Scholar Rock Holding Corporation (NASDAQ:SRRK) Q2 2025 Earnings Call Transcript

Scholar Rock Holding Corporation (NASDAQ:SRRK) Q2 2025 Earnings Call Transcript August 6, 2025

Scholar Rock Holding Corporation misses on earnings expectations. Reported EPS is $-0.98 EPS, expectations were $-0.66.

Operator: Good morning, ladies and gentlemen, and welcome to the Scholar Rock Second Quarter 2025 Business Update Conference Call. [Operator Instructions] This call is being recorded on Wednesday, August 6, 2025. I would like to turn the conference over to Scholar Rock. Please go ahead.

Rushmie Nofsinger: Good morning. I’m Rushmie Nofsinger, Vice President of Corporate Affairs and Investor Relations at Scholar Rock. With me today are David Hallal, Chairman and Chief Executive Officer; Akshay Vaishnaw, President of R&D; Keith Woods, Chief Operating Officer; and Vikas Sinha, Chief Financial Officer. For those of you participating via conference call, the accompanying slides can be accessed by going to the Events section of the Investors page on our website. During today’s call, as outlined on Slide 2, David will provide introductory remarks and provide a general business update. Akshay will review our clinical and regulatory progress. Keith will provide an update on our commercial readiness activities for apitegromab, and Vikas will provide commentary on our financials.

And then we will open the call for questions. Before we begin, I’d like to remind you that during this call, we will be making various statements about Scholar Rock’s expectations, plans and prospects that constitute forward-looking statements for the purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any future date. I encourage you to go to the Investors and Media section of our website for our most up-to-date SEC statements and filings. With that, I’d like to turn the call over to David. David?

David L. Hallal: Thanks, Rushmie, and good morning. Thanks to everyone for joining our Q2 update call today. This is an exciting time of great strength and opportunity at Scholar Rock. We are scaling for the next phase of growth as a commercial stage fully integrated global biopharmaceutical company. Our three core priorities drive our vision of becoming a global biotech powerhouse. First, apitegromab regulatory approvals; and following those approvals, the U.S. launch of apitegromab for children and adults with SMA; followed by a series of country launches in the coming years, starting in Europe, with Germany next year. Second, expand apitegromab into additional rare, severe, and debilitating neuromuscular diseases. And third, disciplined capital allocation to support our high-value commercial and development initiatives.

With respect to our ongoing regulatory processes, we are working collaboratively with the FDA and European Medicines Agency. We are also urgently preparing for our U.S. commercial launch as our BLA has been accepted under priority review with a target action date of September 22. As you are aware, GxP inspections are part of the standard FDA review process, including those relating to pre-approval inspections, clinical trial site inspections and manufacturing site inspections. These inspections often result in observations requiring responses within the review cycle. The FDA has conducted a full set of inspections; and as part of this process, noted observations at 2 of our CDMOs. On Friday, August 1, another pharmaceutical company disclosed observations as part of an FDA general site inspection at their filler, Catalent, Indiana, which was recently acquired by Novo Nordisk.

Our fill/finish for apitegromab is conducted at the same site. The general site inspection of the facility was not specific to apitegromab. Novo Nordisk submitted a robust and comprehensive response earlier this week to the observations noted by the FDA. For the other CDMO, observations were received at the conclusion of a pre-licensing inspection and a comprehensive response will be submitted within the next week. We continue to work collaboratively with the agency. Importantly, the FDA recently completed our late cycle meeting following both site inspections. We are encouraged by the dialogue with the agency at the late cycle meeting where the FDA indicated that they are working towards completing the review of our BLA by our September 22, PDUFA date.

Earlier this year, we also filed our MAA for apitegromab in the EU, and we continue to work with the European Medicines Agency and expect a potential approval near mid-2026. We are planning for Germany to be our first European country launch with an ambition to reach patients with SMA across all of Europe, followed by additional countries in Asia Pacific and Latin America over time. The global opportunity with apitegromab in SMA alone offers the potential for many years of sustainable growth through the end of this decade and into the next. Along with Keith, Akshay, and Vikas and the other leaders at the company, we have bolstered Scholar Rock’s capabilities as we advance our mission to deliver apitegromab to children and adults with SMA. This is indeed what we know well and what we do well.

In addition to the large opportunity to serve patients with SMA, we will continue to expand our pipeline by planning additional opportunities for apitegromab for children and adults suffering with additional rare, severe, and debilitating neuromuscular disorders, which Akshay will discuss in more detail shortly. Importantly, to grow Scholar Rock, we are taking a thoughtful, deliberate approach to capital allocation by staging our investments along with our commercial progress in serving the SMA community. Q2 has been exceptionally productive. In the quarter, when Keith joined our team as our Chief Operating Officer, he brought a proven track record of building and leading teams to deliver highly successful rare disease global launches in the neuromuscular therapeutic area, including most recently with Vyvgart.

Under Keith’s leadership, we have assembled an exceptionally experienced, talented and patient-centric field team committed to the SMA community. Impressively, over just a few months, the team is on board, trained and deployed and are ready to deliver apitegromab to the SMA community pending approval in September. Despite currently available treatments that have been approved over the past 10 years, we are acutely aware that muscle strength and motor function are among the top unmet needs in SMA, which we believe can be addressed with the potential approval of apitegromab, the world’s first and only muscle-targeted therapy to deliver statistically significant and clinically meaningful improvements in motor function in a pivotal Phase III trial.

I would like to now turn briefly to the readout of the positive Phase II EMBRAZE proof-of-concept study in Q2. The goal of EMBRAZE was to understand the role of targeting myostatin in the treatment of patients with obesity. We are pleased that the EMBRAZE study met the primary endpoint with patients on tirzepatide. Apitegromab increased lean mass preservation by greater than 54% compared to tirzepatide alone with a p-value equal to 0.001 with an encouraging safety profile. We are very pleased that the highly selective anti-myostatin approach from our innovative platform continues to deliver. While we remain focused on advancing apitegromab in clinical development for additional rare, severe and debilitating neuromuscular disorders, EMBRAZE raises the exciting possibility to partner our potent and selective approach to targeting myostatin.

As we communicated at EMBRAZE’S data readout, in addition to SRK-439, we have a number of earlier-stage research assets, both anti-myostatin antibodies and the fusion of those with GLPs, which we think have the potential to be meaningful therapeutic candidates in the future. As we look forward, we remain very focused on the nearly 35,000 patients with SMA globally that have received SMN-targeted therapies. While we anticipate the global launch will commence in the U.S. in Q3, pending regulatory approvals, we are also making preparations to serve children and adults with SMA in Europe, Asia Pacific and Latin America. Our ambition at Scholar Rock is that globally, any patient with SMA who can benefit from apitegromab should have access to apitegromab.

At this point, I’ll turn the call over to Akshay to provide a more detailed update on our R&D progress. Akshay?

Akshay K. Vaishnaw: Thanks, David, and good morning, everyone. SMA is a rare, severe neuromuscular disease, resulting in irreversible loss of motor neurons and progressive muscle wasting that causes continuous motor function decline throughout life, diminishing the independence of both children and adults. There’s been progress over the last decade with new therapies for SMA. However, despite the chronic use of these SMN correctors, SMA remains a devastating disease for children, adults and their families living with the disorder. Patients experience muscle wasting that impacts all aspects of mobility, basic activities of daily living like eating, washing and dressing and the ability to live independently. Motor unit has two key components; motor neuron itself, and muscle.

SMN-targeted therapies are aimed at preventing motor neuron loss, but muscle, the principal organ effect in SMA has not been directly addressed. Given that motor function depends not only on neuronal signaling, but also on muscle responsiveness, approaches that target muscle from the start are urgently needed. Our SAPPHIRE trial showed that in those receiving chronic ongoing SMN-targeted therapies, apitegromab has the potential to reverse the progression of SMA from a loss of motor function to a gain of motor function. Specifically, the study demonstrated a statistically significant improvement in motor function as measured by the gold standard Hammersmith Motor Function Scale, while patients on placebo worsened. Importantly, patients treated with apitegromab had an approximately threefold higher chance of a 3.0 or greater increase in Hammersmith versus those on placebo.

In addition, there was a consistent 1.8 point improvement in Hammersmith across all ages in our Phase III trial. Along with the encouraging safety profile, the SAPPHIRE data suggests that apitegromab has great potential to provide clinically significant benefit to patients with SMA despite the chronic use of SMN-targeted therapies. As David mentioned, our BLA was accepted under priority review, which recognizes the potential of apitegromab to be a treatment for a serious or life-threatening condition, or to provide a significant improvement in safety or effectiveness over existing treatments. I’m excited that our team continues to work collaboratively with regulators towards the September 22 PDUFA date. With respect to Europe, the MA was validated by EMA, and we look forward to further review and the approval of apitegromab in Europe in 2026.

Turning to the next slide. I’m pleased to report that we’re on track to initiate the Phase II OPAL Trial in children under the age of 2. The study is evaluating 2 different doses over the course of 48 weeks and will assess PK, PD, efficacy and safety. The enrollment criteria are broad, and infants and toddlers may be enrolled with any approved SMN-targeted therapy, including gene therapy. Early intervention with apitegromab in the OPAL study could support muscle during a critical early developmental phase, complementing SMN-targeted therapies that aim to preserve most neurons. By promoting muscle growth, when both motor neurons and muscles are still forming, apitegromab has a unique opportunity to improve motor outcomes in babies and toddlers with SMA.

Turning to our plans for the study of apitegromab in additional rare and severe neuromuscular disease. At the outset, let me state that the potential to prevent muscle loss and enhance muscle growth by blocking myostatin holds great potential across a wide array of diseases. Here, you see just two examples of that potential in mouse models of the severe debilitating disorders, duchenne muscular dystrophy, or DMD, and facioscapulohumeral dystrophy or FSHD. In the DMD model on the left, the inclusion of an anti-myostatin antibody in mice receiving an exon skipping oligo is associated with a dramatic increase in the level of dystrophin and a resulting increase in muscle force. FSHD is a neuromuscular disease, resulting in patchy changes with affected and unaffected motor fibers.

In the FSHD model on the right, treatment with an anti-myostatin antibody results in hypertrophy of unaffected motor units, and once again, an impressive gain in motor function. We continue our evaluations of an anti-myostatin approach in DMD and FSHD as well as in other models of disease, and we will initiate the study of apitegromab in an additional neuromuscular indication by the end of 2025. In June, we were gratified to announce the exciting results from our EMBRAZE proof-of-concept study. David has covered those findings, including that the study met the primary endpoint with an encouraging safety profile. These findings are important as preservation of lean mass during GLP-1-mediated weight loss has the potential to enhance both cardiometabolic and musculoskeletal health.

Next, we continue to advance our world-leading anti-myostatin platform beyond apitegromab. Further to our commitment to neuromuscular disease, SRK-439 builds on the validated approach that delivered apitegromab. There’s great potential for SRK-439 to be an infrequent, potent subcutaneous anti-myostatin antibody, and we look forward to exploring its potential as another innovative Scholar Rock therapy for patients suffering with severe neuromuscular disorders. We remain on track to file the IND application for SRK-439 to support the first-in-human study later this year. I’d like to conclude by reiterating our key priorities. Number one, drive the U.S. approval of apitegromab in Q3 2025, and advance the EU toward approval in 2026. Number two, initiate a study of apitegromab for infants and toddlers with SMA under the age of 2 in Q3 ’25.

Number three, initiate clinical development of apitegromab in at least one additional neuromuscular indication by the end of ’25. And finally, file an IND for SRK-439 in the second half of ’25. With that, I’ll turn the call over to Keith to provide a commercial update. Keith?

R. Keith Woods: Thanks, Akshay, and good morning, everyone. With apitegromab advancing through the regulatory processes in the U.S. and Europe, we are preparing to usher in a new era for the treatment of children and adults with SMA. This is a progressive and devastating disease that leads to loss of mobility, limited activities of daily living and a lack of independence. If muscle is left untreated, it can result in irreversible atrophy. We are excited about apitegromab’s potential as the first and only muscle-targeted treatment to show clinically meaningful and statistically significant motor function improvements in children and adults living with SMA. The SMA community is calling for a treatment to address progressive muscle degeneration and motor function loss.

To underscore this, a 2025 Cure SMA survey showed that 90% of patients report that their greatest unmet need is to gain muscle strength. Our market research and interactions with health care professionals tell us that 80% of treating neurologists agree that preserving muscle should start as early as possible in treating patients living with SMA. Neurologists recognize that in the future, a treatment approach of dual modalities to target the motor neuron and the muscle will be necessary to treat SMA. We are on track with the preparation of the global launch of apitegromab, starting with the U.S. Based on our September 22 PDUFA date, we will execute our commercial launch of apitegromab immediately following our FDA approval. In Europe, our MAA is under review by the European Medicines Agency, and we are preparing to launch upon approval in 2026.

I’m excited to announce that as of today, under the leadership of our U.S. General Manager and Chief Brand Officer, Rebecca McLeod, our U.S. customer-facing team is fully on board, trained and now deployed in the field. Our team is currently engaging with the SMA treatment centers, key opinion leaders and both public and private payers. We are impressed by the talent, the extensive rare disease experience and the passion to serve patients that our new team members bring. The team is comprised of many professionals that have substantial experience in serving the SMA community or the broader neuromuscular disease community, and we are united by a commitment to serving these patients. Today, in the U.S., there are approximately 10,000 patients living with SMA and roughly 2/3 of them have received an SMN-targeted therapy.

These investments we are making position us to reach these patients with apitegromab and will provide a blueprint for our global rollout. Globally, there are approximately 35 patients with SMA that have already received an SMN-targeted therapy, and we have an enormous opportunity to make a meaningful difference with apitegromab with the potential to reverse progression of SMA from a loss of motor function to a gain of motor function. The entire Scholar Rock team is ready to serve the SMA community, and we will move with a sense of urgency to deliver apitegromab to them following approval. Now I will turn the call over to Vikas. Vikas?

Vikas Sinha: Thank you, Keith, and good morning, everyone. I’m pleased to provide our Q2 business update and provide insights into how we are thinking about resource allocation in the future. The opportunity with apitegromab in SMA alone offers the potential for many years of sustainable growth and will enable strategic, thoughtful investment in our pipeline to develop new indications and new therapies for an increasing number of patients. These pipeline investments will be aligned to our commercial success. We ended the quarter with $295 million. During the quarter, we continued to increase our investment in infrastructure to support commercial readiness and our supply of apitegromab to support the launch. As we look ahead, we are prioritizing the commercial launch and our ongoing clinical programs.

We have an additional $50 million under our debt facility that we can draw down this year, and we also anticipate receiving approximately $16 million from exercise of outstanding common warrants by year-end, bringing our anticipated runway into 2027. Additionally, $50 million is available under our debt facility post approval to support the upcoming launch. We also anticipate monetizing our priority review voucher following approval. We continue to operate with a tight financial plan, and we’ll share more details over the next few quarters. As a reminder, we will continue to focus on driving strong performance with financial discipline; next, investing in capital-efficient commercial build-out; and thoughtful capital allocation to advance our pipeline.

With that, I will turn it back to David. David?

David L. Hallal: Thanks, Vikas. In closing, we are committed to successfully executing on these key priorities, which position us to transform Scholar Rock into a premier global biotech leader. First, apitegromab regulatory approvals and following those approvals, the U.S. launch of apitegromab for children and adults with SMA, followed by a series of country launches in the coming years, starting in Europe with Germany next year; second, expand apitegromab into additional rare, severe and debilitating neuromuscular diseases; and finally, disciplined capital allocation to support our high-value commercial and development initiatives. On behalf of every member of the Scholar Rock team, I want to emphasize our unwavering commitment to more than 35,000 patients and their families. Our mission is to move with urgency to ensure that no patient with SMA is left behind. With that, we’ll now open the line for questions. Operator?

Q&A Session

Operator: [Operator Instructions] And your first question comes from the line of Eric Schmidt with Cantor.

Eric Thomas Schmidt: I appreciate the transparency around your CDMO issues. Can you tell us a little bit more about the specific observation at those 2 sites, whether you expect that a reinspection is going to be required prior to apitegromab approval and whether the 2 facilities right now are currently able to release other pharmaceutical products?

David L. Hallal: Yes. Thanks very much, Eric, and it’s great to be working with you. First, I think, as you know, Eric, GMP inspections are super standard as part of the FDA review process. And in fact, in 2024, based on FDA’s inspection data dashboard, actually more than 70% of drug quality assurance inspections resulted in observations noted by the FDA. So as I noted in the call, we — look, we’re disappointed, but we weren’t surprised to learn that 2 of our sites received observations. I think the benefit for us is those observations were presented well within our review cycle that allow for a response and obviously, a green light. It’s always like very difficult to sort of read the tea leaves and try to understand what the FDA with those observations may want to do, would they want a reinspection or not.

At this moment in time, given the very constructive late cycle meeting that again was held after these site inspections and after these observations were provided, again, the tone and tenor and collaborative nature of that late cycle meeting certainly indicated to us that the agency is very much working toward completing their review of our BLA by the September 22 PDUFA date. I would also just note that we’re obviously working on multiple levels with our CDMO partners. We’re a skilled team. We’re an experienced team. We understand how best to work through situations like this, which we are prepared to do.

Eric Thomas Schmidt: And David, do you know whether the 2 facilities are releasing any product currently?

David L. Hallal: Very good question. The 2 facilities continue to operate, of course, — the one that given the disclosure on August 1, it’s not common practice in the industry nor our common practice to name facilities. But in the case of Catalent, Indiana, now owned and operated by Novo Nordisk, certainly, as you know, Eric, that’s an important filler across the board for a number of very important products across the industry, and we know they continue to be very active. And the other facility continues to manufacture product as well. I think I would also note, and I think this is probably important for our entire audience, our supply chain has produced the apitegromab drug supply that has now accumulated over 600 patient years of experience through multiple years of clinical trials, including our pivotal trial and the most recent EMBRAZE trial. And I think importantly, I’d like to note that our launch supply and beyond is manufactured, vialed and ready to go.

Operator: Your next question comes from the line of Allison Bratzel with Piper Sandler.

Allison Marie Bratzel: First, could you just further characterize any interactions with FDA on the apitegromab review outside of the observations at CDMOs you just discussed? Any feedback on your overall confidence in receiving a broad label would be particularly helpful. And then I think you talked about expansion of payer outreach. So could you just frame for us how your discussions with U.S. payers are going and just overall receptiveness to coverage of apitegromab on top of SMN targeting therapy?

David L. Hallal: Yes. No, thanks, Allison. And yes, as we noted we were very encouraged by our late cycle meeting that we recently had, and Akshay can provide a little bit more context on that. And then as I noted, and Keith did as well, he’s just recently deployed a sensational team, and he can comment on some of those payer interactions. Related to the label and the interactions with the FDA, Akshay?

Akshay K. Vaishnaw: Yes. Thanks, David. We had an exceptionally constructive late cycle meeting recently with the FDA. All the different disciplines that needed to be there were there. We talked through the different aspects of the BLA. I think we were very pleased with the feedback we had. And so we’re working with them, as David said in his prepared statement towards September 22 and look forward to the rest of the BLA review being completed. And we appear to be doing just that right now.

R. Keith Woods: Yes, Allison. And as far as the payers, as we’ve noted before, we have a fully staffed payer team. Our outreach has been progressing to be able to be ready for our September 22 PDUFA date. The meetings have been going positive as we’ve been going through some of the apitegromab data and overall response. But importantly, the durability of response is something that payers have found quite impressive. Lastly, to your other question about paying for another therapy for SMA, I would say that you already have better than 20% of patients that are receiving more than one SMA therapy that is being paid for by payers at this time. So although the question has come up, the unmet medical need is there. And therefore, all I can say is the discussions are going positive.

Operator: Your next question comes from the line of David Nierengarten with Wedbush Securities.

David Matthew Nierengarten: I just had one on the labeling. Have you had labeling discussions with FDA and able to discuss possible labels with payers? Or is that to be discussed with the PDUFA date or as we approach the PDUFA date? And then the second one is if there is unfortunately a delay in the PDUFA, does that possibly put the PRB at risk if there are different changes in the budget that starts on October 1st of the fiscal year?

R. Keith Woods: Yes. Maybe I’ll take that second or last question, David, first. There would be no change in PRB. And I think you’ve all come to know us, this group of management team. We’re — we think about everything. We’re a measure twice, cut once type of crowd. And we would think through any scenarios even before; as we mentioned, we weren’t totally surprised by observations only because 3/4 of the time they happen. And so we would have been thinking through all of this. And there’d be no impact on the PRB at all, which is important and very good news. Regarding just the constructive nature of the dialogue and the label, I’ll have Akshay comment.

Akshay K. Vaishnaw: Yes. So with respect to that topic, again, we had a very good late cycle meeting. And as you can expect at the late cycle meeting, all the different aspects of the BLA leading to a potential approval are discussed, including labeling and the timings around who can expect what. We’ve had those types of interactions. I can’t get into more details than that right now, but we were reassured that everyone is working towards September 22.

Operator: Next question comes from the line of Tess Romero with JPMorgan.

Tessa Thomas Romero: So just double-clicking back on some of the earlier comments you’ve made, what is the right way to think about the next step following these observations given proximity to your goal date? And how likely do you think that the outcome of the review will be positive in light of these findings and remain on time? And then my second question is, what does an ideal label look like for apitegromab? And at this point, what do you believe the indication statement should be?

David L. Hallal: Thank you, Tess. Great questions. So just kind of letting you into our kitchen a little bit, what you might expect us to be doing is working very closely with our CDMO partners. So in other words, like being well aware of the observations, having input on the responses to those observations and then having levels of transparency, both with the CDMOs and their communication with the agency as well as our own continued dialogue with the agency through the final stages of our review process. And so I would just say that we have substantial talent internally. We would always take a no stone left unturned approach to external experts to help us and help our CDMO partners think through the very best way to respond to observations.

As I noted, we’re confident that Novo submitted, and we actually have access to those responses that they made earlier this week. And the same will hold true for the responses that are going in within the week related to the other CDMO. So we’ll have a great visibility into this and then multiple lines of communication through our CDMO partners as well as the FDA directly. Related to the IDL label, I’d turn over to Akshay and Keith, one of the things we’ve worked very hard on by taking a no shortcut approach to the development program is the robustness of our Phase II and then Phase III trial. And so obviously, when we think about children and adults with SMA, we think about aligning with our partners at Cure SMA really for the best interest of the community, a broad label is quite important so that all patients who can benefit from apitegromab will have access to apitegromab.

For more comments on the label, I’ll hand it over to Akshay.

Akshay K. Vaishnaw: Yes. Thanks, David. So with respect to that topic, SAPPHIRE itself studied individuals 2 years and older to the age of 21. The primary endpoint was for the group that was 2- to 12-year-old. We obviously hit that primary endpoint, we relay the data again today. The important thing is that the data in the 13 to 21 were also entirely consistent with what we saw in the 2 to 12 group. And so I think we can expect that those on the 2 that were not studied may not be in the label, but certainly above 2, we would like to see those in the label given the very exciting findings from SAPPHIRE all the way up into adulthood. And if a patient in SAPPHIRE is 21 years old and is experiencing benefit, they’re not going to suddenly stop getting benefit when they’re 22.

So I think from a logic perspective, 2 years and older is a way to think about the group that would be eligible. But again, we cannot give any final information on that until the FDA has finished their deliberations. But —

R. Keith Woods: Yes. And one last thing I’d comment on in our very strong partnership with Cure SMA. They’ve actually advocated with the FDA for many years the importance of sometimes a narrower clinical trial, but a broader label, recognizing the biology of the disease isn’t necessarily different as patients get older. We were gratified that our most recent study in adults, over 100 adults showed the biology of myostatin again held up. That, of course, was with the EMBRAZE trial. But it has been common practice that there can be a slightly narrower patient population in a pivotal trial, but then an acceptance of a broader label, and that’s what we’re working toward. The ideal label, as Akshay said, would be the patients at 2 years of age and older would have access to the therapy.

Operator: And our next question comes from the line of Marc Frahm with TD Cowen.

Marc Alan Frahm: Maybe first, can push a little bit on the pricing discussion that you’re having with payers. Just I think we are encouraged that 20-plus percent of patients are getting combination therapy today even without Phase III data supporting that. But maybe the ask on the payers is a little bit different with that, right, because most of that is onetime gene therapy costs that may have already occurred and then on an annual budget basis, just one therapy. Just can you talk through how they’re kind of thinking through the budget impact of maybe 2 SMA type pricing drugs in individual patients happening on a concurrent and ongoing basis? And then maybe from the R&D side, starting a new indication later this year. Should we view that as like one pilot outside of SMA? Or is that just the first of many we should expect as we go into ’26, additional indications to continue to be added to the pipeline?

David L. Hallal: Marc, thanks. Very thoughtful questions. On the pricing side, I would note, of course, as I have in the past, that we’ll consider a number of things when establishing the price. Certainly, the rarity of SMA — and you talk about budget impact as an individual patient, we obviously think about just how rare SMA is, the severity of the disease despite the use of — over the past 10 years — of SMN-targeted therapies, where they have shown in some of their long-term data, and we then again underscored in our Phase III trial that patients eventually move to a progressive state of motor function loss and how severe SMA is despite the use of best known standard of care. And then, of course, the compelling clinical benefits that we can provide.

And some of those were underscored by Akshay earlier. And so we’ll think about those things. We’ll think about the budget impact. One of the things we also have a lot of experience with is looking at even sort of pricing corridors for rare disease therapies, monotherapies in different settings and sort of thinking about sort of where the starting point is today, we definitely do not think the air is thin in terms of payers’ willingness to support both physician interest as well as patient interest and accessing, and Keith will comment in a moment on the importance of dual modality therapy for this devastating disorder. Keith?

R. Keith Woods: Yes. Thanks, David. Marc, one of the things is you mentioned that this is using 2 agents is just post Zolgensma. And I just want to call out that we actually have met with patients and physicians that have tried both risdiplam and Spinraza simultaneous. So they’re paying for 2 current agents at the same time. So it’s not just post-gene therapy. The bottom line is that over time, these patients on these SMN-targeted therapies, many of them plateau and then they begin to decline and payers are realizing that there is a great deal of unmet medical need that’s left. If I think about the fact, as David mentioned, treating with dual modality and targeting the muscle directly as well as the motor neuron, it gives you an opportunity to potentially not only increase your response as we’ve shown from the SAPPHIRE data, but then also have a durability of response over time. And so that is a meaningful impact that is valuable to payers.

David L. Hallal: And then, Marc, regarding the other sort of the pipeline and a product strategy that Akshay is so skillfully leading, I’ll have him comment.

Akshay K. Vaishnaw: Yes. Thanks, Marc. So we see enormous opportunity for antagonist myostatin in a whole array of neuromuscular disorders. And so yes, there will be many opportunities that you’ll see us studying. We’ll begin with one by the end of the year, but I think it will add to that in quick succession over time. So much more to come on that.

Operator: And your next question comes from the line of Martin Auster with Raymond James. Uknown Analyst This is Thomas on for Martin. Maybe just one on the OPAL Trial here. Anything you can say about expected enrollment time lines there? And maybe just frame for us how to think about the significance of that expansion opportunity if we envision an initial label for apitegromab in patients 2 years and older.

David L. Hallal: Yes. Thank you very much. And consistent with our ambition and mission at the company that no patient would ever be left behind, including babies and toddlers, this is an important study for us. And as Akshay noted, so I’ll have him comment a little bit further on the study and expected time lines.

Akshay K. Vaishnaw: Yes. Thanks. So with respect to time lines, we are going to start enrollment in Q3, as I said on the prepared remarks. My usual practice is let’s get that going. And then in the coming quarter or 2 as we see momentum build, we’ll be able to guide further on the exact completion date of the study. And with respect to 0 to 2-year-old children with SMA and the label, we didn’t study under the age of 2 in the SAPPHIRE study. We’ve initiated the study to understand the impact of the drug in that population, safety, PK/PD efficacy. And as David said, no child should be left behind with this disease, and we think apitegromab can have an impact across the entire age range here. I think in terms of trying to do good with this drug and helping as many kids as possible, one thing I would note is that the prevalent population is much, much larger than the incident population.

And so the 0 to 2 are the new children being born with SMA, that’s dwarfed by the 35,000 or greater who currently have SMA are on treatments, and we believe could be helped by a drug like apitegromab. So there’s a lot for us to do once we get done and start helping under 2, and we’ll begin with 2 years and older.

Operator: And our next question comes from the line of Srikripa Devarakonda with Truist Securities.

Srikripa Devarakonda: I just want to go back to the CDMO site inspections. If there is a need for another inspection, do you have a sense of time lines as to when you will get to know that buy? And given the CRLs that we’ve seen with one of the peers involved, what are typical time lines for potential resolution of these issues?

Akshay K. Vaishnaw: Yes. Thanks, Kripa. Again, it’s hard to predict what the FDA will do. I mean I think you all do this for a living and as do we. And the best that we can do, like you, is assess what has happened from time to time in the industry and what could be some of the different scenarios. But I can tell you that from all of our experience and that of our expert advisers that we are working with along with our CDMOs, the very best thing to do initially is have a robust response to those observations, and that is what we’ve been spending a lot of time on. The robustness of those responses obviously can have an impact on whether or not any reinspection would be required. And so that’s where our effort is being placed.

And then again, I think, as I noted, we would be gathering information both through our CDMO partners, but then also directly with the review decision. And we’ll keep you apprised at that. But right now, given the fact that following these site inspections and following the presentation of those observations, we held our late cycle meeting. The FDA completed that late cycle meeting. The dialogue, the tone, the content of the discussion was very encouraging with a commitment to move forward toward our PDUFA date under priority review of September 22, and we will certainly keep you and all of our stakeholders apprised on that progress.

Operator: And our next question comes from the line of Evan Seigerman with BMO Capital Markets.

Evan David Seigerman: Two questions from me. Can you provide more color or characterize the interactions from your late cycle review meetings? Did they at all talk about just the difference in efficacy we saw between the 20-milligram and the 10-milligram doses. And then also, Vikas, one for you. As we think about kind of modeling the asset post launch, how should we think about the cadence in the back half of this year and into next year?

David L. Hallal: Yes, Evan, great question. Regarding the combined dose analysis, I’ll have Akshay comment on that, which obviously, as you know, there’s been extensive clinical work done with the 10 and the 20 most recently EMBRAZE was 10. Akshay?

Akshay K. Vaishnaw: Yes. So the late cycle interaction was indeed very constructive and positive. So we have discussed the file fully, including the combined dose analysis with all of you before, and we’ve had very constructive discussions with regulators around that as well. As you know, we hit the primary endpoint. The important thing is both 10 and 20 have an almost identical pharmacodynamic effect. And so it’s unsurprising that both showed a positive outcome with efficacy and combining the 2 groups increased statistical power to be able to see the difference versus placebo. And obviously, we saw a gain in most function with apitegromab versus a decline. And our expectation is that given that the regulatory practice always to approve the lowest dose that’s efficacious and given that both have equivalent pharmacodynamic impact, we would request that 10 milligram per kilogram is the approved dose. So I’ll leave it there.

Vikas Sinha: On the financial side, we still to do the 2026 budget planning session, but as I mentioned in my call, we’re going to be very thoughtful about how we go into next year. Some of the expenses in the clinical side is going to drop out next year, and then we’ll replace it with the prioritization as Akshay was laying out in his section with moving 439 and some of the pipeline forward. So that’s other indications for us. So that’s our key priority and keeping our overall spending in check, we do expect it to be in similar lines like what we spent this year.

Operator: Thank you, ladies and gentlemen. This concludes the Q&A session and concludes today’s call. Thank you all for joining. You may now disconnect.