Soleno Therapeutics Faces Investigation Over Vykat XR Safety Claims, Stock Plummets 26.59%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 11 2025
0mins
Source: PRnewswire
- Stock Price Drop: Following the release of a report by Scorpion Capital, Soleno's stock price fell by 7.41% on August 15, 2025, losing $5.73 per share and closing at $71.63, reflecting market concerns over the safety of its product.
- Increased Discontinuation Rate: During its Q3 earnings call, Soleno revealed an approximately 8% discontinuation rate for Vykat XR due to adverse effects, indicating a negative impact on product acceptance and potential future sales decline.
- Significant Short-Term Impact: The CEO noted a disruption in Vykat XR's launch trajectory due to the short seller report, with a decrease in start forms and an increase in discontinuations for non-serious adverse events, exacerbating market pessimism about the company's outlook.
- Legal Investigation Initiated: Pomerantz LLP is investigating whether Soleno engaged in securities fraud or other unlawful business practices, which could expose the company to legal risks and undermine investor confidence.
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Analyst Views on SLNO
Wall Street analysts forecast SLNO stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for SLNO is 110.50 USD with a low forecast of 75.00 USD and a high forecast of 125.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
8 Buy
0 Hold
0 Sell
Strong Buy
Current: 40.550
Low
75.00
Averages
110.50
High
125.00
Current: 40.550
Low
75.00
Averages
110.50
High
125.00
About SLNO
Soleno Therapeutics, Inc. is a biopharmaceutical company. The Company is focused on developing novel therapeutics for the treatment of rare diseases. The Company’s lead product candidate, diazoxide choline extended-release tablets (DCCR), is for the treatment of Prader-Willi syndrome (PWS) in individuals four years and older who have hyperphagia. DCCR contains diazoxide choline, a potent ATP-sensitive potassium (KATP) channel activator. DCCR tablets consist of the active ingredient diazoxide choline, a choline salt of diazoxide, which is a benzothiadiazine. Its proposed mode of action, with targets in the brain, pancreas and fat tissue, has the potential to broadly impact complex diseases like PWS to reduce appetite, reduce food-seeking, decrease insulin and leptin resistance, and reduce body fat. The Company has Breakthrough Therapy and Fast-Track designations in the United States and Orphan Drug designations in the United States and European Union.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Soleno Therapeutics Under Investigation for Securities Violations Amid 40% Stock Decline
- Shareholder Rights Investigation: Johnson Fistel, PLLP is investigating whether Soleno Therapeutics violated federal securities laws by potentially making false or misleading statements, which may have harmed shareholder interests.
- Product Launch Challenges: Despite claiming strong performance for VYKAT™ XR post-FDA approval in September 2025, management acknowledged during the November 2025 earnings call that the launch faced challenges, including a slowdown in new treatment initiations and increased therapy discontinuations.
- Impact of Short Seller Report: Following a report from short seller Scorpion Capital on August 15, 2025, which raised concerns about the safety and demand for VYKAT™ XR, Soleno's stock price experienced significant volatility, declining nearly 40% from August 14 to November 5, 2025.
- Business Model Risks: The Scorpion report criticized Soleno's business model for being overly reliant on a single product with expiring intellectual property protection, raising investor concerns about the company's long-term sustainability and strategic direction.
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Soleno Therapeutics Under Investigation, Shares Plunge 26.59%
- Stock Price Drop: On August 15, 2025, Soleno's shares fell from $77.36 to $71.64, a decline of approximately 7.41%, following a report by Scorpion Capital labeling its only product, Vykat XR, as overpriced and potentially unsafe for children.
- Increased Discontinuation Rate: During the earnings call on November 4, 2025, Soleno's CEO disclosed that the discontinuation rate for Vykat XR due to adverse effects was around 8% at the end of Q3 2025, raising significant safety concerns among investors.
- Severe Stock Plunge: Following the earnings report, Soleno's stock plummeted from $63.85 to $46.87, a staggering drop of 26.59%, reflecting investors' extreme pessimism regarding the company's future prospects.
- Legal Investigation Initiated: Kirby McInerney LLP has reminded investors of an ongoing investigation into potential violations of federal securities laws by Soleno and its senior management, which could adversely affect the company's reputation and future stock performance.
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