Denali Therapeutics Reports Second Quarter 2023 Financial Results and Business Highlights
“In the second quarter, we shared exciting new data demonstrating robust reduction in NfL in the Phase 1/2 MPS II trial with DNL310 (ETV:IDS) and target engagement with DNL343 (eIF2B activator) in the Phase 1b study in ALS patients, which support ongoing late-stage studies for those programs,” said
Second Quarter and Recent Program Updates:
DNL310 (ETV:IDS): MPS II (Hunter syndrome)
DNL310 is an investigational, intravenously administered, Enzyme Transport Vehicle (ETV)-enabled, iduronate-2-sulfatase (IDS) replacement therapy designed to cross the BBB and address the behavioral, cognitive, and physical manifestations of MPS II (Hunter syndrome).
- In June, Denali announced new interim results demonstrating a robust reduction in neurofilament light (NfL), a marker of neuroaxonal damage, from the ongoing open-label, single-arm Phase 1/2 study of DNL310 in children with MPS II. A decline in serum NfL levels was observed after six months of treatment with DNL310, reaching a statistically significant reduction of approximately 40% (p < 0.001) at Week 61 and approximately 64% (p < 0.001) after two years of treatment with DNL310 compared to baseline. The previously reported robust reduction and normalization of heparan sulfate levels in cerebrospinal fluid (CSF), and now the downstream reduction in NfL after treatment, are consistent with positive changes in clinical outcomes measures that Denali has previously reported from interim analyses of the Phase 1/2 study.
- In June, Denali announced that the
U.S. Food and Drug Administration(FDA) had recently recommended to Denali the assessment of NfL as an exploratory endpoint to evaluate its potential as a possible biomarker to assess diagnostic, prognostic, or therapeutic response in subjects with neuronopathic MPS II. Denali intends to share the new NfL data with the FDA at an upcoming meeting as part of the ongoing dialogue related to the DNL310 development program.
- Additional interim data from the Phase 1/2 study of DNL310 will be highlighted in an oral presentation at the
Society for the Study of Inborn Errorsof Metabolism (SSIEM) Annual Symposium 2023 in Jerusalem, Israel, August 29– September 1, 2023.
- Recruitment of participants with MPS II, with and without neuronopathic disease, in the global Phase 2/3 COMPASS study is ongoing.
TAK-594/DNL593 (PTV:PGRN): Frontotemporal Dementia-Granulin (FTD-GRN)
DNL593 is an investigational, intravenously administered, Protein Transport Vehicle (PTV)-enabled progranulin (PGRN) replacement therapy designed to restore normal levels of PGRN in the brain without interfering with normal PGRN transport and processing. DNL593 is being co-developed with Takeda.
- In July, Denali presented additional healthy volunteer data from Part A of the Phase 1/2 study at the Alzheimer's
Association International Conference, which continued to demonstrate that single doses of DNL593 resulted in substantial increases in CSF PGRN levels and were generally well tolerated.
- Recruitment of participants with symptomatic FTD-GRN loss of function mutations in Part B (ascending multiple doses) of the Phase 1/2 study is ongoing.
TAK-920/DNL919 (ATV:TREM2): Alzheimer’s disease
TAK-920/DNL919 is an investigational, Antibody Transport Vehicle (ATV)-enabled, TREM2 agonist intended to improve microglial function as a potential treatment for Alzheimer’s disease, which is being co-developed with Takeda.
- Denali announced that, in agreement with Takeda, the companies will discontinue clinical development of DNL919 in Alzheimer’s disease. This is a strategic decision based on the totality of clinical data emerging from the single ascending dose Phase 1 study of DNL919 in healthy volunteers and in consideration of the rapidly evolving treatment landscape for Alzheimer's disease whereby an understanding of drug combinations with newly approved therapies will be important.
- A preliminary analysis of Phase 1 data indicates robust target engagement and effects on microglial biomarkers (e.g., CSF1R, SPP1, IL1RA, IP10, MIP1b, MCP-1), which were consistent with preclinical studies that demonstrate that ATV:TREM2 induces robust changes to a responsive microglial cell state (
van Lengerich B, et al. Nat Neurosci. 2023).
- In the Phase 1 study, DNL919 was clinically well tolerated at doses with demonstrated changes in CSF biomarkers and there were no serious adverse events or severe treatment emergent adverse events; however, safety signals of moderate, reversible hematologic effects were observed at the highest dose tested, suggesting a narrow therapeutic window for the Alzheimer’s disease patient population. The Phase 1 safety findings are believed to be specific to properties of DNL919 and TREM2 biology.
- Denali and Takeda will focus research efforts on back-up molecules in preclinical development, including exploration of potential combination therapy given recent new drug approvals in Alzheimer's disease.
DNL126 (ETV:SGSH): MPS IIIA (Sanfilippo syndrome Type A)
DNL126 (ETV:SGSH) is an investigational, intravenously administered, ETV-enabled N-sulfoglucosamine sulfohydrolase (SGSH) replacement therapy designed to cross the BBB and address the behavioral, cognitive, and physical manifestations of MPS IIIA (Sanfilippo syndrome Type A).
- Today, Denali announced that the Investigational New Drug (IND) application for DNL126 in MPS IIIA has been cleared, and plans remain on track to initiate recruiting activities for the Phase 1/2 study in the second half of 2023.
Oligonucleotide Transport Vehicle (OTV) platform
Denali’s OTV platform is designed to enable peripheral administration of oligonucleotide therapeutics such as antisense oligonucleotides (ASOs) to address a wide range of neurodegenerative and other neurological diseases. Denali has submitted a manuscript for publication, which can be found on bioRxiv here. Denali has selected five ASO targets for further development and is focused on advancing two OTV candidates towards clinical development.
Antibody Transport Vehicle Amyloid beta (ATV-amyloid-beta) program
ATV-amyloid-beta is an investigational, ATV-enabled anti-amyloid-beta therapy designed to increase brain exposure and target engagement of antibody therapeutics directed against amyloid-beta, which may enable improved plaque clearance and/or reduced amyloid-related imaging abnormalities (ARIA). Accumulation of amyloid-beta plaque in the brain is a defining feature of Alzheimer’s disease. Biogen exercised its option to license Denali’s ATV-amyloid-beta program and is responsible for all development and commercial activities and associated expenses.
SMALL MOLECULE PROGRAMS
BIIB122/DNL151 (LRRK2 Inhibitor): Parkinson’s disease
BIIB122/DNL151 is an investigational small molecule inhibitor of LRRK2, one of the most common genetic drivers of Parkinson’s disease. Targeting LRRK2 has the potential to impact the underlying biology and slow the progression of Parkinson’s disease. Denali and Biogen are co-developing BIIB122.
- In June, Denali in conjunction with Biogen, and based on review of portfolio timelines and resource prioritization, announced plans to revise the clinical development program for BIIB122/DNL151. Prior to the planned revisions, the BIIB122 clinical development program encompassed two global late-stage clinical trials: the Phase 2b
LUMAstudy in participants with early-stage Parkinson’s disease, which commenced in May 2022; and the Phase 3 LIGHTHOUSE study in participants with Parkinson’s disease related to LRRK2 mutations, which commenced in September 2022. In consideration of the LIGHTHOUSE study’s complexity, including the long timeline with anticipated study completion in 2031, Biogen and Denali plan to refocus their efforts to enable a timely readout on efficacy in idiopathic early-stage Parkinson’s disease while gaining further clinical data in Parkinson’s disease with and without a LRRK2 mutation. The planned revisions to the BIIB122 clinical development program are not based on any safety or efficacy data from studies of BIIB122. Biogen and Denali will modify the LUMAstudy’s enrollment criteria to allow for inclusion of eligible participants with Parkinson’s disease and a confirmed pathogenic variant of LRRK2, in addition to continuing to enroll eligible participants with idiopathic early-stage Parkinson’s disease. Collectively, data from the LUMAstudy will inform next steps for the development of BIIB122 in Parkinson’s disease.
- In July, Sanofi completed enrollment in the Phase 2 HIMALAYA study; primary completion of the study is estimated to be
DNL343 (eIF2B Activator): ALS
DNL343 is an investigational small molecule activator of the eukaryotic initiation factor 2B (eIF2B) designed to inhibit the cellular integrated stress response (ISR) and prevent or slow disease progression by interfering with stress granule formation and TDP-43 aggregation, which is a hallmark pathology present in virtually all individuals with ALS. Previously announced results of a Phase 1b study in participants with ALS demonstrated that once-daily oral dosing with DNL343 for 28 days was generally well-tolerated and was associated with extensive distribution in the cerebrospinal fluid as well as robust inhibition of ISR biomarkers.
- In May, the first patient was dosed with DNL343 in the Phase 2/3 HEALEY ALS Platform Trial.
OTHER CLINICAL PROGRAMS
- In June, Sanofi completed a Phase 2 study of DNL758 in patients with cutaneous lupus erythematosus (CLE); data analysis is ongoing.
- Sanofi is conducting a Phase 2 trial of
SAR443122in patients with ulcerative colitis (UC).
Denali continues to selectively advance a broad preclinical portfolio including programs enabled by the Enzyme Transport Vehicle, the Antibody Transport Vehicle, the Oligonucleotide Transport Vehicle, and several small molecules engineered to cross the BBB and intended as potential treatments for patients with neurodegenerative diseases and lysosomal storage diseases.
Participation in Upcoming Investor Conferences:
- Morgan Stanley 21st Annual Global Healthcare Conference,
September 11-13 H.C. Wainwright25th Annual Global Investment Conference, September 11-13
Second Quarter 2023 Financial Results
For the three months ended
Collaboration revenue was
Total research and development expenses were
General and administrative expenses were
Cash, cash equivalents, and marketable securities were approximately
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements expressed or implied in this press release include, but are not limited to, statements regarding expectations regarding Denali’s TV technology platform, including the Enzyme Transport Vehicle (ETV), Antibody Transport Vehicle (ATV) and Oligonucleotide Transport Vehicle (OTV); statements made by Denali’s Chief Executive Officer; plans, timelines, and expectations regarding DNL310 and the ongoing Phase 2/3 COMPASS and Phase 1/2 studies, including the continued recruitment of participants for the Phase 2/3 COMPASS study and the timing and availability of data for the Phase 1/2 study; plans, timelines, and expectations of both Denali and Takeda regarding DNL593 and the ongoing Phase 1/2 study, including the recruitment of patients for the Part B study; plans and expectations related to the therapeutic potential of DNL919 and any back-up molecules in preclinical development; plans, timelines, and expectations related to DNL126, including timing for initiation of recruitment for the Phase 1/2 study; plans, timelines, and expectations regarding the advancement of OTV candidates towards clinical development; plans, timelines, and expectations of both Denali and Biogen regarding the development of Denali's ATV:Abeta for the treatment of Alzheimer's disease; plans, timelines, and expectations of both Denali and Biogen regarding DNL151, the enrollment and timing and availability of data from the ongoing Phase 2b
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
|Three Months Ended
||Six Months Ended
|Collaboration revenue from customers(1)||$||294,123||$||52,480||$||329,264||$||94,621|
|Total collaboration revenue||294,123||52,480||329,264||94,621|
|Research and development(2)||97,520||92,737||226,336||178,835|
|General and administrative||26,120||21,159||53,260||43,700|
|Total operating expenses||123,640||113,896||279,596||222,535|
|Income (loss) from operations||170,483||(61,416||)||49,668||(127,914||)|
|Interest and other income, net||12,900||2,649||23,934||3,927|
|Income (loss) before income taxes||183,383||(58,767||)||73,602||(123,987||)|
|Income tax expense||—||(27||)||—||(27||)|
|Net income (loss)||$||183,383||$||(58,794||)||$||73,602||$||(124,014||)|
|Net income (loss) per share:|
|Net income (loss) per share, basic||$||1.34||$||(0.48||)||$||0.54||$||(1.01||)|
|Net income (loss) per share, diluted||$||1.30||$||(0.48||)||$||0.52||$||(1.01||)|
|Weighted-average shares used in calculating:|
|Weighted average number of shares outstanding, basic||137,047,227||123,008,558||136,787,321||122,842,171|
|Weighted average number of shares outstanding, diluted||140,930,625||123,008,558||140,550,226||122,842,171|
|(1)||Includes related-party collaboration revenue from customers of
|(2)||Includes expenses for cost sharing payments due to a related party of
Condensed Consolidated Balance Sheets
|Cash and cash equivalents||$||131,973||$||218,044|
|Short-term marketable securities||1,059,014||1,118,171|
|Prepaid expenses and other current assets||33,075||36,104|
|Total current assets||1,224,062||1,372,319|
|Property and equipment, net||39,821||44,087|
|Operating lease right-of-use assets||27,417||30,437|
|Other non-current assets||14,434||13,399|
|Liabilities and stockholders' equity|
|Cost sharing payments due to related party||6,976||4,388|
|Accrued clinical and other research & development costs||15,120||16,297|
|Accrued manufacturing costs||17,263||22,307|
|Other accrued costs and current liabilities||3,603||3,682|
|Operating lease liabilities, current||6,774||7,318|
|Related-party contract liability, current||845||290,053|
|Total current liabilities||69,357||363,922|
|Related-party contract liability, less current portion||422||479|
|Operating lease liabilities, less current portion||48,751||53,032|
|Other non-current liabilities||379||379|
|Total stockholders' equity||1,186,825||1,042,430|
|Total liabilities and stockholders’ equity||$||1,305,734||$||1,460,242|
Investor and Media Contact:
Vice President, Investor Relations
Source: Denali Therapeutics Inc.