Scholar Rock Surges 50% as Muscular Atrophy Drug Nears FDA Review
A pivotal FDA meeting for its lead drug candidate and a multi-million dollar insider purchase have propelled the biotech's shares to near 52-week highs.
Shares of Scholar Rock (NASDAQ: SRRK) have rallied more than 50% over the past two months, reaching a near 52-week high as the company moves closer to seeking U.S. regulatory approval for its lead drug candidate for spinal muscular atrophy (SMA).
The Cambridge, Massachusetts-based biotech has seen its market capitalization climb to approximately $4.44 billion, fueled by growing investor optimism after a critical update on its experimental therapy, apitegromab. The stock was trading at $45.02 in recent sessions, just shy of its 52-week peak of $46.98.
The primary catalyst for the surge was the company's third-quarter business update on November 14. Scholar Rock announced it had successfully completed a Type A meeting with the U.S. Food and Drug Administration (FDA) regarding the planned Biologics License Application (BLA) for apitegromab. According to the company's announcement, the meeting provided a clear path forward for resubmitting the application, with a potential U.S. launch targeted for 2026.
Apitegromab is an antibody designed to improve muscle function by targeting myostatin, a protein that limits muscle growth. It is being developed as a potential add-on therapy for patients with SMA, a progressive neuromuscular disease that leads to muscle weakness and atrophy. The successful FDA meeting signals a significant de-risking event for the drug's path to market.
Adding to the bullish sentiment was a significant insider transaction that preceded the rally. In early October, board member Srinivas Akkaraju purchased 319,700 shares of SRRK for a total value of nearly $12 million, according to regulatory filings. Such a substantial open-market purchase by a director is often interpreted by investors as a strong vote of confidence in a company's future prospects.
This large insider buy stands in contrast to more routine stock sales by other company executives earlier in the year, many of which were conducted under pre-scheduled Rule 10b5-1 trading plans or to cover tax obligations related to vested equity awards.
Wall Street has responded favorably to the recent developments. On November 18, analysts at JPMorgan Chase & Co. raised their price target on Scholar Rock to $47.00 while maintaining an "overweight" rating. That same day, Wolfe Research initiated coverage on the stock with an "outperform" rating. The consensus among 14 analysts covering the company is a strong buy, with an average price target of $47.33.
Beyond the regulatory progress, Scholar Rock reported a solid financial position, ending the third quarter with $369.6 million in cash, cash equivalents, and marketable securities. Management stated this provides a cash runway into the second half of 2027, funding the company through the anticipated launch of apitegromab.
As Scholar Rock prepares for its BLA resubmission, investors will be closely watching for further updates on its manufacturing and commercialization strategies. The successful navigation of the final stages of regulatory review will be the next major milestone for the company and its potential first-in-class therapy for SMA patients.