Financial Data and Key Metrics Changes - The company is preparing for the PDUFA date of September 22 for apategromab in SMA, indicating a significant milestone in its financial outlook [11] - The management has emphasized a strong cash position, with a runway extending into early 2027, allowing for strategic investments without immediate equity issuance [42][44] Business Line Data and Key Metrics Changes - The company has seen robust clinical development for ipilimumab in SMA, with a Phase III SAFIRE trial enrolling 188 patients, demonstrating clinically meaningful benefits [12][13] - The obesity program is set to share Phase II data from the EMBRAZE trial, focusing on the preservation of lean mass in patients receiving tirzepatide [28][29] Market Data and Key Metrics Changes - The company is under review with the FDA and the European Medicines Agency, with plans for a substantial launch in the U.S. and thoughtful expansion into Europe and Asia Pacific [25][26] - There are approximately 35,000 patients worldwide who have received at least one SMN targeted therapy, highlighting a significant market opportunity for the company's products [26][40] Company Strategy and Development Direction - The company aims to scale its growth into global commercialization, focusing on the approval of ipilimumab in multiple countries [3][25] - The strategy includes leveraging existing assets while exploring new indications for ipilimumab and SRK-439 in rare neuromuscular disorders [9][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the potential of ipilimumab to reverse the trend of motor function loss in SMA patients, positioning it as a new standard of care [15][19] - The company is committed to making a meaningful difference for patients and ensuring that no patient is left behind in accessing their therapies [27][44] Other Important Information - The company is considering the implications of pricing strategies based on the rarity and severity of diseases like SMA, as well as the clinical benefits demonstrated [39][40] - The management is cautious about the investment in cardiometabolic and obesity indications, focusing instead on rare severe neuromuscular disorders [33][44] Q&A Session Summary Question: What are the expectations for the label regarding apategromab in SMA? - Management expects a broad label based on the robust data from the Phase III SAFIRE trial and the consistency of results across patient subgroups [12][13] Question: How does the drug fit into the existing treatment paradigm for SMA? - The company believes ipilimumab can provide significant benefits beyond existing SMN targeted therapies, particularly for patients who have started to lose motor function again [14][15] Question: What is the company's strategy for the obesity program? - The company plans to present Phase II data from the EMBRAZE trial, focusing on the preservation of lean mass in patients receiving tirzepatide [28][29] Question: How does the company view the regulatory pathway for obesity treatments? - Management acknowledges the evolving view of the FDA and the need to demonstrate both weight loss and preservation of lean mass in future trials [32][33] Question: What is the current cash position and runway for the company? - The company has a strong cash position with a runway extending into early 2027, allowing for strategic investments without immediate equity issuance [42][44]

Summary of Scholar Rock Holding (SRRK) Conference Call Company Overview - **Company**: Scholar Rock Holding (SRRK) - **Event**: 2025 Conference at Jefferies Healthcare Conference - **Date**: June 04, 2025 Key Points Management Transition - David, the new CEO, transitioned from chairman to CEO to lead the next growth phase of Scholar Rock, emphasizing his long-term commitment to the company [4][9] - Akshay, the President of R&D, returned from retirement to join Scholar Rock, highlighting the team's collective experience in biotech [6][18] Product Development and Pipeline - The company is focused on the development of **epitogromab**, a therapy for Spinal Muscular Atrophy (SMA), with a PDUFA date set for September 22, 2025 [37][42] - The EMBRAICE study, an exploratory phase two study, is expected to provide data on the preservation of lean mass in patients starting on tirzepatide with or without epitogromab [24][25] Market Position and Competition - Scholar Rock aims to differentiate itself in the myostatin inhibition space, addressing challenges faced by previous attempts to target myostatin [9][30] - The company acknowledges the competitive landscape, particularly with Regeneron's recent data on myostatin and obesity, which sets a benchmark for their own upcoming data [21][27] Safety and Efficacy - The management emphasized the importance of safety in their therapeutic approach, noting that their therapy has shown a favorable safety profile compared to competitors [25][30] - The company is optimistic about the efficacy of epitogromab across various age groups, including younger patients, based on their existing data [50][52] Launch Strategy - The launch of epitogromab is expected to be steady rather than explosive, with a focus on known patient populations already receiving treatment for SMA [65][69] - The reimbursement landscape is favorable, but the absence of a J code may pose challenges during the launch [67][68] Regulatory Interactions - Ongoing interactions with the FDA have been positive, with no indications of an Advisory Committee meeting required for the BLA review [42][43] - The company plans to submit safety updates as part of standard operating procedures [46] Future Outlook - Scholar Rock is preparing for a global launch of epitogromab, with plans to file for approval in Europe, expected around mid-2026 [74][76] - The management team believes that their combined experience in rare disease biotech will facilitate a successful launch and growth trajectory for the company [19][20] Additional Insights - The management discussed the evolving understanding of SMA as a single disease, which may influence treatment approaches and regulatory perspectives [60][62] - There is a recognition of the need to balance innovation in new therapeutic areas, such as obesity, while maintaining focus on core competencies in rare diseases [35][37]

Financial Data and Key Metrics Changes - Scholar Rock reported a strong start to 2025, with significant progress in bringing up epitigromab for SMA patients globally [6][9] - The company ended the quarter with $364.4 million in cash, and has an additional $100 million available under its debt facility to support the upcoming launch [25][26] Business Line Data and Key Metrics Changes - The phase three SAPPHIRE trial for epitigromab showed a statistically significant improvement in motor function, indicating its potential to reverse SMA progression [7][13] - The company is preparing for a U.S. commercial launch of epitigromab anticipated in Q3 2025, with plans to expand into Europe, Asia Pacific, and Latin America [9][20] Market Data and Key Metrics Changes - Approximately 10,000 SMA patients in the U.S. and around 35,000 globally have received SMN-targeted therapies, highlighting the market potential for epitigromab [21][22] - Market research indicates that 90% of SMA patients are seeking new treatment options that improve muscle strength, emphasizing the demand for epitigromab [20] Company Strategy and Development Direction - Scholar Rock aims to establish itself as a fully integrated global biopharmaceutical company, focusing on the launch of epitigromab and expanding its pipeline into other neuromuscular disorders [9][28] - The company is also exploring the EMBRAZE study to understand its role in treating obesity, indicating a diversification of its research focus [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming U.S. launch and the potential for sustainable growth driven by epitigromab and its pipeline [9][28] - The management team is committed to ensuring that no patient with SMA is left behind, reflecting a strong patient-centric approach [29] Other Important Information - The BLA for epitigromab was granted priority review by the FDA, with a PDUFA date set for September 22, 2025 [8][15] - The company is actively engaging with U.S. payers and preparing for reimbursement discussions in Europe, indicating proactive market access strategies [30][35] Q&A Session Summary Question: How receptive are U.S. payers to coverage of combination therapy for SMA patients? - Management indicated that early discussions with U.S. payers have been positive, with a focus on the need for better therapeutic options for SMA patients [32][34] Question: Can you comment on interactions with the FDA regarding the upadacumab review? - Management reported that interactions with the FDA have been routine and constructive, with no issues anticipated for the September 22 PDUFA date [38][39] Question: What are the expectations for the EMBRAZE study data in June? - Management confirmed that the primary focus will be on the 24-week data, with additional follow-up information provided as necessary [42][43] Question: How are you evaluating the potential to secure a commercial partner for Europe? - Management stated that they do not prioritize finding a partner outside the U.S., as they feel well-equipped to serve patients directly [88][89] Question: What are the launch dynamics and early demand expectations for epitigromab? - Management expressed optimism about the launch, citing the 100% newborn screening for SMA in the U.S. and the concentration of patients in centers of excellence [69][70]

Financial Data and Key Metrics Changes - Scholar Rock reported a strong start to 2025, with significant progress in bringing up epitigromab for SMA patients globally [6][9] - The company ended the quarter with $364.4 million in cash, indicating a solid financial position to support upcoming initiatives [25] Business Line Data and Key Metrics Changes - The phase three SAPPHIRE trial for epitigromab showed statistically significant improvement in motor function, with patients treated having a threefold higher chance of a three-point or greater increase in Hammersmith Scale compared to placebo [7][13] - The company is preparing for a U.S. commercial launch of epitigromab anticipated in Q3 2025, with plans to expand into Europe, Asia Pacific, and Latin America [9][22] Market Data and Key Metrics Changes - Approximately 10,000 SMA patients in the U.S. and around 35,000 globally have received SMN-targeted therapies, highlighting the market potential for epitigromab [21] - The company is focusing on the dual modality treatment approach for SMA, combining SMN-targeted therapies with muscle-targeting therapies [20] Company Strategy and Development Direction - Scholar Rock aims to establish itself as a fully integrated global biopharmaceutical company, with a focus on SMA and potential expansion into other neuromuscular disorders [9][27] - The company is also exploring the EMBRAZE study to understand its role in treating obesity, indicating a diversification of its research focus [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming U.S. launch of epitigromab and the potential for sustainable growth through the end of the decade [9][27] - The company is committed to ensuring that no patient with SMA is left behind, emphasizing its responsibility to patients and families [28] Other Important Information - The BLA for epitigromab was granted priority review by the FDA, with a PDUFA date set for September 22, 2025 [8][15] - The company has an additional $100 million under its debt facility to support the upcoming launch, extending its financial runway into 2027 [25][26] Q&A Session Summary Question: How have discussions with U.S. payers gone regarding coverage for combination therapy? - Management indicated that early discussions with payers have been positive, with a focus on the need for better therapeutic options for SMA patients [31][34] Question: Can you provide an update on interactions with the FDA regarding the upadacumab review? - Management reported that interactions with the FDA have been routine and constructive, with no issues anticipated for the September 22 PDUFA date [36][37] Question: What are the expectations for the EMBRAZE study data in June? - Management confirmed that the primary focus will be on the 24-week data, with additional follow-up information provided as necessary [41][42] Question: How do you evaluate the potential to secure a commercial partner for Europe? - Management stated that they do not prioritize seeking a partner outside the U.S., feeling confident in their ability to serve patients directly [86] Question: What are the expectations for launch dynamics and early demand post-approval? - Management noted that while they will not provide specific guidance, they are optimistic due to the existing infrastructure and patient population [68][70]

Financial Data and Key Metrics Changes - The company ended the quarter with $364.4 million in cash [25] - The company has an additional $100 million under its debt facility that can be drawn down this year to support the upcoming launch, extending its anticipated runway into 2027 [26] Business Line Data and Key Metrics Changes - The company is focused on the commercial launch of epitigromab for SMA, with a PDUFA date set for September 22, 2025 [6][13] - The company is preparing for a global launch, starting in the US in Q3 2025, and is also evaluating expanding the study of upitigramab into other rare neuromuscular disorders [7][8] Market Data and Key Metrics Changes - Approximately 10,000 patients with SMA are in the US, with about two-thirds having received SMN-targeted therapies [20] - Globally, around 35,000 patients have received SMN-targeted therapies, indicating a significant market opportunity for epitigromab [20] Company Strategy and Development Direction - The company aims to establish itself as a fully integrated global biopharmaceutical company, focusing on SMA and exploring additional indications for its therapies [7][14] - The company is committed to ensuring that any patient with SMA who can benefit from epitigromab has access to it, indicating a patient-centric approach [7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming launch and the potential of epitigromab to transform the treatment landscape for SMA [19] - The company is aware of the competitive landscape and the need for dual modalities to address both motor neuron and muscle degeneration in SMA patients [20] Other Important Information - The EMBRAZE proof of concept study is ongoing, focusing on the role of the company in treating obesity and preserving lean mass [9][10] - The company is on track to share top-line results from the EMBRAZE study in June 2025 [10] Q&A Session Summary Question: How have discussions with U.S. payers gone regarding coverage for combination therapy? - Management indicated that early discussions with payers have been positive, and they expect that the budget impact for any single payer will be limited due to the rarity of the disease [31][34] Question: Can you comment on interactions with the FDA regarding the upadacumab review? - Management reported that interactions with the FDA have been routine and constructive, with no issues anticipated for the September 22 PDUFA date [38] Question: What are the expectations for the EMBRAZE study data in June? - Management confirmed that they will provide the 24-week data as the main study outcome and will include any necessary follow-up information [43] Question: How quickly will the company be able to launch after the PDUFA date? - The company is prepared to launch the day after the PDUFA date, with ample supply to meet demand [60] Question: How is the company evaluating the potential to secure a commercial partner for Europe? - Management stated that they do not prioritize finding a partner outside the U.S. and feel well-equipped to serve patients directly [86]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=8&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Presents unaudited consolidated financial statements, including balance sheets, statements of operations, equity, and cash flows, with detailed notes for Q1 2025 and FY 2024 [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20March%2031%2C%202025%20and%20December%2031%2C%202024) The consolidated balance sheets show a decrease in total assets and stockholders' equity from December 31, 2024, to March 31, 2025, primarily driven by a reduction in cash, cash equivalents, and marketable securities Consolidated Balance Sheets (in thousands) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total assets | $407,553 | $474,922 | | Total liabilities | $95,220 | $106,288 | | Total stockholders' equity | $312,333 | $368,634 | | Cash and cash equivalents | $137,926 | $177,878 | | Marketable securities | $226,449 | $259,400 | [Consolidated Statements of Operations and Comprehensive Loss](index=9&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) The company reported an increased net loss for the three months ended March 31, 2025, compared to the same period in 2024, primarily due to higher operating expenses, particularly in general and administrative costs and research and development Consolidated Statements of Operations and Comprehensive Loss (in thousands) | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :----------------------------------- | :--------------------------------------- | :--------------------------------------- | | Research and development | $48,678 | $43,094 | | General and administrative | $28,412 | $15,325 | | Total operating expenses | $77,090 | $58,419 | | Loss from operations | $(77,090) | $(58,419) | | Other income (expense), net | $2,367 | $1,566 | | Net loss | $(74,723) | $(56,853) | | Net loss per share, basic and diluted | $(0.67) | $(0.59) | - Net loss increased by **$17.87 million** (31.4%) from $56.85 million in Q1 2024 to $74.72 million in Q1 2025[15](index=15&type=chunk)[109](index=109&type=chunk) [Consolidated Statements of Stockholders' Equity](index=10&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) Stockholders' equity decreased from $368.6 million at December 31, 2024, to $312.3 million at March 31, 2025, primarily due to the net loss incurred during the period, partially offset by equity-based compensation expense and proceeds from stock option exercises Consolidated Statements of Stockholders' Equity (in thousands) | Metric | December 31, 2024 (in thousands) | March 31, 2025 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total Stockholders' Equity | $368,634 | $312,333 | | Net loss | $(74,723) | N/A | | Equity-based compensation expense | N/A | $13,413 | | Exercise of stock options | N/A | $5,038 | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) Net cash used in operating activities significantly increased in Q1 2025 compared to Q1 2024, while investing activities provided cash, mainly from marketable securities. Financing activities provided less cash in Q1 2025, influenced by debt refinancing and stock option exercises Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Net cash used in operating activities | $(78,675) | $(49,785) | | Net cash provided by investing activities | $34,554 | $33,384 | | Net cash provided by financing activities | $4,169 | $6,525 | | Net decrease in cash, cash equivalents and restricted cash | $(39,952) | $(9,876) | | Cash, cash equivalents and restricted cash, end of period | $140,333 | $94,386 | - Net cash used in operating activities increased by **$28.89 million**, from $49.78 million in Q1 2024 to $78.67 million in Q1 2025[21](index=21&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Provides detailed disclosures on business, accounting policies, financial instruments, equity, debt, and other financial details, offering crucial context to the financial statements [1. Nature of the Business](index=12&type=section&id=1.%20Nature%20of%20the%20Business) Scholar Rock is a late-stage biopharmaceutical company focused on neuromuscular diseases, cardiometabolic disorders, and cancer, leveraging its TGFβ superfamily biology platform - Apitegromab for SMA: Positive top-line results from pivotal Phase 3 SAPPHIRE trial announced October 2024. U.S. BLA submitted January 2025 (priority review, PDUFA target action date September 22, 2025). EMA MAA submitted March 2025. Commercial launch in U.S. expected Q4 2025, Europe in 2026[23](index=23&type=chunk)[85](index=85&type=chunk) - SRK-439 for cardiometabolic disorders (including obesity): Preclinical data supports potential to increase lean mass with GLP-1 RA. IND submission planned Q3 2025. Phase 2 EMBRAZE proof-of-concept trial with apitegromab initiated May 2024, enrollment completed September 2024, top-line results expected Q2 2025[24](index=24&type=chunk)[88](index=88&type=chunk)[91](index=91&type=chunk) - SRK-181 for checkpoint inhibitor-resistant cancers: Phase 1 DRAGON trial enrollment completed December 2023. Safety, efficacy, and biomarker data presented June 2024 (ASCO) and November 2024 (SITC), showing encouraging responses in heavily pretreated patients[25](index=25&type=chunk)[26](index=26&type=chunk)[92](index=92&type=chunk) - The Company believes existing cash, cash equivalents, and marketable securities at March 31, 2025, will fund operations for **at least one year** from the financial statements' issuance date[31](index=31&type=chunk) [2. Summary of Significant Accounting Policies](index=14&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) Significant accounting policies remain consistent with 2024 Annual Report; recent ASUs are noted, with no material impact from ASU 2023-07 - No material changes to significant accounting policies from the 2024 Annual Report on Form 10-K[32](index=32&type=chunk) - ASU 2023-07 (Segment Reporting) adopted, **no material impact** on financial position or results of operations[37](index=37&type=chunk) - ASU 2023-09 (Income Tax Disclosures) effective January 1, 2025, not early adopted, impact on disclosures being evaluated[38](index=38&type=chunk) - ASU 2024-03 (Expense Disaggregation) effective after December 15, 2026, impact on disclosures being evaluated[39](index=39&type=chunk) [3. Fair Value of Financial Assets and Liabilities](index=17&type=section&id=3.%20Fair%20Value%20of%20Financial%20Assets%20and%20Liabilities) Financial assets measured at fair value are primarily Level 1, with no transfers between levels; debt carrying value approximates fair value Fair Value of Financial Assets (in thousands) | Asset Category | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------------------- | :----------------------------- | :----------------------------- | | Money market funds (Level 1) | $87,071 | $97,290 | | U.S. treasury obligations (Level 1) | $31,907 | $63,171 | | Marketable securities (U.S. treasury & government agency securities) (Level 1) | $226,449 | $259,400 | | Total assets at fair value | $345,427 | $419,861 | - All financial assets measured at fair value are categorized as **Level 1**, indicating valuation using quoted market prices[40](index=40&type=chunk) [4. Marketable Securities](index=17&type=section&id=4.%20Marketable%20Securities) Marketable securities, classified as available-for-sale, include U.S. treasury and government agency securities, with some unrealized losses considered temporary Marketable Securities (in thousands) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------------------- | :----------------------------- | :----------------------------- | | Estimated Fair Value of Marketable Securities | $226,449 | $259,400 | | Aggregate Fair Value of Securities with Unrealized Losses | $51,000 | $23,900 | | Number of Investments with Unrealized Losses | 11 | 12 | - Unrealized losses are considered temporary, and the company has the ability and intent to hold these investments until recovery of amortized cost or maturity[43](index=43&type=chunk) [5. Prepaid Expenses and Other Assets](index=18&type=section&id=5.%20Prepaid%20Expenses%20and%20Other%20Assets) Prepaid expenses and other current assets significantly increased from December 2024 to March 2025, mainly due to prepaid external R&D expenses Prepaid Expenses and Other Assets (in thousands) | Category | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Prepaid external R&D expenses | $13,739 | $7,716 | | Total prepaid expenses and other current assets | $20,872 | $13,887 | | Total other long-term assets | $2,857 | $2,945 | [6. Accrued Expenses](index=19&type=section&id=6.%20Accrued%20Expenses) Accrued expenses decreased from December 2024 to March 2025, primarily due to lower accrued payroll, partially offset by increased professional services and R&D Accrued Expenses (in thousands) | Category | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Accrued external R&D expense | $12,853 | $12,116 | | Accrued payroll and related expenses | $8,386 | $14,776 | | Accrued professional services expense | $5,652 | $3,296 | | Total accrued expenses | $27,640 | $31,067 | [7. Common Stock](index=19&type=section&id=7.%20Common%20Stock) Authorized common stock increased to 300 million shares; a public offering raised $324.4 million net, and 26.04 million warrants remain outstanding - Authorized common stock increased from 150 million to **300 million shares** in June 2024[47](index=47&type=chunk) - October 2024 public offering: Issued 10,265,488 common shares and pre-funded warrants for 353,983 shares, raising approximately **$324.4 million net**[48](index=48&type=chunk) - ATM program: Sold 619,290 shares for **$5.2 million net proceeds** as of March 31, 2025; no sales in Q1 2025[49](index=49&type=chunk) Outstanding Warrants as of March 31, 2025 | Warrants | Outstanding as of March 31, 2025 | | :----------------- | :----------------------------- | | Pre-funded warrants | 17,362,147 | | Common warrants | 8,678,664 | [8. Equity-Based Compensation](index=20&type=section&id=8.%20Equity-Based%20Compensation) Equity-based compensation expense significantly increased in Q1 2025 due to headcount and award modifications, with $134.95 million unrecognized expense remaining Equity-Based Compensation Expense (in thousands) | Expense Category | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Research and development expense | $4,035 | $3,531 | | General and administrative expense | $9,378 | $4,633 | | Total equity-based compensation | $13,413 | $8,164 | Unrecognized Equity-Based Compensation Expense (in thousands) | Award Type | Unrecognized Expense (in thousands) | Weighted Average Remaining Period of Recognition (years) | | :---------------- | :-------------------------------- | :------------------------------------------------------- | | RSUs | $63,427 | 2.7 | | Stock options | $71,527 | 2.6 | | Total | $134,954 | N/A | - Total fair value of RSUs vested during Q1 2025 was **$28.3 million**[53](index=53&type=chunk) [9. Commitments and Contingencies](index=21&type=section&id=9.%20Commitments%20and%20Contingencies) The company's primary commitment is an amended operating lease for its Cambridge headquarters, with no material legal proceedings during the period - Lease for corporate headquarters extended in May 2024 for approximately **two years**, with an option for a **five-year extension**[57](index=57&type=chunk) Lease Metrics (in thousands) | Lease Metric | Three Months Ended March 31, 2025 | | :------------------------------------ | :-------------------------------- | | Operating lease cost | $1,714 (in thousands) | | Variable lease cost | $392 (in thousands) | | Total lease cost | $2,106 (in thousands) | | Weighted average remaining lease term | 2.4 years | | Weighted average incremental borrowing rate | 13.1% | - No material legal proceedings during the three months ended March 31, 2025 and 2024[59](index=59&type=chunk) [10. Debt](index=22&type=section&id=10.%20Debt) An Amended and Restated Loan and Security Agreement with Oxford Finance LLC provides up to $200.0 million, extending interest-only payments through March 2029 - Amended and Restated Loan and Security Agreement with Oxford Finance LLC provides up to **$200.0 million** in term loans[69](index=69&type=chunk) - Interest-only payment period extended through **March 2029**, with principal payments commencing **April 2029**[69](index=69&type=chunk) - Annual interest rate is the greater of (i) 1-Month CME Term SOFR (min **3%**) plus (b) **5.5%**[70](index=70&type=chunk) [11. Net Loss per Share](index=24&type=section&id=11.%20Net%20Loss%20per%20Share) Basic and diluted net loss per share are identical due to the net loss, rendering 21.67 million common stock equivalents anti-dilutive - Basic and diluted net loss per share are the same because the company incurred a net loss, making potentially dilutive securities anti-dilutive[71](index=71&type=chunk)[72](index=72&type=chunk) Common Stock Equivalents Excluded from Diluted EPS Calculation | Common Stock Equivalents | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :----------------------- | :-------------------------------- | :-------------------------------- | | RSUs | 3,701,687 | 3,089,689 | | Stock options | 9,287,577 | 9,048,138 | | Warrants | 8,678,664 | 9,157,496 | | Total | 21,667,928 | 21,295,323 | [12. Segment Reporting](index=26&type=section&id=12.%20Segment%20Reporting) The company operates as a single segment, with CODM reviewing consolidated financials; operating expenses increased, particularly for SMA and cardiometabolic/obesity R&D - The company operates as a **single segment**, with the CODM reviewing consolidated financial information[74](index=74&type=chunk) Operating Expense Categories (in thousands) | Operating Expense Category | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :------------------------------------ | :--------------------------------------- | :--------------------------------------- | | Employee related expense | $22,938 | $16,080 | | External R&D expense - SMA | $17,074 | $16,201 | | External R&D expense - oncology | $1,110 | $2,747 | | External R&D expense - cardiometabolic/obesity | $6,348 | $4,032 | | External expense - G&A | $8,942 | $5,001 | | Employee related equity-based compensation expense | $13,413 | $8,164 | | Net loss | $74,723 | $56,853 | [13. Subsequent Events](index=27&type=section&id=13.%20Subsequent%20Events) Effective April 27, 2025, new CEO, President of R&D, COO, and CFO were appointed, receiving new equity awards - David Hallal appointed CEO, Akshay Vaishnaw as President of Research and Development, R. Keith Woods as COO, and Vikas Sinha as CFO, effective **April 27, 2025**[76](index=76&type=chunk) - New executives received stock options, RSUs, and PSUs as part of their appointments[76](index=76&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion and analysis covers financial condition, operational results, biopharmaceutical focus, recent developments, operating expenses, liquidity, capital resources, and critical accounting estimates [Overview](index=28&type=section&id=Overview) Scholar Rock is a late-stage biopharmaceutical company developing treatments for neuromuscular diseases, cardiometabolic disorders, and cancer, expecting continued operating losses - Scholar Rock is a late-stage biopharmaceutical company focused on neuromuscular diseases, cardiometabolic disorders, and other serious diseases, utilizing a proprietary platform for monoclonal antibodies targeting latent growth factors[82](index=82&type=chunk) - Key product candidates: Apitegromab (SMA, potential in other neuromuscular disorders and obesity), SRK-439 (cardiometabolic disorders), SRK-181 (checkpoint inhibitor-resistant cancers), SRK-373 (fibrotic diseases), SRK-256 (iron-restricted anemias)[83](index=83&type=chunk)[89](index=89&type=chunk) - The company has incurred significant operating losses since inception, with a net loss of **$74.7 million** for Q1 2025 and an accumulated deficit of **$997.4 million** as of March 31, 2025. Expects continued significant losses[94](index=94&type=chunk) [Recent Developments](index=34&type=section&id=Recent%20Developments) The company amended its Loan and Security Agreement, increasing borrowing capacity and extending interest-only payments, alongside a significant management transition - Amended and Restated Loan and Security Agreement with Oxford Finance LLC on **February 10, 2025**, for up to **$200.0 million**, extending interest-only payments through **March 2029**[97](index=97&type=chunk) - Effective **April 27, 2025**, David Hallal appointed CEO, Akshay Vaishnaw as President of Research & Development, R. Keith Woods as COO, and Vikas Sinha as CFO[98](index=98&type=chunk) [Financial Operations Overview](index=34&type=section&id=Financial%20Operations%20Overview) Outlines R&D, G&A, and Other Income (Expense), Net; R&D costs are expensed as incurred, G&A expected to rise for commercialization, and other income is primarily interest [Research and Development](index=34&type=section&id=Research%20and%20Development) R&D expenses, including employee costs and third-party activities, are expensed as incurred and are expected to remain substantial as product candidates advance - R&D expenses are expensed as incurred and include employee costs, third-party research, clinical trials, manufacturing, and regulatory compliance[99](index=99&type=chunk)[100](index=100&type=chunk) - R&D costs are expected to remain substantial due to ongoing development of apitegromab (SMA, obesity), SRK-439, and pipeline expansion[103](index=103&type=chunk)[112](index=112&type=chunk) [General and Administrative](index=36&type=section&id=General%20and%20Administrative) G&A expenses cover employee-related costs, facility, legal, and professional services, projected to increase with apitegromab's commercialization infrastructure build-out - G&A expenses include employee-related costs (salaries, benefits, equity-based compensation), facility costs, legal fees, and professional services[106](index=106&type=chunk) - G&A expenses are expected to increase as the company invests in commercialization infrastructure for apitegromab[106](index=106&type=chunk)[113](index=113&type=chunk) [Other Income (Expense), Net](index=37&type=section&id=Other%20Income%20(Expense)%2C%20Net) Other income (expense), net, primarily reflects interest income from cash, cash equivalents, and marketable securities, offset by interest expense on debt - Other income (expense), net, is mainly interest income from cash, cash equivalents, and marketable securities, offset by interest expense on debt[108](index=108&type=chunk) [Results of Operations](index=37&type=section&id=Results%20of%20Operations) Total operating expenses increased by 32.0%, leading to a 31.4% higher net loss in Q1 2025, driven by significant increases in R&D and G&A expenses Summary of Results of Operations (in thousands) | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | Change ($) | Change (%) | | :-------------------------- | :--------------------------------------- | :--------------------------------------- | :--------- | :--------- | | Total operating expenses | $77,090 | $58,419 | $18,671 | 32.0% | | Loss from operations | $(77,090) | $(58,419) | $(18,671) | 32.0% | | Other income (expense), net | $2,367 | $1,566 | $801 | 51.1% | | Net loss | $(74,723) | $(56,853) | $(17,870) | 31.4% | [Research and Development Expenses](index=37&type=section&id=Research%20and%20Development%20Expenses) R&D expense increased by 13.0% to $48.7 million in Q1 2025, driven by higher external costs for apitegromab and SRK-439, and increased employee-related costs Research and Development Expenses (in thousands) | R&D Expense Category | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | Change ($) | Change (%) | | :------------------------------------ | :--------------------------------------- | :--------------------------------------- | :--------- | :--------- | | Apitegromab | $19,301 | $18,248 | $1,053 | 5.8% | | SRK-181 | $1,110 | $2,747 | $(1,637) | (59.6)% | | SRK-439 | $4,279 | $1,985 | $2,294 | 115.6% | | Other early programs and unallocated costs | $1,455 | $741 | $714 | 96.4% | | Total external costs | $26,145 | $23,721 | $2,424 | 10.2% | | Employee compensation and benefits | $18,110 | $14,928 | $3,182 | 21.3% | | Total R&D expense | $48,678 | $43,094 | $5,584 | 13.0% | - Increase in apitegromab costs primarily due to drug supply manufacturing, partially offset by decreased clinical trial costs for TOPAZ and SAPPHIRE[110](index=110&type=chunk) - SRK-439 preclinical and manufacturing development costs increased by **115.6%**[110](index=110&type=chunk) - SRK-181 costs decreased by **59.6%** as Phase 1 DRAGON trial enrollment completed[110](index=110&type=chunk)[112](index=112&type=chunk) [General and Administrative Expenses](index=39&type=section&id=General%20and%20Administrative%20Expenses) G&A expense surged by 85.4% to $28.4 million in Q1 2025, driven by increased employee-related costs, equity-based compensation, and professional service fees - General and administrative expense increased by **$13.1 million** (**85.4%**) to **$28.4 million** in Q1 2025[109](index=109&type=chunk)[113](index=113&type=chunk) - Key drivers: **$4.2 million** increase in employee-related costs, **$4.7 million** increase in non-cash equity-based compensation, and **$4.0 million** increase in professional service fees[113](index=113&type=chunk) [Other Income (Expense), Net](index=39&type=section&id=Other%20Income%20(Expense)%2C%20Net) Other income (expense), net, increased by $0.8 million (51.1%) in Q1 2025, primarily due to higher interest income from increased cash balances - Other income (expense), net, increased by **$0.8 million** (**51.1%**) to **$2.37 million** in Q1 2025, driven by higher interest income[109](index=109&type=chunk)[114](index=114&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity decreased in Q1 2025, with $364.4 million in cash, cash equivalents, and marketable securities; additional financing will be required for full development and commercialization [Sources of Liquidity](index=39&type=section&id=Sources%20of%20Liquidity) The company funds operations through equity, collaborations, and debt; total cash, cash equivalents, and marketable securities decreased by $72.9 million in Q1 2025 - Primary funding sources: equity financings, research collaborations, and debt facilities[115](index=115&type=chunk) Cash, Cash Equivalents, and Marketable Securities (in thousands) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------ | :----------------------------- | :----------------------------- | | Cash and cash equivalents | $137,926 | $177,878 | | Marketable securities | $226,449 | $259,400 | | Total cash, cash equivalents and marketable securities | $364,375 | $437,278 | - Total cash, cash equivalents, and marketable securities decreased by **$72.9 million** in Q1 2025, primarily due to cash used in operations[116](index=116&type=chunk) - Amended and Restated Loan and Security Agreement with Oxford provides up to **$200 million** in borrowing capacity[120](index=120&type=chunk) [Cash Flows](index=41&type=section&id=Cash%20Flows) Net cash used in operating activities significantly increased to $78.7 million in Q1 2025, while investing activities provided cash, and financing activities provided less cash Cash Flow Activities (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Net cash used in operating activities | $(78,675) | $(49,785) | | Net cash provided by investing activities | $34,554 | $33,384 | | Net cash provided by financing activities | $4,169 | $6,525 | | Net decrease in cash, cash equivalents and restricted cash | $(39,952) | $(9,876) | - Net cash used in operating activities increased by **$28.89 million** YoY, driven by higher net loss and changes in operating assets/liabilities[123](index=123&type=chunk)[124](index=124&type=chunk) - Net cash provided by financing activities in Q1 2025 was primarily from stock option exercises and debt refinancing, partially offset by debt extinguishment[126](index=126&type=chunk) [Funding Requirements](index=43&type=section&id=Funding%20Requirements) Existing capital is expected to fund operations into 2027, but substantial additional capital is required for full development and commercialization, to be sought through various financing methods - Existing cash, cash equivalents, and marketable securities are expected to fund operations into **2027**[128](index=128&type=chunk) - Additional capital is required to complete clinical development and commercialization for current programs[128](index=128&type=chunk) - Future funding requirements are highly uncertain and depend on factors like clinical trial costs, manufacturing, regulatory review, and commercialization activities[128](index=128&type=chunk)[129](index=129&type=chunk)[376](index=376&type=chunk)[378](index=378&type=chunk) - Plans to finance future cash needs through equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements[131](index=131&type=chunk)[377](index=377&type=chunk) [Critical Accounting Estimates](index=45&type=section&id=Critical%20Accounting%20Estimates) No material changes to critical accounting estimates from the 2024 Annual Report on Form 10-K were reported - No material changes to critical accounting estimates from the 2024 Annual Report on Form 10-K[134](index=134&type=chunk) [Off-Balance Sheet Arrangements](index=45&type=section&id=Off-Balance%20Sheet%20Arrangements) The company did not have any off-balance sheet arrangements during the periods presented or currently - No off-balance sheet arrangements during the periods presented or currently[135](index=135&type=chunk) [Recent Accounting Pronouncements](index=45&type=section&id=Recent%20Accounting%20Pronouncements) Reviewed recently issued accounting standards; no material impact on financial statements other than as disclosed in Note 2 - Reviewed all recently issued standards; no material impact on financial statements other than as disclosed in Note 2[136](index=136&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Scholar Rock Holding Corporation is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[137](index=137&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls over financial reporting - Disclosure controls and procedures were effective at the reasonable assurance level as of **March 31, 2025**[139](index=139&type=chunk) - No material changes in internal controls over financial reporting occurred during the three months ended March 31, 2025[140](index=140&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any material legal proceedings or claims that are reasonably expected to have a material adverse effect on its business - No material legal proceedings or claims that would individually or in aggregate have a material adverse effect on the business[141](index=141&type=chunk) [Item 1A. Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) Outlines significant risks that could materially and adversely affect Scholar Rock's business, financial condition, and results of operations, spanning development, regulatory, commercial, operational, IP, financial, and stock volatility [Summary of the Material Risks Associated with Our Business](index=48&type=section&id=Summary%20of%20the%20Material%20Risks%20Associated%20with%20Our%20Business) The company faces numerous material risks, including unpredictable regulatory approval, commercialization challenges, development uncertainties, reliance on third parties, IP protection issues, ongoing net losses, and stock price volatility - Regulatory approval process is lengthy, time-consuming, and unpredictable, potentially delaying or preventing approval of product candidates[144](index=144&type=chunk) - Lack of prior commercialization experience and challenges in building commercial infrastructure for apitegromab could negatively impact business[144](index=144&type=chunk) - Reliance on third-party manufacturers and clinical trial conductors poses risks of supply limitations, interruptions, or quality issues[150](index=150&type=chunk) - Difficulty in protecting intellectual property rights and potential infringement claims from third parties could harm business[150](index=150&type=chunk) - History of net losses and future capital requirements necessitate additional financing, which may not be available on acceptable terms[150](index=150&type=chunk) [Risks Related to Product Development, Regulatory Approval and Commercialization](index=51&type=section&id=Risks%20Related%20to%20Product%20Development%2C%20Regulatory%20Approval%20and%20Commercialization) Substantial risks include lengthy regulatory approval, commercialization challenges, clinical trial delays, unpredictable early-stage results, reliance on third parties, limited benefits of special designations, and market acceptance issues - Regulatory approval process is lengthy, time-consuming, and inherently unpredictable; failure to obtain or delays in approval for apitegromab, SRK-181, SRK-439, and future candidates are significant risks[151](index=151&type=chunk) - The company has no prior commercialization experience and is building sales, marketing, and distribution capabilities for apitegromab, which, if unsuccessful, could negatively impact its launch[154](index=154&type=chunk)[155](index=155&type=chunk) - Product development is expensive and uncertain; delays in clinical trials due to various factors (e.g., trial design, enrollment, safety issues, regulatory requirements) could increase costs and jeopardize commercialization[163](index=163&type=chunk)[165](index=165&type=chunk)[171](index=171&type=chunk) - Preclinical and early-stage clinical trial results may not be predictive of future outcomes, and interim data are subject to change, potentially leading to setbacks in later stages[173](index=173&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk) - Reliance on third parties (CROs, manufacturers) for clinical trials and preclinical studies introduces risks if they fail to meet contractual duties, deadlines, or regulatory requirements[181](index=181&type=chunk)[187](index=187&type=chunk) - Orphan Drug, Rare Pediatric Disease, Fast Track, and PRIME designations do not guarantee faster development, approval, or market exclusivity, and their benefits may be limited or revoked[189](index=189&type=chunk)[190](index=190&type=chunk)[193](index=193&type=chunk)[197](index=197&type=chunk)[200](index=200&type=chunk) - Even if approved, product candidates may fail to achieve market acceptance due to factors like efficacy, safety, pricing, reimbursement, and competition[214](index=214&type=chunk) [Risks Related to Our Business and Operations](index=76&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Operations) Operational risks include reliance on third-party manufacturers, scaling challenges, supply chain disruptions, managing growth, retaining personnel, regulatory compliance, cybersecurity, product liability, and business interruptions - Reliance on a limited number of third-party contract manufacturers for all product supplies (clinical and commercial) creates risks of supply limitations, interruptions, or quality issues[227](index=227&type=chunk) - Scaling manufacturing processes for commercial supply is a challenge, and failure to do so in a timely or cost-effective manner could delay development and commercialization[233](index=233&type=chunk)[235](index=235&type=chunk) - Economic uncertainty, geopolitical instability, high inflation, and tariffs could adversely impact supply chains, development, and financial results[237](index=237&type=chunk)[239](index=239&type=chunk) - Challenges in managing organizational growth, recruiting, and retaining highly skilled personnel, especially during management transitions, could impair development and commercialization efforts[240](index=240&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk)[246](index=246&type=chunk) - Internal computer systems and those of third-party contractors are vulnerable to security breaches, incidents, or compromises, risking data loss, operational disruption, and legal liability[247](index=247&type=chunk)[248](index=248&type=chunk) - Misconduct by employees or third parties, including noncompliance with regulatory standards (e.g., FDA, EMA, anti-kickback, fraud and abuse laws), could lead to significant penalties, reputational harm, and operational restrictions[249](index=249&type=chunk)[251](index=251&type=chunk) - Ongoing healthcare legislative and regulatory reforms, including pricing and reimbursement changes, could adversely affect market demand, pricing, and profitability of products[252](index=252&type=chunk)[295](index=295&type=chunk)[298](index=298&type=chunk) - Failure to comply with health care privacy and data protection laws (e.g., HIPAA, EU GDPR, UK GDPR, CCPA) could result in enforcement actions, litigation, and adverse publicity[256](index=256&type=chunk)[258](index=258&type=chunk)[260](index=260&type=chunk)[261](index=261&type=chunk)[264](index=264&type=chunk)[267](index=267&type=chunk) - The use of artificial intelligence (AI) presents risks including security risks to confidential information, intellectual property infringement, and increased regulatory burden (e.g., EU AI Act)[268](index=268&type=chunk)[269](index=269&type=chunk)[270](index=270&type=chunk)[273](index=273&type=chunk) - Non-compliance with international laws (e.g., FCPA, export control) could lead to substantial penalties and restrict global operations[274](index=274&type=chunk)[277](index=277&type=chunk) - Failure to comply with environmental, health, and safety laws could result in fines, penalties, or costly clean-up liabilities[278](index=278&type=chunk)[280](index=280&type=chunk) - Product liability lawsuits, if brought against the company, could result in substantial liabilities, limit commercialization, and exhaust insurance/capital resources[282](index=282&type=chunk)[283](index=283&type=chunk)[285](index=285&type=chunk) - Concentration of laboratory operations in one location and reliance on third parties for clinical trials and manufacturing facilities expose the company to business interruptions from natural disasters or other unforeseen events[286](index=286&type=chunk)[287](index=287&type=chunk)[289](index=289&type=chunk) - Coverage and reimbursement for product candidates, if approved, may be limited or unavailable, making it difficult to sell profitably and impacting revenue[290](index=290&type=chunk)[294](index=294&type=chunk)[302](index=302&type=chunk) - Inability to enter into or maintain successful collaborations with third parties could adversely affect product discovery, development, and commercialization[303](index=303&type=chunk)[304](index=304&type=chunk)[306](index=306&type=chunk)[308](index=308&type=chunk) [Risks Related to Intellectual Property](index=106&type=section&id=Risks%20Related%20to%20Intellectual%20Property) Success relies on protecting IP; challenges include costly patenting, infringement claims, licensing difficulties, evolving patent laws, and inadequate trade secret protection - Commercial success depends on obtaining and maintaining patent, trademark, and trade secret protection for proprietary technologies and product candidates[310](index=310&type=chunk) - Patenting is expensive, time-consuming, and uncertain; patent applications may not result in issued patents, or issued patents may be challenged, narrowed, or invalidated[313](index=313&type=chunk)[314](index=314&type=chunk) - Third-party claims of intellectual property infringement could lead to expensive litigation, substantial damages, injunctions, or the need to obtain costly licenses[337](index=337&type=chunk)[338](index=338&type=chunk)[342](index=342&type=chunk) - Dependence on in-licensed intellectual property means failure to comply with license obligations or termination of licenses could result in loss of significant rights[322](index=322&type=chunk) - Inability to obtain or maintain necessary rights to develop future product candidates on acceptable terms could hinder business growth[327](index=327&type=chunk)[328](index=328&type=chunk)[329](index=329&type=chunk) - Changes in patent law (e.g., America Invents Act, Supreme Court rulings) could diminish the value of patents, increasing uncertainty and costs[331](index=331&type=chunk)[332](index=332&type=chunk)[335](index=335&type=chunk)[336](index=336&type=chunk) - Inadequate protection of trade secrets, including through disclosure or independent development by competitors, would harm competitive position[364](index=364&type=chunk)[366](index=366&type=chunk) - Limited foreign intellectual property rights mean inability to protect inventions globally, potentially allowing competitors to use technologies in other jurisdictions[356](index=356&type=chunk) - Patent terms may be inadequate, and inability to obtain patent term extensions or data exclusivity could allow competitors to enter the market sooner[361](index=361&type=chunk)[363](index=363&type=chunk) [Risks Related to Our Financial Condition and Capital Requirements](index=127&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%20and%20Capital%20Requirements) The company expects continued net losses, requiring substantial additional capital; NOL carryforwards may be limited, and financial services industry risks and loan restrictions impact flexibility - The company has incurred net losses since inception (**$74.7 million** in Q1 2025, accumulated deficit of **$997.4 million** as of March 31, 2025) and anticipates continued losses[371](index=371&type=chunk) - Substantial additional capital is required to fund operations, complete product development, and commercialization, beyond existing cash, cash equivalents, and marketable securities (expected to last into **2027**)[374](index=374&type=chunk)[375](index=375&type=chunk) - Ability to use net operating loss carryforwards (**$512.6 million** federal, **$498.8 million** state as of Dec 31, 2024) and tax credit carryforwards may be limited by ownership changes under Section 382 of the Code[381](index=381&type=chunk) - Adverse developments in the financial services industry (e.g., bank failures, liquidity problems) could impair access to funding sources and negatively impact financial condition[382](index=382&type=chunk)[385](index=385&type=chunk)[386](index=386&type=chunk) - Potential for losses on marketable securities due to interest rate increases or deteriorating economic conditions, despite a focus on capital preservation[389](index=389&type=chunk)[390](index=390&type=chunk) - Terms of the Amended and Restated Loan and Security Agreement place restrictions on operating and financial flexibility; default could accelerate repayment obligations[391](index=391&type=chunk)[392](index=392&type=chunk)[393](index=393&type=chunk) [Risks Related to Our Common Stock](index=136&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock) Stock price is highly volatile, no dividends are planned, significant insider ownership exists, scaled disclosures may reduce investor appeal, public company costs are high, and potential dilution from warrants and ATM sales is a risk - The price of common stock is volatile, subject to fluctuations from operating results, acquisitions, collaborations, accounting changes, and litigation[395](index=395&type=chunk)[396](index=396&type=chunk) - No intention to pay dividends; returns are limited to stock appreciation, and debt facility restricts dividend payments[397](index=397&type=chunk) - Executive officers, directors, and affiliates own approximately **9%** of outstanding voting stock, allowing significant influence over stockholder approval matters[398](index=398&type=chunk) - As a 'smaller reporting company,' the company uses scaled disclosures, which may make its common stock less attractive to some investors and increase price volatility[399](index=399&type=chunk)[402](index=402&type=chunk) - Operating as a public company incurs significant legal, accounting, and compliance costs, diverting management time[403](index=403&type=chunk) - Failure to maintain effective internal control over financial reporting could lead to inaccurate financial reports, fraud, and loss of investor confidence[405](index=405&type=chunk) - Broad discretion in the use of cash, cash equivalents, and marketable securities may not always increase investment value[408](index=408&type=chunk) - Anti-takeover provisions in charter documents and Delaware law could delay or prevent a change of control, limiting stock price and hindering stockholder actions[409](index=409&type=chunk)[410](index=410&type=chunk) - Securities litigation is expensive and could divert management attention, harming business and stock price[414](index=414&type=chunk) - Exclusive forum provisions in bylaws could limit stockholders' ability to choose a favorable judicial forum for disputes[415](index=415&type=chunk) - Substantial number of outstanding warrants and equity awards (**17.36 million** pre-funded warrants, **8.68 million** common warrants, **12.99 million** stock options/RSUs) could result in significant dilution[416](index=416&type=chunk) - Sales of a substantial number of common stock shares, including through the ATM program, could cause the stock price to fall[419](index=419&type=chunk)[420](index=420&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=144&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - No unregistered sales of equity securities during the three months ended March 31, 2025[422](index=422&type=chunk) [Item 3. Defaults Upon Senior Securities](index=144&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period - No defaults upon senior securities during the three months ended March 31, 2025[424](index=424&type=chunk) [Item 4. Mine Safety Disclosures](index=144&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reported no mine safety disclosures during the period - No mine safety disclosures during the three months ended March 31, 2025[424](index=424&type=chunk) [Item 5. Other Information](index=145&type=section&id=Item%205.%20Other%20Information) Details Rule 10b5-1 trading plans adopted or terminated by directors and officers in Q1 2025 for stock sales and tax obligations - Several directors and officers adopted Rule 10b5-1 trading plans in **February and March 2025** for the sale of common stock[425](index=425&type=chunk) - Plans are intended to satisfy tax obligations upon RSU vesting or for general stock sales[426](index=426&type=chunk)[427](index=427&type=chunk) - Former COO and CFO, Ted Myles, terminated his trading plan in **March 2025**[425](index=425&type=chunk) [Item 6. Exhibits](index=147&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with Form 10-Q, including corporate documents, loan agreements, employment agreements, equity plans, and certifications - Includes Amended and Restated Certificate of Incorporation, Amended and Restated Loan and Security Agreement, Separation Agreement, and Equity Plan amendments[429](index=429&type=chunk) - Certifications of Principal Executive Officer and Principal Financial Officer are filed herewith[429](index=429&type=chunk)[430](index=430&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT (857) 259-3860 (Registrant's telephone number, including area code) Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event Reported): May 14, 2025 Scholar Rock Holding Corporation (Exact Name of Registrant as Specified in Charter) (State or Other Jurisdiction of Incorporation) Delaware 001-38501 82-3750435 (Commission File Number) (I.R.S. Employer Identificat ...

Group 1 - The core concern among investors is the significant changes in Scholar Rock's management team, which may indicate instability or indecision within the company [1][4] - David Hallal has been appointed as the new CEO, succeeding Jay Backstrom, who will take on a role as strategic advisor [2] - The new executive team includes R. Keith Woods as COO, Vikas Sinha as CFO, and Akshay Vaishnaw as president of research and development, all of whom have strong backgrounds in the biotech industry [3] Group 2 - Despite the qualifications of the new management, the abruptness of the changes has raised investor concerns [4] - Scholar Rock is not currently facing any significant troubles, but investors are advised to monitor upcoming press releases and regulatory disclosures for further developments [4]

Core Insights - Scholar Rock's stock saw a nearly 3% increase following a positive analyst note, outperforming the S&P 500 index which rose by 1.7% [1] Company Overview - Scholar Rock focuses on rare disorders with limited treatment options, with its lead drug candidate, apitegromab, aimed at preserving muscle mass in patients with spinal muscular atrophy (SMA) [2] Analyst Perspective - Analyst Allison Bratzel from Piper Sandler believes that the market has not fully priced in the potential of apitegromab, suggesting that a positive reception could significantly increase the stock price, which she considers undervalued. She maintains an overweight recommendation with a price target of $42 per share [3] Drug Potential - There is currently no cure for SMA, but treatments that address the disorder's symptoms could perform well. Apitegromab has shown promising results in clinical trials, positioning it as a potential key treatment for muscle mass preservation in SMA patients [4]

Deep Insights Advancing Impactful Medicines Company Overview | January 2025 © 2025 Scholar Rock, Inc. All rights reserved. Forward-Looking Statements Various statements in this presentation concerning the future expectations, plans and prospects of Scholar Rock Holding Corporation and Scholar Rock, Inc. (collectively, "Scholar Rock"), including without limitation, Scholar Rock's expectations regarding its strategy, its product candidate selection and development timing, including timing for the initiation o ...