Biohaven’s SMA Trial Miss Bolsters Scholar Rock Stock: Analysts Give Verdicts, Retail Watches Closely
By Stocktwits Inc | First Published Nov 26, 2024, 12:39 AM ISTLast month, Scholar Rock achieved the primary endpoint in the company's own Phase 3 trial of apitegromab in SMA patients.
Shares of Biohaven Pharmaceutical Holding Company ($BHVN) rose 2% on Monday afternoon, reversing early losses, while rival Scholar Rock Holding Corp. ($SRRK) surged over 30% to three-year highs after Biohaven’s spinal muscular atrophy (SMA) trial failed to meet its primary endpoint.
Biohaven’s RESILIENT SMA study found that its treatment, taldefgrobep alfa, showed clinically meaningful motor function improvements at all time points on the Motor Function Measurement-32 (MFM-32) scale. However, the primary endpoint — statistical separation from placebo at 48 weeks — was not achieved.
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Last month, Scholar Rock achieved the primary endpoint in the company's own Phase 3 trial of apitegromab in SMA patients.
JPMorgan deemed the trial setup “high in risk” and noted that many investors had not attributed significant value to the program, minimizing downside to Biohaven’s stock. The brokerage called the setback a “net positive” for Scholar Rock, as it removes near-term competition from another myostatin inhibitor.
RBC Capital lowered its price target for Biohaven to $58 from $66 but maintained an ‘Outperform’ rating, citing favorable trends Biohaven plans to discuss with the FDA.
Meanwhile, Jefferies pointed out that Scholar Rock now appears as a “cleaner story” with a clearer path to SMA market dominance and reiterated its $50 price target on SRRK.
Truist raised its price target for Scholar Rock to $45 from $36, emphasizing its strengthened position in SMA and increasing its peak sales forecast for apitegromab to $1.5 billion.
Wedbush also raised its target to $47 from $40, highlighting apitegromab as the likely first-to-market agent in its class with potential approval as early as Q4 2025.
However, H.C. Wainwright maintained a ‘Buy’ rating on Biohaven, citing a positive signal for taldefgrobep alfa in reducing body fat mass, hinting at potential use in obesity treatment. The firm sees this as a possible pivot for Biohaven despite the SMA trial setback.
On Stocktwits, sentiment for Scholar Rock turned ‘extremely bullish,’ while Biohaven saw a shift to ‘bearish’ amid heightened message activity. Biohaven was among the top 20 trending symbols by early afternoon.
Scholar Rock has also generated interest for its ongoing Phase 2 trial targeting muscle preservation in patients experiencing rapid weight loss from GLP-1 weight-loss drugs, a burgeoning market.
Spinal muscular atrophy, a rare neuromuscular disease affecting 30,000–35,000 people in the U.S. and Europe, presents a significant market opportunity.
Year-to-date, Scholar Rock’s stock has risen over 120%, while Biohaven shares have gained 11%.
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