Executive Summary

Q4 2021 reflected a lean operating quarter: no revenue, estimated net loss of ~$2.83M, and total operating expenses of ~$3.00M, with cash and equivalents at $21.3M at year‑end .
Regulatory path was clarified: after a December Type C meeting, FDA was receptive to a controlled-data design using current C602 participants; Soleno plans to submit the proposal and continue NDA preparations .
Financing overhang addressed via a proposed underwritten offering announced March 28, 2022, to fund DCCR and general corporate purposes .
Listing risk noted: Nasdaq granted an additional compliance period to September 12, 2022 for minimum bid price, a factor for near-term stock reaction alongside regulatory progress and funding developments .

What Went Well and What Went Wrong

What Went Well

Management strengthened the regulatory narrative: “We appreciate the constructive dialogue with the FDA… This approach would significantly reduce the time and cost to obtain the necessary data” (CEO Anish Bhatnagar, M.D.) .
Persistent commitment to DCCR strategy: “We remain firmly committed to obtaining regulatory approval for DCCR as a new treatment for people with PWS as quickly as possible” .
Operating discipline into Q4: total operating expenses declined versus prior quarters as activities tapered post-dataset submissions; management had previously cited spend “primarily due to the cadence of activities related to the DCCR development program” .

What Went Wrong

No commercial revenue and continued losses; FY 2021 net loss was $30.9M, underscoring funding needs and execution risks to approval .
G&A intensity rose: FY 2021 G&A increased 23% YoY to $10.8M, reflecting higher compensation and professional fees .
Going concern disclosure and listing risk: management highlighted substantial doubt about the ability to continue as a going concern absent new capital; Nasdaq extended the bid price compliance period, elevating listing uncertainty if shares remain below threshold .

Financial Results

Quarterly P&L and Cash (all units $USD Millions)

Metric	Q1 2021	Q2 2021	Q3 2021	Q4 2021
Revenue	0.0	0.0	0.0	0.0
Net Loss	(8.954)	(10.988)	(8.140)	(2.828) (derived from FY net loss $30.910M less nine‑month $28.082M)
Net Loss per Share ($)	(0.11)	(0.14)	(0.10)	n/a (not disclosed in available filings)
Total Operating Expenses	9.156	11.085	8.286	3.001 (derived from FY $31.528M less nine‑month $28.527M)
R&D Expense	7.164	5.587	4.968	3.734 (derived from FY $21.453M less nine‑month $17.719M)
G&A Expense	2.979	2.464	2.767	2.596 (derived from FY $10.806M less nine‑month $8.210M)
Cash and Equivalents	41.607	33.596	28.185	21.304

Notes: Quarterly “Revenue” is shown as 0.0 consistent with management’s disclosure of no commercial revenue through FY 2021 . Q4 figures marked “derived” are calculated from FY and nine‑month totals reported in filings .

Segment Breakdown

Segment	Description
Single segment	Company operates in one segment focused on DCCR for PWS .

KPIs (Operational/Regulatory)

KPI	Q2 2021	Q3 2021	Current Period (Q4 2021 context)
C602 one‑year completions	97 patients completed one year by June 2021	—	—
C602 enrollment	—	115 subjects enrolled into C602	—
FDA interactions	Type B minutes (June 11, 2021): FDA encouraged submission of C601/C602 data	Submitted collective results to FDA in Q4 2021	Type C minutes (Dec 21, 2021): FDA receptive to C602‑based controlled design

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Regulatory pathway for DCCR	2021–2022	FDA indicated an additional clinical trial likely needed; encouraged submission of C601/C602 data for assessment	FDA receptive to a controlled‑data design using current C602 participants; Soleno to submit study proposal and continue NDA preparations	Clarified path; potential to reduce time and cost
Financial guidance	2021–2022	None provided	None provided	Maintained (no financial guidance)

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3 2021)	Current Period (Q4 2021)	Trend
Regulatory/clinical strategy	FDA encouraged submitting C601/C602 data; ongoing dialogue	FDA receptive to C602‑based controlled design; continue NDA preparations	Improving clarity
Open‑label extension (C602) data	Progressive improvement in hyperphagia and behaviors; statistically significant vs PfPWS	Data submitted in Q4 2021 as part of regulatory dialogue	Data leveraged
Capital/financing	No ATM usage disclosed; prior 2020 raise	Proposed underwritten offering announced Mar 28, 2022	Proactive funding
Listing compliance	Nasdaq deficiency notice (Sep 2021)	Extension to Sep 12, 2022	Watch status

Management Commentary

“We remain firmly committed to obtaining regulatory approval for DCCR as a new treatment for people with PWS as quickly as possible.” (CEO, Q3 press release) .
“We appreciate the constructive dialogue with the FDA… This approach would significantly reduce the time and cost to obtain the necessary data.” (CEO, regulatory update Jan 24, 2022) .
Use of proceeds for proposed offering: to fund R&D focused on DCCR and general corporate purposes .

Q&A Highlights

No Q4 2021 earnings call transcript was found; all clarifications on regulatory path and financing were communicated via press releases and the FY 2021 10‑K .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2021 EPS and revenue was unavailable at time of analysis; the company has no revenue and limited sell‑side coverage. As a result, comparison vs consensus could not be completed. Values retrieved from S&P Global were unavailable due to data access limits.

Key Takeaways for Investors

Cash runway tightened into year‑end: cash fell to $21.3M, with $27.8M cash used in operating activities in FY 2021, making near‑term financing pivotal .
Q4 operating cadence was light (Opex ~$3.00M), reflecting completion of submissions; future spend will ramp with execution of the controlled‑data study design if accepted by FDA .
No revenue and continued net losses (FY net loss $30.9M) underscore binary regulatory outcomes for DCCR and the importance of capital planning .
Regulatory path clarity is a potential catalyst: FDA’s receptivity to a C602‑based controlled design can accelerate timelines and reduce costs vs a full new trial .
Listing status remains a watch item: the extended bid price compliance window to Sep 12, 2022 adds overhang; financing (and subsequent investor reception) can drive resolution .
Corporate actions reduced contingent earnout exposure (assignment of rights from two former Essentialis holders), modestly improving future milestone payment obligations .
Near‑term focus: submit the controlled‑data proposal, secure funding, and maintain listing compliance while advancing DCCR regulatory strategy .

Citations:

SOLENO THERAPEUTICS INC (SLNO)·Q4 2021 Earnings Summary