** Shares of Soleno Therapeutics SLNO.O fall 6.1% to $52.41

** On Tuesday, U.S. FDA extended the review of SLNO's drug to treat a rare genetic disorder Prader–Willi syndrome

** Investors are overreading into Applied's APLT.O FDA outcome - brokerage Baird

** On Friday, FDA rejects APLT's drug to treat galactosemia, a rare genetic metabolic disease

** Baird says SLNO's drug DCCR meets FDA's standard of substantial evidence of effectiveness at face value

** In SLNO's study, in consultation with the FDA, DCCR met the main goal, whereas APLT's drug missed the main goal in its study - brokerage

** SLNO has FDA's breakthrough designation for DCCR, while APLT does not - Baird

** SLNO has a stronger application for approval and more external validation from the FDA - brokerage

** FDA will decide on SLNO's drug by Mar. 27

** YTD, SLNO up 28.8%

(Reporting by Puyaan Singh)

((Puyaan.Singh@thomsonreuters.com;))