Stifel resumes Soleno coverage with 'buy' rating, citing potential of rare disease drug

Brokerage Stifel resumes coverage on drug developer Soleno Therapeutics SLNO.O with a "buy" rating and a PT of $74

SLNO's experimental rare-disease drug DCCR has an 80% chance of an FDA approval for the treatment of a rare genetic disorder known as Prader-Willi syndrome - brokerage

Prader-Willi syndrome affects parts of the body with constant hunger, cognitive impairment and behavioral issues

Brokerage believes that the FDA will be flexible in the approval process, given the significant unmet need for this rare disease

We expect sales exceeding $1.5 billion, given that the loss of exclusivity is not expected until the mid-2030s - Stifel

"We model a blockbuster opportunity that implies meaningful potential upside to the stock. We also think M&A is likely a plausible upside case as well" - Stifel analysts

Stock down 5% in the past 12 months