Scholar Rock Holding Corp (SRRK)·Q3 2025 Earnings Summary

Executive Summary

• Q3 2025 focused on regulatory path and launch readiness following the September 22 CRL; management held an in-person Type A meeting with FDA (including Novo Nordisk/Catalent Bloomington) and now anticipates BLA resubmission and a U.S. launch following approval in 2026; EMA decision remains targeted for mid‑2026 .
• OpEx rose sharply y/y, driven by pre‑launch investments; G&A jumped to $53.1M (from $16.1M y/y) on headcount, professional services, and one-time severance; R&D was $50.5M; no revenue was recognized; net loss was $102.2M (EPS -$0.90) .
• Cash, cash equivalents, and marketable securities were $369.6M at 9/30; with ATM proceeds, debt draw, and potential ~$60M warrant exercises, runway extends into 2027; CFO outlined preference for expanding credit over equity to bridge to approval .
• Key catalysts: FDA reinspection and minutes from Type A meeting; clarity on BLA resubmission class/timeline; second U.S.-based fill‑finish site tech transfer with commercial capacity reserved from Q1 2026; EMA review progress; OPAL dosing in <2 yrs SMA; SRK‑439 first‑in‑human start in Q4 2025 .

What Went Well and What Went Wrong

• What Went Well

  • Constructive in-person Type A meeting with FDA (Neurology and Office of Compliance present); Novo detailed remediation progress for Bloomington and affirmed reinspection readiness by year-end; company now guides to U.S. launch post‑approval in 2026 .
  • Supply chain redundancy accelerated: a second U.S. fill‑finish facility selected with commercial capacity reserved beginning Q1 2026; tech transfer underway to de‑risk and support seamless commercial distribution .
  • Continued scientific/clinical momentum: dosing initiated in OPAL (SMA infants/toddlers <2 years), EMA MAA review ongoing (decision mid‑2026), and FDA cleared IND for SRK‑439 with Phase 1 dosing to start in Q4 2025 .
  • Quote: “We know that it is not a matter of if, but when apitegromab will be approved in the U.S.” – CEO David Hallal .

• What Went Wrong

  • Regulatory delay: CRL tied to Catalent/Novo Bloomington CGMP status pushed U.S. approval/launch expectations from 2025 to 2026 (material timeline impact) .
  • Operating leverage pressure: G&A rose to $53.1M (+$37.0M y/y) with pre‑launch infrastructure, headcount, professional services, and severance; R&D also up y/y on commercial manufacturing and people costs; net loss widened to $102.2M .
  • Revenue/EPS vs S&P consensus: pre‑revenue status resulted in a small revenue miss; EPS slightly below consensus; the company remains non‑commercial and dependent on financing and regulatory milestones *.

Financial Results

Income statement summary (USD)

Operating expenses (USD)

Liquidity and runway

Estimates vs. actuals (Q3 2025)

*Values retrieved from S&P Global.

Observations:

• EPS missed consensus modestly; revenue was guided as zero (pre‑commercial) and came in below a small estimate *.
• G&A increased on launch readiness (employee +$13.2M, SBC +$7.6M, professional services +$14.3M, $1.1M severance) .
• R&D up y/y on commercial manufacturing/launch readiness and employee costs .

No segments or product revenues are applicable at this stage.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We know that it is not a matter of if, but when apitegromab will be approved in the U.S.” – David Hallal, CEO .
• “We have secured commercial capacity commencing in the first quarter of 2026, and tech transfer is now underway.” – David Hallal, CEO .
• “The impact in the marketplace really should be almost seamless… whether… distributing… from the Bloomington facility or the new second vial.” – Keith Woods, COO .
• “Our first objective here is to bridge the financing till the approval… extend our loan facility… Royalty probably comes next… equity… last and the most expensive.” – Vikas Sinha, CFO .

Q&A Highlights

• Regulatory path and timeline: Management expects the reinspection to occur before resubmission; resubmission likely after a successful reinspection; class/timeline to be guided by FDA; tone from Type A meeting was constructive .
• Manufacturing redundancy: Second U.S. vialer capacity secured (Q1’26) with minimal changes vs primary vial to speed validation; operational impact expected to be seamless .
• Financing approach: Company intends to expand its credit facility, may consider royalty financing; aims to avoid equity raises; runway into 2027 assumes ~$60M warrant exercises and excludes PRV/launch proceeds .
• Commercial readiness: Additional time used to deepen engagement across ~140 SMA centers and multidisciplinary teams; broader regional payer engagement ongoing .
• EMA linkage: Mutual recognition/interdependency of manufacturing compliance acknowledged; mid‑2026 decision still expected .

Estimates Context

• Q3 2025 EPS was -$0.90 vs S&P consensus of -$0.84 (miss of $0.06); revenue was $0 vs S&P consensus of $50,000 (immaterial miss in pre‑revenue context) *.
• With U.S. launch now anticipated in 2026 and investments continuing ahead of approval, street models may push out first revenue and adjust OpEx cadence; watch for updates post reinspection/minutes.
  *Values retrieved from S&P Global.

Key Takeaways for Investors

• Regulatory: The CRL was manufacturing‑site related only; Type A meeting constructive; watch for FDA reinspection outcome and meeting minutes – these are the gating catalysts to resubmission and to confirming 2026 approval/launch timing .
• Supply chain: Second U.S. fill‑finish facility with Q1’26 capacity and ongoing tech transfer reduces reliance on Bloomington and supports stable commercial supply post‑approval .
• Commercial readiness: U.S. field and market access teams are in place and using extra time to tighten payer and center engagement; could support efficient uptake once approved .
• Financial runway: $369.6M cash at Q3; plan to expand debt and avoid dilution; runway into 2027 provides buffer through anticipated 2026 approval and early launch activities .
• Expense trajectory: G&A step‑up reflects launch build (professional services, headcount, SBC); expect some spend deferrals until approval but elevated OpEx likely persists into pre‑launch period .
• Pipeline momentum: OPAL dosing underway; SRK‑439 entering the clinic in Q4 2025; second apitegromab indication to initiate by YE25—each offers medium‑term optionality .
• EU optionality: EMA mid‑2026 decision pathway intact; ex‑U.S. launch sequencing remains a lever for medium‑term growth once U.S. is clarified .

Appendix: Additional Data Points

• Stock‑based compensation in Q3: $18.3M total; R&D $5.5M; G&A $12.8M .
• y/y deltas: Net loss widened ($102.2M vs $64.5M), G&A +$37.0M y/y; drivers include launch infrastructure, headcount, professional services, and severance .
• SAPPHIRE published in The Lancet Neurology with significant HFMSE benefit and favorable safety; underpins clinical value narrative at launch .