UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 8, 2019
Denali Therapeutics Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-38311 | 46-3872213 | ||||||||||||
| (State or other jurisdiction of | (Commission | (I.R.S. Employer | ||||||||||||
| incorporation) | File Number) | Identification No.) | ||||||||||||
161 Oyster Point Blvd.
South San Francisco, California 94080
(Address of principal executive offices, including zip code)
(650) 866-8548
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last reports)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company x | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x | |||||
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
| Common Stock, par value $0.01 per share | DNLI | NASDAQ Global Select Market | ||||||
Item 2.02 Results of Operations and Financial Condition.
On May 8, 2019, Denali Therapeutics Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2019. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
All of the information furnished in this Item 2.02 and Item 9.01 (including Exhibit 99.1) shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | ||||||||||
| 99.1 | |||||||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DENALI THERAPEUTICS INC. | |||||||||||
| Date: | May 8, 2019 | By: | /s/ Steve E. Krognes | ||||||||
| Steve E. Krognes | |||||||||||
| Chief Financial Officer | |||||||||||
Exhibit 99.1
Denali Therapeutics Reports First Quarter 2019 Financial Results
SOUTH SAN FRANCISCO – May 8, 2019 – Denali Therapeutics Inc. (NASDAQ: DNLI), a biopharmaceutical company developing a broad portfolio of product candidates for neurodegenerative diseases, today reported financial results for the first quarter ended March 31, 2019.
First Quarter 2019 Financial Results
For the three months ended March 31, 2019, Denali reported a net loss of $39.0 million compared with a net loss of $23.7 million for the three months ended March 31, 2018.
Collaboration revenue was $4.2 million for the three months ended March 31, 2019, compared with collaboration revenue of $0.6 million for the three months ended March 31, 2018. The increase was due to $3.5 million of revenue recognized under the Sanofi Collaboration Agreement in the three months ended March 31, 2019.
Total research and development expenses were $37.4 million for the three months ended March 31, 2019, including non-cash stock-based compensation of $4.0 million, compared to $20.8 million for the three months ended March 31, 2018, including non-cash stock-based compensation of $1.7 million. The increase in total research and development expenses of $16.6 million was primarily attributable to increases in personnel-related expenses, including non-cash stock-based compensation, driven primarily by higher headcount and new option grants. Further, there were increases in external research and development expenses, reflecting both the progress of Denali's most advanced programs and increased investment in growing and developing its pipeline, and facilities-related expenses primarily due to rent expense.
General and administrative expenses were $9.3 million for the three months ended March 31, 2019, including non-cash stock-based compensation of $2.9 million, compared to $5.6 million for the three months ended March 31, 2018, including non-cash stock-based compensation of $1.2 million. The increase in total general and administrative expenses of $3.7 million was primarily attributable to an increase in personnel-related expenses, including non-cash stock-based compensation, driven primarily by higher headcount and new option grants. Further, there were increases in legal and professional services expenses required to support Denali's ongoing operations as a public company, and facilities-related expenses primarily due to rent expense.
Cash, cash equivalents, and marketable securities were $583.0 million as of March 31, 2019.
About Denali Therapeutics
Denali is a biopharmaceutical company developing a broad portfolio of product 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 share and per share amounts)
| Three Months Ended March 31, | |||||||||||
| 2019 | 2018 | ||||||||||
| Collaboration revenue | $ | 4,205 | $ | 641 | |||||||
| Operating expenses: | |||||||||||
| Research and development | 37,403 | 20,819 | |||||||||
| General and administrative | 9,310 | 5,570 | |||||||||
| Total operating expenses | 46,713 | 26,389 | |||||||||
| Loss from operations | (42,508) | (25,748) | |||||||||
| Interest and other income, net | 3,516 | 2,070 | |||||||||
| Net loss | $ | (38,992) | $ | (23,678) | |||||||
| Net loss per share, basic and diluted | $ | (0.41) | $ | (0.26) | |||||||
| Weighted average number of shares outstanding, basic and diluted | 94,984,503 | 89,560,576 | |||||||||
Denali Therapeutics Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
| March 31, 2019 | December 31, 2018 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 39,661 | $ | 77,123 | |||||||
| Short-term marketable securities | 445,820 | 387,174 | |||||||||
| Prepaid expenses and other current assets | 14,052 | 16,539 | |||||||||
| Total current assets | 499,533 | 480,836 | |||||||||
| Long-term marketable securities | 97,554 | 147,881 | |||||||||
| Property and equipment, net | 36,955 | 25,162 | |||||||||
| Operating lease right-of-use asset | 34,407 | — | |||||||||
| Other non-current assets | 8,147 | 8,105 | |||||||||
| Total assets | $ | 676,596 | $ | 661,984 | |||||||
| Liabilities and stockholders' equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 3,662 | $ | 1,891 | |||||||
| Accrued liabilities | 12,114 | 8,520 | |||||||||
| Accrued compensation | 3,213 | 9,952 | |||||||||
| Contract liabilities | 23,148 | 11,427 | |||||||||
| Other current liabilities | 1,107 | 996 | |||||||||
| Total current liabilities | 43,244 | 32,786 | |||||||||
| Contract liabilities, less current portion | 44,852 | 57,350 | |||||||||
| Operating lease liability, less current portion | 71,412 | — | |||||||||
| Deferred rent, less current portion | — | 24,532 | |||||||||
| Other non-current liabilities | 440 | 471 | |||||||||
| Total liabilities | 159,948 | 115,139 | |||||||||
| Total stockholders' equity | 516,648 | 546,845 | |||||||||
| Total liabilities and stockholders’ equity | $ | 676,596 | $ | 661,984 | |||||||