Soleno Therapeutics(SLNO) - 2024 Q1 - Quarterly Results

Soleno Therapeutics Q1 2024 Corporate and Financial Update Corporate Highlights and Strategic Priorities The company is focused on its mid-2024 DCCR NDA submission, supported by a recent financing and team expansion - The company's top priority is the New Drug Application (NDA) submission for DCCR in Prader-Willi syndrome (PWS), on track for mid-2024[3][4] - DCCR was granted Breakthrough Therapy Designation by the U.S. FDA for the treatment of PWS in adults and children ages four and older[3][4] - Successfully closed an underwritten public offering of approximately $158.7 million, strengthening the company's financial position[4] - Strengthened the leadership team with key appointments to prepare for potential commercialization[4] Financial Results The Q1 2024 net loss widened to $21.4 million due to higher expenses, while a public offering boosted cash reserves Key Financial Metrics Q1 2024 saw operating expenses triple to $23.5 million, widening the net loss to $21.4 million year-over-year Q1 2024 vs Q1 2023 Financial Performance (in millions) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Research and Development Expense | $14.6 | $5.3 | | General and Administrative Expense | $8.5 | $2.9 | | Total Operating Expenses | $23.5 | $8.5 | | Net Loss | $21.4 | $8.4 | | Net Loss per Share | $0.59 | $0.88 | - The increase in R&D expense was primarily due to increased headcount and expenditures supporting the NDA submission and commercial launch preparation[7] - The rise in G&A expense was mainly related to higher stock-based compensation, increased headcount, and higher professional expenses[8] Balance Sheet and Cash Position The company held $158.4 million in cash and investments, with a May offering boosting pro forma reserves to $307.2 million Cash and Investments Position (as of March 31, 2024) | Item | Amount (in millions) | | :--- | :--- | | Cash and cash equivalents | $42.8 | | Short-term investments | $106.8 | | Long-term investments | $8.8 | | Total Cash & Investments | $158.4 | - In May 2024, the company received $148.8 million in net proceeds from a public offering, bringing pro forma cash reserves to $307.2 million[6] - The company has a contingent liability with a fair value of $12.0 million as of March 31, 2024, related to future commercial sales milestones for DCCR[9] Business and Product Overview The company is a clinical-stage biopharma developing its lead candidate, DCCR, for the rare disease Prader-Willi Syndrome About Prader-Willi Syndrome (PWS) PWS is a rare genetic disorder defined by life-threatening hyperphagia for which there are no approved therapies - PWS occurs in one in every 15,000 live births and is characterized by hyperphagia, a chronic and life-threatening feeling of intense hunger[12] - A global survey showed that 96.5% of parents and caregivers rated hyperphagia as the most important symptom to be relieved by a new medicine[13] - There are currently no approved therapies to treat the hyperphagia, metabolic, cognitive function, or behavioral aspects of PWS[13] About DCCR (Diazoxide Choline) Extended-Release Tablets DCCR is a proprietary, once-daily tablet for PWS that has completed Phase 3 and received multiple FDA designations - DCCR is a novel, proprietary once-daily extended-release tablet form of diazoxide choline[14] - The Phase 3 clinical program showed DCCR was promising in addressing hyperphagia and other symptoms like aggressive/destructive behaviors and fat mass[14] - DCCR has received Orphan Drug, Fast Track, and Breakthrough Designations in the U.S. for the treatment of PWS[14] Financial Statements The statements detail the company's financial position, with total assets of $168.8 million and a Q1 net loss of $21.4 million Condensed Consolidated Balance Sheets Total assets were $168.8 million as of March 31, 2024, with total liabilities of $25.5 million Condensed Balance Sheet Data (in thousands) | Balance Sheet Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $42,847 | $169,681 | | Total current assets | $151,223 | $171,358 | | Total assets | $168,837 | $180,691 | | Total liabilities | $25,451 | $23,184 | | Total stockholders' equity | $143,386 | $157,507 | Condensed Consolidated Statements of Operations and Comprehensive Loss The company reported a Q1 2024 net loss of $21.4 million, a significant increase from $8.4 million in Q1 2023 Condensed Statement of Operations Data (in thousands) | Statement of Operations Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Research and development | $14,602 | $5,316 | | General and administrative | $8,472 | $2,854 | | Operating loss | $(23,475) | $(8,469) | | Net loss | $(21,398) | $(8,356) | | Net loss per share, basic and diluted | $(0.59) | $(0.88) |