Soleno Therapeutics Reports Significant Financial Changes, Net Losses Increase 673% in Q3 2024

Soleno Therapeutics, Inc. reported significant financial changes in its 10-Q filing for the quarter ending September 30, 2024. The company, focused on developing therapeutics for rare diseases, particularly Prader-Willi syndrome (PWS), experienced a notable increase in operating expenses and net losses compared to the same period in 2023.

For the three months ended September 30, 2024, Soleno's operating expenses surged to $80.2 million, a 673% increase from $10.4 million in Q3 2023. This rise was driven by substantial increases in both research and development expenses, which reached $30.1 million (up 399% from $6.0 million), and general and administrative expenses, which soared to $49.2 million (up 1,383% from $3.3 million). The operating loss for the quarter was $(80.2 million), compared to $(10.4 million) in the prior year, while the net loss increased to $(76.6 million) from $(10.9 million).

For the nine months ended September 30, 2024, total operating expenses were $128.6 million, a 368% increase from $27.5 million in the same period of 2023. The net loss for this period was $(119.9 million), compared to $(27.7 million) in 2023, reflecting a 333% increase. The company reported a significant increase in stock-based compensation, which contributed to the higher expenses.

On the balance sheet, Soleno reported total assets of $296.7 million as of September 30, 2024, up from $180.7 million at the end of 2023. Cash and cash equivalents decreased to $48.4 million from $169.7 million, while total current assets increased to $258.2 million. The company raised $158.7 million in a public offering in May 2024, which bolstered its cash position despite the losses.

The company’s lead candidate, DCCR (Diazoxide Choline) Extended-Release tablets, has received Fast-Track and Breakthrough Therapy designations from the FDA, with a New Drug Application submitted in June 2024. The FDA granted Priority Review status, with a target action date set for December 27, 2024.

In terms of liabilities, Soleno reported total liabilities of $14.5 million, which includes a purchase price contingency liability related to its merger with Essentialis. The fair value of this contingent consideration increased by $2.9 million since December 31, 2023.

Overall, Soleno Therapeutics is navigating a challenging financial landscape marked by increased expenditures and significant net losses, while simultaneously advancing its regulatory efforts for its lead therapeutic candidate.