07:53 AM EDT, 10/08/2024 (MT Newswires) -- Scholar Rock's ( SRRK ) shares pulled back early Tuesday after more than quadrupling a day earlier on upbeat data from a drug that Truist Securities said could result in earlier treatment for patients with spinal muscular atrophy.

Investors were taking some profit pre-bell after the shares surged 362% by the close Monday, driving the biotechnology firm's market value to $2.74 billion. That came after Scholar Rock ( SRRK ) said its investigational drug, apitegromab, for spinal muscular atrophy met its primary endpoint in a late-stage clinical trial.

The trial data supports the drug's "approval with possibility of a broad label (non-ambulatory, ages 2-21) given the consistency of benefit observed across age groups and understanding of SMA as a continuum," Truist analysts including Vice President Srikripa Devarakonda said in a note late Monday. "While approval in ambulatory patients might be out of the scope of the label, we believe potential success in SRRK's planned trial in (under 2 year olds) could allow patients to access apitegromab from an early age broadening the eligible patient population."

Scholar Rock ( SRRK ) said in a conference call late Monday that it plans to initiate a study for the treatment for patients under 2 years old by mid-2025. Spinal muscular atrophy is a genetic condition that causes muscle weakness and wasting. One in every 6,000 babies is born with SMA, according to Johns Hopkins Medicine.

The therapeutic candidate apitegromab showed a "clinically meaningful" improvement in motor function across all age groups from two years to 21 versus placebo in a phase 3 trial, according to the biopharmaceutical company.

About 30% of patients receiving the drug showed improvement in motor function, compared with roughly 13% of patients on placebo, the company said. The product demonstrated early motor function improvement from the first measured point at 8 weeks, with the benefit expanding at 52 weeks. The product was "well tolerated" across all age groups, with no new safety findings observed. Serious adverse events were consistent with the underlying disease and current standard of care received by patients, Scholar Rock ( SRRK ) said.

"We are thrilled that apitegromab met the primary endpoint in our phase 3 sapphire clinical study," Chief Executive Jay Backstrom said in a statement. "We are working with urgency to deliver the potentially transformative benefits of apitegromab to children and adults with (spinal muscular atrophy) in the US, Europe and around the world."

The company plans to submit a biologics license application in the US and a European Union marketing authorization application for the drug in the first quarter of 2025.

After the release of the trial results, Wedbush Securities raised its price target on Scholar Rock's ( SRRK ) stock. "The conversation is now not whether apitegromab's sapphire study will succeed, but will focus on approval and commercialization," according to Wedbush. The firm raised its price target on the stock later Monday to $37 from $27.

Price: 34.27, Change: -0.01, Percent Change: -0.03