Scholar Rock Announces Closing of Full Exercise of Option to Purchase Additional Shares in Public Offering

Rhea-AI Summary

Scholar Rock Holding (Nasdaq: SRRK) announced on October 16, 2024, that the underwriters of its previously announced public offering exercised their option to purchase an additional 1,592,920 shares at $28.25 per share. This resulted in additional gross proceeds of approximately $45 million. The closing of this additional purchase occurred on October 18, 2024.

The original offering, which closed on October 10, 2024, included common stock and pre-funded warrants. J.P. Morgan Securities , Jefferies, and Piper Sandler & Co. acted as joint book-running managers, while BMO Capital Markets Corp., Wedbush Securities Inc., and Raymond James & Associates, Inc. served as co-managers for the offering.

An automatically effective shelf registration statement on Form S-3 was filed with the SEC on October 7, 2024. The final prospectus supplement and accompanying prospectus were filed on October 9, 2023.

Positive

• Additional gross proceeds of approximately $45 million raised
• Full exercise of underwriters' option to purchase additional shares
• Successful closing of the additional share purchase

Negative

• Potential dilution of existing shareholders' ownership due to additional share issuance

Insights

Financial Analyst

Scholar Rock's successful exercise of the underwriters' option to purchase additional shares is a positive development for the company. This move has generated an additional $45 million in gross proceeds, significantly bolstering the company's financial position. The total capital raised from this offering, including the initial closing and the option exercise, strengthens Scholar Rock's ability to advance its late-stage pipeline, particularly in SMA and cardiometabolic disorders.

The strong investor demand, evidenced by the full exercise of the option, suggests confidence in Scholar Rock's potential. With a market cap of $2.7 billion, this additional capital infusion represents a substantial boost to the company's resources. The involvement of major underwriters like J.P. Morgan, Jefferies and Piper Sandler also lends credibility to the offering.

For investors, this news indicates improved financial stability and potentially accelerated development timelines for Scholar Rock's innovative treatments. However, it's important to note that while the increased cash position is positive, the issuance of new shares may lead to some dilution for existing shareholders. The long-term impact will depend on how effectively the company utilizes these funds to advance its pipeline and create value.

CAMBRIDGE, Mass.--(BUSINESS WIRE)-- Scholar Rock Holding Corporation (Nasdaq: SRRK), a late-stage biopharmaceutical company focused on advancing innovative treatments for spinal muscular atrophy (SMA), cardiometabolic disorders, and other serious diseases where protein growth factors play a fundamental role, today announced that on October 16, 2024, the underwriters of its previously announced underwritten public offering of common stock and pre-funded warrants, which closed on October 10, 2024, exercised their option in full to purchase an additional 1,592,920 shares at the public offering price of $28.25 per share, resulting in additional gross proceeds of approximately $45 million, before deducting underwriting discounts and commissions and offering expenses payable by Scholar Rock. The closing of the underwriters’ exercise of their option to purchase 1,592,920 additional shares occurred on October 18, 2024.

J.P. Morgan Securities LLC, Jefferies and Piper Sandler & Co. acted as joint book-running managers for the offering. BMO Capital Markets Corp., Wedbush Securities Inc. and Raymond James & Associates, Inc. acted as co-managers for the offering.

An automatically effective shelf registration statement on Form S-3 relating to the offering of the shares of common stock and pre-funded warrants described above was filed with the Securities and Exchange Commission (SEC) on October 7, 2024. A preliminary prospectus supplement and accompanying prospectus relating to the offering were filed with the SEC on October 7, 2024, and are available on the SEC’s website located at www.sec.gov. The final prospectus supplement and accompanying prospectus relating to the offering were filed with the SEC on October 9, 2023 and may be obtained by contacting: J.P. Morgan Securities LLC, c/o: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, or by email at prospectus-eq_fi@jpmchase.com and postsalemanualrequests@broadridge.com; Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, New York, NY 10022, by telephone at 877-821-7388, or by email at prospectus_department@jefferies.com; or Piper Sandler & Co., 800 Nicollet Mall, J12S03, Minneapolis, MN 55402, Attention: Prospectus Department, by telephone at 800-747-3924, or by email at prospectus@psc.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that state or jurisdiction.

About Scholar Rock

Scholar Rock is a biopharmaceutical company that discovers, develops, and delivers life-changing therapies for people with serious diseases that have high unmet need. As a global leader in the biology of the transforming growth factor beta (TGFβ) superfamily of cell proteins and named for the visual resemblance of a scholar rock to protein structures, the clinical-stage company is focused on advancing innovative treatments where protein growth factors are fundamental. Over the past decade, Scholar Rock has created a pipeline with the potential to advance the standard of care for neuromuscular disease, cardiometabolic disorders, cancer, and other conditions where growth factor-targeted drugs can play a transformational role.

This commitment to unlocking fundamentally different therapeutic approaches is powered by broad application of a proprietary platform, which has developed novel monoclonal antibodies to modulate protein growth factors with extraordinary selectivity. By harnessing cutting-edge science in disease spaces that are historically under-addressed through traditional therapies, Scholar Rock works every day to create new possibilities for patients.

Scholar Rock^® is a registered trademark of Scholar Rock, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241022036032/en/

Scholar Rock:

Investors

Rushmie Nofsinger

Scholar Rock

rnofsinger@scholarrock.com

ir@scholarrock.com

857-259-5573

Media

Molly MacLeod

Scholar Rock

mmacleod@scholarrock.com

media@scholarrock.com

802-579-5995

Source: Scholar Rock

FAQ

How many additional shares did Scholar Rock (SRRK) sell in the public offering?

Scholar Rock (SRRK) sold an additional 1,592,920 shares in the public offering through the full exercise of the underwriters' option.

What was the price per share for the additional shares sold by Scholar Rock (SRRK)?

The additional shares were sold at $28.25 per share, which was the same as the public offering price.

How much additional gross proceeds did Scholar Rock (SRRK) raise from the option exercise?

Scholar Rock (SRRK) raised approximately $45 million in additional gross proceeds from the full exercise of the underwriters' option.

When did the closing of the additional share purchase for Scholar Rock (SRRK) occur?

The closing of the additional share purchase for Scholar Rock (SRRK) occurred on October 18, 2024.

Who were the joint book-running managers for Scholar Rock's (SRRK) public offering?

J.P. Morgan Securities , Jefferies, and Piper Sandler & Co. acted as joint book-running managers for Scholar Rock's (SRRK) public offering.