Shares of Soleno Therapeutics (SLNO) catapulted an astonishing 505% higher last week after positive late-stage clinical results for the company’s experimental obesity and hunger control pill. The massive stock surge demonstrates investor enthusiasm around Soleno’s DCCR pill as a potential new medicine for Prader-Willi syndrome (PWS).
DCCR aims to treat hyperphagia, or abnormally increased hunger and food drive, in patients with PWS. The rare genetic disorder can lead to excessive eating, obesity, and other complications. Soleno’s pill showed promising ability to control hunger signals in PWS patients during a 4-month placebo-controlled withdrawal study.
The trial enrolled 77 PWS patients who had been taking DCCR for 2-4 years. Half the participants continued their DCCR regimen, while the other half were switched to placebo. After just one month, the placebo group showed a rapid return of hyperphagia symptoms. On a 9-point clinical scale, their hunger scores increased by a significant 5 points on average.
In contrast, PWS patients who remained on DCCR maintained stable, controlled hunger levels throughout the 4-month trial. The results provide strong evidence that DCCR specifically curbs abnormal hunger drive in PWS, rather than just having a placebo effect.
Beyond hunger control, PWS patients taking placebo also showed worsening in overall PWS symptoms and severity. No new safety issues emerged during the 4 months on placebo, indicating the hunger control benefits of DCCR remained after stopping treatment.
Armed with the successful phase 3 results, Soleno now plans to submit a New Drug Application for DCCR to the FDA in mid-2024. The company is seeking an initial approval in PWS, which would make DCCR the first ever pharmacotherapy for hyperphagia associated with the condition.
The FDA previously designated DCCR an Orphan Drug for treating PWS. This status provides incentives to develop medicines for rare diseases, since PWS affects only about 15,000-16,000 individuals in the U.S. The new trial results could support approval based on the FDA’s prior guidance.
If greenlighted, analysts project DCCR peak sales could reach $500 million – $1 billion annually. The pill would provide a novel, non-surgical therapeutic option to manage hyperphagia and obesity in PWS. DCCR’s unique clinical benefits could command premium pricing above $100,000 per patient annually.
Soleno still has work ahead to realize commercialization, including securing FDA approval and payer coverage. But the company now has a de-risked late stage asset and clear regulatory path forward. The 505% share price spike last week reflects renewed investor confidence in DCCR’s commercial potential.
Despite the rally, Soleno still trades 70% below its 2018 highs. The stock has suffered from past clinical setbacks that stoked skepticism around DCCR. But with a successful phase 3 trial now completed, the tide may be turning.
Soleno could seek to expand DCCR’s use into additional patient populations with uncontrolled hunger and obesity issues beyond PWS. The pill works by modulating metabolic pathways that drive hyperphagia symptoms.
While gains may moderate going forward, last week’s huge rally kicks off a new chapter for Soleno stock. Look for the company to shift focus from pivotal trial execution to commercial planning. Investors cheered the pivotal data, signaling confidence in DCCR’s prospects. Soleno still has work left to turn its hunger-controlling pill into an FDA-approved medicine, but the 505% surge shows just how much upside investors anticipate.
