Scholar Rock Holding Corporation (SRRK) Q4 FY2025 Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by. Welcome to the Scholar Rock Fourth Quarter 2025 Financial Results and Business Update Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Scholar Rock. Please go ahead.

Good morning. I'm Laura Ekas, Vice President of 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. During today's call, David will provide introductory remarks and a business update. Akshay will review our R&D progress. Keith will provide an update on our commercial readiness activities and Vikas will provide a financial update. We will then 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 & 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?

Thank you, Laura, and good morning. Thanks to everyone for joining our fourth quarter and full year 2025 earnings call. Scholar Rock is poised for a transformative year in 2026. Our priorities are clear, and we are executing with focus, discipline and urgency as we seek to deliver the world's first muscle-targeted therapy to children and adults living with SMA, while also laying the foundation to realize our ambition to develop life-transforming therapies for patients with additional rare and severe neuromuscular diseases globally. Our highest priority is to bring apitegromab to the SMA community as quickly as possible. We remain relentless on behalf of patients and we are grateful that important progress continues to be made at a steady and rapid pace. Let me briefly summarize the key events that have occurred since our constructive and collaborative in-person Type A meeting in November. First, a week following our Type A meeting the FDA issued a warning letter to Catalent Indiana. Next, Novo Nordisk rapidly responded to the FDA by mid-December. Then following Novo's response, FDA reached out prior to the holidays to schedule an early Q1 meeting. That meeting has since taken place. And importantly, at that meeting, the FDA had no additional request to Novo's remediation plan. And most recently, following the meeting with Novo, we were encouraged that the FDA sent a field team to Catalent Indiana. At the conclusion of the visit, the FDA once again did not have any additional request to Novo's remediation plan and stated to Novo that it intends to conduct a site reinspection following routine manufacturing activities, which has since resumed in late February. The cadence of activity since our Type A meeting reflects the shared understanding between us, the FDA and Novo of the high unmet need in the SMA community and a shared sense of urgency to bring apitegromab to children and adults living with SMA as rapidly as possible. We are pleased with FDA's continued level of engagement, and we expect this momentum to continue. Our team is prepared to resubmit the apitegromab BLA following a successful FDA reinspection of the Catalent Indiana facility. We are reaffirming our guidance of BLA resubmission and U.S. launch following approval in 2026. Also, I am pleased that progress with a second fill-finish facility is moving quickly to build redundancy into our supply chain. Engineering runs at the facility are now underway with additional manufacturing runs to follow. We anticipate filing a supplemental BLA for the second filer later this year. As we advance the regulatory process for apitegromab toward approval for patients with SMA in the U.S., our MAA review continues in Europe, and we expect a decision from the European Medicines Agency in mid-2026. With anticipated regulatory approvals in the U.S. and Europe this year, I would like to now turn to our Scholar Rock commercial launch preparations. In the U.S., our team is deployed in the field and is educating potential prescribers and payers on the unmet need in SMA and the importance of targeting muscle, the principal organ affected in SMA while also broadening and deepening relationships with the community. In Europe, we are building momentum with launch readiness activities and engaging with the SMA community. We continue to plan for a launch in the second half of the year, beginning with Germany. Keith will discuss the substantial progress we are making with commercial preparations and our disease awareness initiatives shortly. We know it is not a matter of if, but when apitegromab will be approved for children and adults with SMA. We are emboldened by the commitment we have made to the more than 35,000 patients globally living with SMA who have received an SMN-targeted therapy. We are working expeditiously to deliver on our ambition that globally, any patient with SMA who can benefit from apitegromab should have access to apitegromab. This is indeed what we know well and what we do well, and we are confident in the significant opportunity that we have to serve patients with SMA. We are ready now more than ever. to usher in the next era of innovation for the SMA community. I would like to now turn to the progress we are making in advancing our world-leading anti-myostatin pipeline. Enrollment and dosing continued in our Phase II OPAL study, evaluating apitegromab in infants and toddlers with SMA. Our IND for apitegromab in FSHD is cleared, and we are on track to initiate a robust, randomized, placebo-controlled Phase II study later this year. With regards to our subcutaneous formulation of apitegromab, we shared the promising results of a Phase I study comparing subcu and IV apitegromab in January. We expect to share our clinical and regulatory strategy for the program later this year. And finally, we continue to enroll and dose participants in our Phase I study for our highly innovative SRK-439 myostatin inhibitor. We expect to have top line data from this study in the second half of this year. Akshay will discuss these programs in greater detail shortly. Turning now to our balance sheet. We were pleased to have added -- we are pleased to have ended 2025 with $368 million in cash and cash equivalents. This includes $60.4 million from the exercise of warrants that were set to expire on December 31. We continue to strengthen our financial position to drive our commercial and R&D priorities and this morning, we are pleased to announce that we have secured a new debt facility for up to $550 million, which Vikas will discuss later in the call. 2026 will be a transformative year for Scholar Rock. We are ready to resubmit our BLA for apitegromab at any moment. Our U.S. commercial team is working with urgency to prepare the market for the launch of the world's first and only muscle-targeted therapy for children and adults living with SMA. Beyond the U.S. the build-out of our 50-country operating platform is underway in Europe with other regions and countries to follow. And our highly innovative world-leading anti-myostatin pipeline with apitegromab and SRK-439 is progressing with strong momentum. The opportunity ahead of us to serve patients with SMA and additional rare and severe neuromuscular diseases is significant. We remain steadfast in our strategy confident in the determination of our team and energized by the transformative potential of apitegromab and our broader pipeline. The road ahead is one of purpose progress and extraordinary possibility. And with that, I'll now turn the call over to Akshay for an R&D update. Akshay?

Thank you, David, and good morning, everybody. As David noted, we remain focused on our apitegromab BLA resubmission to bring this important therapy to children and adults with SMA as rapidly as possible. Since being joined by Cure SMA and Novo at our in-person Type A meeting with FDA leadership in November, I've been pleased by the ongoing level of engagement and progress made on behalf of patients. We expect this momentum to continue, and our team is prepared to resubmit the apitegromab BLA following a successful FDA reinspection of the Catalent Indiana facility. I'd now like to provide an update on the status of our second fill/finish facility, which will strengthen supply continuity and support future commercial demand. As we shared late last year, we are working with a world-class U.S.-based manufacturing facility that has a proven track record of successful FDA and EMA site inspections. Importantly, engineering runs are now underway with additional manufacturing runs planned for Q2, and we continue to expect to submit a supplemental BLA with this facility later in 2026. Outside of the U.S., our apitegromab MAA is progressing through the review process with the EMA, and we continue to anticipate a decision in the middle of this year. Turning to our pipeline. Let me start with the Phase II OPAL trial evaluating apitegromab in infants and toddlers under the age of 2. This trial is enrolling participants who have been treated with an SMN1-targeted gene therapy or who are receiving ongoing treatment with an SMN2-targeted therapy. The study is important for 2 reasons in particular. First, it is anticipated to expand the impact of apitegromab to the full spectrum of patients currently being treated for SMA as this is the first time we're evaluating the use of apitegromab in Zolgensma-treated patients in a clinical trial setting. Second, we believe early interventions with apitegromab could support muscle during the critical early development phase, complementing SMN-targeted therapy that aim to preserve motor neurons. By promoting muscle growth on both motor neurons and muscles are still maturing, apitegromab has a unique opportunity to improve motor outcomes in the youngest patients with SMA to ensure that no patients are left behind. We continue to enroll patients in this study and dosing is ongoing. Turning now to our next indication for apitegromab, facioscapulohumeral muscular dystrophy or FSHD. FSHD is a rare, devastating neuromuscular disease with significant unmet need. More than 30,000 patients are diagnosed in the U.S. and Europe alone, and there are no approved therapies. FSHD is caused by a dysregulation of DUX4, a protein that can cause muscle damage when inappropriately expressed. Symptoms usually begin in adolescents or early adulthood with muscle weakness in the face and upper body, but FSHD can impact any muscle in the body. An estimated 20% of patients will become wheelchair dependent. We're prioritizing FSHD as the next indication for apitegromab for 3 key reasons. First, there is significant unmet need in this population for a safe and effective therapeutic. Second, we have preclinical data from the gold standard FLExDUX4 mouse that provides mechanistic rationale for apitegromab in FSHD. Using this mouse model, we've shown that myostatin inhibition can produce robust increase in muscle mass, significant improvements in muscle force and consistent gains in endurance after 28 days. Third, there are randomized studies in FSHD that suggest muscle mass can increase and has the capacity to show functional benefit. For example, in studies of either rigorous physical therapy or treatment with anabolic agents, patients with FSHD demonstrated increases in lean mass and muscle function. These data suggest that apitegromab as a monotherapy may have the potential to bring important benefit to FSHD patients. The FSHD IND is cleared, and our next step is to conduct a robust randomized double-blind, placebo-controlled Phase II study that is expected to enroll 60 patients. The study, called FORGE, is on track to initiate in the middle of this year. We also continue to advance 2 additional programs in our world-leading anti-myostatin pipeline, a subcu formulation of apitegromab and SRK-439. In our subcu apitegromab program, we showed some very exciting data from a Phase I study earlier this year. In that study, healthy volunteers received apitegromab at either 100 or 800 mg subcu or 800 mg IV. The data demonstrated that 800 mg subcu resulted in an overlapping pharmacodynamic profile with 800 IV. Accordingly, subcu apitegromab appears to have a favorable bioavailability with the pharmacodynamic profile comparable to IV administration. Additional development activities with subcu apitegromab are underway. We're planning engagements with U.S. and European regulators later in the year. Turning now to SRK-439, which we discovered by leveraging our world-leading expertise in targeting myostatin. 439 is a subcutaneously administered myostatin inhibitor binding to both pro and latent myostatin with high affinity and selectivity. We recently presented data demonstrating that 439 is 10x more potent than apitegromab since we have shown in nonhuman primates that 439 can produce changes in whole body lean mass at doses as low as 0.3 mg per kg. We're very excited about this program and dosing in our Phase I healthy volunteer study is well underway. We expect to have top line data from the study in the second half of this year. In closing, we're executing with focused urgency to bring apitegromab to children and adults with SMA, whilst in parallel investing with discipline to advance our world-leading anti-myostatin pipeline. The strengths of our data and the sustained momentum of our programs underpins our confidence that we can shape the future of treatment for patients living with rare neuromuscular diseases. I'll now turn the call over to Keith to discuss our commercial launch preparations. Keith?

Thanks, Akshay, and good morning, everyone. As David noted, our team continues to operate with urgency as we prepare for the launch of apitegromab. Our commercial organization remains focused and disciplined, advancing the critical capabilities required to deliver a seamless launch and support patients from day 1. Nearly a decade after the introduction of SMN-targeted therapies, the market continues to grow and now represents nearly $5 billion in global annual sales. However, while SMN-targeted therapies have brought much needed innovation, muscle strength and motor function remain the top unmet need with 95% of patients continuing to experience persistent and progressive muscle weakness. That limits function and independence. Additionally, 3/4 of neurologists believe multiple modalities are necessary to optimally treat patients with SMA. This data underscores the significant opportunity we have with apitegromab, the world's first muscle-targeted therapy. To this end, our U.S. customer-facing team is active in the field, focused on disease education programs that reinforce a broader understanding of SMA as a disease of the motor unit consisting of both the motor neuron and the muscle, which is the principal organ impacted by the disease. We continue to engage across approximately 140 SMA treatment centers, 2,600 prescribing physicians and their multidisciplinary care teams throughout the U.S., and our SMA disease education efforts remain a core component of our work in the field. In parallel, we are strengthening and advancing the key elements of our commercial capabilities to ensure launch readiness. We have expanded our specialty pharmacy network to enhance SMA patient and caregiver convenience. SMA patients currently receiving an SMN targeted therapy from a specialty pharmacy will be able to access apitegromab through that same specialty pharmacy. In addition, through our patient access partners, we have established a home infusion network of more than 10,000 affiliated nurses nationwide. We are also working to ensure we mitigate reimbursement and access bottlenecks. This includes preparations to launch our patient services program, which we have named Scholar Rock Supports. This program is designed to provide comprehensive and individualized support to patients, caregivers and providers. In addition, we remain focused on patient engagement and community activation. In January, we launched the next phase of our disease awareness campaign called Life Takes Muscle, aligned with our objective to deepen community awareness of the importance of targeting muscle. And finally, we continue to engage with payers, advancing discussions with national and key regional payers as well as Medicare and Medicaid. At U.S. approval and launch, I look forward to discussing our comprehensive SMA patient access support program in more detail. While we make substantial progress in preparing for the launch in the U.S., we are also advancing launch readiness across key European markets in anticipation of a mid-2026 EMA decision. In Germany, we have established local leadership, initiated our compassionate use program and are progressing reimbursement planning to enable rapid access following approval. Across the broader region, we are advancing reimbursement dossiers in multiple countries, strengthening our distributor relationship, and we are building out our EMEA infrastructure to support future commercialization. In closing, we have invested thoughtfully to build the commercial foundation necessary to support a world-class launch, and we believe apitegromab is well positioned to play a central role in the next era of SMA care. Our team is prepared to move quickly upon approval and to deliver on our commitment to the SMA community, one patient, one caregiver and one family at a time. With that, I'll turn the call over to Vikas. Vikas?

Thank you, Keith. Our financial objectives for 2026 remains consistent. We are focused on supporting our commercial build to deliver a strong apitegromab launch, funding R&D activities to advance our pipeline and expand our leadership in the myostatin and muscle space, and continuing to evaluate opportunities to strengthen our balance sheet in a way that supports long-term shareholder value. In keeping with these objectives, I'm pleased to provide our fourth quarter and full year financial results. For the fourth quarter, we reported $91.9 million in operating expenses, which included $19.4 million in noncash stock-based compensation. Excluding stock-based compensation, operating expenses were $72.5 million. For the year ended 2025, we reported $384.6 million in operating expenses, which included $75.6 million in noncash stock-based compensation. Excluding stock-based compensation, operating expenses were $309 million for the year ended 2025. Turning to our balance sheet. We ended 2025 with $368 million in cash and cash equivalents. During the fourth quarter, we strengthened our cash position, adding $60.4 million from the exercise of warrants that were set to expire on December 31. We continue to strengthen our balance sheet and are pleased to announce today that we secured a new debt facility for up to $550 million with Blue Owl Capital. This debt facility consists of 4 elements. First, upon closing, $100 million was immediately available to us, which we have used to repay our prior $100 million debt facility with Oxford Finance. Second, an additional $100 million is available to us this quarter, which we expect to draw down by March 31. Then following FDA approval of apitegromab, we have the option to draw up to $150 million in additional capital. And lastly, we have an option for additional incremental facilities of up to $200 million at the mutual consent of Scholar Rock and Blue Owl. This debt facility provides us with additional flexibility as we transition towards a global commercial stage company while investing in our pipeline. In addition to the $150 million available from the debt facility upon FDA approval of apitegromab, we will look to monetize our priority review voucher to further strengthen our balance sheet. Looking ahead, we continue to operate with a tight financial plan. Our prioritized investments remain focused on our apitegromab commercial launch readiness in the U.S. and Europe, strengthening our supply chain to support the pipeline and commercial demand for apitegromab and advancing our highly innovative clinical programs that Akshay discussed earlier in the call. With that, I will turn the call back to David. David?

Thanks, Vikas. In closing, we remain focused on bringing apitegromab, the world's first and only muscle-targeted treatment to improve motor function to children and adults living with SMA as rapidly as possible. We are encouraged by the progress that has been made and by the continued momentum across our regulatory, clinical and commercial priorities. With a strong foundation, clear strategic priorities, and a world-class team, we are well positioned to make 2026 a transformative year for Scholar Rock as we continue to work with urgency on behalf of children and adults living with SMA. We look forward to updating you on our continued progress throughout the year. And with that, we'll now open the line for questions. Operator?

[Operator Instructions] And our first question is going to come from Eric Schmidt with Cantor.

David, just to put a pin in on, is Novo now ready for reinspection, open for reinspection? And then assuming the reinspection does go "well, what would trigger your resubmission? What do you need to see from that reinspection to be able to push the button on the refiling?

Thanks, Eric. So we are gratified really since our Type A Meeting in November with the shared sense of urgency and high priority that both FDA and Novo has made the remediation of the Catalent Indiana facility. And you got a sense from the call just the drumbeat of progress week after week, month after month. We like the high engagement we continue to see. And given the constructive meeting in early Q1 and then the following site visit, really the gating item now just is a reinspection follows these routine manufacturing activities as Novo moves into full-scale production. As far as our trigger, we would look for, obviously, a successful reinspection, as you noted, and we're assuming that given the progress that has been made, and that would then trigger. We are at the ready to submit our BLA submission very, very quickly. But it really would be with some level of confidence that it was a successful reinspection.

And our next question will come from Tazeen Ahmad with Bank of America.

Not to belabor the point on timing here, but I know your confidence about the ability of Novo to resolve the issue. But in the event that you do have to revert to your backup facility, you've guided to a supplemental filing in the second half of the year. What would happen to time lines if that needed to be the primary filing?

Thanks, Tazeen, very much. As I noted on the call, we're gratified in the rapid and steady progress that has been made between FDA and Novo. And we do think apitegromab and the importance of apitegromab for the SMA community is a key driver in not the sole driver, but a key driver in this. I would say that we are pleased with how rapidly we are moving forward with an additional vialer. And our assumption is whether or not it were to be a supplemental BLA, which is our plan or whether or not we had to fall back. We've always looked at that as an important effort on our part, no matter what because we cannot control everything in this process. And we don't really believe that, that timing would be altered tremendously in terms of if it were not an sBLA. So we've thought about it. It is our plan that it will be an sBLA. That's the level of insight, information and confidence that we have. But nonetheless, we would be prepared to pivot should need be on behalf of children and adults living with SMA.

Thank you. And our next question comes from Tessa Romero with JPMorgan.

So first one is, can you elaborate on what it meant that the FDA sent a field team? What was the purpose of that? And is that routine? And then the second one, just to loop back on sort of better understanding the next procedural steps post the reinspection and what the time lines could be there? Will you get verbal communication or as written documentation what you'll see similar to a normal inspection?

Yes. Thanks, Tess. It's a good question because it's -- certainly nothing has been completely ordinary about this process. And I do think what has created some level of extraordinary behavior with kind of a constant drumbeat of progress, I think it was really set off by that in-person Type A meeting that we held with FDA and where there really was with Cure SMA in attendance, with Novo in attendance, there was a shared sense of urgency to bring apitegromab to patients. And so while I can't really comment on what was the overall sort of objective, we do think what it shows is for just weeks after a really constructive meeting with Novo in early Q1, where there were no new requests by the FDA of Novo into their remediation plan. We think it just continues to show high priority by the FDA to send a field team out to interact with the site and to indicate that after routine manufacturing activities, which have since recommenced at the facility. They would be in line for a reinspection. So overall, we just feel good about the drumbeat of progress here, and we're quite pleased. And we would expect, given these sort of rapid and steady pace that we've seen over these last 3 months that anything else that follows the timing of a reinspection, the timing of resubmission, that review, hopefully, it continues to follow sort of this commitment that has been made to rapidly progress the apitegromab file so that we can deliver this drug to children and adults living with SMA. And we'll certainly keep you apprised on that progress.

And our next question comes from Mani Foroohar with Leerink.

You have Ryan on for Mani. Congrats on the update. Maybe just one sticking with the review. Kind of based off your latest conversations with the FDA, I'm curious what your expectations are for a turnaround time following BLA submission to eventual approval. Are there any details that still need to be worked out, label, et cetera, with regulators? And then maybe just as a second one on the pipeline. Can you talk about the strategy for 439? Is this something that you plan to keep in-house, look for broader strategic options? Is it best suited in rare neuromuscular diseases or potential broader application?

Thanks, Ryan. Regarding the timing, again, just to remind everybody tuning in today, in our CRL that we received last year, the sole approvability issue was the state of compliance at the Catalent Indiana facility. So we're certainly very focused on working with FDA and Novo on that. As I noted earlier in the call, we would -- and we are planning and we are ready to rapidly resubmit our BLA following successful reinspection. And again, we would just point to -- without really being able to comment on timing, we would just kind of point to the evidence of the progress over these last 3 months and how attentive the FDA has been to remediating this facility and our focused Novo has been to really working with urgency as well, and we'll keep you apprised on that timing. Regarding the pipeline and 439, Akshay?

Yes. 439, obviously is a very important and exciting drug. It's a high potency anti-myostatin antibody, appears to us, at least from the preclinical work to be about tenfold more potent. So it could be a very low volume, small volume, infrequent administration type drug. So I think that creates very interesting and exciting possibilities in the rare neuromuscular space for us. But at least at the current time, we think this is a Scholar Rock proprietary asset, and we have no intentions of partnering it. But we'll share further development plans after we get the top line Phase I data later this year.

And our next question is going to come from Srikripa Devarakonda with Truist.

Time lines-wise, not to be with the point, you expect -- you continue to expect inspection, BLA resubmission, U.S. launch, everything to happen in 2026. For the launch to be in 2026, can it still happen with the Class II submission? Our due diligence suggests that this is most likely going to be a Class II submission. And in any of your recent conversations with the FDA, was there any hint or indication for a potential CNPV for apitegromab?

I didn't get the last part of that Kripa, could you say, any indication of...

Commissioner's priority voucher, the National Priority voucher?

These are all very good questions, Kripa. And as you might imagine, we've thought about it all, right? And we -- with all of the information that we have and the progress that is made, we were pleased and confident to reaffirm the guidance that we provided today of a 2026 BLA resubmission and U.S. launch upon approval. We would certainly point to sort of this steady FDA prioritization and progress with Novo over these past weeks and months, and it remains very steady. And I think like we have thought about Class I versus Class II and what we've seen actually in our own sort of analysis of this, even when Class IIs are sort of granted, oftentimes, the decision is taken up before that 6-month time line. And again, I'm just reminding you that the sole approvability issue for us has been the status of the Catalent Indiana facility. And we're pretty -- we are planning for the resubmission to be happening once we have indication that it was a successful reinspection. So we'll keep you apprised at that, but we certainly are very, very comfortable with the guidance that we have provided. And then regarding like the commissioner's sort of -- I would just say that we are just staying in close communication with the FDA on all of our different initiatives and just keeping in the forefront the very high priority that exists with the SMA community in the United States to gain access to the world's first and only muscle-targeted treatment. And we look forward to continuing to keep you guys apprised on our regulatory progress there with FDA.

And our next question will come from Michael Yeh with UBS.

I'm not going to ask a submission question. Can you talk a little bit about the expectations for the label as it relates to either ambulatory or non-ambulatory and with no issues regarding age subgrouping, given that you had what sounds like a very successful review process and only CMC was the outstanding part. How should we think about a broad label? And then a follow-up, assuming approval, maybe for Vikas, can you just remind us, given that your drug is a weight-based drug, how to think about the comparable pricing relative to other drugs and if models should reflect anything philosophically as it relates to the differences in how the drugs are administered?

Thanks, Michael. Akshay, on the label and then Keith on the weight-based element of the drug and pricing. Akshay?

Yes, Michael, we were gratified by the progress made during the original PDUFA cycle. We had gone to a very advanced stage with the draft label and the FDA had really worked hard to get to that. So with the Catalent issue being an outstanding issue, we anticipate that it would be relatively straightforward to get aligned with the FDA on the final label after our BLA resubmission. Now all of that being said, the details ultimately, that's up to the FDA. But we know from the conversations leading up to the September PDUFA date that kind of the guiding principles are what the FDA has shown before in the SMA space, the trial design that supports the approval, that's important. Now if you note that the totality of that package, we have experience with both non-ambulatory and ambulatory. We have experience with children 2 years and older. We have experience in patients on risdiplam and nusinersen. And so I think that these are the important guiding factors. The agency also previously has tended to look at the broad applicability or not of the therapeutic hypothesis and the mech of action of the drug to try and maximize getting these drugs in terrible disease to as many patients as possible. Now those are the kind of guiding principles. I think we have to await the ultimate BLA resubmission and see where we end up. But we've been pleased so far with how straightforward the FDA is...

Keith?

And then on price, I guess, first of all, it's not really appropriate for us to comment on specifics at this stage. But I do promise you when we have approval and we have our launch call, we will get very specific about the pricing. But Mike, as you mentioned, because it is weight-based dosing, you are going to see a range. So it's not going to just be one set price for all. But look, when we think about pricing of apitegromab, we think about 3 key factors, and it's the rarity and the severity of SMA, it's the progressive nature of the disease. And in combination with SMN-targeted therapies, our data from both TOPAZ and SAPPHIRE have just demonstrated compelling clinical benefits. So we will get into all of the specifics on pricing on the launch call.

And our next question is going to come from Amy Li with Jefferies.

So looking ahead to launch, what commercial analogs would you point us to as we think about the initial uptake and launch trajectory? And then maybe another one on subcu epi. Do you think approval will require a full clinical study in SMA, a smaller bridging study or primarily human factor studies? And if you could give us a time line to market, that would be awesome.

Thanks very much, Amy. And yes, what I would say is that, for sure, we've been pleased in our engagement with the patient community, the caregiver community as well as, as Keith noted, neurologists appreciation that not only addressing the motor neuron component of the disease, but for the first time, to really be able to address directly the muscle component of the disease, which is a principal organ that is clinically impacted and affected by this disease. We sense that there is a lot of interest in accessing the drug, and that in and of itself could support like a very nice uptake at launch. I think what Keith and I have looked at, though, is this is essentially a Q4-week infusion. It will have a miscellaneous J-code for some period of time. We know that there are payers, for example, Medicaid that could be a little sluggish at launch. We recognize payers in and of themselves. It's not a matter of if they reimburse, but sometimes it takes time to reimburse. And so we believe robust demand, but we think that will be met with initially some access speed bumps that could impact our launch curve. But overall, the long-term opportunity that we see for apitegromab in the U.S. and beyond, we feel like is quite significant for us, and we're really looking forward to the eventual approval and then Keith and team launching apitegromab to the SMA community. With respect to your question on subcu and clinical regulatory strategy, I'll hand that over to Akshay.

Yes. Thanks, David. So for subcu apitegromab, what we have is very interesting and supportive data that the subcu is viable, shows excellent bioavailability and a pharmacodynamic profile. Now we know a lot about apitegromab in terms of PK/PD from our prior work via the IV route of administration. We obviously want to leverage that and find a path forward for subcu apitegromab by saying this is a drug that's well characterized and studied by different route of administration. But if we can mimic the appropriate PK/PD, then there's no reason why it cannot be equally safe and effective. Now those are all discussions that we need to have with the FDA. The initial approval of the drug, of course, is very important. But subsequent to that, we hope to get aligned with regulators on that approach. So ultimately, we can't guide the time lines today, but we're hoping as the year progresses to engage with regulators and formulate our final plans and then discuss the path forwards.

And our next question will come from Geoff Meacham with Citi Group.

This is [indiscernible] on for Jeff. Maybe just thinking about the second fill-finish facility. If you guys were to switch over to that one, would it completely derisk the supply chain from a U.S. and EU launch perspective? And then on the launch, what specific leading indicators of payer and physician readiness are you guys tracking? Maybe if you guys can give some color on that, it would be helpful.

Absolutely. I'll start with the second vial arm and Keith, you might a clarification on the second.

Yes. Can you repeat the second question, please?

Yes, sure. What specific leading indicators are you guys paying attention to, to indicate payer and physician readiness that you're tracking?

Great. So second fill-finish, we are really pleased with the progress that we have been making. As I mentioned, tech transfer commenced in Q4. Engineering runs are underway, and there are additional manufacturing runs to follow here in the very near term. So we're working urgently. Again, our assumption is this is going to be our second vialer, we're going to submit an sBLA. Should we rely on this facility solely, we are confident that we would be derisking as well our U.S. and EU commercial opportunities. So we wanted to be very thoughtful in selecting the right second partner for fill-finish, and we're gratified that we have done that. And also, as I noted, really pleased with the progress that's being made at a very rapid pace. Keith?

Yes. So first of all, when it comes to the payers, we've been really pleased with the access that our team has been able to get, as I stated in the prepared remarks, to not just the big national payers, but also now regional payers and even some Medicare and Medicaid while we've had more time. We've been able to have in-depth discussions with them, and our medical team has been able to go through the SAPPHIRE clinical data with them. The bottom line is just as we've -- just as what's been shared in a lot of the Cure SMA data and some of our own market research, neurologists and patients, they want more and they need more. And that's why we understand 3/4 of these physicians already believe in multiple modalities to treat -- to treat SMA.

And our next question will come from Salvatore Caruso with TD Cowen.

This is Salvatore Caruso on behalf of Marc Frahm at TD. Just one quick question to kind of cross some t's and dot some i's, regarding the status of the MMA review, will that market also be served by the Novo Catalent Indiana facility? And if so, has EMA taken any actions in response to the FDA inspection findings?

Yes. I'll start and then I can hand it over to Akshay. There is a mutual recognition between both FDA and EMA. And so this steady and rapid progress we're making with FDA actually serves us very well for the current MAA review with regulators. And so it's very important that we continue to make this progress forward. As I noted, the continued remediation and eventual successful reinspection will really support our EMA decision near midyear. And then as I noted, if for some reason, we were to rely on the second filer, that would also be very important. But for now, we're very excited with the rapid and steady progress that's been made. Akshay, anything to add?

Yes. I think you covered it, David. I think the other piece is that we kept in close touch with the reviewing authorities in EMA. They are fully aware of this, they're supportive, and we will await resolution of the Catalent's by which we will obviously not want approval.

And the next question will come from Etzer Darout with Barclays.

Just a couple for me. Has the FDA requested or could they request additional safety data that could extend review of apitegromab? And then on FSHD, just wondered, would you be looking at any functional endpoints in the Phase II study that you're planning? And could this be a more appropriate indication for SRK-439 longer term?

Thanks, Etzer. Yes, it's a great comment, and we can remind you that the BLA resubmission will be a fairly rapid and small resubmission, but there would be an update to sort of our safety database, which was called out in our response letter from the FDA. Akshay can comment on that and then talk about any sort of functional outcome measures for FSHD. Akshay?

Yes. So we're aligned with the FDA. The November meeting was useful in many regards, including that and which aspect of the safety database needed to be updated and that was all agreed to. And so we're ready and prepared with the BLA resubmission. So I don't see any great issues there. But it's a good question. And obviously, we should always provide the FDA with the latest safety understanding of that drug, which we will do. With respect to the FOG Phase II study in FSHD, the primary endpoint will focus on increasing lean muscle volume, measured very sensitively by imaging techniques. But we will have on-site biomonitoring there, which is a validated approach in FSHD to understand the functional impact of any potential change in muscle mass and we look forward, obviously, to those data too.

And our next question will come from Evan Seigerman with BMO Capital Markets.

Malcolm Hoffman on for Evan. Thinking about the financials of the business, I know you mentioned the new debt facility secured with approvals in U.S. and Europe coming this year. I just wanted to ask how are you thinking about expectations for time to profitability and whether you anticipate any additional need for financing ahead of that kind of profitability hinge point?

Thanks, Malcolm. Vikas?

Malcolm, we have not given a forward-looking guidance at all here, but we will follow most likely the normal rare disease kind of revenue trajectory, which leads you into very similar levels of profitability time frames of 2 to 3 years from launch. But it also depends on how our pipeline progresses during that time, and we will weigh into profitability versus investing into the future. But overall, looking at our fundamental principle of creating long-term shareholder value.

And our next question comes from Allison Bratzel with Piper Sandler.

Just drilling down on some of the prior discussion around review timing. I know you talked a lot about FDA's sense of urgency on apitegromab. I guess, is there a good precedent for FDA spending less than 6 months to review a Class II resubmission? And can you just clarify, does your guidance for commercial launch in '26 assume a Class II resubmission and the full 6-month review? And then separately, just on OPAL, could you talk to what you're seeing on enrollment trends there? And just what that tells you about the underlying awareness of apitegromab in the SMA community?

Thanks, Allison. Maybe I'll just point out one example on the Class II not taking the full time. And I think it's important as we have been mentioned occasionally here during this current journey with Regeneron. And in 2023, at the same facility, Regeneron did have a CRL, had a resubmission. I believe it was a Class II resubmission and yet it was approved within essentially sort of a 60-day window. And so -- but we have more examples than that. I'd just point to that because it's a little bit relevant given the fact that it was a CRL and it was the same facility and I think it had to do with some assessment of the facility post an inspection. So I would just point your attention to that.

Yes, Following up on, I just lost my train of thought. What was the second question?

OPAL enrollment.

That's right. The enrollment's going very well. I mean, I think the first thing to say, actually, of people we get to enroll is there's very wide knowledge and appreciation for a muscle-based approach in the patient community and the prescriber community, and Keith has spoken to that. The fact it's startlingly high and patients, families, and physicians await the approval of this drug. Consistent with that, they see the possibilities for this drug throughout the entire patient age range and disease severity range as a community and we're gratified by the very nice progress with that. I'm not going to share details today, but yes, we're seeing a good clip of enrollment and as we get later into the year, we will clarify, you know, as the sort of clinical trial comes into sight that exactly when we will have data and so forth. Certainly consistent with knowledge of the drug and its potential. There's very good enrollment.

And Allison, I would just add, as Akshay noted in the prepared remarks, we have a deep commitment to the SMA community, and I'm really, really pleased that we are making sure no patients are left behind by opening up this under 2 study. So we're super excited to be doing this work in the youngest of patients with SMA.

And the next question will come from Kalpit Patel with Wolfe Research.

This is Gugan on for Kalpit. Previous myostatin inhibitors in FSHD increased muscle mass without meaningful functional improvement. Can you give some color on how apitegromab aims to address this historical hurdle and what a clinically meaningful functional improvement might be in the planned Phase II?

Sure. Akshay?

Yes. So I think you're pointing to either drugs that didn't have a very clear and well-validated mechanism of action and potency and safety profile. So the earlier generations of anti-myostatin clearly didn't have the potency and selectivity of a drug like apitegromab in our opinion. More importantly, another one is the -- another point you raised is the Acceleron example, I suspect. Acceleron did a study in FSHD and they were injecting locally in one isolated muscle. Now one can't expect that to result in global functional improvement. But we do know separately that globally applied strategies like intense physical therapy or anabolic agents that increase muscle mass such as somatostatin or rather growth hormone and testosterone and other similar agents that those kinds of agents clearly show an increase in muscle mass and also increase in functional capacity. So we've incorporated quantitative myometric testing into the Phase II to evaluate change in muscle function. The primary approach or the primary endpoint, obviously, is to document the change in lean muscle volume, but we look forward to getting those data, and that's a validated approach in that indication, and we'll share the data when we have them.

Thank you. I am showing no further questions at this time. This will conclude today's conference call. And thank you so much for participating, and you may now disconnect.