Scholar Rock's shares experienced a notable pullback early Tuesday following an impressive surge of over 362% the previous day, driven by optimistic data concerning its investigational drug, apitegromab, which has the potential to significantly affect treatment timelines for patients diagnosed with spinal muscular atrophy (SMA).
The biotechnology firm saw its market capitalization leap to approximately $2.74 billion after the announcement of trial results highlighting the drug's efficacy. The clinical trials revealed that apitegromab successfully met its primary endpoint in a pivotal late-stage study, garnering the approval prospects for a broad label that includes non-ambulatory patients aged 2 to 21.
Analysts at Truist Securities, led by Vice President Srikripa Devarakonda, emphasized the consistency of the beneficial effects observed across various age groups, suggesting that this drug could represent a critical advancement in SMA treatment given the understanding of the disease as a continuum.
Furthermore, they noted that while the approval for ambulatory patients may not be within the current label's scope, the upcoming trial targeting patients under 2 years old could widen the eligible population for apitegromab, allowing earlier access to this promising therapy. In a conference call, Scholar Rock announced intentions to initiate a study specifically for SMA treatment in children under 2 years old by mid-2025.
SMA, a genetic disorder leading to muscle weakness and atrophy, affects approximately one in every 6,000 newborns as reported by Johns Hopkins Medicine. The data showcased in the phase 3 trial illustrated a 'clinically meaningful' improvement in motor function across all age brackets from 2 years to 21 years when compared to a placebo group.
The therapeutic agent displayed a marked improvement, with approximately 30% of participants receiving apitegromab experiencing enhanced motor function, in stark contrast to around 13% in the placebo cohort. Early signs of motor function improvement were observable as soon as eight weeks post-treatment, with benefits continuing to expand through the 52-week mark.
Scholar Rock highlighted that the drug exhibited good tolerability across all age groups, with no newly identified safety issues. Adverse events were in line with the underlying conditions of SMA and the standard care protocols for the affected patients. Chief Executive Jay Backstrom expressed enthusiasm regarding the trial's positive outcome, stating, "We are thrilled that apitegromab met the primary endpoint in our phase 3 sapphire clinical study.
We are working with urgency to deliver the potentially transformative benefits of apitegromab to children and adults with spinal muscular atrophy in the US, Europe, and around the world." Scholar Rock is actively preparing to submit a biologics license application in the US and a marketing authorization application in the European Union for the drug within the first quarter of 2025. Following these promising results, Wedbush Securities adjusted its price target for Scholar Rock's stock upwards.
They indicated a shift in focus from simply whether apitegromab’s sapphire study would succeed to the aspects concerning its approval and market entry. Consequently, the firm revised their price target from $27 to $37 later that same Monday. Current Stock Price: $34.27, Change: -0.01, Percent Change: -0.03.