Soleno Therapeutics Faces Class Action Lawsuit Over VYKAT™ XR Safety Concerns

Soleno Therapeutics Faces Class Action Lawsuit Over VYKAT™ XR Concerns

Soleno Therapeutics, Inc. is embroiled in a securities class action lawsuit after the company disclosed troubling news regarding its drug, DCCR, marketed under the name VYKAT™ XR, intended for treating hyperphagia associated with Prader-Willi Syndrome. The lawsuit, which involves investors who purchased Soleno common stock between March 26 and November 4, 2025, follows a significant announcement made by the firm on November 5, 2025. That day, Soleno revealed serious safety concerns related to DCCR, leading to a dramatic 26% decrease in the company’s stock price. Investor confidence plummets as the implications for both sales and future profitability come into question.

The plaintiffs, represented by the national shareholder rights firm Hagens Berman, assert that Soleno misled its investors by underreporting critical safety and efficacy information concerning the drug. Specifically, the lawsuit alleges that the company downplayed risks surrounding excess fluid retention observed in clinical trials, suggesting the medication may pose greater health hazards than previously disclosed. Hagens Berman indicates that these misleading claims about DCCR’s safety profile not only jeopardize the health of patients but also raise alarms about the drug’s market viability. The firm emphasizes that heightened risk of adverse events resulting from the drug could deter healthcare professionals from prescribing it, adversely affecting the company’s revenue streams.

The lawsuit traces its roots back to troubling claims made by activist short-seller Scorpion Capital, which raised concerns on August 15, 2025, regarding Soleno's transparency. According to Scorpion Capital, there was an alarming rise in reports of heart failure among children using VYKAT™ XR, prompting fears of regulatory scrutiny or a potential market withdrawal. The implications are substantial; should VYKAT™ XR be re-evaluated due to safety concerns, it could significantly hinder Soleno’s ability to attract new prescriptions, thus affecting its financial outlook and overall stability. As of now, Hagens Berman is actively working to consolidate affected investors to pursue claims of losses incurred during this tumultuous period, with a lead plaintiff deadline set for May 5, 2026.

In addition to the lawsuit, the fallout from Soleno's announcement underscores the increasing scrutiny and responsibility biotech companies bear when marketing new drugs, especially for rare diseases. Investors and stakeholders are advised to stay informed about the nature of clinical trials and the updates that companies provide, as these factors greatly influence market perception and financial outcomes. The ongoing legal battle serves as a reminder of the critical balance between innovation and patient safety in the pharmaceutical industry.