMA is caused by insufficient SMN protein due to SMN1 gene defects. SMN or Survival Motor Neuron is a protein essential for the health of motor neurons. Without adequate SMN, motor neurons degenerate and die. The SMN protein is primarily produced by the SMN1 gene. Defects in the SMN1 gene can lead to a deficiency of SMN. There is a backup gene called SMN2, but it produces only a small fraction of functional SMN protein.
Approved SMN-targeted therapies such as Spinraza, Evrysdi, and Zolgensma are available to treat SMA and these aim to restore SMN protein levels to preserve motor neurons and slow disease progression. While effective, these therapies do not address muscle deterioration directly, leaving patients with unmet needs in strength and mobility.
Apitegromab’s Differentiated Approach
The motor unit in a human body consists of the motor neuron and the muscle. Motor function depends not only on neuron health but also on muscle responsiveness. SMN-based therapies are designed to prevent motor neuron loss, but leave muscle unaddressed.
Apitegromab takes a complementary approach. It doesn’t replace SMN-based therapies, instead, it directly addresses the muscle side of the motor unit. Apitegromab blocks myostatin, a natural protein that normally limits muscle growth, thereby increasing muscle mass and strength.
Clinical Data Highlights
A pivotal late stage study showed that in SMA patients receiving chronic ongoing SMN-targeted therapies, apitegromab demonstrated a statistically significant improvement in motor function as measured by the gold standard Hammersmith Motor Function Scale Expanded (HFMSE), compared to patients on just SMN-targeted therapies (placebo).
Notably, 30.4% of patients treated with apitegromab achieved ≥3-point HFMSE improvement vs. 12.5% on placebo. In SMA, a ≥3-point improvement on the HFMSE is widely recognized as clinically significant. Apitegromab achieved a statistically significant mean improvement of 1.8 points over placebo in the 2–12-year-old efficacy population. Treatment with apitegromab was generally well-tolerated across all age groups, and there were no drug discontinuations in the study due to adverse events.
Together, these findings suggest that apitegromab could provide meaningful clinical benefit for people with SMA, even in the context of ongoing SMN therapy.
The outcome of the late stage study formed the basis of Scholar Rock’s Biologics License Application (BLA). The FDA granted priority review for apitegromab, reducing review time to six months, with a PDUFA date set for September 22, 2025.
What are the odds of approval for apitegromab?
The case for approval appears strong, here’s why:
- Unmet need for muscle-targeted therapies in SMA to improve motor functioning.
- Apitegromab is the first and only muscle-targeted therapy to-date to show clinically meaningful and statistically significant functional improvement in SMA.
- Apitegromab is also the first anti-myostatin therapy to achieve functional benefit in a Phase 3 study.
- Scholar Rock’s preparations for commercial launch signal confidence in approval.
Regulatory Risk: Will the FDA Review Be Delayed?
In July, the FDA flagged quality issues at Novo Nordisk’s Bloomington, Indiana plant, which performs final vial filling for apitegromab. Findings included contamination and equipment concerns, raising questions about whether the FDA might delay its decision on apitegromab.
Scholar Rock, however, noted that a late-cycle meeting indicated that the FDA is still working towards completing the BLA review by the September 22 PDUFA date.
Even if a delay occurs, the issue appears to be a manufacturing timing risk, not an approvability risk. Any stock weakness from such a delay could likely present a buy-the-dip opportunity.
Other Catalysts for Apitegromab
Optionality in Obesity and GLP-1 Therapies
In a phase 2 proof-of-concept trial, apitegromab was tested in combination with tirzepatide, the active ingredient in Eli Lilly’s obesity drug Zepbound:
Adding apitegromab preserved an additional 4.2 pounds (1.9 kilograms) or 54.9% of lean mass compared to tirzepatide alone, leading to higher quality weight loss. The combo treatment was generally well tolerated. These results suggest apitegromab may also help offset the significant lean mass loss often associated with weight-loss therapies.
Scholar Rock signaled that it may seek a partner for further development.
“We love the results that we see today, but we think that this is an undertaking that may be better placed with those companies a little bit more focused on the cardiometabolic and obesity space,” Scholar Rock’s CEO David Hallal noted.
Broader Neuromuscular Pipeline
Scholar Rock also sees potential for apitegromab in other neuromuscular conditions, offering longer-term upside beyond SMA.
Investor Takeaway
Scholar Rock is up nearly 300% over the past year, but about 30% below its January highs, partly due to concerns over a possible FDA delay.
With global revenue of about $4.5 billion for the three SMN-targeted therapies – Spinraza, Evrysdi, and Zolgensma – apitegromab’s role as a complementary treatment could support a strong revenue base if approved. The Sept 22 PDUFA date is the key near-term catalyst, with high approval odds and limited risk.
For investors, SRRK offers:
- A high-probability FDA catalyst,
- Meaningful upside in SMA,
- Additional long-term optionality in obesity and neuromuscular indications.
Any delay in FDA review would likely present a buy-the-dip opportunity rather than a fundamental setback.
Please note that I am not a registered investment advisor and readers should do their own due diligence before investing in the stocks mentioned in the article, or any other stock. I am not responsible for the investment decisions made by individuals after reading this article. Readers are asked not to rely on the opinions and analysis expressed in the article and encouraged to do their own research before investing.