On Tuesday, H.C. Wainwright adjusted its outlook on shares of Scholar Rock (NASDAQ:SRRK), raising the price target to $50.00 from the previous $40.00 while maintaining a Buy rating on the stock. This adjustment followed Biohaven's announcement that its Phase 3 RESILIENT study of taldefgrobep alfa for Spinal Muscular Atrophy (SMA) did not meet the primary outcome at Week 48 when compared to the placebo plus standard-of-care group.
Key Developments:
- Failed Study Clears Path for Apitegromab: The firm's analyst cites the failed study as an event that clears the way for Scholar Rock's apitegromab, as it faces fewer near-term challenges in the market.
- Revised Sales Projection: The firm now increases its global penetration assumptions for apitegromab, resulting in a revised peak sales projection of $1.12 billion by 2034, up from the earlier forecast of $985 million.
- Efficacy Signals Observed: Despite the trial's primary outcome not being met, efficacy signals were observed in subgroups based on age, ambulatory status, background therapy, and baseline myostatin levels. The most notable improvements were seen in Caucasian participants and those with measurable baseline myostatin.
Biohaven's Next Steps:
- Discussion with FDA: Biohaven plans to discuss with the FDA for future steps.
- Presentation of Study Data: Detailed study data will be presented at an upcoming medical conference.
- Phase 2 Obesity Trial: A placebo-controlled Phase 2 obesity trial is set to initiate towards the end of 2024.
Analyst Confidence:
H.C. Wainwright reaffirms its positive stance on Scholar Rock, reflected in the increased price target and sustained Buy rating, based on the anticipated market performance and potential of apitegromab.
Recent Developments:
- Phase 3 SAPPHIRE Study Results: Scholar Rock has seen a surge in analyst confidence following successful Phase 3 SAPPHIRE study results for its drug Apitegromab, a potential treatment for spinal muscular atrophy (SMA).
- Price Target Increases: Truist Securities, BMO Capital Markets, and H.C. Wainwright have all increased their price targets for the biopharmaceutical company, maintaining their respective Buy and Outperform ratings.
- U.S. Commercial Launch: The biopharmaceutical company is preparing for the U.S. commercial launch of Apitegromab in Q4 2025, following a planned submission of regulatory applications in Q1 2025.
- Financial Position: Scholar Rock's cash balance stands at approximately $463 million, following a successful $345 million follow-on offering.
Additional Research:
Scholar Rock is also conducting the EMBRAZE Phase 2 study and developing SRK-439, both aimed at obesity management, highlighting the company's efforts to address unmet medical needs.
