Executive Summary / Key Takeaways

• Scholar Rock is on the cusp of transforming spinal muscular atrophy (SMA) treatment with apitegromab, a muscle-targeted therapy showing statistically significant and clinically meaningful motor function gains in the pivotal SAPPHIRE trial.
• The U.S. BLA for apitegromab is under FDA priority review with a September 22, 2025 PDUFA date, positioning the company for a potential U.S. commercial launch in Q4 2025, followed by Europe in 2026.
• Beyond SMA, Scholar Rock's proprietary platform targeting latent growth factors is yielding a promising pipeline, including SRK-439 for cardiometabolic disorders, with positive Phase 2 EMBRAZE data demonstrating significant lean mass preservation during GLP-1 induced weight loss.
• The company's financial position, bolstered by recent financings and an amended debt facility, provides an anticipated cash runway into 2027, supporting the transition to a commercial entity and continued pipeline advancement.
• Key catalysts include the upcoming PDUFA date, the full analysis of EMBRAZE data, and the planned IND submission for SRK-439, while execution risks related to commercial launch and competition remain critical factors for investors.

The Dawn of a New Era in SMA Treatment

Scholar Rock Holding Corporation stands at a pivotal juncture, poised to transition from a research-focused biotechnology firm to a commercial-stage company. Founded in 2012, the company built its foundation on a proprietary platform centered on the intricate biology of the transforming growth factor beta (TGFβ) superfamily. This innovative approach allows for the discovery and development of monoclonal antibodies that selectively target the precursor, or latent, forms of growth factors within the disease microenvironment. The strategic intent is to modulate growth factor signaling precisely where needed, potentially avoiding the systemic, dose-limiting toxicities often associated with inhibiting these powerful proteins. This technological differentiation forms the bedrock of Scholar Rock's strategy, aiming to create novel therapies for serious diseases, initially focusing on neuromuscular disorders, cardiometabolic conditions, and oncology.

The competitive landscape in these areas is populated by established pharmaceutical giants. In Spinal Muscular Atrophy (SMA), where Scholar Rock's lead program resides, companies like Biogen (BIIB) with Spinraza, Novartis (NVS) with Zolgensma, and Roche (RHHBY) with Evrysdi have brought significant innovation by targeting the underlying genetic defect and increasing survival motor neuron (SMN) protein levels. However, despite these advances, many SMA patients, particularly those with Type 2 and 3, continue to experience progressive muscle weakness and loss of motor function over time. This persistent unmet need for therapies that directly address muscle health creates a strategic opening for Scholar Rock's muscle-targeted approach. In the burgeoning cardiometabolic space, particularly concerning obesity treatments, the rapid adoption of GLP-1 receptor agonists from companies like Eli Lilly (LLY) and Novo Nordisk (NVO) has highlighted a new challenge: significant lean muscle mass loss accompanying weight reduction. Scholar Rock believes its myostatin-targeting technology offers a differentiated solution to this emerging problem.

Scholar Rock's history is a narrative of translating foundational science into clinical programs. Early equity financings and collaborations fueled initial research and intellectual property development. The journey of apitegromab, the company's lead candidate, exemplifies this progression, moving from preclinical studies to receiving key regulatory designations like FDA Orphan Drug, Rare Pediatric Disease, and Fast Track, as well as EMA Orphan and PRIME designations. The successful execution of the Phase 2 TOPAZ trial provided early validation, demonstrating sustained clinical benefit in SMA patients over 48 months, with a notable retention rate exceeding 90% in nonambulatory Type 2 and 3 patients receiving SMN therapy. This paved the way for the pivotal Phase 3 SAPPHIRE trial, the results of which now position the company for potential commercialization.

Apitegromab: A Muscle-Targeted Catalyst

The core of Scholar Rock's near-term investment thesis rests on apitegromab and its potential to redefine the standard of care in SMA. The positive top-line results from the pivotal Phase 3 SAPPHIRE trial, announced in October 2024, represent a significant de-risking event. The study, evaluating apitegromab in nonambulatory Type 2 and 3 SMA patients already on SMN therapy, successfully met its primary endpoint, demonstrating a statistically significant and clinically meaningful improvement in motor function as measured by the gold standard Hammersmith Functional Motor Scale at 52 weeks. Patients treated with apitegromab plus standard of care showed a 1.8-point improvement compared to placebo plus standard of care. Importantly, apitegromab treatment led to a gain in function over the study period, while the placebo group experienced a decline, consistent with the natural history of the disease despite SMN therapy.

Further data presented in March 2025 underscored the robustness of these results, showing clinically meaningful and consistent benefit across various pre-specified subgroups, including different SMN therapy types, age, and geography. Efficacy was also supported by improvements in other motor function measures like the Revised Upper Limb Module (RULM) and the World Health Organization Motor Development Index. A key highlight was the transformative clinical activity observed, with 30% of apitegromab-treated patients achieving an additional 3-point or greater improvement in Hammersmith scores, compared to only 12.5% in the placebo group. This magnitude of improvement on top of existing therapy is particularly compelling.

Building on this clinical success, Scholar Rock has rapidly advanced regulatory submissions. The U.S. Biologics License Application (BLA) for apitegromab was submitted in January 2025 and subsequently granted priority review by the FDA, setting a PDUFA target action date of September 22, 2025. Priority review status signals the FDA's determination that apitegromab, if approved, could offer a significant improvement in the treatment of SMA. In March 2025, the company also submitted its Marketing Authorisation Application (MAA) to the European Medicines Agency (EMA), which received validation. These regulatory milestones pave the way for a potential commercial launch in the United States in the fourth quarter of 2025, with plans for a European launch to follow in 2026.

Scholar Rock is actively building its commercial infrastructure in anticipation of approval. This includes establishing sales, market access, and patient support teams, aiming to be fully staffed by mid-2025. Early interactions with U.S. payers are described as positive, with recognition of the continued unmet need in SMA and the potential value of a muscle-targeted therapy in combination with SMN-directed treatments. Management expresses confidence in the commercial opportunity, citing the concentration of SMA patients in specialized centers and the high rate of newborn screening in the U.S. While not providing specific revenue guidance yet, the company believes apitegromab has the potential to achieve blockbuster status, with a total revenue potential exceeding $1 billion, and potentially over $2 billion, assuming a competitive market. This outlook is based on the belief that apitegromab can establish a new standard of care by addressing the muscle component of SMA, complementing the existing SMN-targeted therapies.

Expanding the Platform: Addressing Muscle in Cardiometabolic Health

Scholar Rock's strategic vision extends beyond SMA, leveraging its myostatin expertise to address the emerging challenge of muscle loss in the context of weight management therapies. The rapid rise of GLP-1 receptor agonists has brought significant weight loss benefits to individuals with obesity and cardiometabolic disorders. However, a notable drawback is the substantial loss of lean muscle mass, which can account for 12% to 40% of total weight loss. Maintaining lean muscle is crucial for metabolic health, strength, mobility, and potentially for sustaining weight loss and mitigating fat regain.

Recognizing this unmet need, Scholar Rock announced an expansion into cardiometabolic disorders in October 2023, advancing SRK-439, a novel anti-myostatin monoclonal antibody, towards clinical development. Preclinical data for SRK-439 have been promising, supporting its potential to increase lean mass and contribute to a favorable body composition when used with GLP-1 RAs. Importantly, preclinical studies demonstrated SRK-439's superior potency compared to a non-selective Anti-ActRII antibody, achieving equivalent lean mass preservation at a significantly lower dose (1 mg/kg vs. 20 mg/kg). The data also showed SRK-439's ability to attenuate fat mass regain following GLP-1 withdrawal, leading to a more favorable overall body composition.

To quickly test the hypothesis that selective myostatin inhibition can preserve lean mass in obesity, Scholar Rock initiated the Phase 2 EMBRAZE proof-of-concept trial in May 2024, utilizing apitegromab in individuals with obesity on background GLP-1 RA therapy. Enrollment for EMBRAZE was completed ahead of schedule in September 2024, with positive top-line results reported in June 2025. The trial demonstrated statistically significant preservation of lean mass (p=0.001), with apitegromab preserving an additional 4.2 pounds (1.9 kg), or 54.9%, of lean mass compared to tirzepatide alone. This resulted in a "higher quality of weight loss," halving the proportion of lean mass lost to 14.6% compared to 30% with tirzepatide alone. These results provide clinical validation for Scholar Rock's approach in this new therapeutic area.

Based on the preclinical data for SRK-439 and the positive proof-of-concept from EMBRAZE, Scholar Rock is targeting an Investigational New Drug (IND) submission for SRK-439 in the third quarter of 2025. The company sees optionality for SRK-439 to potentially address either neuromuscular disorders or cardiometabolic conditions, depending on the strategic evaluation informed by the EMBRAZE data and further development.

Pipeline Depth and Financial Foundation

Beyond its lead myostatin programs, Scholar Rock continues to advance a pipeline of differentiated candidates leveraging its platform. SRK-181, a selective inhibitor of latent TGFβ1 activation, is being developed for cancers resistant to checkpoint inhibitors. The Phase 1 DRAGON trial completed enrollment in December 2023, with data presented in 2024 showing encouraging responses in heavily pretreated, anti-PD-L1 resistant patients across multiple tumor types. While costs for this program are expected to decrease following enrollment completion, it represents another potential application of Scholar Rock's selective targeting technology in a significant therapeutic area. Other preclinical programs include SRK-373 for fibrosis and SRK-256 for iron-restricted anemia, further highlighting the platform's breadth.

Financially, Scholar Rock has been investing significantly in R&D and, more recently, in building its commercial capabilities. For the three months ended March 31, 2025, operating expenses totaled $77.1 million, an increase from $58.4 million in the same period of 2024. This increase was driven by higher R&D expenses ($48.7 million vs. $43.1 million), primarily due to increased apitegromab drug supply manufacturing and SRK-439 preclinical/manufacturing development, and a substantial rise in general and administrative expenses ($28.4 million vs. $15.3 million), reflecting investments in commercial infrastructure and increased employee-related costs. The net loss for Q1 2025 was $74.7 million, compared to $56.9 million for Q1 2024.

As of March 31, 2025, Scholar Rock held $364.4 million in cash, cash equivalents, and marketable securities, a decrease from $437.3 million at the end of 2024. This decrease was primarily due to cash used in operating activities ($78.7 million in Q1 2025).

The company has strategically managed its liquidity through various financings, including an upsized public offering in October 2024 and an amended and restated debt facility with Oxford Finance LLC in February 2025. This facility provides access to up to $200 million in term loans (with $50 million already received) and extends the interest-only payment period through March 2029.

Based on its current operating plan, Scholar Rock believes its existing cash, cash equivalents, marketable securities, and available debt will be sufficient to fund operations into 2027. However, the company acknowledges that additional capital will be required to fully complete the clinical development and commercialization of its programs.

Key risks include the inherent uncertainties of the regulatory review process, even with priority review status. While the PDUFA date is set, approval is not guaranteed, and the label may be narrower than sought. As a company preparing for its first commercial launch, execution risk is significant, requiring successful build-out of sales, marketing, and distribution capabilities and effective payer access strategies in a competitive market. Reliance on third-party manufacturers and CROs also poses potential operational challenges. The success of pipeline programs like SRK-439 and SRK-181 is subject to clinical trial outcomes and competitive pressures. Macroeconomic factors, including inflation and capital market volatility, could impact funding access and operational costs.

Conclusion

Scholar Rock stands at a transformative moment, driven by the compelling clinical data for apitegromab in SMA and the imminent potential for regulatory approval and commercial launch. The positive results from the SAPPHIRE trial, demonstrating significant motor function gains in a population with ongoing unmet needs, position apitegromab as a potential new cornerstone therapy. The FDA's priority review underscores the potential impact of this muscle-targeted approach. Concurrently, the company's proprietary platform continues to yield promising candidates, validated by the positive EMBRAZE data in obesity and the advancement of SRK-439 towards the clinic.

While significant execution challenges lie ahead, particularly in building a commercial organization and navigating market access, Scholar Rock's strategic focus, validated technology, and strengthened financial position provide a solid foundation. The upcoming PDUFA date for apitegromab, the full analysis of the EMBRAZE data, and the IND filing for SRK-439 represent critical near-term catalysts that could further unlock value. For investors, Scholar Rock represents an opportunity to participate in the potential launch of a therapy poised to address a significant unmet need in SMA, supported by a platform capable of generating future assets in large and emerging markets like cardiometabolic health. The successful transition to a commercial entity and continued pipeline execution will be key determinants of long-term value creation.