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INVESTOR ALERT: Pomerantz Law Firm Investigates Claims On Behalf of Investors of Soleno Therapeutics, Inc. - SLNO
GlobeNewswire News Room· 2025-08-25 15:33
Group 1 - Pomerantz LLP is investigating claims on behalf of investors of Soleno Therapeutics, Inc. regarding potential securities fraud or unlawful business practices by the company and its officers [1] - Scorpion Capital published a report on August 15, 2025, labeling Soleno's product Vykat XR as overpriced and potentially unsafe for children, leading to a significant stock price drop [3] - Following the Scorpion report, Soleno's stock price decreased by $5.73 per share, or 7.41%, closing at $71.63 per share on the same day [3] Group 2 - Pomerantz LLP is recognized as a leading firm in corporate, securities, and antitrust class litigation, with a history of recovering multimillion-dollar damages for victims of securities fraud [4]
INVESTOR ALERT: Investigation of Soleno Therapeutics, Inc. (SLNO) Announced by Holzer & Holzer, LLC
GlobeNewswire News Room· 2025-08-19 17:38
Core Points - Holzer & Holzer, LLC is investigating Soleno Therapeutics, Inc. for potential violations of federal securities laws following a report by Scorpion Capital that questioned the credibility of the company's phase 3 clinical trials for its drug VYKAT™ XR [1] - The report from Scorpion Capital highlighted numerous problems with the clinical trials and withdrawal studies, leading to a decline in Soleno Therapeutics' stock price [1] Company Overview - Soleno Therapeutics, Inc. is publicly traded on NASDAQ under the ticker SLNO and is focused on developing treatments, including VYKAT™ XR [1] - The company is currently facing scrutiny regarding its compliance with securities laws due to allegations of issues in its clinical trial processes [1] Legal Context - Holzer & Holzer, LLC is a law firm specializing in securities litigation and has a history of representing shareholders in class action lawsuits [3] - The firm has been recognized as a top-rated securities litigation law firm for multiple years and has recovered significant amounts for investors affected by corporate misconduct [3]
Down 21.7% in 4 Weeks, Here's Why Soleno Therapeutics (SLNO) Looks Ripe for a Turnaround
ZACKS· 2025-08-19 14:36
Core Viewpoint - Soleno Therapeutics, Inc. (SLNO) is experiencing significant selling pressure, with a 21.7% decline over the past four weeks, but is now positioned for a potential trend reversal due to being in oversold territory and positive earnings expectations from Wall Street analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a momentum oscillator that indicates whether a stock is oversold, with readings below 30 typically signaling this condition [2]. - SLNO's current RSI reading is 26.7, suggesting that the heavy selling pressure may be exhausting itself, indicating a potential trend reversal [5]. Group 2: Fundamental Indicators - There is a strong consensus among sell-side analysts that SLNO will report better earnings than previously predicted, with a 46.7% increase in the consensus EPS estimate over the last 30 days [7]. - The upward trend in earnings estimate revisions is generally associated with price appreciation in the near term [7]. Group 3: Analyst Ratings - SLNO holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a strong potential for a turnaround [8].
Soleno Therapeutics (SLNO) Drops Amid Critical Scorpion Report -- Hagens Berman
GlobeNewswire News Room· 2025-08-19 12:21
Core Viewpoint - Soleno Therapeutics, Inc. has faced a significant decline in share price following a critical report by Scorpion Capital, which raised serious concerns about the safety and commercial viability of its drug VYKAT™ XR [1][4]. Company Overview - Soleno Therapeutics is focused on developing treatments for Prader-Willi syndrome, with its primary product being VYKAT™ XR, a once-daily oral tablet aimed at treating hyperphagia, a condition associated with the syndrome [2][4]. Investigation Details - Hagens Berman has initiated an investigation into Soleno to determine if the company misled investors regarding the safety and commercial prospects of VYKAT™ XR [2][3][6]. - The investigation will scrutinize Soleno's statements about the drug's safety and its commercial potential, particularly in light of recent adverse reports [3][6]. Critical Report Findings - Scorpion Capital's report highlighted a concerning trend of children being hospitalized for potential heart failure after using VYKAT™ XR, suggesting that the drug may face market withdrawal or a significant drop in new prescriptions [4][5]. - The report characterized Soleno as a "one-trick pony," emphasizing the lack of other meaningful assets or scientific programs, and warned of the company's potential demise if VYKAT™ XR fails, especially with its core patent expiring in 2026 [4][5]. Concerns Raised - Scorpion Capital criticized Soleno's launch metrics as misleading and pointed to a controversial physician involved in key trials, suggesting potential issues with data integrity and scientific standards [5][6]. - Allegations were made regarding irregularities in the physician's co-authored papers, which could undermine the validity of Soleno's trials and FDA submissions [5].
How Much Upside is Left in Soleno Therapeutics (SLNO)? Wall Street Analysts Think 43.15%
ZACKS· 2025-08-11 14:55
Group 1 - Soleno Therapeutics, Inc. (SLNO) shares have increased by 1% over the past four weeks, closing at $82.35, with a mean price target of $117.88 indicating a potential upside of 43.2% [1] - The mean estimate consists of eight short-term price targets with a standard deviation of $13.62, where the lowest estimate is $100.00 (21.4% increase) and the highest is $145.00 (76.1% increase) [2] - Analysts show a strong consensus that SLNO will report better earnings than previously estimated, which is a positive indicator for potential stock upside [4][11] Group 2 - The Zacks Consensus Estimate for SLNO's current year earnings has risen by 56.7% over the past month, with five estimates increasing and no negative revisions [12] - SLNO holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates, suggesting a strong potential for near-term upside [13] - While consensus price targets may not be entirely reliable, the direction they imply appears to be a good guide for potential price movement [14]
Here's Why Momentum in Soleno Therapeutics (SLNO) Should Keep going
ZACKS· 2025-08-11 13:51
Core Viewpoint - The article emphasizes the importance of confirming the sustainability of stock trends for successful short-term investing, highlighting that price movements should be supported by strong fundamentals and positive earnings estimates [1][2]. Group 1: Stock Performance - Soleno Therapeutics, Inc. (SLNO) has shown a solid price increase of 9.8% over the past 12 weeks, indicating investor confidence in its potential upside [4]. - SLNO has maintained a price increase of 1% over the past four weeks, suggesting that the upward trend is still intact [5]. - The stock is currently trading at 83.7% of its 52-week high-low range, indicating a potential breakout opportunity [5]. Group 2: Fundamental Strength - SLNO holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [6]. - The stock has an Average Broker Recommendation of 1 (Strong Buy), reflecting high optimism from the brokerage community regarding its near-term price performance [7]. - The Zacks Rank system has a strong historical performance, with Zacks Rank 1 stocks averaging an annual return of +25% since 1988 [7]. Group 3: Investment Strategy - The "Recent Price Strength" screen is a useful tool for identifying stocks like SLNO that are on an uptrend supported by strong fundamentals [3]. - Investors are encouraged to explore over 45 Zacks Premium Screens tailored to different investing styles to find potential winning stocks [8].
Soleno Therapeutics, Inc. (SLNO) Reports Q2 Loss, Tops Revenue Estimates
ZACKS· 2025-08-06 22:11
Financial Performance - Soleno Therapeutics reported a quarterly loss of $0.09 per share, significantly better than the Zacks Consensus Estimate of a loss of $0.53, and an improvement from a loss of $0.57 per share a year ago, representing an earnings surprise of +83.02% [1] - The company posted revenues of $32.66 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.58%, compared to zero revenues a year ago [2] Stock Performance - Soleno Therapeutics shares have increased approximately 81.6% since the beginning of the year, outperforming the S&P 500's gain of 7.1% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.49 on revenues of $24.62 million, and for the current fiscal year, it is -$2.13 on revenues of $122.75 million [7] Industry Outlook - The Medical - Drugs industry, to which Soleno Therapeutics belongs, is currently ranked in the top 34% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that the company's stock may continue to perform well based on these revisions [5][6]
Soleno Therapeutics(SLNO) - 2025 Q2 - Earnings Call Transcript
2025-08-06 21:32
Financial Data and Key Metrics Changes - Total net revenue for Q2 2025 was $32.7 million, reflecting strong demand for VICAT XR, compared to no revenue in Q2 2024 [20][21] - The company used $12.6 million in cash for operating activities during the quarter and had cash, cash equivalents, and marketable securities of approximately $293.8 million at the end of the quarter [20][21] - The net loss for Q2 2025 was approximately $4.7 million, or $0.09 per share, compared to a net loss of $21.9 million, or $0.57 per share, in Q2 2024 [22] Business Line Data and Key Metrics Changes - VICAT XR was launched in March 2025, becoming the first FDA-approved treatment for hyperphagia in patients with Prader-Willi syndrome (PWS) [7][8] - The company received 646 patient start forms from launch through June 30, 2025, with a majority of patients aged between 4 and 26 years [14][15] - The number of unique prescribers reached 295, with over a third of the top 300 prescribers actively writing prescriptions [15][18] Market Data and Key Metrics Changes - Approximately 33% of all insured lives in the U.S. are now covered for VICAT XR, representing over 100 million lives [18] - The company is actively engaging with payers to establish broad reimbursement coverage, which is a high priority moving forward [9][18] Company Strategy and Development Direction - The company aims to establish VICAT XR as the standard of care for PWS-related hyperphagia and is focused on expanding its market presence in Europe [24][10] - Plans for potential approval of DCCR in Europe are underway, with a marketing authorization application submitted to the EMA [10][12] - The company is considering both standalone and partnership approaches for commercialization in Europe, leveraging its strong cash position of over $500 million [20][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for VICAT XR and its potential to become a long-term therapy for PWS patients [27][28] - The company is optimistic about the trajectory of patient starts and prescriber engagement, indicating a strong launch momentum [24][44] - Management acknowledged the need for ongoing monitoring of safety data in the post-marketing setting, with no new safety signals reported so far [41][42] Other Important Information - The cost of goods sold for Q2 2025 was $700,000, with research and development expenses at $9.1 million, reflecting a decrease from the previous year [21][22] - Selling, general, and administrative expenses for the quarter were $28.2 million, indicating increased investment in personnel and programs to support the VICAT XR launch [22] Q&A Session Summary Question: How do you see monthly scripts in July compared to earlier months? - Management refrained from discussing data post-quarter end but expressed confidence in VICAT XR becoming the standard of care for PWS [27] Question: Are there any emerging pain points during the patient start form process? - Management noted a strong start with 646 patient starts and indicated that the next couple of quarters will be educational regarding potential pain points [33] Question: What are the early compliance trends tracking? - Early data suggests discontinuation rates are lower than those seen in clinical trials, indicating strong compliance [36] Question: Can you comment on safety based on real-world evidence? - No new safety signals have been observed in the post-marketing setting, and discontinuation rates remain low [41][42] Question: What is the breakdown of revenue trends for the rest of the year? - Management indicated that while the start was strong, normalization may occur in the coming quarters [44] Question: Are there any patterns in patient severity for those receiving VICAT XR? - Management does not actively collect severity data but suspects a mix of motivated families and physician referrals are driving early prescriptions [61] Question: What are the plans for expanding the portfolio beyond VICAT XR? - The company is currently focused on the launch of VICAT XR but may consider diversification in the long term [81]
Soleno Therapeutics(SLNO) - 2025 Q2 - Earnings Call Transcript
2025-08-06 21:30
Financial Data and Key Metrics Changes - Total net revenue for Q2 2025 was $32.7 million, reflecting strong demand for VICAT XR, compared to no revenue in Q2 2024 [19][20] - The company used $12.6 million in cash for operating activities during the quarter and had cash, cash equivalents, and marketable securities of approximately $293.8 million at the end of the quarter [19][20] - The net loss for Q2 2025 was approximately $4.7 million, or $0.09 per share, compared to a net loss of $21.9 million, or $0.57 per share, in Q2 2024 [21][22] Business Line Data and Key Metrics Changes - The commercial launch of VICAT XR for treating hyperphagia in Prader Willi syndrome (PWS) began on April 14, 2025, following FDA approval on March 26, 2025 [6][7] - The company received 646 patient start forms from launch through June 30, 2025, with a majority of patients aged between 4 and 26 years [14][15] - There were 295 unique prescribers for VICAT XR, with over a third of the top 300 prescribers already writing prescriptions [15][16] Market Data and Key Metrics Changes - Approximately 33% of all insured lives in the U.S. are now covered for VICAT XR, representing over 100 million lives [17][18] - The company is actively engaging with payers to establish broad reimbursement for VICAT XR, which is a high priority moving forward [8][17] Company Strategy and Development Direction - The company aims to establish VICAT XR as the standard of care for PWS-related hyperphagia and is focused on expanding its market presence in Europe [22][10] - Plans for potential approval of DCCR in Europe are underway, with a marketing authorization application submitted to the EMA [10][12] - The company is considering both standalone and partnership approaches for commercialization in Europe, leveraging its strong cash position of over $500 million [19][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for VICAT XR and its potential to become the standard therapy for PWS [25][22] - The company is optimistic about the trajectory of patient starts and prescriber engagement, indicating a strong launch momentum [22][19] - Management acknowledged the need for continued monitoring of safety data in the post-marketing setting, with no new safety signals reported so far [37][38] Other Important Information - The company raised an additional $230 million through an underwritten offering of common stock after the quarter ended, enhancing its financial position [19] - Research and development expenses for Q2 2025 were $9.1 million, down from $12.3 million in the same period of 2024, reflecting a shift in focus towards commercialization [20][21] Q&A Session Summary Question: How do you see monthly scripts in July compared to earlier months? - Management refrained from discussing data post-quarter end but expressed confidence in VICAT XR becoming the standard of care for PWS [25] Question: Are there any emerging pain points during the patient start form process? - Management noted a strong start with 646 patient starts and indicated that the next couple of quarters will provide more insights into potential pain points [30] Question: What are the early compliance trends tracking? - Early data suggests discontinuation rates are lower than in clinical trials, indicating strong compliance among patients [32] Question: Can you comment on safety based on real-world evidence? - Management reported no new safety signals in the post-marketing setting, consistent with clinical trial data [38] Question: What is the breakdown of revenue trends for the rest of the year? - Management indicated that while Q2 was strong, normalization may occur in the coming quarters [39] Question: Are there any concerns regarding prescribers deploying VICAT XR in patients with diabetes? - Management stated that controlled diabetes should not deter prescribers from using VICAT XR, but uncontrolled diabetes may raise concerns [78] Question: Is the company considering expanding its portfolio beyond VICAT XR? - Management confirmed a focus on VICAT XR for now but acknowledged the need for future diversification [79]
Soleno Therapeutics(SLNO) - 2025 Q2 - Quarterly Report
2025-08-06 21:16
PART I [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company began generating product revenue from VYKAT XR in Q2 2025, leading to a net loss of $48.5 million for the first six months of 2025 due to commercial launch costs, while total assets slightly increased to $332.3 million [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet reflects a slight increase in total assets to $332.3 million as of June 30, 2025, with new current assets from the VYKAT XR commercial launch Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $76,497 | $87,928 | | Marketable securities | $217,346 | $230,720 | | Total current assets | $316,789 | $293,889 | | Total assets | $332,306 | $330,972 | | **Liabilities & Equity** | | | | Total current liabilities | $20,943 | $18,747 | | Long-term debt, net | $49,845 | $49,828 | | Total liabilities | $92,166 | $85,859 | | Total stockholders' equity | $240,140 | $245,113 | - The company reported new current assets of **Accounts Receivable ($24.6 million)** and **Inventory ($2.4 million)** as of June 30, 2025, following the commercial launch of VYKAT XR[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company recorded its first product revenue of $32.7 million in Q2 2025, but increased selling, general, and administrative expenses led to a net loss of $48.5 million for the first six months of 2025 Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | $— | | Total operating expenses | $39,182 | $24,868 | $84,925 | $48,343 | | Research and development | $9,147 | $12,342 | $22,664 | $26,944 | | Selling, general and administrative | $28,238 | $10,889 | $57,497 | $19,361 | | Operating loss | $(6,525) | $(24,868) | $(52,268) | $(48,343) | | Net loss | $(4,708) | $(21,854) | $(48,481) | $(43,252) | | Net loss per share, basic and diluted | $(0.09) | $(0.57) | $(1.00) | $(1.16) | - The company began generating product revenue in Q2 2025, recording **$32.7 million** following FDA approval of VYKAT XR, which was accompanied by a significant increase in Selling, General and Administrative expenses to support the commercial launch[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities increased to $45.4 million for the first six months of 2025, while investing activities provided cash and financing activities contributed $18.9 million Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(45,360) | $(30,179) | | Net cash provided by (used in) investing activities | $15,022 | $(236,165) | | Net cash provided by financing activities | $18,907 | $153,687 | | **Net decrease in cash and cash equivalents** | **$(11,431)** | **$(112,657)** | - Net cash used in operating activities increased to **$45.4 million** in the first six months of 2025 from **$30.2 million** in the prior year period, primarily due to costs associated with the commercial launch of VYKAT XR[16](index=16&type=chunk) - Financing activities in the first half of 2025 provided **$18.9 million**, mainly from the exercise of stock options and warrants, compared to **$153.7 million** in the same period of 2024 which included proceeds from a common stock sale[16](index=16&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the FDA approval and commercial launch of VYKAT XR, the company's liquidity position, debt agreements, and revenue recognition policies - The company's lead product, **VYKAT XR**, received FDA approval on March 26, 2025, for treating hyperphagia in patients with Prader-Willi syndrome (PWS), with revenue recognition beginning in Q2 2025[18](index=18&type=chunk) - As of June 30, 2025, the company held **$76.5 million** in cash and cash equivalents and **$217.3 million** in marketable securities, which management deems sufficient to meet obligations for at least the next twelve months[19](index=19&type=chunk)[24](index=24&type=chunk) - The company has a loan agreement with Oxford for up to **$200 million**, with **$50 million** outstanding as of June 30, 2025, and an additional **$50 million** available upon FDA approval of VYKAT XR[20](index=20&type=chunk)[66](index=66&type=chunk) - Subsequent to the quarter end, in July 2025, the company closed an underwritten public offering of common stock, raising gross proceeds of **$230.0 million**[23](index=23&type=chunk)[103](index=103&type=chunk) - Product revenue is recognized upon transfer of control to its single specialty pharmacy customer, with net revenue including estimates for variable consideration totaling **$4.3 million** in provisions for the six months ended June 30, 2025[34](index=34&type=chunk)[35](index=35&type=chunk)[38](index=38&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's transition to a commercial-stage entity following VYKAT XR's FDA approval, highlighting initial product revenue of $32.7 million in Q2 2025, increased SG&A expenses for launch, and strengthened liquidity from a recent $230 million public offering [Results of Operations](index=31&type=section&id=Results%20of%20Operations) The company's results reflect the commercial launch of VYKAT XR, with new product revenue offset by significantly increased selling, general, and administrative expenses Comparison of Three Months Ended June 30, 2025 and 2024 (in thousands) | Item | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | 100% | | Research and development | $9,147 | $12,342 | $(3,195) | (26%) | | Selling, general and administrative | $28,238 | $10,889 | $17,349 | 159% | | Net loss | $(4,708) | $(21,854) | $17,146 | (78%) | - For Q2 2025, R&D expenses decreased by **$3.2 million (26%)** YoY due to lower costs for the NDA submission, while SG&A expenses increased by **$17.3 million (159%)** YoY, driven by hiring and program costs for the commercial launch of VYKAT XR[121](index=121&type=chunk)[122](index=122&type=chunk) Comparison of Six Months Ended June 30, 2025 and 2024 (in thousands) | Item | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $32,657 | $— | $32,657 | 100% | | Research and development | $22,664 | $26,944 | $(4,280) | (16%) | | Selling, general and administrative | $57,497 | $19,361 | $38,136 | 197% | | Net loss | $(48,481) | $(43,252) | $(5,229) | 12% | - For the first six months of 2025, SG&A expenses increased by **$38.1 million (197%)** YoY, reflecting a **$15.3 million** increase in personnel costs and a **$12.6 million** increase in commercial launch program costs[131](index=131&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with substantial cash and marketable securities, further bolstered by available debt and a recent public offering - As of June 30, 2025, the company had **$76.5 million** in cash and cash equivalents and **$217.3 million** in marketable securities, with a working capital of **$295.8 million**[134](index=134&type=chunk) - The company has access to additional capital through its loan agreement with Oxford, with **$50 million** available through September 30, 2025, and further tranches available upon meeting certain milestones[135](index=135&type=chunk) - In July 2025, the company raised gross proceeds of **$230.0 million** from a public offering of common stock, further strengthening its capital position[137](index=137&type=chunk) - Management believes that existing cash, cash equivalents, and marketable securities are sufficient to meet working capital needs for the next twelve months[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes to its exposure to market risk during the six months ended June 30, 2025, as compared to the disclosures in its 2024 Annual Report on Form 10-K - There have been no material changes to the company's market risk exposure during the first six months of 2025[148](index=148&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of June 30, 2025, due to a material weakness in IT general controls, for which a remediation plan is being implemented - Management concluded that disclosure controls were not effective as of June 30, 2025, due to a material weakness in internal control[151](index=151&type=chunk) - The material weakness relates to ineffective design and operation of controls over certain **information technology general controls (ITGCs)**, including segregation of duties, program change management, and user access controls[152](index=152&type=chunk) - The company is implementing a remediation plan that includes hiring additional personnel, enhancing training, and improving oversight of IT controls[154](index=154&type=chunk)[157](index=157&type=chunk) PART II—OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company states that it may be party to litigation in the ordinary course of business but currently believes these matters will not have a material adverse effect - The company is not currently involved in any legal proceedings that are expected to have a material adverse effect on its business[159](index=159&type=chunk) [Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks primarily from its dependence on the commercial success of VYKAT XR, alongside financial, operational, intellectual property, and regulatory challenges, including potential stock price volatility - The company is highly dependent on the commercial success of its sole FDA-approved product, **VYKAT XR**[164](index=164&type=chunk) - The company has a limited commercialization history, has incurred significant losses since inception, and may need additional funds to support operations[162](index=162&type=chunk)[167](index=167&type=chunk) - Market acceptance of **VYKAT XR** by physicians, patients, and payers is critical for commercial success and is not guaranteed[187](index=187&type=chunk) - The company relies on sole source suppliers for manufacturing and a single specialty pharmacy for initial U.S. distribution, posing supply chain and commercialization risks[236](index=236&type=chunk)[240](index=240&type=chunk) - The company faces risks from potential intellectual property infringement claims and challenges in maintaining and enforcing its own patent rights[245](index=245&type=chunk)[251](index=251&type=chunk) - Ongoing regulatory obligations, healthcare reform measures like the **Inflation Reduction Act**, and compliance with fraud and abuse laws present significant challenges[292](index=292&type=chunk)[307](index=307&type=chunk)[314](index=314&type=chunk)