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Denali Therapeutics Reports First Quarter 2018 Financial Results

May 11, 2018

SOUTH SAN FRANCISCO, Calif., May 11, 2018 (GLOBE NEWSWIRE) -- Denali Therapeutics Inc. (NASDAQ:DNLI), a biopharmaceutical company developing a broad portfolio of therapeutic candidates for neurodegenerative diseases, today reported financial results for the first quarter ended March 31, 2018.

First Quarter 2018 Financial Results

For the three months ended March 31, 2018, Denali reported a net loss of $23.7 million, compared with a net loss for the three months ended March 31, 2017 of $21.3 million.

Collaboration Revenue was $0.6 million for the three months ended March 31, 2018, with no revenue recognized for the three months ended March 31, 2017. The increase was due to revenue recognized under the Option and Collaboration Agreement with Takeda Pharmaceutical Company Limited, which was entered into in January 2018.

Total research and development expenses were $20.8 million for the three months ended March 31, 2018 compared to $18.5 million for the three months ended March 31, 2017, including non-cash stock-based compensation of $1.7 million and $0.5 million in the first quarter of 2018 and 2017, respectively. The increase in total research and development expenses of $2.3 million was primarily attributable to an increase in personnel related expenses, including stock-based compensation, and an increase in lab consumable costs and facilities related expenses. The main drivers of these increases are an increase in research and development headcount and the increased value of Denali's common stock.

General and administrative expenses were $5.6 million for the three months ended March 31, 2018 compared to $3.3 million for the three months ended March 31, 2017, including non-cash stock-based compensation of $1.2 million and $0.2 million in the first quarter of 2018 and 2017, respectively. The increase in total general and administrative expenses of $2.3 million was primarily attributable to an increase in personnel related expenses, including stock-based compensation, and an increase in legal and professional service expenses. The main drivers of these increases are an increase in general and administrative headcount and the increased value of Denali's common stock, as well as the increased professional services required as a public company.

Cash, cash equivalents, and marketable securities were $592.8 million as of March 31, 2018, compared to $467.0 million as of December 31, 2017.  The increase of $125.8 million was primarily attributable to $155.0 million in cash received related to the Option and Collaboration Agreement and Stock Purchase Agreement with Takeda.

About Denali Therapeutics

Denali is a biopharmaceutical company developing a broad portfolio of therapeutic candidates for neurodegenerative diseases. Denali pursues new treatments by rigorously assessing genetically validated targets, engineering delivery across the blood-brain barrier and guiding development with biomarker monitoring to demonstrate target engagement and select patients. Denali is based in South San Francisco. For additional information, please visit www.denalitherapeutics.com.

Denali Therapeutics Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)

   
  Three Months Ended
March 31,
  2018   2017
Collaboration revenue $ 641     $  
Operating expenses:      
Research and development 20,819     18,470  
General and administrative 5,570     3,274  
Total operating expenses 26,389     21,744  
Loss from operations (25,748 )   (21,744 )
Interest income, net 2,070     424  
Net loss $ (23,678 )   $ (21,320 )
Net loss per share, basic and diluted $ (0.26 )   $ (2.36 )
Weighted average number of shares outstanding, basic and diluted 89,560,576     9,017,425  
           

Denali Therapeutics Inc.
Condensed Consolidated Balance Sheet Data
(Unaudited)
(In thousands)

       
  March 31,
2018
  December 31,
2017
Assets      
Current assets:      
Cash and cash equivalents $ 44,001     $ 218,375  
Short-term marketable securities 329,401     187,851  
Prepaid expenses and other current assets 4,020     3,381  
Total current assets 377,422     409,607  
Long-term marketable securities 219,406     60,750  
Property and equipment, net 14,860     14,923  
Other non-current assets 2,265     1,441  
Total assets $ 613,953     $ 486,721  
Liabilities, convertible preferred stock and stockholders’ equity      
Current liabilities:      
Accounts payable $ 1,377     $ 2,716  
Accrued liabilities 4,425     5,364  
Accrued compensation 1,994     5,166  
Contract Liability 8,434      
Deferred rent 874     855  
Other current liabilities 63     63  
Total current liabilities 17,167     14,164  
Contract liability, less current portion 51,519      
Deferred rent, less current portion 6,051     6,294  
Other non-current liabilities 188     467  
Total liabilities 74,925     20,925  
Total stockholders’ equity 539,028     465,796  
Total liabilities and stockholders’ equity $ 613,953     $ 486,721  
               

Contact:
Morgan Warners
(202) 337-0808
mwarners@gpg.com 

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Source: Denali Therapeutics Inc.