On Thursday, Piper Sandler maintained a positive outlook on Soleno Therapeutics Inc. (NASDAQ:SLNO) stock, reiterating an Overweight rating with a $93.00 price target.
The firm anticipates a potential upside as the company approaches the New Drug Application (NDA) acceptance for its DCCR treatment for Prader-Willi Syndrome (PWS), which is expected around August 27, based on the 60-day period following the submission on June 28.
The analyst highlighted the possibility of the treatment receiving priority review and a high probability of approval, potentially by late February, based on their calculations.
The expectation is that the Street will be looking for an Advisory Committee (AdCom) meeting; however, any announcement indicating the absence of an AdCom upon NDA acceptance or during the mid-cycle review could present an opportunity for upside.
Soleno Therapeutics is well-prepared to present its case, with a differentiated asset for PWS, drawing from experience and data from Levo Therapeutics' carbetocin AdCom in 2021.
The company's preparation is further supported by insights from a Patient-Focused Drug Development (PFDD) Meeting, which emphasized hyperphagia as a significant burden for patients and caregivers.
The analyst expressed high conviction in the approval of DCCR, citing the treatment's comprehensive benefits in addressing hyperphagia and secondary behavioral symptoms, its clean safety profile, and the undeniable unmet need recognized by the FDA. As the anticipated date for NDA acceptance nears, the market is closely monitoring Soleno Therapeutics' progress and the FDA's response.
In other recent news, Soleno Therapeutics has seen significant changes in its Board of Directors, with Matthew Pauls stepping in as the new Lead Independent Director and biotech veteran Dawn Carter Bir joining the board.
Concurrently, the company is awaiting regulatory approval for its lead candidate, DCCR, a treatment for Prader-Willi syndrome, and has submitted a New Drug Application to the FDA.
In a bid to bolster financial flexibility, Soleno Therapeutics entered an agreement with Jefferies LLC to potentially sell up to $150 million of its common stock. Piper Sandler, Oppenheimer, and Baird have maintained their Overweight and Outperform ratings on the company.
The company also awarded performance-based restricted stock units to its employees, including top executives, under the Amended and Restated 2014 Equity Incentive Plan.
Soleno Therapeutics has expanded its corporate footprint with a new office lease in Redwood (NYSE:RWT) City, California. These are recent developments in the company's ongoing operational and strategic initiatives.
InvestingPro Insights
As Soleno Therapeutics (NASDAQ:SLNO) approaches a critical juncture with its New Drug Application for DCCR, investors are keenly observing the company's financial health and market performance. According to InvestingPro data, the company boasts a market capitalization of $2020M, reflecting significant investor interest. Despite facing challenges with profitability, as indicated by a negative P/E ratio of -23.79, Soleno has demonstrated remarkable market performance with a one-year price total return of over 1013%. This surge in stock price aligns with the anticipation of the NDA acceptance and potential FDA approval, underscoring the high stakes involved for the company.
InvestingPro Tips highlight that Soleno holds more cash than debt on its balance sheet, which is a reassuring sign for investors concerned about the company's financial resilience. Additionally, the company is expected to grow its net income this year, suggesting optimism regarding its future financial performance. Notably, Soleno is trading near its 52-week high, with the stock price at 96.38% of this peak, indicating strong investor confidence as key milestones approach.
For investors seeking more detailed analysis and forecasts, InvestingPro offers additional insights, including 12 more InvestingPro Tips, which can be found at https://www.investing.com/pro/SLNO. These tips provide a deeper understanding of Soleno's financial position and market dynamics, helping investors make informed decisions as they watch the company's next moves in the biopharmaceutical space.
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