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Selected Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Schedule of Consolidated Quarterly Financial Information (Unaudited)

The following tables provide the selected quarterly financial data for the years ended December 31, 2019 and 2018 (in thousands, except per share amounts):


	Quarter Ended
	December 31, 2019		September 30, 2019		June 30, 2019		March 31, 2019
Collaboration revenue	$	4,672	$	13,604	$	4,197	$	4,205
Loss from operations	(57,758)		(50,155)		(62,763)		(42,508)
Net loss	(54,025)		(46,260)		(58,337)		(38,992)
Net loss per share, basic and diluted⁽¹⁾	$	(0.56)	$	(0.48)	$	(0.61)	$	(0.41)

_________________________________________________

⁽¹⁾Basic and diluted net income per share for the quarter ended December 31, 2019 is calculated using 96,078,950 shares.


	Quarter Ended
	December 31, 2018		September 30, 2018		June 30, 2018		March 31, 2018
Collaboration revenue	$	125,676	$	1,195	$	1,648	$	641
Income (loss) from operations	74,722		(37,964)		(57,382)		(25,748)
Net income (loss)	77,533		(35,371)		(54,724)		(23,678)
Net income (loss) per share, basic⁽¹⁾	$	0.82	$	(0.38)	$	(0.59)	$	(0.26)
Net income (loss) per share, diluted⁽¹⁾	$	0.79	$	(0.38)	$	(0.59)	$	(0.26)

_________________________________________________

(1) Basic and diluted net income per share for the quarter ended December 31, 2018 is calculated using 94,299,096 and 97,746,224 shares, respectively, the latter of which is computed by giving effect to all dilutive potential ordinary shares including options.

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 79,449	$ 77,123
Short-term marketable securities	335,907	387,174
Prepaid expenses and other current assets	14,675	16,539
Total current assets	430,031	480,836
Long-term marketable securities	39,886	147,881
Property and equipment, net	46,732	25,162
Operating lease right-of-use asset	33,923
Other non-current assets	2,659	8,105
Total assets	553,231	661,984
Current liabilities:
Accounts payable	2,590	1,891
Accrued expenses and other current liabilities	24,015	19,468
Contract liabilities	18,739	11,427
Total current liabilities	45,344	32,786
Contract liabilities, less current portion	43,753	57,350
Operating lease liability, less current portion	68,865
Deferred rent, less current portion		24,532
Other non-current liabilities	379	471
Total liabilities	158,341	115,139
Commitments and contingencies
Stockholders' equity:
Convertible preferred stock, $0.01 par value; 40,000,000 shares authorized as of December 31, 2019 and December 31, 2018; 0 shares issued and outstanding as of December 31, 2019 and December 31, 2018	0	0
Common stock, $0.01 par value; 400,000,000 shares authorized as of December 31, 2019 and December 31, 2018; 96,189,935 and 94,662,435 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively	1,288	1,273
Additional paid-in capital	818,803	774,158
Accumulated other comprehensive income (loss)	350	(649)
Accumulated deficit	(425,551)	(227,937)
Total stockholders’ equity	394,890	546,845
Total liabilities and stockholders’ equity	$ 553,231	$ 661,984

Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Convertible Preferred Stock	Series B-2 Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Convertible preferred stock, beginning balance (in shares) at Dec. 31, 2016		58,600,315
Convertible preferred stock, beginning balance at Dec. 31, 2016		$ 348,673
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of convertible preferred stock, net of issuance costs (in shares)			1,764,705
Issuance of convertible preferred stock, net of issuance costs			$ 29,927
Conversion of Series A and B convertible preferred stock into common stock (in shares)		(60,365,020)
Conversion of Series A and B convertible preferred stock into common stock		$ (378,600)
Convertible preferred stock, ending balance (in shares) at Dec. 31, 2017		0
Convertible preferred stock, ending balance at Dec. 31, 2017		$ 0
Common stock, shares outstanding beginning balance (in shares) at Dec. 31, 2016				8,597,316
Beginning balance at Dec. 31, 2016	$ (94,154)			$ 344	$ 9,387	$ (373)	$ (103,512)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Convertible preferred stock converted into shares of common stock (in shares)				60,365,020
Convertible preferred stock converted into shares of common stock	378,600			$ 604	377,996
Issuance of common stock upon initial public offering, net of issuance costs (in shares)				15,972,221
Issuance of common stock upon initial public offering, net of issuance costs	264,261			$ 160	264,101
Issuance of common stock upon exercise of stock options (in shares)				648,317
Issuance of common stock upon exercise of stock options	733			$ 25	708
Issuance of reversed common stock as consideration in asset acquisition (in shares)				81,164
Issuance of reserved common stock as consideration in asset acquisition	0			$ 1	(1)
Vesting of early exercised common stock (in shares)				187,500
Vesting of early exercised common stock	127			$ 6	121
Vesting of restricted stock awards (in shares)				1,628,824
Vesting of restricted stock awards	0			$ 61	(61)
Stock-based compensation	4,409				4,409
Net loss	(88,185)						(88,185)
Other comprehensive income (loss)	5					5
Common stock, shares outstanding ending balance (in shares) at Dec. 31, 2017				87,480,362
Ending balance at Dec. 31, 2017	465,796			$ 1,201	656,660	(368)	(191,697)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in connection with Takeda Collaboration Agreement (in shares)				4,214,559
Issuance of common stock in connection with the Takeda Collaboration Agreement	94,406			$ 42	94,364
Issuances under equity incentive plans (in shares)				792,939
Issuances under equity incentive plans	3,999			$ 8	3,991
Vesting of early exercised common stock (in shares)				234,372
Vesting of early exercised common stock	374			$ 3	371
Vesting of restricted stock awards (in shares)				1,940,203
Vesting of restricted stock awards	0			$ 19	(19)
Stock-based compensation	18,791				18,791
Net loss	(36,240)						(36,240)
Other comprehensive income (loss)	$ (281)					(281)
Common stock, shares outstanding ending balance (in shares) at Dec. 31, 2018	94,662,435			94,662,435
Ending balance at Dec. 31, 2018	$ 546,845			$ 1,273	774,158	(649)	(227,937)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock upon exercise of stock options (in shares)	786,638
Issuances under equity incentive plans (in shares)				973,012
Issuances under equity incentive plans	$ 6,190			$ 9	6,181
Vesting of early exercised common stock (in shares)				135,424
Vesting of early exercised common stock	92			$ 2	90
Vesting of restricted stock awards (in shares)				419,064
Vesting of restricted stock awards	0			$ 4	(4)
Stock-based compensation	38,378				38,378
Net loss	(197,614)						(197,614)
Other comprehensive income (loss)	$ 999					999
Common stock, shares outstanding ending balance (in shares) at Dec. 31, 2019	96,189,935			96,189,935
Ending balance at Dec. 31, 2019	$ 394,890			$ 1,288	$ 818,803	$ 350	$ (425,551)

Balance Sheet Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accrued compensation	$ 8,739	$ 9,952
Accrued clinical costs	5,042	2,091
Accrued manufacturing and other research & development costs	5,251	4,179
Accrued general, administrative and shared costs	1,310	2,250
Deferred rent, current		616
Operating lease liability, current	3,665
Other current liabilities	8	380
Total accrued expenses and other current liabilities	$ 24,015	$ 19,468

Significant Accounting Policies

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Significant Accounting Policies

Organization and Description of Business

Denali Therapeutics Inc. ("Denali" or the “Company”) is a biopharmaceutical company, incorporated in Delaware, that discovers and develops therapeutics to defeat neurodegenerative diseases. The Company is headquartered in South San Francisco, California.

Basis of Presentation

These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

Reverse Stock Split

In November 2017, the Company’s board of directors and stockholders approved an amendment to the Company’s amended and restated certificate of incorporation to effect a reverse split of shares of its common stock and convertible preferred stock on a 4-to-1 basis (the “Reverse Stock Split”). The par values and the authorized shares of the common and convertible preferred stock were not adjusted as a result of the Reverse Stock Split. The Reverse Stock Split became effective on November 28, 2017. All issued and outstanding common stock and convertible preferred stock and related per share amounts contained in the financial statements have been retroactively adjusted to reflect this Reverse Stock Split for all periods presented.

Initial Public Offering

On December 7, 2017, the Company's Registration Statement on Form S-1 was declared effective by the SEC for our initial public offering ("IPO") of common stock. The Company's shares started trading on the NASDAQ Global Select Market on December 8, 2017, and the transaction formally closed on December 12, 2017. In connection with the IPO, the Company sold an aggregate of 15,972,221 shares of common stock, including 2,083,333 shares sold pursuant to the underwriters’ full exercise of their option to purchase additional shares, at a price to the public of $18.00 per share. The aggregate net proceeds received by the Company from the offering, net of underwriting discounts and commissions and offering expenses, were $264.3 million. Upon the closing of the IPO, all then-outstanding shares of the Company's convertible preferred stock converted into 60,365,020 shares of common stock. The related carrying value of $378.6 million was reclassified to common stock and additional paid-in capital. Additionally, the Company amended and restated its certificate of incorporation effective December 7, 2017 to, among other things, change the authorized number of shares of common stock to 400,000,000 shares and the authorized number of shares of preferred stock to 40,000,000 shares.

Principles of Consolidation

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. For the Company and its subsidiary, the functional currency has been determined to be U.S. dollars. Monetary assets and liabilities denominated in foreign currency are remeasured at period-end exchange rates. Non-monetary assets and liabilities denominated in foreign currencies are remeasured at historical rates. Foreign currency transaction gains and losses resulting from remeasurement are recognized in interest and other income, net in the Consolidated Statements of Operations and Comprehensive Loss.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Company to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported amounts of expenses during the reporting period. Actual results could differ from those estimates, and such differences could be material to the Consolidated Balance Sheets and Statements of Operations and Comprehensive Loss.

Concentration of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, marketable securities and forward foreign currency exchange contracts. Substantially all of the Company’s cash and cash equivalents are deposited in accounts with financial institutions that management believes are of high credit quality. Such deposits have and will continue to exceed federally insured limits. The Company maintains its cash with accredited financial institutions and accordingly, such funds are subject to minimal credit risk. The Company has not experienced any losses on its cash deposits.

The Company’s investment policy limits investments to certain types of securities issued by the U.S. government, its agencies and institutions with investment-grade credit ratings and places restrictions on maturities and concentration by type and issuer. The Company is exposed to credit risk in the event of a default by the financial institutions holding its cash, cash equivalents and marketable securities and issuers of marketable securities to the extent recorded on the Consolidated Balance Sheets. As of December 31, 2019 and 2018, the Company had no off-balance sheet concentrations of credit risk.

The Company is exposed to counterparty credit risk on all of its derivative financial instruments. The Company has established and maintains strict counterparty credit guidelines and enters into hedges only with financial institutions that are investment grade or better to minimize the Company’s exposure to potential defaults. The Company does not require collateral to be pledged under these agreements.

The Company is subject to a number of risks similar to other early-stage biopharmaceutical companies, including, but not limited to, the need to obtain adequate additional funding, possible failure of current or future preclinical testing or clinical trials, its reliance on third parties to conduct its clinical trials, the need to obtain regulatory and marketing approvals for its product candidates, competitors developing new technological innovations, the need to successfully commercialize and gain market acceptance of the Company’s product candidates, its right to develop and commercialize its product candidates pursuant to the terms and conditions of the licenses granted to the Company, protection of proprietary technology, the ability to make milestone, royalty or other payments due under any license or collaboration agreements, and the need to secure and maintain adequate manufacturing arrangements with third parties. If the Company does not successfully commercialize or partner any of its product candidates, it will be unable to generate product revenue or achieve profitability.

Segments

The Company has one operating segment. The Company’s chief operating decision maker, its Chief Executive Officer, manages the Company’s operations on a consolidated basis for the purposes of allocating resources.

Fair Value of Financial Instruments

Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances.

ASC 820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tier fair value hierarchy that distinguishes between the following:

Level 1 – inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 – inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 – inputs are unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The carrying amounts reflected in the Consolidated Balance Sheets for cash and cash equivalents, prepaid expenses and other current assets, accounts payable and accrued liabilities approximate their fair values, due to their short-term nature.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with original maturities of 90 days or less at the date of purchase to be cash and cash equivalents. Cash equivalents are stated at fair value.

The Company’s restricted cash consists of the letter of credit for the Company’s headquarters building lease, and is included within other non-current assets on the accompanying Consolidated Balance Sheets.

Marketable Securities

The Company generally invests its excess cash in money market funds and investment grade short to intermediate-term fixed income securities. Such investments are included in cash and cash equivalents, short-term marketable securities, or long-term marketable securities on the balance sheets, are considered available-for-sale, and reported at fair value with unrealized gains and losses included as a component of stockholders’ equity (deficit). We classify investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. We classify investments in securities with remaining maturities of over one year as long-term investments. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest and other income, net in the Consolidated Statements of Operations and Comprehensive Loss. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on marketable securities are included in interest and other income, net. The cost of securities sold is determined using specific identification.

The Company periodically evaluates whether declines in fair values of its marketable securities below their book value are other-than-temporary. This evaluation consists of several qualitative and quantitative factors regarding the severity and duration of the unrealized loss as well as the Company’s ability and intent to hold the marketable security until a forecasted recovery occurs. Additionally, the Company assesses whether it has plans to sell the security or it is more likely than not it will be required to sell any marketable securities before recovery of its amortized cost basis. Factors considered include quoted market prices, recent financial results and operating trends, implied values from any recent transactions or offers of investee securities, credit quality of debt instrument issuers, other publicly available information that may affect the value of the marketable security, duration and severity of the decline in value, and our strategy and intentions for holding the marketable security.

Accounts Receivable

Accounts receivable are included within prepaid expenses and other current assets in the Consolidated Balance Sheets. The accounts receivable balance represents amounts receivable from the Company's collaboration partners. The Company estimates the allowance for doubtful accounts based on existing contractual payment terms, actual payment patterns of its partners, and individual partner circumstances. To date, an allowance for doubtful accounts has not been required.

Derivatives and Hedging Activities

The Company accounts for its derivative instruments as either assets or liabilities on the Consolidated Balance Sheets and measures them at fair value. Derivatives are adjusted to fair value through interest and other income, net in the Consolidated Statements of Operations and Comprehensive Loss.

Property and Equipment, Net

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the related estimated useful lives as presented in the table below. Significant additions and improvements are capitalized, while repairs and maintenance are charged to expense as incurred.


Asset						Estimated useful life
Leasehold improvements						Shorter of life of asset or lease term
Manufacturing and laboratory equipment						five years
Computer hardware and software						three years
Office furniture and equipment						five years

Impairment of Long-Lived Assets

The Company periodically evaluates property and equipment for impairment whenever events or changes in circumstances indicate that a potential impairment may have occurred. If such events or changes in circumstances arise, the Company compares the carrying amount of the long-lived assets to the estimated future undiscounted cash flows expected to be generated by the long-lived assets. If the estimated aggregate undiscounted cash flows are less than the carrying amount of the long-lived assets, an impairment charge, calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets, is recorded. The fair value of the long-lived assets is determined based on the estimated discounted cash flows expected to be generated from the long-lived assets. The Company has not recorded any such impairment charges during the years presented.

Leases

The Company adopted Accounting Standards Update ("ASU") No. 2016-02, Leases, as of January 1, 2019. A determination is made as to whether an arrangement is a lease at inception. A right-of-use (“ROU”) asset and operating lease liability is recognized for identified operating leases in the Consolidated Balance Sheets.

ROU assets represent the Company’s right to use the underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments due over the lease term, with the ROU assets adjusted for lease incentives received. When determining the present value of lease payments, the Company uses its incremental borrowing rate (“IBR”) on the date of lease commencement, or the rate implicit in the lease, if known. The Company does not assume renewals in its determination of the lease term unless the renewals are deemed by management to be reasonably certain at lease inception.

Leases with an initial term of 12 months or less are not recorded on the balance sheet, unless they include an option to purchase the underlying asset that the Company is reasonably certain to exercise. The Company recognizes lease expenses on a straight-line basis over the lease term. The Company has leases with lease and non-lease components, which the Company has elected to account for as a single lease component. The current operating lease liability is included within accrued expenses and other current liabilities on the Consolidated Balance Sheet.

Revenue Recognition

License and Collaboration Revenue

The Company analyzes its collaboration arrangements to assess whether they are within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities. This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain multiple elements, the Company first determines which elements of the collaboration are deemed to be within the scope of ASC 808 and those that are more reflective of a vendor-customer relationship and, therefore, within the scope of Topic 606. For elements of collaboration arrangements that are accounted for pursuant to ASC 808, an appropriate recognition method is determined and applied consistently, generally by analogy to Topic 606. The accounting treatment pursuant to Topic 606 is outlined below.

The terms of licensing and collaboration agreements entered into typically include payment of one or more of the following: non-refundable, up-front license fees; development, regulatory and commercial milestone payments; payments for manufacturing supply and research and development services; and royalties on net sales of licensed products. Each of these payments results in license, collaboration and other revenue, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenue. The core principle of Topic 606 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services.

In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under each of its agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations based on estimated selling prices; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

Amounts received prior to satisfying the revenue recognition criteria are recorded as contract liabilities in the Company’s consolidated balance sheets. If the related performance obligation is expected to be satisfied within the next twelve months this will be classified in current liabilities. Amounts recognized as revenue prior to the Company having an unconditional right (other than a right that is conditioned only on the passage of time) to receipt are recorded as contract assets in the Company's consolidated balance sheets. If the Company expects to have an unconditional right to receive the consideration in the next twelve months, this will be classified in current assets. A net contract asset or liability is presented for each contract with a customer.

At contract inception, the Company assesses the goods or services promised in a contract with a customer and identifies those distinct goods and services that represent a performance obligation. A promised good or service may not be identified as a performance obligation if it is immaterial in the context of the contract with the customer, if it is not separately identifiable from other promises in the contract (either because it is not capable of being separated or because it is not separable in the context of the contract), or if the performance obligation does not provide the customer with a material right.

The Company considers the terms of the contract to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration will only be included in the transaction price when it is not considered constrained, which is when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur.

If it is determined that multiple performance obligations exist, the transaction price is allocated at the inception of the agreement to all identified performance obligations based on the relative standalone selling prices ("SSP"). The relative SSP for each deliverable is estimated using external sourced evidence if it is available. If external sourced evidence is not available, the Company uses its best estimate of the SSP for the deliverable.

Revenue is recognized when, or as, the Company satisfies a performance obligation by transferring a promised good or service to a customer. An asset is transferred when, or as, the customer obtains control of that asset, which for a service is considered to be as the services are received and used. The Company recognizes revenue over time by measuring the progress toward complete satisfaction of the relevant performance obligation using an appropriate input or output method based on the nature of the service promised to the customer.

After contract inception, the transaction price is reassessed at every period end and updated for changes such as resolution of uncertain events. Any change in the transaction price is allocated to the performance obligations on the same basis as at contract inception.

Management may be required to exercise considerable judgment in estimating revenue to be recognized. Judgment is required in identifying performance obligations, estimating the transaction price, estimating the SSP of identified performance obligations, which may include forecasted revenue, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success, and estimating the progress towards satisfaction of performance obligations.

Research and Development Expenses

Research and development costs are expensed as incurred. Research and development costs consist of salaries and other personnel related expenses, including associated stock–based compensation, consulting fees, lab supplies, and facility costs, as well as fees paid to other entities that conduct certain research, development and manufacturing activities on behalf of the Company.

Nonrefundable advance payments for goods and services that will be used or received in future research and development activities are deferred and recognized as expense in the period in which the related goods are delivered or services are performed.

The Company has acquired and may continue to acquire the rights to develop and commercialize new product candidates from third parties. The upfront payments to acquire license, product or rights, as well as any future milestone payments, are immediately recognized as research and development expense provided that there is no alternative future use of the rights in other research and development projects.

Stock-Based Compensation

The Company’s stock-based compensation programs grant awards that have included stock options, restricted stock units, restricted stock awards, and shares issued under its employee stock purchase plan. Grants are awarded to employees, including directors, and non-employees.

The Company measures employee and director stock-based compensation expense for all stock-based awards at the grant date based on the fair value measurement of the award. Subsequent to the adoption of ASU No. 2018-07, Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting on September 30, 2018, future stock-based compensation expense for non-employee stock-based awards is measured based on the fair value on the date of adoption. The expense is recorded on a straight-line basis over the requisite service period, which is generally the vesting period, for the entire award. Expense is adjusted for actual forfeitures of unvested awards as they occur. The Company calculates the fair value measurement of stock options using the Black-Scholes valuation model. The Company uses the fair value of our common stock to determine the fair value of restricted stock awards.

Income Taxes

Income taxes are accounted for using the liability method, under which deferred tax assets and liabilities are determined based on the temporary differences between the financial reporting and tax bases of assets and liabilities and consideration is given to net operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using the enacted tax rates that are expected to be in effect when the differences are expected to reverse.

The Company assesses the likelihood that deferred tax assets will be recovered from future taxable income, and a valuation allowance is established when necessary to reduce deferred tax assets to the amounts more likely than not expected to be realized.

The Company recognizes and measures uncertain tax positions using a two–step approach. The first step is to evaluate the tax position taken or expected to be taken by determining whether the weight of available evidence indicates that it is more likely than not that the tax position will be sustained in an audit, including resolution of any related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Significant judgment is required to evaluate uncertain tax positions. The Company evaluates uncertain tax positions on a regular basis. The evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, correspondence with tax authorities during the course of the audit, and effective settlement of audit issues. Previously recognized tax positions that no longer meet the more-likely-than-not threshold are derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

Comprehensive Income (Loss)

Comprehensive income (loss) is composed of net loss and certain changes in stockholders’ equity (deficit) that are excluded from net loss, primarily unrealized gains or losses on the Company’s marketable securities.

Net Income (Loss) per Share

Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding during the period, without consideration for common stock equivalents.

Diluted net income per ordinary share is computed by giving effect to all dilutive potential ordinary shares including options. However, where there is a diluted net loss per ordinary share, no adjustment is made for potentially issuable ordinary shares since their effect would be anti-dilutive. In this case, diluted net loss per share is equal to basic net loss per share.

Recently Issued Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2016-13, Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets. In April 2019, the FASB issued clarification to ASU 2016-13 within ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments. The guidance will become effective as of January 1, 2020, and must be adopted using a modified retrospective approach, with certain exceptions. The Company plans to adopt this standard on January 1, 2020, and is substantially complete with its evaluation of the effect that the adoption of this ASU will have on its Consolidated Financial Statements. The Company does not expect any impact to the Consolidated Financial Statements. The only impact is expected to be in the applicable disclosures included in the Significant Accounting Policies and Cash and Marketable Securities footnotes.

In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. ASU No. 2019-12 modifies ASC 740 to simplify several aspects of accounting for income taxes, including eliminating certain exceptions to the guidance in ASC 740 related to the approach for intraperiod tax allocation. The guidance is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted, and is required to be adopted prospectively, with the exception of certain specific amendments. The Company is currently assessing the impact of this ASU on its Consolidated Financial Statements.

Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes the guidance in former ASC 840, Leases. The FASB issued further updates to this guidance in July 2018 through ASU 2018-10, Codification Improvements to Topic 842, Leases and ASU 2018-11, Leases (Topic 842): Targeted Improvements, in December 2018 through ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors and in March 2019 through ASU 2019-01 Leases (Topic 842): Codification Improvements. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. The standard was effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and was required to be adopted using a modified retrospective approach.

The Company adopted this standard as of January 1, 2019, applying the optional transition method such that it is not required to adjust prior period presentations. ASU 2016-02 has impacted the Company’s Consolidated Balance Sheet as the Company has certain operating lease arrangements for which the Company is the lessee and one operating lease arrangement for which the Company is the lessor. The Company has no financing leases. Management has elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows the Company to carryforward the historical lease classification. The impact of adoption of the standard is that as of January 1, 2019, the Company recognized a ROU asset of $46.1 million and operating lease liability of $71.3 million. The standard did not have a material impact on the Company’s Consolidated Statements of Operations and Comprehensive Loss, Convertible Preferred Stock and Stockholders's Equity (Deficit) or Consolidated Statements of Cash Flows.

Income Taxes - Narrative (Details) - USD ($)	12 Months Ended
Income Taxes - Narrative (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Operating Loss Carryforwards [Line Items]
Valuation allowance against net deferred tax assets (as a percentage)	100.00%	100.00%
Valuation allowance increase (decrease)	$ 51,800,000
Liability recorded for potential interest or penalties	0
Expected change to unrecognized tax benefit	0
State authority
Operating Loss Carryforwards [Line Items]
Net operating loss carryforward	144,200,000
Tax credit carryforward	9,800,000
Federal authority
Operating Loss Carryforwards [Line Items]
Net operating loss carryforward	221,500,000
Federal authority \| Research Tax Credit Carryforward
Operating Loss Carryforwards [Line Items]
Tax credit carryforward	14,500,000
Federal authority \| Orphan Drug Tax Credit Carryforward
Operating Loss Carryforwards [Line Items]
Tax credit carryforward	$ 1,700,000

Collaboration Agreements - Summary of Collaboration Revenue (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2018
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue	$ 4,672	$ 13,604	$ 4,197	$ 4,205	$ 125,676	$ 1,195	$ 1,648	$ 641	$ 26,678	$ 129,160	$ 0
Deferred revenue												$ 0
Takeda Collaboration Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									5,926	5,677
Sanofi Collaboration Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									20,752	123,483
Sanofi Collaboration Agreement \| CNS Program License
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									0	73,932
Sanofi Collaboration Agreement \| Peripheral Product
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									10,000	47,148
Sanofi Collaboration Agreement \| Alzheimer's Disease Services
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									358	60
Sanofi Collaboration Agreement \| Retained Activities
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaboration revenue									$ 10,394	$ 2,343

Balance Sheet Components

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Components

Property and Equipment, Net

Property and equipment, net consists of the following (in thousands):


	As of December 31,
	2019		2018
Lab equipment	$	21,846	$	14,352
Leasehold improvements	34,563		22,288
Computers equipment and purchased software	1,156		458
Furniture and fixtures	1,440		74
Total property and equipment	59,005		37,172
Less: accumulated depreciation	(12,273)		(12,010)
Total property and equipment, net	$	46,732	$	25,162

Depreciation expense was $8.0 million, $7.4 million and $3.1 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consists of the following (in thousands):


	As of December 31,
	2019		2018
Accrued compensation	$	8,739	$	9,952
Accrued clinical costs	5,042		2,091
Accrued manufacturing and other research & development costs	5,251		4,179
Accrued general, administrative and shared costs	1,310		2,250
Deferred rent, current	—		616
Operating lease liability, current	3,665		—
Other current liabilities	8		380
Total accrued expenses and other current liabilities	$	24,015	$	19,468

Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Net operating loss carryforwards	$ 56,612	$ 35,023
Tax credit carryforwards	19,133	9,565
Contract liabilities	13,516	0
Operating lease liability	15,686	0
Stock-based compensation	9,513	3,305
Accruals and other	11,815	17,181
Gross deferred tax assets	126,275	65,074
Valuation allowance	(112,713)	(60,915)
Net deferred tax assets	13,562	4,159
Deferred tax liabilities:
Property and equipment	(6,225)	(4,159)
Operating lease right-of-use asset	(7,337)	0
Net deferred tax assets	$ 0	$ 0

Commitments and Contingencies - Narrative (Details) $ in Thousands		12 Months Ended
	May 02, 2018 USD ($) ft²	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Oct. 31, 2018 ft²
Loss Contingencies [Line Items]
Right of use asset		$ 33,923
Operating lease liability, current		3,665
Non-current operating lease liability		$ 68,865
Discount rate (as a percentage)		9.00%
Operating lease costs		$ 10,200
Rent expense			$ 6,000	$ 2,200
Weighted average remaining lease term		9 years 3 months 18 days
Weighted-average discount rate (as a percentage)		9.00%
Cash paid for lease liabilities		$ 5,400
Sublease income		2,600
Sublease income			0	0
Contractual obligation		1,100	1,200
Headquarters Lease
Loss Contingencies [Line Items]
Area under lease \| ft²	148,020
Lease period	10 years
Lease renewal option term	10 years
New Premises Sublease Agreement
Loss Contingencies [Line Items]
Rentable square feet \| ft²					36,835
Sublease term					5 years
Landlord Funded Tenant Improvements \| Headquarters Lease
Loss Contingencies [Line Items]
Tenant improvement allowance repayable in rent	$ 4,400
DMSA
Loss Contingencies [Line Items]
Purchase order executed		21,200	24,700
Costs incurred		12,700	3,900	0
Payments for development and manufacturing services		12,500	3,400	$ 0
Non-Cancellable Purchase Commitments
Loss Contingencies [Line Items]
Non-refundable purchase commitments		$ 11,200	$ 14,000
Minimum \| Headquarters Lease
Loss Contingencies [Line Items]
Lease renewal notice period	9 months
Maximum \| Headquarters Lease
Loss Contingencies [Line Items]
Lease renewal notice period	12 months
Maximum \| Landlord Funded Tenant Improvements \| Headquarters Lease
Loss Contingencies [Line Items]
Tenant improvements	$ 25,900

Subsequent Events - Narrative (Details) - Over-Allotment Option - Subsequent Event $ / shares in Units, $ in Millions	1 Months Ended
	Jan. 31, 2020 USD ($) $ / shares shares
Subsequent Event [Line Items]
Number of common stock (in shares) \| shares	9,000,000.0
Closing stock price (usd per share) \| $ / shares	$ 23.00
Purchase price \| $	$ 194.1

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Organization and Description of Business

Basis of Presentation

Basis of PresentationThese consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

Reverse Stock Split

Initial Public Offering

Principles of Consolidation

Use of Estimates

Concentration of Credit Risk and Other Risks and Uncertainties

Segments

Fair Value of Financial Instruments

Level 1 – inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 – inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Cash, Cash Equivalents and restricted cash

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with original maturities of 90 days or less at the date of purchase to be cash and cash equivalents. Cash equivalents are stated at fair value.

Marketable Securities

Accounts receivable

Accounts Receivable

Derivatives and Hedging Activities

Property and Equipment, Net


Asset						Estimated useful life
Leasehold improvements						Shorter of life of asset or lease term
Manufacturing and laboratory equipment						five years
Computer hardware and software						three years
Office furniture and equipment						five years

Impairment of Long-Lived Assets

Leases

Revenue Recognition

License and Collaboration Revenue

Research and Development Expenses

Stock-Based Compensation

Income Taxes

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

Comprehensive Income (Loss)

Net Income (Loss) per Share

Recently Issued and Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Acquisition (Details) - USD ($) $ in Thousands				1 Months Ended		12 Months Ended			22 Months Ended
Acquisition (Details) - USD ($) $ in Thousands	May 31, 2018	May 30, 2018	Aug. 24, 2016	Jun. 30, 2019	Aug. 31, 2016	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	May 31, 2018
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Research and development expense						$ 193,382	$ 143,183	$ 74,460
Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment									$ 11,500
Upfront option fee					$ 500
Contingent consideration payment				$ 1,500
Contingent consideration recognized	$ 0					1,500
Maximum development plan period for research costs			24 months
Upfront purchase price less estimated net liabilities acquired							18,300
Research and development expense						$ 1,100	$ 800	$ 1,100
Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Initial option exercise payments			$ 17,800
Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma \| Preclinical
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent payments upon achievement of milestones		$ 27,000
Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma \| Clinical
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent payments upon achievement of milestones		50,000
Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma \| Regulatory
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent payments upon achievement of milestones		120,000
Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma \| Commercial
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent payments upon achievement of milestones		250,000
Maximum \| Exercise of buy-out option \| Collaborative Arrangement with F-Star and Acquisition of F-Star Gamma
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent payments upon achievement of milestones		$ 447,000

Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits at January 1	$ 2,642	$ 1,146	$ 531
Additions for tax positions taken in a prior year	107	0	0
Additions for tax positions taken in the current year	2,595	1,506	640
Reductions for tax positions taken in the prior year	(45)	(10)	(25)
Unrecognized tax benefits at December 31	$ 5,299	$ 2,642	$ 1,146

Selected Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Data (Unaudited)

The following tables provide the selected quarterly financial data for the years ended December 31, 2019 and 2018 (in thousands, except per share amounts):


	Quarter Ended
	December 31, 2019		September 30, 2019		June 30, 2019		March 31, 2019
Collaboration revenue	$	4,672	$	13,604	$	4,197	$	4,205
Loss from operations	(57,758)		(50,155)		(62,763)		(42,508)
Net loss	(54,025)		(46,260)		(58,337)		(38,992)
Net loss per share, basic and diluted⁽¹⁾	$	(0.56)	$	(0.48)	$	(0.61)	$	(0.41)

_________________________________________________

⁽¹⁾Basic and diluted net income per share for the quarter ended December 31, 2019 is calculated using 96,078,950 shares.


	Quarter Ended
	December 31, 2018		September 30, 2018		June 30, 2018		March 31, 2018
Collaboration revenue	$	125,676	$	1,195	$	1,648	$	641
Income (loss) from operations	74,722		(37,964)		(57,382)		(25,748)
Net income (loss)	77,533		(35,371)		(54,724)		(23,678)
Net income (loss) per share, basic⁽¹⁾	$	0.82	$	(0.38)	$	(0.59)	$	(0.26)
Net income (loss) per share, diluted⁽¹⁾	$	0.79	$	(0.38)	$	(0.59)	$	(0.26)

_________________________________________________

License Agreements (Details) - Genentech - USD ($) $ in Millions		12 Months Ended			43 Months Ended
	Jun. 17, 2016	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2019
Clinical
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestone payments upon achievement of specified clinical and regulatory milestones	$ 37.5
Regulatory
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestone payments upon achievement of specified clinical and regulatory milestones	102.5
Commercial
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestone payments upon achievement of specified clinical and regulatory milestones	175.0
Maximum
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestone payments upon achievement of specified clinical and regulatory milestones	$ 315.0
License Agreement \| Research and Development
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront fee paid		$ 0.0	$ 0.0		$ 12.5
First clinical milestone				$ 2.5

Commitments and Contingencies - Summary of Company's Future Minimum Lease Receivables (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2020	$ 2,842
2021	2,925
2022	3,009
2023	3,096
2024	876
Thereafter	0
Total undiscounted sublease receipts	$ 12,748

Convertible Preferred Stock - Narrative (Details) $ / shares in Units, $ in Millions		1 Months Ended						12 Months Ended
	Dec. 07, 2017 $ / shares shares	Nov. 30, 2017 USD ($) $ / shares shares	Aug. 31, 2016 USD ($) $ / shares shares	Jun. 30, 2016 USD ($) $ / shares shares	Jan. 31, 2016 USD ($) shares	Jul. 31, 2015 USD ($) shares	May 31, 2015 USD ($) director shares	Dec. 31, 2019 $ / shares shares	Dec. 31, 2017 USD ($) shares	Dec. 31, 2018 $ / shares shares
Subsidiary, Sale of Stock [Line Items]
Convertible preferred stock, par value (usd per share) \| $ / shares								$ 0.01		$ 0.01
Common stock, par value (usd per share) \| $ / shares								$ 0.01		$ 0.01
Dividends declared and accrued \| $									$ 0.0
Conversion ratio								100.00%
Underwritten IPO stock price (in usd per share) \| $ / shares	$ 5.00
Underwritten IPO gross proceeds \| $									$ 50.0
Convertible preferred stock, shares issued (in shares)								0		0
Convertible preferred stock, shares outstanding (in shares)								0		0
First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Convertible preferred stock, par value (usd per share) \| $ / shares				$ 0.01
Common stock, par value (usd per share) \| $ / shares				$ 0.01
Common Stock
Subsidiary, Sale of Stock [Line Items]
Convertible preferred stock converted into shares of common stock (in shares)	60,365,020								60,365,020
Common Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				81,787,360
Preferred Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				63,288,470
Series A-1 Convertible Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Dividends entitled to be received by preferred stockholders (in use per share) \| $ / shares	$ 0.08
Series A-1 Convertible Preferred Stock \| Initial Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)							45,223,970
Number of stock issued (in shares)							6,295,810
Net proceeds \| $							$ 24.8
Series A-1 Convertible Preferred Stock \| First Additional Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)							456,250
Number of stock issued (in shares)							3,481,250
Net proceeds \| $							$ 13.9
Series A-1 Convertible Preferred Stock \| Second Additional Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)						2,420,830
Net proceeds \| $						$ 9.6
Series A-1 Convertible Preferred Stock \| Third Additional Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)					500,000
Net proceeds \| $					$ 2.0
Series A-1 Convertible Preferred Stock \| First Tranche Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)					11,250,000
Net proceeds \| $					$ 45.0
Series A-1 Convertible Preferred Stock \| Second Tranche Closing and Series A-2 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)				22,166,550
Net proceeds \| $				$ 88.7
Series A-1 Convertible Preferred Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				46,114,433
Series A-2 Convertible Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Dividends entitled to be received by preferred stockholders (in use per share) \| $ / shares	0.16
Series A-2 Convertible Preferred Stock \| Initial Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)							4,361,530
Series A-2 Convertible Preferred Stock \| Second Tranche Closing and Series A-2 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)				4,361,530
Net proceeds \| $				$ 34.9
Series A-2 Convertible Preferred Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				4,361,533
Series B-1 Convertible Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Dividends entitled to be received by preferred stockholders (in use per share) \| $ / shares	0.32
Series B-1 Convertible Preferred Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				8,125,000
Number of stock issued (in shares)				7,646,240
Closing stock price (usd per share) \| $ / shares				$ 16.00
Net proceeds \| $				$ 122.2
Series B-1 Convertible Preferred Stock \| Second Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)			478,120
Closing stock price (usd per share) \| $ / shares			$ 16.00
Net proceeds \| $			$ 7.6
Series B-2 Convertible Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Number of stock issued (in shares)		1,764,710
Closing stock price (usd per share) \| $ / shares		$ 17.00
Net proceeds \| $		$ 29.9
Dividends entitled to be received by preferred stockholders (in use per share) \| $ / shares	$ 0.34
Series B-2 Convertible Preferred Stock \| First Series B-1 Closing
Subsidiary, Sale of Stock [Line Items]
Number of stock authorized (in shares)				4,687,500
Series A
Subsidiary, Sale of Stock [Line Items]
Minimum shares held by investors (in shares)							100,000
Number of members under board election \| director							1
Total number of members \| director							5
Series B
Subsidiary, Sale of Stock [Line Items]
Number of members under board election \| director							1
Series A and Series B
Subsidiary, Sale of Stock [Line Items]
Additional number of members under board election \| director							2

Collaboration Agreements - Sanofi Performance Obligation (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Alzheimer's Disease Services
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligation	$ 3.5	$ 3.9

Stock-Based Awards - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 38,378	$ 18,791	$ 4,409
Research and Development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	19,261	10,093	2,852
General and Administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 19,117	$ 8,698	$ 1,557

Stock-Based Awards

1 Months Ended

Dec. 31, 2017

Share-based Payment Arrangement [Abstract]

Stock-Based Awards

2017 Equity Incentive Plan

In December 2017, the Company adopted the 2017 Equity Incentive Plan (the “2017 Plan”), which initially reserved approximately 6.4 million shares of common stock for the issuance of stock options, restricted stock and other stock awards, to employees, non-employee directors, and consultants under terms and provisions established by the Board of Directors and approved by the stockholders. The 2017 Plan provides that the number of shares reserved and available for issuance under the 2017 Plan will automatically increase each January 1, beginning on January 1, 2019, by the least of (i) 10.0 million shares, (ii) 5% of the outstanding shares on the last day of the immediately preceding fiscal year, or (iii) such number of shares determined by the administrator of the 2017 Plan. In January 2019, common stock available for issuance under the 2017 Plan was increased by approximately 4.8 million shares as a result of this automatic increase provision.

Awards granted under the 2017 Plan expire no later than ten years from the date of grant. For stock options, the option price shall not be less than 100% of the estimated fair value of the Company's common stock on the day of grant. Options granted typically vest over a four-year period but may be granted with different vesting terms.

2015 Stock Incentive Plan

In May 2015, the Company adopted the 2015 Stock Incentive Plan (the “2015 Plan”), which as amended, reserved approximately 8.3 million shares of common stock for the issuance of stock options, restricted stock and other stock awards, to employees, non-employee directors, and consultants under terms and provisions established by the Board of Directors and approved by the stockholders. Awards granted under the 2015 Plan expire no later than ten years from the date of grant. For stock options, the option price shall not be less than 100% of the estimated fair value of the Company's common stock on the day of grant. Options granted typically vest over a four-year period but may be granted with different vesting terms.

Upon adoption of the 2017 Plan, no new awards or grants are permitted under the 2015 Plan, and the approximately 0.2 million shares that were then unissued and available for future award under the 2015 Plan became available under the 2017 Plan. The 2015 Plan will continue to govern restricted stock awards and option awards previously granted thereunder.

As of December 31, 2019 and 2018, there were approximately 3.4 million and 2.3 million common shares available for the Company to grant under the 2017 Plan, respectively.

Stock Option Activity

The following table summarizes option award activity under the 2017 Plan and the 2015 Plan:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average remaining contractual life (years)	Aggregate Intrinsic Value (in thousands)
Balance at December 31, 2018	9,612,652	$	10.49	8.20	$	97,804
Options granted	3,610,835	18.58
Options exercised	(786,638)	4.27
Options forfeited	(796,115)	16.72
Balance at December 31, 2019	11,640,734	$	12.96	7.79	$	51,879
Options vested and expected to vest at December 31, 2019	9,896,002	$	15.13	8.17	$	22,672
Options exercisable at December 31, 2019	3,938,523	$	11.19	7.38	$	24,552

Aggregate intrinsic value represents the difference between the fair value of the Company's common stock and the exercise price of outstanding options. The total intrinsic value of options exercised was $13.1 million, $9.8 million and $3.5 million for the years ended December 31, 2019, 2018 and 2017, respectively. During the years ended December 31, 2019, 2018, and 2017 the weighted-average grant-date fair value of the options vested was $10.09, $3.85, and $1.94 per share, respectively. The weighted-average grant date fair value of all options granted during the years ended December 31, 2019, 2018 and 2017 was $11.86, $14.79, and $6.41 per share, respectively.

Stock Options Granted to Employees with Service-Based Vesting

The estimated fair value of stock options granted to employees were calculated using the Black-Scholes option-pricing model using the following assumptions:


	Year Ended December 31,
	2019	2018	2017
Expected term (in years)	5.50 - 6.08	5.50 - 6.08	6.08
Volatility	65.5% - 77.8%	79.4% - 87.4%	81.9% - 91.3%
Risk-free interest rate	1.5% - 2.6%	2.6% - 3.1%	1.8% - 2.3%
Dividend yield	—	—	—

Expected Term: The expected term represents the period that the options granted are expected to be outstanding and is determined using the simplified method (based on the mid-point between the vesting date and the end of the contractual term).

Expected Volatility: The Company uses an average historical stock price volatility of comparable public companies within the biotechnology and pharmaceutical industry that were deemed to be representative of future stock price trends as the Company does not have sufficient trading history for its common stock. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available.

Risk-Free Interest Rate: The Company based the risk-free interest rate over the expected term of the options based on the constant maturity rate of U.S. Treasury securities with similar maturities as of the date of the grant.

Expected Dividend Yield: The Company has not paid and does not anticipate paying any dividends in the near future. Therefore, the expected dividend yield was zero.

Performance and Market Contingent Stock Options Granted to Employees

In August and November 2015, the Board of Directors granted approximately 1.6 million and 0.1 million shares of performance- and market- contingent awards to members of the senior management team, respectively. These awards have an exercise price of $0.68 per share.

These awards have two separate market triggers for vesting based upon either (i) the successful achievement of stepped target closing prices on a national securities exchange for 90 consecutive trading days later than 180 days after the Company’s initial public offering for its common stock, or (ii) stepped target prices for a change in control transaction. In the event that neither of these market triggers are achieved by the specified timelines, such awards will terminate with respect to that portion of the shares. The expense recognized associated with these performance- and market- contingent awards was $5.2 million and $0.5 million of general and administrative and research and development expense, respectively, during the year ended December 31, 2019. The remaining expense for these awards, to be recognized using the accelerated attribution method, is $0.3 million, which will be recognized over the remaining derived service period of approximately nine months.

The Company used a lattice model with a Monte Carlo simulation to value these stock options. This valuation methodology utilized the estimated fair value of the Company’s common stock on grant date and several key assumptions, including expected volatility of the Company’s stock price based on comparable public companies, risk-free rates of return and expected dividend yield.

Stock Options Granted to Non-Employees with Service-Based Vesting Valuation Assumptions

Stock-based compensation related to stock options granted to non-employees is recognized as the stock options are earned. Prior to the adoption of ASU 2018-07 during the third quarter of 2018, the unvested options granted to non-employees were revalued using the Company's estimate of fair value on each reporting date. Subsequent to the adoption of ASU 2018-07, existing stock options granted to non-employees are no longer revalued, and the estimated fair value of new stock options granted to non-employees is calculated on the date of grant and not remeasured, similar to stock options granted to employees.

Restricted Stock Activity

Under the 2017 Plan, the Company may grant restricted stock awards ("RSAs"), which represent restricted shares of issued common stock for which the recipient's rights in the stock are restricted until the shares are vested, and restricted stock units ("RSUs"), which represent a commitment to issue shares of common stock in the future upon vesting. The fair value of restricted stock underlying the RSAs and RSUs is determined based on the closing market price of the Company's common stock on the date of grant.

Aggregated information regarding RSAs and RSUs granted under the Plan for the year ended December 31, 2019 is summarized below:


	Share Awards & Units	Weighted-Average Fair Value at Date of Grant per Share




Unvested at December 31, 2018	503,243	$	4.86
Granted	850,234	18.86
Vested and released	(419,064)	2.63
Forfeited	(51,777)	20.50
Unvested at December 31, 2019	882,636	$	18.67
Expected to vest – December 31, 2019	882,636	$	18.67

The aggregate intrinsic value of RSUs is calculated as the closing price per share of the Company's common stock on the last trading day of the fiscal period, multiplied by the number of RSUs expected to vest. The total intrinsic value of RSUs expected to vest was $15.4 million as of December 31, 2019. During the year ended December 31, 2018, the weighted-average grant-date fair value of RSUs granted was $15.92. No RSAs or RSUs were granted in the year ended December 31, 2017. The total fair value of RSAs and RSUs that vested during the years ended December 31, 2019, 2018, and 2017 (measured on the date of vesting) was $8.8 million, $37.0 million and $14.3 million, respectively. There was $13.7 million of total unrecognized stock-based compensation related to unvested RSUs at December 31, 2019, all of which is expected to be recognized over a remaining weighted-average period of 3.2 years.

Employee Stock Purchase Plan

In December 2017, the Company adopted the 2017 Employee Stock Purchase Plan (the “2017 ESPP”), which initially reserved 1.0 million shares of common stock for employee purchases under terms and provisions established by the Board of Directors. The 2017 ESPP provides that the number of shares reserved and available for issuance under the 2017 ESPP will automatically increase each January 1, beginning on January 1, 2019, by the least of (i) 2.0 million shares, (ii) 1% of the outstanding shares on the last day of the immediately preceding fiscal year, or (iii) such number of shares determined by the administrator of the 2017 Plan. In January 2019, common stock available for issuance under the 2017 ESPP was increased by approximately 1.0 million shares as a result of this automatic increase provision.

Under the 2017 ESPP, employees may purchase common stock through payroll deductions at a price equal to 85% of the lower of the fair market value of common stock on the first trading day of each offering period or on the exercise date. The 2017 ESPP provides for consecutive, overlapping 12-month offering periods. The offering periods are scheduled to start on the first trading day on or after May 31 or November 30 of each year, except for the first offering period which commenced on December 8, 2017, the first trading day after the effective date of the Company’s registration statement. Contributions under the 2017 ESPP are limited to a maximum of 15% of an employee's eligible compensation. We issued 0.2 million and 0.1 million shares of common stock under the 2017 ESPP during the years ended December 31, 2019 and 2018, respectively.

The estimated fair value of stock purchase rights granted under the ESPP were calculated using the Black-Scholes option-pricing model using the following assumptions:


	Year Ended December 31,
	2019	2018	2017
Expected term (in years)	0.50 - 1.00	0.50 - 1.00	0.48 - 0.98
Volatility	47.6% - 59.1%	61.0% - 64.3%	50.0% - 51.3%
Risk-free interest rate	1.6% - 2.4%	2.1% - 2.7%	1.5% - 1.7%
Dividend yield	—	—	—

Stock-Based Compensation Expense

The Company’s results of operations include expenses relating to stock-based compensation as follows (in thousands):


	Year Ended December 31,
	2019		2018		2017
Research and development	$	19,261	$	10,093	$	2,852
General and administrative	19,117		8,698		1,557
Total	$	38,378	$	18,791	$	4,409

As of December 31, 2019, total unamortized stock-based compensation expense related to employee and non-employee awards was $76.2 million. The weighted-average period over which such stock-based compensation expense will be recognized is approximately 2.7 years.

Collaboration Agreements - Takeda (Details) $ / shares in Units, $ in Thousands			3 Months Ended								12 Months Ended			24 Months Ended
	Feb. 23, 2018 USD ($) program $ / shares shares	Jan. 03, 2018 USD ($) program	Dec. 31, 2019 USD ($) targets	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2019 USD ($) targets	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2019 USD ($) targets	Feb. 28, 2018 program
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestones recognized			$ 4,672	$ 13,604	$ 4,197	$ 4,205	$ 125,676	$ 1,195	$ 1,648	$ 641	$ 26,678	$ 129,160	$ 0
Collaborative Arrangement \| Takeda Pharmaceutical Company Limited
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment	$ 40,000
Number of programs \| program	3	3													3
Preclinical milestone payment received	$ 5,000
Number of targets \| targets			3								3			3
Target option period		5 years
Option fee		$ 5,000
Variable consideration relating to future milestones	26,000
Preclinical milestone payment earned not yet received			$ 0				5,000				$ 0	5,000		$ 0
Remaining preclinical milestones, cost and profit sharing income, and the development and commercial milestones	$ 44,000
Number of performance obligations \| program	3
Contract liability			$ 59,000				$ 64,900				59,000	64,900		59,000
Revenue recognized relating to future milestones											$ 2,400	$ 1,700
Milestones recognized														15,000
Collaborative Arrangement \| Takeda Pharmaceutical Company Limited \| Product
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestones recognized														$ 0
Collaborative Arrangement \| Share Purchase Agreement \| Takeda Pharmaceutical Company Limited
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Number of common stock (in shares) \| shares	4,214,559
Purchase price	$ 110,000
Fair market value of common stock	$ 94,400
Closing stock price (usd per share) \| $ / shares	$ 22.40
Premium on sale of common stock	$ 15,600
Collaborative Arrangement \| Maximum \| Takeda Pharmaceutical Company Limited
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Preclinical milestone payments per program		25,000
Total aggregate payments due upon achievement of certain preclinical milestone events		75,000
Aggregated option exercise fee		15,000
Total aggregate payments due upon achievement of certain clinical and regulatory milestone events		407,500
Regulatory milestone payment		300,000
Milestone payments per biologic product upon achievement of a certain sales-based milestone		75,000
Milestone payments upon achievement of biologic product from each program		$ 225,000

Collaboration Agreements

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Collaboration Agreements

Sanofi

In October 2018, the Company entered into a Collaboration and License Agreement ("Sanofi Collaboration Agreement") with Genzyme Corporation, a wholly owned subsidiary of Sanofi S.A. ("Sanofi") pursuant to which certain small molecule CNS and peripheral RIPK1 inhibitors contributed by Sanofi and by Denali will be developed and commercialized. The Sanofi Collaboration Agreement became effective in November 2018 when the HSR requirements were satisfied at which time Sanofi paid the Company an upfront payment of $125.0 million. Under the Sanofi Collaboration Agreement, Denali is eligible to receive milestone payments from Sanofi up to approximately $1.1 billion upon achievement of certain clinical, regulatory and sales milestone events. Such milestone payments include $215.0 million in clinical milestone payments and $385.0 million in regulatory milestone payments for CNS Products, as defined, that are developed and approved in the United States, by the European Medicines Agency ("EMA") and in Japan for three indications, including Alzheimer's disease. These milestones also include $120.0 million in clinical milestone payments, $175.0 million in regulatory milestone payments and $200.0 million in commercial milestone payments for Peripheral Products, as defined, that are developed and approved in the United States, by the EMA and Japan for three indications.

Denali will share profits and losses equally with Sanofi for CNS Products sold in the United States and China, and receive variable royalties on net sales for CNS Products sold outside of the United States and China and for Peripheral Products sold worldwide.

Denali and Sanofi will jointly develop CNS Products pursuant to a global development plan. The Company will be responsible, at its own cost, for conducting Phase 1 and Phase 2 trials for CNS Products in Alzheimer’s disease and any activities required to support such clinical trials and specific for Alzheimer’s disease. Denali is conducting, at Sanofi’s cost, a Phase 1b trial for the lead CNS penetrant RIPK1 inhibitor, DNL747, in ALS. Sanofi is responsible, at its cost, for all other Phase 1 and Phase 2 trials for CNS Products, including for multiple sclerosis. Sanofi will lead the conduct of all Phase 3 and later stage development trials for CNS Products, with Sanofi and Denali funding 70% and 30% of such costs, respectively. Sanofi will also lead the commercialization activities globally for CNS Products, subject to certain options that Denali has to conduct co-commercialization activities with respect to each CNS Product in the United States and China.

Sanofi will be responsible, at its cost, for conducting activities relating to the development and commercialization of all Peripheral Products. Denali will be entitled to receive tiered royalties in the low- to mid- teen percentages on net sales of Peripheral Products.

The Company identified the following distinct performance obligations associated with the Sanofi Collaboration Agreement upon inception: the CNS program license, the Peripheral program license, the Phase 1 and Phase 2 trials for CNS Products for Alzheimer’s disease ("Alzheimer's Disease Services"), and the Phase 1b trial for DNL747 for ALS and associated activities ("Retained Activities").

The Company believes that the Sanofi Collaboration Agreement is a collaboration arrangement as defined in ASC 808, Collaborative Agreements. The Company also believes that Sanofi meets the definition of a customer as defined in ASC 606, Revenue From Contracts With Customers for three of the performance obligations identified at inception, but does not meet the definition of a customer for the Alzheimer's Disease Services. Further, Sanofi does not meet the definition of a customer for all Phase 3 and later stage development trials for CNS Products led by Sanofi for which Denali will fund 30% of total costs. Since ASC 808 does not address recognition and measurement, the Company looked to other accounting literature for guidance where the performance obligation does not fall under ASC 606, and determined that for the Alzheimer's Disease Services, the guidance in ASC 606 should be analogized for the recognition, measurement and reporting of this performance obligation, and for the cost sharing provisions, the Company determined that the guidance in ASC 730, Research and Development should be applied.

The transaction price at inception included upfront fixed consideration of $125.0 million. All potential future milestones and other payments were considered constrained at the inception of the Sanofi Collaboration Agreement since the Company could not conclude it was probable that a significant reversal in the amount recognized would not occur. During the years ended December 31, 2019 and 2018, the transaction price increased by $20.4 million and $2.3 million, respectively, with increases of $10.4 million and $2.3 million, respectively, related to costs incurred for Retained Activities that were no longer constrained. Additionally, the $10.0 million milestone triggered by the commencement of a DNL758 Phase 1 clinical trial in healthy volunteers, as described below, was included in the increase in transaction price for the year ended December 31, 2019.

The respective standalone value for each of the performance obligations has been determined by applying the SSP method and the transaction price allocated based on the relative SSP method with revenue recognition timing to be determined either by delivery or the provision of services.

The Company used an adjusted market assessment approach to estimate the selling price for the program licenses, and an expected cost plus margin approach for estimating the Alzheimer’s Disease Services and the Retained Activities. The program licenses and existing know-how were delivered on the effective date of the Sanofi Collaboration Agreement. The Alzheimer’s Disease Services and the Retained Activities are expected to be delivered over time as the services are performed. For the Alzheimer's Disease Services, revenue will be recognized over time using the input method, based on costs incurred to perform the services, since the level of costs incurred over time is thought to best reflect the transfer of services to Sanofi. For the Retained Activities, revenue will be recognized over time using the output method, based on amounts invoiced to Sanofi, since this is believed to directly correlate to the value of the services performed.

In July 2019, Sanofi commenced a DNL758 Phase 1 clinical trial in healthy volunteers, which triggered a milestone payment of $10.0 million, which the Company received in August 2019. The entire milestone payment was recognized in collaboration revenue in the year ended December 31, 2019. There were no milestones received or recognized in the year ended December 31, 2018.

A contract liability of $3.5 million and $3.9 million was recorded on the Consolidated Balance Sheets as of December 31, 2019 and 2018, respectively. These contract liabilities relate to the portion of the Alzheimer's Disease Services performance obligation yet to be satisfied, with such amounts to be recognized over the estimated period of the services, which is expected to be several years. There was a receivable of $1.2 million and $2.3 million as of December 31, 2019 and 2018, respectively, associated with the Sanofi Collaboration Agreement.

In assessing the Sanofi Collaboration Agreement, management is required to exercise considerable judgment in estimating revenue to be recognized. Management applies judgment in determining the separate performance obligations, in estimating the selling price, in determining when control was transferred to Sanofi for the licenses, and in estimating total future costs when using the input method.

Through December 31, 2019, Denali has received milestone payments of $10.0 million and has not recorded any product sales under the Sanofi Collaboration Agreement.

Takeda

In January 2018, the Company entered into a Collaboration and Option Agreement ("Takeda Collaboration Agreement") with Takeda Pharmaceutical Company Limited ("Takeda"), pursuant to which the Company granted Takeda an option to develop and commercialize, jointly with the Company, certain biologic products that are enabled by Denali's blood-brain barrier ("BBB") delivery technology and intended for the treatment of neurodegenerative disorders. The programs were Denali’s ATV:BACE1/Tau, ATV:TREM2 and PTV:PGRN programs. The Takeda Collaboration Agreement became effective in February 2018, at which time Takeda paid the Company an upfront payment of $40.0 million. Takeda may pay up to an aggregate of $25.0 million with respect to each of the three programs directed to a target and based upon the achievement of certain preclinical milestone events, up to $75.0 million in total, $5.0 million of which was paid upon the Takeda Collaboration Agreement becoming effective. In February 2019, the agreement was amended to replace the ATV:BACE1/Tau program with the ATV:Tau program. The amendment did not have a material impact to the consolidated financial statements.

Under the Takeda Collaboration Agreement and unless otherwise agreed jointly between both parties, Denali will be responsible, at its cost, for conducting activities relating to pre-IND development of biologic products directed to the three identified targets and enabled by its BBB delivery technology targeting TfR during the applicable research period. The period through which the option can be exercised continues for each target until the first biologic product directed to the relevant target is IND-ready or approximately five years after selection of the target, whichever is earlier.

If Takeda exercises its option with respect to a particular target, then Takeda will have the right to develop and commercialize, jointly with the Company, a specified number of biologic products enabled by its BBB delivery technology that were developed during the research period and which are directed to the relevant target. The Company will grant to Takeda a co-exclusive license under the intellectual property the Company controls related to those biologic products.

Takeda is obligated to pay Denali a $5.0 million option fee for each target for which Takeda exercises its option, up to $15.0 million in total.

In addition, if Takeda exercises its option for all three collaboration programs, Takeda may be obligated to pay Denali up to an aggregate of $407.5 million upon achievement of certain clinical milestone events and up to an aggregate of $300.0 million in regulatory milestone events relating to receipt of regulatory approval in the United States, certain European countries and Japan. Takeda may also be obligated to pay Denali up to $75.0 million per biologic product upon achievement of a certain sales-based milestone, or an aggregate of $225.0 million if one biologic product from each program achieves this milestone.

If Takeda exercises its option for a particular target, Denali and Takeda will share equally the development and commercialization costs, and, if applicable, the profits, for each collaboration program.

Pursuant to the terms of the Takeda Collaboration Agreement, the Company entered into a common stock purchase agreement (the "Stock Purchase Agreement") with Takeda on January 3, 2018, pursuant to which Takeda purchased 4,214,559 shares of Denali’s common stock (the "Shares") for an aggregate purchase price of $110.0 million. The sale of the Shares closed on February 23, 2018. The fair market value of the common stock sold to Takeda was $94.4 million, based on the closing stock price of $22.40 on the date of issuance, resulting in a $15.6 million premium paid to the Company above the fair value of the Company's common stock which was credited to contract liability in the Company's Consolidated Balance Sheets.

The Company believes that the Takeda Collaboration Agreement is a collaboration arrangement as defined in ASC 808, Collaborative Agreements. Further, during the research period, the Company believes that the arrangement is a contract with a customer as defined in ASC 606, Revenue From Contracts With Customers. The Takeda Collaboration Agreement and the Stock Purchase Agreement are being accounted for as one arrangement because they were entered into at the same time with interrelated financial terms.

The Company identified performance obligations during the research period consisting of the license, the development options, and joint steering committee ("JSC") participation together with the research services for each collaboration program. The license rights, JSC involvement, option and research services are considered to be a single performance obligation for each program since the research services are highly interrelated with the option and JSC involvement and will significantly modify the license. The performance obligations under each of the three programs are separate since the activities and risks under the programs are distinct.

The Company has determined that all other goods or services which are contingent upon Takeda exercising its option for each program are not considered performance obligations at the inception of the Takeda Collaboration Agreement.

The transaction price at inception included fixed consideration consisting of the upfront fee of $40.0 million, the $15.6 million premium on the sale of common stock, and the first preclinical milestone payment of $5.0 million. It also included variable consideration of $26.0 million relating to future milestones that were not constrained. The amount of variable consideration was estimated using the most likely amount method.

The remaining $44.0 million of preclinical milestones were considered constrained at the inception of the Takeda Collaboration Agreement since the Company could not conclude it is probable that a significant reversal in the amount recognized will not occur. Additionally, cost and profit sharing income, and the development and commercial milestones as outlined above, have not been considered given Takeda has not exercised its options for the development and commercial phases for any program. There was no change in the transaction price during the years ended December 31, 2019 and 2018. This will be reassessed at each reporting period.

The transaction price has been ascribed in its entirety to the three performance obligations identified in the research term of the Takeda Collaboration Agreement.

Revenue is recognized when, or as, the Company satisfies its performance obligations by transferring the promised services to Takeda. Revenue is being recognized over time using the input method, based on costs incurred to perform the research services, since the level of costs incurred over time is thought to best reflect the transfer of services to Takeda. There were no material changes in estimates during the years ended December 31, 2019 and 2018.

A contract liability of $59.0 million and $64.9 million is recorded on the Consolidated Balance Sheets as of December 31, 2019 and 2018, respectively. These contract liabilities relate to the three performance obligations identified, with such amounts to be recognized over the estimated period of the pre-IND research services, which is expected to be several years. There was no receivable as of December 31, 2019, and there was a receivable of $5.0 million as of December 31, 2018, related to the Takeda Collaboration Agreement.

Revenue recognized relating to future milestone payments of $2.4 million and $1.7 million, which the Company concluded is probable that a significant reversal in the amount recognized will not occur, is presented net in the contract liability on the Consolidated Balance Sheets as of December 31, 2019 and 2018, respectively.

In assessing the Takeda Collaboration Agreement, management is required to exercise considerable judgment in estimating revenue to be recognized. Management applies judgment in determining the separate performance obligations in the research period, estimating variable consideration, and estimating total future costs when using the input method.

Through December 31, 2019, Denali has received $15.0 million in preclinical milestone payments from Takeda and has not recorded any product sales under the Takeda Collaboration Agreement.

Collaboration Revenue

Revenue disaggregated by collaboration agreement and performance obligation is as follows (in thousands):


	Year Ended December 31,
	2019		2018
Takeda Collaboration Agreement⁽¹⁾	$	5,926	$	5,677
Sanofi Collaboration Agreement:
CNS Program License	—		73,932
Peripheral Program License	10,000		47,148
Alzheimer's Disease Services⁽¹⁾	358		60
Retained Activities	10,394		2,343
Total Sanofi Collaboration Revenue	20,752		123,483
Total Collaboration Revenue	$	26,678	$	129,160

_________________________________________________

(1)Amounts for the year ended December 31, 2019 represent revenue recognized that was included in the contract liability balance at the beginning of the year. There was no deferred revenue at the beginning of the year ended December 31, 2018. There was no collaboration revenue in the year ended December 31, 2017.

Net Loss and Net Loss Per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Net Loss and Net Loss Per Share

Since the Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share as the inclusion of all potential dilutive securities would have been anti-dilutive. Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:


	Year Ended December 31,
	2019	2018	2017
Options issued and outstanding and ESPP shares issuable	11,921,434	9,789,594	6,835,313
Restricted shares subject to future vesting	882,636	503,243	2,293,788
Early exercised common stock subject to future vesting	—	135,424	369,796
Total	12,804,070	10,428,261	9,498,897

License Agreements	12 Months Ended
License Agreements	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
License Agreements	License Agreements Genentech In June 2016, the Company entered into an Exclusive License Agreement with Genentech, Inc. (“Genentech”). The agreement gives the Company access to Genentech’s LRRK2 inhibitor small molecule program for Parkinson's disease. Under the agreement, Genentech granted the Company (i) an exclusive, worldwide, sublicensable license under Genentech’s rights to certain patents and patent applications directed to small molecule compounds which bind to and inhibit LRRK2 and (ii) a non-exclusive, worldwide, sublicensable license to certain related know-how, in each case, to develop and commercialize certain compounds and licensed products incorporating any such compound. The Company may owe Genentech milestone payments upon the achievement of certain development, regulatory, and commercial milestones, up to a maximum of $315.0 million in the aggregate. These milestones include up to $37.5 million in clinical milestone payments, $102.5 million in regulatory milestone payments and $175.0 million in commercial milestone payments. In addition, the Company may owe royalties on net sales of licensed products ranging from low to high single-digit percentages. To date, the Company has paid Genentech $12.5 million in the aggregate, including an upfront fee, a technology transfer fee and a clinical milestone payment, all of which was recorded as research and development expense as incurred. No amounts were recorded in the years ended December 31, 2019 or 2018. The first clinical milestone payment of $2.5 million was recorded as research and development expense during the year ended December 31, 2017.

Commitments and Contingencies - Summary of Company's Future Minimum Lease Commitments (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2020	$ 9,737
2021	10,391
2022	10,731
2023	11,083
2024	11,447
Thereafter	54,074
Total undiscounted lease payments	107,463
Present value adjustment	(34,933)
Net operating lease liabilities	$ 72,530

Cash and Marketable Securities - Schedule of Restricted Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 79,449	$ 77,123	$ 218,375
Restricted cash included within prepaid expenses and other current assets	0	0	84
Restricted cash included within other non-current assets	1,500	1,500	451
Total cash, cash equivalents, and restricted cash	$ 80,949	$ 78,623	$ 218,910	$ 40,388

Net Loss and Net Loss Per Share (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Schedule of Dilutive Securities Not Included in Diluted Per Share Calculations

Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows:


	Year Ended December 31,
	2019	2018	2017
Options issued and outstanding and ESPP shares issuable	11,921,434	9,789,594	6,835,313
Restricted shares subject to future vesting	882,636	503,243	2,293,788
Early exercised common stock subject to future vesting	—	135,424	369,796
Total	12,804,070	10,428,261	9,498,897

Cash and Marketable Securities - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash and Cash Equivalents [Abstract]
Other-than-temporary impairment	$ 0	$ 0
Income tax benefit	$ 351	0	$ 0
Effective maturity (less than)	2 years
Unrealized gains in other comprehensive income	$ (400)	$ 0	$ 0

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2019	Feb. 19, 2020	Jun. 28, 2019
Cover page.
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2019
Document Transition Report	false
Entity File Number	001-38311
Entity Registrant Name	Denali Therapeutics Inc.
Entity Central Index Key	0001714899
Document Fiscal Year Focus	2019
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-3872213
Entity Address, Address Line One	161 Oyster Point Blvd
Entity Address, City or Town	South San Francisco
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94080
City Area Code	650
Local Phone Number	866-8548
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	DNLI
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 715.6
Entity Common Stock, Shares Outstanding		105,423,277
Documents Incorporated by Reference	Portions of the registrant’s Definitive Proxy Statement relating to the registrant’s 2019 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Such Definitive Proxy Statement will be filed with the Securities and Exchange Commission within 120 days after the end of the registrant’s 2019 fiscal year ended December 31, 2019.

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Summary of Company's Future Minimum Lease Commitments

The following table reconciles the undiscounted cash flows for the next five years and total of the remaining years to the operating lease liabilities recorded in the Consolidated Balance Sheet as of December 31, 2019 (in thousands):


Year Ended December 31:
2020	$	9,737
2021	10,391
2022	10,731
2023	11,083
2024	11,447
Thereafter	54,074
Total undiscounted lease payments	107,463
Present value adjustment	(34,933)
Net operating lease liabilities	$	72,530

Summary of Company's Future Minimum Lease Receivables

The following table details the future undiscounted cash inflows relating to the Company's Sublease Agreement as of December 31, 2019 (in thousands):


Year Ended December 31:
2020	$	2,842
2021	2,925
2022	3,009
2023	3,096
2024	876
Thereafter	—
Total undiscounted sublease receipts	$	12,748

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

The Company has reported pre-tax operating losses for all periods presented. The Company has not reflected any benefit for corresponding tax net operating loss carryforwards in the accompanying consolidated financial statements. The Company has established a full valuation allowance against its deferred tax assets due to the uncertainty surrounding the realization of such assets.

The effective tax rate for the years ended December 31, 2019, 2018, and 2017 is different from the federal statutory tax rate primarily due to the valuation allowance against deferred tax assets. The Company's effective tax rate differs from the federal statutory rate as follows:


	Year Ended December 31,
	2019		2018		2017
Taxes at the U.S. statutory tax rate	21.0	%	21.0	%	34.0	%
Effect of Tax Act	—		—		(26.6)
Change in valuation allowance	(24.4)		(20.7)		(7.3)
Research tax credits	3.5		10.2		1.0
Stock-based compensation	0.1		(0.7)		(1.0)
Nondeductible acquisition-related costs	—		(9.5)		—
Other	(0.1)		(0.3)		(0.1)
Total provision for income taxes	0.1	%	—	%	—	%

The components of the Company’s net deferred tax assets are as follows (in thousands):


	December 31,
	2019		2018
Deferred tax assets:
Net operating loss carryforwards	$	56,612	$	35,023
Tax credit carryforwards	19,133		9,565
Contract liabilities	13,516		—
Operating lease liability	15,686		—
Stock-based compensation	9,513		3,305
Accruals and other	11,815		17,181
Gross deferred tax assets	126,275		65,074
Valuation allowance	(112,713)		(60,915)
Net deferred tax assets	13,562		4,159
Deferred tax liabilities:
Property and equipment	(6,225)		(4,159)
Operating lease right-of-use asset	(7,337)		—
Net deferred tax assets	$	—	$	—

Recognition of deferred tax assets is appropriate when realization of such assets is more likely than not. Based upon the weight of available evidence, especially the uncertainties surrounding the realization of deferred tax assets through future taxable income, the Company believes it is not more likely than not that the deferred tax assets will be fully realizable. Accordingly, the Company has provided a 100% valuation allowance against its net deferred tax assets as of December 31, 2019 and 2018. There was an increase in the net valuation allowance of $51.8 million during the year ended December 31, 2019.

As of December 31, 2019, the Company has federal net operating loss (“NOL”) carryforwards of approximately $221.5 million, which are available to reduce future taxable income, and has federal R&D and orphan drug tax credits of approximately $14.5 million and $1.7 million respectively, both of which may be used to offset future tax liabilities. The federal NOL and federal tax credit carryforwards will begin to expire in 2035. The Company also has state NOL carryforwards of approximately $144.2 million, which are available to reduce future taxable income, and has state tax credits of approximately $9.8 million which may be used to offset future tax liabilities. The state NOL will begin to expire in 2035 and the state tax credit carryforwards will be carried forward indefinitely. The NOL and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service (“IRS”) and state tax authorities and may become subject to an annual limitation in the event of certain future cumulative changes in the ownership interest of significant stockholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code of 1986. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. Annual limitations may result in expiration of net operating loss and tax credit carryforwards before some or all of such amounts have been utilized.

The Company follows the provisions of ASC 740, Accounting for Income Taxes, and the accounting guidance related to accounting for uncertainty in income taxes. The Company determines its uncertain tax positions based on a determination of whether and how much of a tax benefit taken by the Company in its tax filings is more likely than not to be sustained upon examination by the relevant income tax authorities.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):


	December 31,
	2019		2018		2017
Unrecognized tax benefits at January 1	$	2,642	$	1,146	$	531
Additions for tax positions taken in a prior year	107		—		—
Additions for tax positions taken in the current year	2,595		1,506		640
Reductions for tax positions taken in the prior year	(45)		(10)		(25)
Unrecognized tax benefits at December 31	$	5,299	$	2,642	$	1,146

If recognized, none of the unrecognized tax benefits would reduce the annual effective tax rate, primarily due to corresponding adjustments to the valuation allowance. The Company will recognize both accrued interest and penalties related to unrecognized benefits in income tax expense. As of December 31, 2019, no liability has been recorded for potential interest or penalties. The Company does not expect the unrecognized tax benefits to change significantly over the next 12 months.

Since the Company is in a loss carryforward position, the Company is generally subject to examination by the U.S. federal, state and local income tax authorities for all tax years in which a loss carryforward is available.

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Convertible preferred stock, par value (usd per share)	$ 0.01	$ 0.01
Convertible preferred stock, shares authorized (in shares)	40,000,000	40,000,000
Convertible preferred stock, shares issued (in shares)	0	0
Convertible preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	400,000,000	400,000,000
Common stock, shares issued (in shares)	96,189,935	94,662,435
Common stock, shares outstanding (in shares)	96,189,935	94,662,435

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Operating activities
Net loss	$ (197,614)	$ (36,240)	$ (88,185)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	7,991	7,415	3,082
Stock-based compensation expense	38,378	18,791	4,409
Net amortization of (discounts) and premiums on marketable securities	(5,019)	(2,705)	753
Non-cash operating lease expense	864	0	0
Other non-cash items	(351)	(36)	1
Changes in operating assets and liabilities:
Prepaid expenses and other assets	6,675	(18,290)	73
Accounts payable	1,033	(526)	207
Accrued and other current liabilities	1,500	9,113	3,578
Contract liability	(6,286)	68,777	0
Non-cash rent expense	0	3,438	0
Operating lease liability	1,253	0	0
Other non-current liabilities	0	379	(553)
Net cash provided by (used in) operating activities	(151,576)	50,116	(76,635)
Investing activities
Purchase of marketable securities	(369,696)	(557,930)	(179,789)
Purchase of property and equipment	(17,919)	(3,393)	(2,875)
Maturities and sales of marketable securities	535,327	273,901	141,498
Net cash provided by (used in) investing activities	147,712	(287,422)	(41,166)
Financing activities
Issuance of common stock in connection with the Takeda Collaboration Agreement	0	94,406	0
Proceeds from exercise of awards under equity incentive plans	6,190	3,999	733
Proceeds from issuance of common stock, net of issuance costs	0	0	265,619
Proceeds from issuance of convertible preferred stock, net of issuance costs	0	0	29,971
Net cash provided by financing activities	6,190	97,019	296,323
Net increase (decrease) in cash, cash equivalents and restricted cash	2,326	(140,287)	178,522
Cash, cash equivalents and restricted cash at beginning of year	78,623	218,910	40,388
Cash, cash equivalents and restricted cash at end of year	80,949	78,623	218,910
Supplemental disclosures of cash flow information
Tenant improvements provided by the landlord	11,343	14,561	0
Property and equipment purchases accrued but not yet paid	0	335	103
Deferred IPO costs incurred but not yet paid	0	0	1,358
Convertible preferred stock issuance costs incurred but not yet paid	0	0	44
Common Stock
Financing activities
Payments of issuance costs related to issuance of stock	0	(1,342)	0
Preferred Stock
Financing activities
Payments of issuance costs related to issuance of stock	$ 0	$ (44)	$ 0

Fair Value Measurements (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	$ 375,793	$ 535,055
Asset - foreign currency derivative contracts	85	14
Total asset fair value measurements	446,030	588,772
Liability - foreign currency derivative contracts	8	182
Total liability fair value measurements	8	182
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	54,163	42,225
U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	15,989	1,499
Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		9,979
Short-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	250,070	219,754
Short-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	2,000	73,151
Short-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	53,479	71,675
Short-term marketable securities: \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	30,358	22,594
Long-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	13,869	117,131
Long-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities		1,977
Long-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	26,017	28,773
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset - foreign currency derivative contracts	0	0
Total asset fair value measurements	334,091	380,609
Liability - foreign currency derivative contracts	0	0
Total liability fair value measurements	0	0
Level 1 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	54,163	42,225
Level 1 \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	15,989	1,499
Level 1 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		0
Level 1 \| Short-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	250,070	219,754
Level 1 \| Short-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 1 \| Short-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 1 \| Short-term marketable securities: \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 1 \| Long-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	13,869	117,131
Level 1 \| Long-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities		0
Level 1 \| Long-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset - foreign currency derivative contracts	85	14
Total asset fair value measurements	111,939	208,163
Liability - foreign currency derivative contracts	8	182
Total liability fair value measurements	8	182
Level 2 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 2 \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 2 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		9,979
Level 2 \| Short-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 2 \| Short-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	2,000	73,151
Level 2 \| Short-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	53,479	71,675
Level 2 \| Short-term marketable securities: \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	30,358	22,594
Level 2 \| Long-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 2 \| Long-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities		1,977
Level 2 \| Long-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	26,017	28,773
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset - foreign currency derivative contracts	0	0
Total asset fair value measurements	0	0
Liability - foreign currency derivative contracts	0	0
Total liability fair value measurements	0	0
Level 3 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 3 \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 3 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents		0
Level 3 \| Short-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 3 \| Short-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 3 \| Short-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 3 \| Short-term marketable securities: \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 3 \| Long-term marketable securities: \| U.S. government treasuries
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	0	0
Level 3 \| Long-term marketable securities: \| U.S. government agency securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities		0
Level 3 \| Long-term marketable securities: \| Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	$ 0	$ 0

Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Summary of Estimated Useful Life

Depreciation is computed using the straight-line method over the related estimated useful lives as presented in the table below. Significant additions and improvements are capitalized, while repairs and maintenance are charged to expense as incurred.


Asset						Estimated useful life
Leasehold improvements						Shorter of life of asset or lease term
Manufacturing and laboratory equipment						five years
Computer hardware and software						three years
Office furniture and equipment						five years

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of Effective Tax Rate Reconciliation

The Company's effective tax rate differs from the federal statutory rate as follows:


	Year Ended December 31,
	2019		2018		2017
Taxes at the U.S. statutory tax rate	21.0	%	21.0	%	34.0	%
Effect of Tax Act	—		—		(26.6)
Change in valuation allowance	(24.4)		(20.7)		(7.3)
Research tax credits	3.5		10.2		1.0
Stock-based compensation	0.1		(0.7)		(1.0)
Nondeductible acquisition-related costs	—		(9.5)		—
Other	(0.1)		(0.3)		(0.1)
Total provision for income taxes	0.1	%	—	%	—	%

Schedule of Deferred Tax Assets and Liabilities

The components of the Company’s net deferred tax assets are as follows (in thousands):


	December 31,
	2019		2018
Deferred tax assets:
Net operating loss carryforwards	$	56,612	$	35,023
Tax credit carryforwards	19,133		9,565
Contract liabilities	13,516		—
Operating lease liability	15,686		—
Stock-based compensation	9,513		3,305
Accruals and other	11,815		17,181
Gross deferred tax assets	126,275		65,074
Valuation allowance	(112,713)		(60,915)
Net deferred tax assets	13,562		4,159
Deferred tax liabilities:
Property and equipment	(6,225)		(4,159)
Operating lease right-of-use asset	(7,337)		—
Net deferred tax assets	$	—	$	—

Schedule of Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands):


	December 31,
	2019		2018		2017
Unrecognized tax benefits at January 1	$	2,642	$	1,146	$	531
Additions for tax positions taken in a prior year	107		—		—
Additions for tax positions taken in the current year	2,595		1,506		640
Reductions for tax positions taken in the prior year	(45)		(10)		(25)
Unrecognized tax benefits at December 31	$	5,299	$	2,642	$	1,146

Convertible Preferred Stock	12 Months Ended
Convertible Preferred Stock	Dec. 31, 2017
Temporary Equity Disclosure [Abstract]
Convertible Preferred Stock	Convertible Preferred Stock The Company entered into a preferred stock purchase agreement (“Preferred Stock Purchase Agreement”), with certain investors in May 2015 (the “Initial Closing”), under which the Company agreed to sell up to 45,223,970 shares of Series A-1 convertible preferred stock and 4,361,530 shares of Series A-2 convertible preferred stock. Additionally, at the Initial Closing, the Company concurrently issued 6,295,810 shares of Series A-1 convertible preferred stock for net proceeds of $24.8 million. The Preferred Stock Purchase Agreement provided that, upon Board of Directors approval, each investor would purchase its pro-rata portion of the shares to be issued in one or more additional Series A-1 closings, and in any Series A-2 closings. Further, the Company agreed to sell and issue said shares of Series A-1 convertible preferred stock on the same terms as the first tranche, and to issue said shares of Series A-2 convertible preferred stock on the terms included in the Preferred Stock Purchase Agreement. The second and third Series A-1 closings added further obligations for new investors to participate in the Series A-2 tranches. The Company did not separately account for tranche purchase rights described above as they were not freestanding from the associated shares of convertible preferred stock. In May 2015 (the “First Additional Closing”) the Company and the Series A convertible preferred stock shareholders amended the Preferred Stock Purchase Agreement pursuant to which the Company agreed to sell up to an additional 456,250 shares of Series A-1 convertible preferred stock. Additionally, at the First Additional Closing, the Company issued 3,481,250 shares of Series A-1 convertible preferred stock for net proceeds of $13.9 million and in July 2015 (“Second Additional Closing”), the Company issued an additional 2,420,830 shares of Series A-1 convertible preferred stock for net proceeds of $9.6 million. In January 2016 (the “Third Additional Closing”), the Company issued 500,000 shares of Series A-1 convertible preferred stock, for net proceeds of $2.0 million, and also issued 11,250,000 shares of Series A-1 convertible preferred stock (the “first Tranche Closing”), for net proceeds of $45.0 million. In June 2016 (the “Second Tranche Closing and Series A-2 Closing”), the Company issued 22,166,550 shares of Series A-1 convertible preferred stock and 4,361,530 shares of Series A-2 convertible preferred stock, for net proceeds of $88.7 million and $34.9 million, respectively. All of these shares were sold under the Preferred Stock Purchase Agreement. In June 2016 (the “First Series B-1 Closing”), the Company entered into a preferred stock purchase agreement (“Series B Preferred Stock Purchase Agreement”) with certain investors, under which the Company sold 7,646,240 shares of Series B-1 convertible preferred stock at a price of $16.00 per share for net proceeds of $122.2 million. In connection with this financing, the Company amended and restated its certificate of incorporation to increase the authorized shares of its common stock to 81,787,360 shares and the authorized shares of its preferred stock to 63,288,470 shares, each with a par value of $0.01 per share. The authorized preferred shares consisted of 46,114,433 designated as Series A-1 convertible preferred stock, 4,361,533 designated as Series A-2 convertible preferred stock, 8,125,000 designated Series B-1 convertible preferred stock and 4,687,500 designated Series B-2 convertible preferred stock. In August 2016, (the “Second Series B-1 Closing”), the Company sold 478,120 shares of Series B-1 convertible preferred stock at a price of $16.00 per share for net proceeds of $7.6 million. In November 2017, the Company sold 1,764,710 shares of Series B-2 convertible preferred stock at a price of $17.00 per share for net proceeds of $29.9 million. Prior to the conversion of the convertible preferred stock upon closing of the IPO, the rights, preferences and privileges of the convertible preferred stock were as follows: Dividend Rights The holders of preferred stock were entitled to receive dividends, if and when declared by the Board of Directors, at the rate of $0.08 per share per annum for Series A-1, $0.16 per share per annum for Series A-2, $0.32 per share per annum for Series B-1, and $0.34 per share per annum for Series B-2, from and after the date of issuance of such shares. As of December 31, 2016, and through the date of conversion, no such dividends were declared or accrued. Dividends on any other class of capital stock could not be paid unless the holders of the preferred stock first received, or simultaneously received, the preferred stock dividend. The holders of preferred stock also participated in dividends paid on common stock as if the shares of preferred stock had been converted into shares of common stock and were considered participating securities. Conversion Rights The holders of preferred stock had right to convert at any time into shares of common stock initially at a one-for-one ratio. All shares of the preferred stock would have been automatically converted into shares common stock (i) upon the consent of the holders of at least a majority of the outstanding preferred stock, or (ii) upon the closing of a firmly underwritten initial public offering of common stock at a price of at least $5.00 per share resulting in at least $50.0 million of gross proceeds. The conversion price for each series of preferred stock was subject to an adjustment in the event of stock split, combination, common stock dividend or distribution, reclassification, exchange, substitution, or reorganization. Liquidation Rights In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company or a deemed liquidation event, the holders of shares of preferred stock then outstanding were entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment could have been made to the holders of common stock, an amount per share equal to the greater of (i) the original issue price for the Series of preferred stock held plus any dividends accrued but unpaid, whether or not declared; or (ii) such amount per share as would have been paid if all shares of preferred stock had been converted to common stock immediately prior to such liquidation, dissolution, winding up or deemed liquidation event. If assets of the Company available were insufficient to pay holders of Preferred Stock the full amount they are entitled to, the holders of preferred stock would have shared ratably in any distribution of the assets available for distribution in proportion to the amounts due such holders. After the payment of all preferential amounts required to be paid to the holders of shares of preferred stock, the remaining assets of the Company would have been distributed among the holders of the shares of common stock, pro rata based on the number of shares held by each such holder. The Company classified its convertible preferred stock outside of stockholders’ deficit as certain change in control events are outside the Company’s control. Redemption Upon certain change in control events that were outside of the Company’s control, including liquidation, sale or transfer of control of the Company, holders of the convertible preferred stock could have caused its redemption. Shares of preferred stock could have been redeemed by the Company at the original issue price for each series of preferred stock plus any dividends accrued but unpaid, whether or not declared, in three annual installments, upon a written request from the holders of a majority of the then outstanding shares of preferred stock, which request could have been made at any time after the fifth anniversary of the Series B-1 original issue date (on or after June 22, 2021). On each of the three annual redemption dates the Company could have redeemed the number of outstanding shares of preferred stock determined by dividing the total number of outstanding shares of preferred stock by the number of remaining redemption dates. Voting Rights Each share of preferred stock had voting rights equal to the number of shares of common stock into which the preferred stock could have been converted immediately after the close of business on the record date. As long as certain investors in Series A convertible preferred stock held 100,000 or more shares of convertible preferred stock purchased pursuant to the Preferred Stock Purchase Agreement, they were entitled to elect individually one member of the Board totaling five Series A Directors. Series B convertible preferred stockholders were entitled to elect one member of the Board by majority vote of the Series B convertible preferred stockholders. Together, Series A and Series B convertible preferred stock investors were entitled to elect two additional members of the Board that were not otherwise an affiliate of the Company or of any investor. Upon the closing of the IPO, all outstanding shares of convertible preferred stock converted into 60,365,020 shares of common stock. As of December 31, 2019 and 2018, the Company did not have any convertible preferred stock issued or outstanding.

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Assets and liabilities measured at fair value

Assets and liabilities measured at fair value at each balance sheet date are as follows (in thousands):


	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	54,163	$	—	$	—	$	54,163
U.S. government treasuries	15,989		—		—		15,989

Short-term marketable securities:
U.S. government treasuries	250,070		—		—		250,070
U.S. government agency securities	—		2,000		—		2,000
Corporate debt securities	—		53,479		—		53,479
Commercial paper	—		30,358		—		30,358
Long-term marketable securities:
U.S. government treasuries	13,869		—		—		13,869

Corporate debt securities	—		26,017		—		26,017
Foreign currency derivative contracts	—		85		—		85
Total	$	334,091	$	111,939	$	—	$	446,030
Liabilities:
Foreign currency derivative contracts	$	—	$	8	$	—	$	8
Total	$	—	$	8	$	—	$	8


	December 31, 2018
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents
Money market funds	$	42,225	$	—	$	—	$	42,225
U.S. government treasuries	1,499		—		—		1,499
Commercial paper	—		9,979		—		9,979
Short-term marketable securities:
U.S. government treasuries	219,754		—		—		219,754
U.S. government agency securities	—		73,151		—		73,151
Corporate debt securities	—		71,675		—		71,675
Commercial paper	—		22,594		—		22,594
Long-term marketable securities:
U.S. government treasuries	117,131		—		—		117,131
U.S. government agency securities	—		1,977		—		1,977
Corporate debt securities	—		28,773		—		28,773
Foreign currency derivative contracts	—		14		—		14
Total	$	380,609	$	208,163	$	—	$	588,772
Liabilities:
Foreign currency derivative contracts	$	—	$	182	$	—	$	182
Total	$	—	$	182	$	—	$	182

Commitments and Contingencies

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Lease Obligations

In May 2018, the Company entered into an amendment to its operating lease for its former corporate headquarters in South San Francisco (the "Headquarters Lease Amendment") to relocate and expand its headquarters to 148,020 rentable square feet in a building in South San Francisco, California (the "New Premises"). The Headquarters Lease Amendment has a contractual term of ten years from the legal commencement date, which was April 1, 2019 when the building was ready for occupancy. For accounting purposes, the lease commencement date was determined to be August 1, 2018, which was the date at which the Company was deemed to have obtained control over the property. The Company has an option to extend the lease term for a period of ten years by giving the landlord written notice of the election to exercise the option at least nine months, but not more than twelve months, prior to the expiration of the Headquarters Lease Amendment lease term. The Company determined that this renewal was not reasonably certain at lease inception.

The Headquarters Lease Amendment provides for monthly base rent amounts escalating over the term of the lease. In addition, the Headquarters Lease Amendment provided a tenant improvement allowance ("TIA") of up to $25.9 million, which was fully utilized, of which $4.4 million will be repaid to the landlord in the form of additional monthly rent. This is recorded as leasehold improvement assets and an offset to the lease ROU asset on the Consolidated Balance Sheet as of December 31, 2019. The Company is also required to pay the operating expenses for the New Premises, such as taxes and insurance, which are treated as variable lease payments.

As of December 31, 2019, the carrying value of the ROU asset was $33.9 million. The related current and non-current liabilities as of December 31, 2019 were $3.7 million and $68.9 million, respectively. The current and non-current lease liabilities are included in accrued expenses and other current liabilities and operating lease liability, less current portion, respectively, in the Consolidated Balance Sheet.

Management exercised judgment in applying the requirements of ASC 842, including the determination as to whether certain contracts contain a lease and for the Headquarters Lease Amendment, the discount rate used to determine the measurement of the lease liability. As the implicit rate of the Headquarters Lease Amendment was not known, the Company estimated a 9.0% discount rate, which was management’s estimate of the Company’s incremental borrowing rate. To estimate the incremental borrowing rate, management considered observable debt yields of comparable market instruments, as well as benchmarks within the Headquarters Lease Amendment that may be indicative of the rate implicit in the lease.

Total operating lease costs, including variable and short-term lease costs, was $10.2 million for the year ended December 31, 2019. Rent expense excluding amortization of leasehold improvements was $6.0 million and $2.2 million for the years ended December 31, 2018 and 2017, respectively.

Operating lease liabilities are calculated as the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. As of December 31, 2019, the weighted average remaining lease term is 9.3 years and the weighted average discount rate used to determine the operating lease liability was 9.0%. Cash paid for amounts included in the measurement of lease liabilities for the year ended December 31, 2019 was $5.4 million and was included in net cash used in operating activities in our Consolidated Statements of Cash Flows.


Year Ended December 31:
2020	$	9,737
2021	10,391
2022	10,731
2023	11,083
2024	11,447
Thereafter	54,074
Total undiscounted lease payments	107,463
Present value adjustment	(34,933)
Net operating lease liabilities	$	72,530

In October 2018, the Company entered into a sublease agreement ("Sublease Agreement") to sublease approximately 36,835 rentable square feet of space in its New Premises. The Sublease Agreement has a term of five years from the commencement date of April 12, 2019 and provides for the Company to receive monthly base rent amounts escalating over the term of the lease. The Company also passes through a portion of the operating expenses, such as taxes and insurance for the New Premises to the sublessee, which are treated as variable sublease income. Total sublease income, including rent and variable sublease cost reimbursements, was $2.6 million for the year ended December 31, 2019. There was no sublease income for the years ended December 31, 2018 or 2017.

The following table details the future undiscounted cash inflows relating to the Company's Sublease Agreement as of December 31, 2019 (in thousands):


Year Ended December 31:
2020	$	2,842
2021	2,925
2022	3,009
2023	3,096
2024	876
Thereafter	—
Total undiscounted sublease receipts	$	12,748

Indemnification

In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to vendors, lessors, business partners, board members, officers, and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company, negligence or willful misconduct of the Company, violations of law by the Company, or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with directors and certain officers and employees that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. No demands have been made upon the Company to provide indemnification under such agreements, and thus, there are no claims that the Company is aware of that could have a material effect on the Company’s Consolidated Balance Sheets, Consolidated Statements of Operations and Comprehensive Loss, or Consolidated Statements of Cash Flows.

Commitments

Effective September 2017, the Company entered into a Development and Manufacturing Services Agreement as amended (“DMSA”) with Lonza Sales AG (“Lonza”) for the development and manufacture of biologic products. Under the DMSA, the Company will execute purchase orders based on project plans authorizing Lonza to provide development and manufacturing services with respect to certain of the Company's antibody and enzyme products, and will pay for the services provided and batches delivered in accordance with the DMSA and project plan. Unless earlier terminated, the DMSA will expire on September 6, 2022.

As of December 31, 2019 and 2018, the Company had open non-cancellable purchase orders for biological product development and manufacturing costs totaling $21.2 million and $24.7 million, respectively. The activities under these purchase orders are expected to be completed by November 2024. As of December 31, 2019 and 2018, the Company had total non-refundable purchase commitments of $11.2 million and $14.0 million, respectively, under the DMSA.

During the years ended December 31, 2019 and 2018, the Company incurred costs of $12.7 million and $3.9 million, and made payments of $12.5 million and $3.4 million, respectively, for the development and manufacturing services rendered under the DMSA. The Company had not incurred any costs or made any payments for the development and manufacturing services rendered under the DMSA for the year ended December 31, 2017.

In the normal course of business, the Company enters into various firm purchase commitments primarily related to research and development activities. The Company had contractual obligations under license and other agreements of $1.1 million and $1.2 million as of December 31, 2019 and 2018, respectively.

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2019
Subsequent Events [Abstract]
Subsequent event	Subsequent eventIn January 2020, the Company sold 9.0 million shares of common stock (inclusive of shares sold pursuant to an overallotment option granted to the underwriters in connection with the offering) through an underwritten public offering at a price of $23.00 per share for aggregate net proceeds of approximately $194.1 million.

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Statement [Abstract]
Collaboration revenue	$ 26,678	$ 129,160	$ 0
Operating expenses:
Research and development expense	193,382	143,183	74,460
General and administrative	46,480	32,349	15,680
Total operating expenses	239,862	175,532	90,140
Loss from operations	(213,184)	(46,372)	(90,140)
Interest and other income, net	15,219	10,132	1,955
Loss before income taxes	(197,965)	(36,240)	(88,185)
Income tax benefit	351	0	0
Net loss	(197,614)	(36,240)	(88,185)
Other comprehensive income (loss):
Net unrealized gain (loss) on marketable securities, net of tax	999	(281)	5
Comprehensive loss	$ (196,615)	$ (36,521)	$ (88,180)
Net loss per share, basic and diluted (usd per share)	$ (2.07)	$ (0.39)	$ (5.89)
Weighted average number of shares outstanding, basic and diluted (in shares)	95,608,208	92,621,991	14,964,144

Stock-Based Awards - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Number of Options
Number of options, beginning balance (in shares)	9,612,652
Number of options, granted (in shares)	3,610,835
Number of options, exercised (in shares)	(786,638)
Number of options, forfeited (in shares)	(796,115)
Number of options, ending balance (in shares)	11,640,734	9,612,652
Number of options, vested and expected to vest (in shares)	9,896,002
Number of options, exercisable (in shares)	3,938,523
Weighted- Average Exercise Price
Weighted average exercise price, beginning balance (usd per share)	$ 10.49
Weighted average exercise price, granted (usd per share)	18.58
Weighted average exercise price, exercised (usd per share)	4.27
Weighted average exercise price, forfeited (usd per share)	16.72
Weighted average exercise price, ending balance (usd per share)	12.96	$ 10.49
Weighted average exercise price, vested and expected to vest (usd per share)	15.13
Weighted average exercise price, exercisable (usd per share)	$ 11.19
Stock Option Activity, Additional Disclosures
Weighted average remaining contractual life	7 years 9 months 14 days	8 years 2 months 12 days
Weighted average remaining contractual life, vested and expected to vest	8 years 2 months 1 day
Weighted average remaining contractual life, exercisable	7 years 4 months 17 days
Aggregate intrinsic value, beginning balance	$ 97,804
Aggregate intrinsic value, ending balance	51,879	$ 97,804
Aggregate intrinsic value, vested and expected to vest	22,672
Aggregate intrinsic value	$ 24,552

Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
Collaboration revenue	$ 4,672	$ 13,604	$ 4,197	$ 4,205	$ 125,676	$ 1,195	$ 1,648	$ 641	$ 26,678	$ 129,160	$ 0
Income (loss) from operations	(57,758)	(50,155)	(62,763)	(42,508)	74,722	(37,964)	(57,382)	(25,748)	(213,184)	(46,372)	(90,140)
Net loss	$ (54,025)	$ (46,260)	$ (58,337)	$ (38,992)	$ 77,533	$ (35,371)	$ (54,724)	$ (23,678)	$ (197,614)	$ (36,240)	$ (88,185)
Net income (loss) per share, basic (usd per share)					$ 0.82	$ (0.38)	$ (0.59)	$ (0.26)
Net income (loss) per share, diluted (usd per share)					$ 0.79	$ (0.38)	$ (0.59)	$ (0.26)
Net income (loss) per share, basic and diluted (usd per share)	$ (0.56)	$ (0.48)	$ (0.61)	$ (0.41)					$ (2.07)	$ (0.39)	$ (5.89)
Weighted average common shares outstanding (in shares)	96,078,950								95,608,208	92,621,991	14,964,144
Weighted average shares outstanding, basic (in shares)					94,299,096
Total number of shares outstanding, diluted (in shares)					97,746,224

Defined Contribution Plan	12 Months Ended
Defined Contribution Plan	Dec. 31, 2019
Retirement Benefits [Abstract]
Defined Contribution Plan	Defined Contribution PlanThe Company sponsors a 401(k) retirement savings plan for the benefit of its employees, including Denali's named executive officers, who satisfy certain eligibility requirements. Under the 401(k) plan, eligible employees may elect to defer a portion of their compensation, within the limits prescribed by the Code, on a pre-tax or after-tax (Roth) basis through contributions to the 401(k) plan. The 401(k) plan authorizes employer safe harbor contributions. The 401(k) plan is intended to qualify under Sections 401(a) and 501(a) of the Code. As a tax-qualified retirement plan, pre-tax contributions to the 401(k) plan and earnings on those pre-tax contributions are not taxable to the employees until distributed from the 401(k) plan, and earnings on Roth contributions are not taxable when distributed from the 401(k) plan. The Company made contributions to the Plan for eligible participants, and recorded contribution expenses of $1.6 million, $0.9 million and $0.5 million for the years ended December 31, 2019, 2018, and 2017, respectively.

Stock-Based Awards - Summary of Restricted Stock Activity (Details) - Restricted Stock - $ / shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Share Awards & Units
Shares, unvested, beginning balance (in shares)	503,243
Shares, granted (in shares)	850,234
Shares, vested (in shares)	(419,064)
Shares, forfeited (in shares)	(51,777)
Shares, unvested, ending balance (in shares)	882,636	503,243
Shares, vested and expected to vest (in shares)	882,636
Weighted-Average Fair Value at Date of Grant per Share
Weighted-average fair value at date of grant per share, unvested, beginning balance (usd per share)	$ 4.86
Weighted-average fair value at date of grant per share, granted (usd per share)	18.86	$ 15.92
Weighted-average fair value at date of grant per share, vested (usd per share)	2.63
Weighted-average fair value at date of grant per share, forfeited (usd per share)	20.50
Weighted-average fair value at date of grant per share, unvested, ending balance (usd per share)	18.67	$ 4.86
Weighted-average fair value at date of grant per share, vested and expected to vest (usd per share)	$ 18.67

Derivative Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Forward Foreign Currency Exchange Contracts Outstanding

The following table summarizes the Company’s forward foreign currency exchange contracts outstanding as of December 31, 2019 (notional amounts in thousands):

Foreign Exchange Contracts

Number of Contracts

Aggregate Notional⁽¹⁾ Amount in Foreign Currency

Maturity

Euros

1,500

Jan 2020 - Nov 2020

British Pounds

2,285

Jan 2020 - Jun 2020

Swiss Francs

129

Jan 2020 - Aug 2020

Total

_________________________________________________

(1)The notional amount represents the net amount of foreign currency that will be received upon maturity of the forward contracts.

- Definition

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4B
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Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
-Topic 815
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Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
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-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=109980867&loc=d3e41620-113959

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=109980867&loc=SL5579245-113959

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
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-Section 50
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Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
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Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(n)(2))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=109980867&loc=SL5579240-113959

+ Details

Fair Value Measurements

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

Assets and liabilities measured at fair value at each balance sheet date are as follows (in thousands):


	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	54,163	$	—	$	—	$	54,163
U.S. government treasuries	15,989		—		—		15,989

Short-term marketable securities:
U.S. government treasuries	250,070		—		—		250,070
U.S. government agency securities	—		2,000		—		2,000
Corporate debt securities	—		53,479		—		53,479
Commercial paper	—		30,358		—		30,358
Long-term marketable securities:
U.S. government treasuries	13,869		—		—		13,869

Corporate debt securities	—		26,017		—		26,017
Foreign currency derivative contracts	—		85		—		85
Total	$	334,091	$	111,939	$	—	$	446,030
Liabilities:
Foreign currency derivative contracts	$	—	$	8	$	—	$	8
Total	$	—	$	8	$	—	$	8


	December 31, 2018
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents
Money market funds	$	42,225	$	—	$	—	$	42,225
U.S. government treasuries	1,499		—		—		1,499
Commercial paper	—		9,979		—		9,979
Short-term marketable securities:
U.S. government treasuries	219,754		—		—		219,754
U.S. government agency securities	—		73,151		—		73,151
Corporate debt securities	—		71,675		—		71,675
Commercial paper	—		22,594		—		22,594
Long-term marketable securities:
U.S. government treasuries	117,131		—		—		117,131
U.S. government agency securities	—		1,977		—		1,977
Corporate debt securities	—		28,773		—		28,773
Foreign currency derivative contracts	—		14		—		14
Total	$	380,609	$	208,163	$	—	$	588,772
Liabilities:
Foreign currency derivative contracts	$	—	$	182	$	—	$	182
Total	$	—	$	182	$	—	$	182

The carrying amounts of prepaid expenses and other current assets, accounts payable and accrued liabilities approximate their fair values due to their short-term maturities.

The Company’s Level 2 securities are valued using third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly.

There were no transfers of assets or liabilities between the fair value measurement levels during the years ended December 31, 2019 or 2018.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Derivative Financial Instruments

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Foreign Currency Exchange Rate Exposure

The Company uses forward foreign currency exchange contracts to hedge certain operational exposures resulting from potential changes in foreign currency exchange rates. Such exposures result from portions of the Company's forecasted cash flows being denominated in currencies other than the U.S. dollar, primarily the Euro and British Pound. The derivative instruments the Company uses to hedge this exposure are not designated as cash flow hedges, and as a result, changes in their fair value are recorded in interest and other income, net, on the Company's Consolidated Statements of Operations and Comprehensive Loss.

The fair values of forward foreign currency exchange contracts are estimated using current exchange rates and interest rates and take into consideration the current creditworthiness of the counterparties. Information regarding the specific instruments used by the Company to hedge its exposure to foreign currency exchange rate fluctuations is provided below. The Company did not have foreign currency exchange contracts prior to June 2018.

The following table summarizes the Company’s forward foreign currency exchange contracts outstanding as of December 31, 2019 (notional amounts in thousands):

Foreign Exchange Contracts

Number of Contracts

Aggregate Notional⁽¹⁾ Amount in Foreign Currency

Maturity

Euros

1,500

Jan 2020 - Nov 2020

British Pounds

2,285

Jan 2020 - Jun 2020

Swiss Francs

129

Jan 2020 - Aug 2020

Total

_________________________________________________

(1)The notional amount represents the net amount of foreign currency that will be received upon maturity of the forward contracts.

An immaterial derivative liability balance is recorded in other current liabilities on the Consolidated Balance Sheet as of December 31, 2019, and a derivative liability balance of $0.2 million is recorded in other current liabilities on the Consolidated Balance Sheet as of December 31, 2018. Immaterial derivative asset balances are recorded in prepaid assets and other current assets on the Consolidated Balance Sheets as of December 31, 2019 and 2018. A net gain of $0.2 million, and a net loss of $0.2 million, each associated with the Company's derivative instruments, are recognized in interest and other income, net on the Consolidated Statement of Operations and Comprehensive Loss for the years ended December 31, 2019 and 2018, respectively.

Stock-Based Awards - Summary of Assumptions Used for Estimating the Fair Value of Stock Options Granted (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)			6 years 29 days
Volatility, minimum	65.50%	79.40%	81.90%
Volatility, maximum	77.80%	87.40%	91.30%
Risk-free interest rate, minimum	1.50%	2.60%	1.80%
Risk-free interest rate, maximum	2.60%	3.10%	2.30%
Dividend yield	0.00%	0.00%	0.00%
Minimum \| Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	5 years 6 months	5 years 6 months
Maximum \| Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 29 days	6 years 29 days

Collaboration Agreements - Sanofi (Details) $ in Thousands		1 Months Ended	3 Months Ended								12 Months Ended			15 Months Ended
Collaboration Agreements - Sanofi (Details) $ in Thousands	Nov. 20, 2018 USD ($)	Aug. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2019 USD ($)	Oct. 31, 2018 indication	Oct. 29, 2018
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Number of indications \| indication															3
Milestones recognized			$ 4,672	$ 13,604	$ 4,197	$ 4,205	$ 125,676	$ 1,195	$ 1,648	$ 641	$ 26,678	$ 129,160	$ 0
Collaborative Arrangement \| Sanofi
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Upfront payment	$ 125,000
Milestone payments upon achievement of certain clinical, regulatory and sales milestone events	1,100,000
Funded percentage																70.00%
Receivable			$ 1,200				$ 2,300				1,200	2,300		$ 1,200
Transaction price increase											20,400	2,300
Proceeds for milestone		$ 10,000										0
Milestones recognized											10,000
Collaborative Arrangement \| Sanofi \| Retained Activities
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Transaction price increase											$ 10,400	$ 2,300
Collaborative Arrangement \| Sanofi \| CNS Product
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Clinical and regulatory milestone payments	215,000
Regulatory milestone payment	385,000
Collaborative Arrangement \| Sanofi \| Peripheral Product
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Regulatory milestone payment	175,000
Clinical, regulatory and commercial milestone payments	120,000
Commercial milestone payments	$ 200,000
Collaborative Arrangement \| Sanofi \| Product
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestones recognized														0
Collaborative Arrangement \| Sanofi \| Milestone Triggered
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Transaction price increase														$ 10,000
Collaborative Arrangement \| Denali
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Funded percentage																30.00%

Collaboration Agreements (Tables)

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Collaboration Revenue

Revenue disaggregated by collaboration agreement and performance obligation is as follows (in thousands):


	Year Ended December 31,
	2019		2018
Takeda Collaboration Agreement⁽¹⁾	$	5,926	$	5,677
Sanofi Collaboration Agreement:
CNS Program License	—		73,932
Peripheral Program License	10,000		47,148
Alzheimer's Disease Services⁽¹⁾	358		60
Retained Activities	10,394		2,343
Total Sanofi Collaboration Revenue	20,752		123,483
Total Collaboration Revenue	$	26,678	$	129,160

_________________________________________________

Stock-Based Awards - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended				12 Months Ended
	Dec. 31, 2017	Nov. 30, 2015	Aug. 31, 2015	May 31, 2015	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Jan. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of options exercised					$ 13,100	$ 9,800	$ 3,500
Weighted average grant date fair value of options vested (usd per share)					$ 10.09	$ 3.85	$ 1.94
Estimated fair value of option (usd per share)					$ 11.86	$ 14.79	$ 6.41
Dividends paid					$ 0
Dividend yield					0.00%
Stock options granted (in shares)					3,610,835
Exercise price (usd per share)					$ 4.27
Share based compensation cost recognized					$ 38,378	$ 18,791	$ 4,409
General and Administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation cost recognized					19,117	8,698	1,557
Research and Development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation cost recognized					$ 19,261	$ 10,093	2,852
Performance and Market Contingent Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted (in shares)		100,000	1,600,000
Exercise price (usd per share)		$ 0.68	$ 0.68
Vesting trigger, number of consecutive trading days					90 days
Vesting trigger, number of days after IPO					180 days
Share based compensation cost not recognized					$ 300
Period of recognition					9 months
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unamortized stock- based compensation expense related to unvested stock options					$ 13,700
Intrinsic value of units expected to vest					$ 15,400
Expected weighted average period					3 years 2 months 12 days
Weighted-average fair value at date of grant per share, granted (usd per share)					$ 18.86	$ 15.92
Fair value of units vested					$ 8,800	$ 37,000	$ 14,300
2017 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance (in shares)	1,000,000.0						1,000,000.0
Number of additional shares allowable under the plan (in shares)	2,000,000.0						2,000,000.0	1,000,000.0
Percent of outstanding shares (as a percentage)	1.00%
Common stock purchase discounted rate for employees	85.00%
Maximum employee contribution to ESPP, percent of base compensation	15.00%						15.00%
Stock issued during period (in shares)					200,000	100,000
Options Issued and Outstanding and ESPP Shares Issuable and Outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield					0.00%	0.00%	0.00%
Unamortized stock- based compensation expense related to unvested stock options					$ 76,200
Expected weighted average period					2 years 8 months 12 days
2017 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance (in shares)	6,400,000						6,400,000
Number of additional shares allowable under the plan (in shares)	10,000,000.0						10,000,000.0	4,800,000
Percent of outstanding shares (as a percentage)	5.00%
Number of shares available for grant (in shares)					3,400,000	2,300,000
2015 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for issuance (in shares)				8,300,000
Number of shares available for grant (in shares)	0						0
Shares Transferred As Available For Issuance From 2015 Plan to 2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant (in shares)	200,000						200,000
Maximum \| Performance and Market Contingent Stock Options \| General and Administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation cost not recognized					$ 5,200
Maximum \| Performance and Market Contingent Stock Options \| Research and Development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation cost not recognized					$ 500
Maximum \| 2017 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award expiration period	10 years
Maximum \| 2015 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award expiration period				10 years
Minimum \| 2017 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of option price of estimated fair value on grant date	100.00%
Award vesting period	4 years
Minimum \| 2015 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of option price of estimated fair value on grant date				100.00%
Award vesting period				4 years

Cash and Marketable Securities (Tables)

12 Months Ended

Dec. 31, 2019

Cash and Cash Equivalents [Abstract]

Schedule of Restricted Cash and Cash Equivalents

A reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance Sheets to the amount reported within the Consolidated Statements of Cash Flows is shown in the table below (in thousands):


	December 31, 2019		December 31, 2018		December 31, 2017
Cash and cash equivalents	$	79,449	$	77,123	$	218,375
Restricted cash included within prepaid expenses and other current assets	—		—		84
Restricted cash included within other non-current assets	1,500		1,500		451
Total cash, cash equivalents, and restricted cash	$	80,949	$	78,623	$	218,910

Schedule of Cash and Cash Equivalents


	December 31, 2019		December 31, 2018		December 31, 2017
Cash and cash equivalents	$	79,449	$	77,123	$	218,375
Restricted cash included within prepaid expenses and other current assets	—		—		84
Restricted cash included within other non-current assets	1,500		1,500		451
Total cash, cash equivalents, and restricted cash	$	80,949	$	78,623	$	218,910

Summary of Available for Sale Securities

The amortized cost, gross unrealized holding gains or losses, and fair value of the Company’s marketable securities by major security type at each balance sheet date are summarized in the tables below (in thousands):


	December 31, 2019
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Aggregate Fair Value
Short-term marketable securities:
U.S. government treasuries	$	249,478	$	594	$	(2)	$	250,070
U.S. government agency securities	1,999		1		—		2,000
Corporate debt securities	53,396		94		(11)		53,479

Commercial paper	30,358		—		—		30,358
Total short-term marketable securities	335,231		689		(13)		335,907
Long-term marketable securities:
U.S. government treasuries	13,865		6		(2)		13,869

Corporate debt securities	25,998		34		(15)		26,017
Total long-term marketable securities	39,863		40		(17)		39,886
Total	$	375,094	$	729	$	(30)	$	375,793


	December 31, 2018
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Aggregate Fair Value
Short-term marketable securities:
U.S. government treasuries	$	220,081	$	29	$	(356)	$	219,754
U.S. government agency securities	73,373		—		(222)		73,151
Corporate debt securities	71,940		1		(266)		71,675
Commercial paper	22,594		—		—		22,594
Total short-term marketable securities	387,988		30		(844)		387,174
Long-term marketable securities:
U.S. government treasuries	116,878		329		(76)		117,131
U.S. government agency securities	1,975		2		—		1,977
Corporate debt securities	28,864		8		(99)		28,773
Total long-term marketable securities	147,717		339		(175)		147,881
Total	$	535,705	$	369	$	(1,019)	$	535,055

Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($)
Series B-2 Convertible Preferred Stock
Convertible preferred stock issuance cost	$ 73
Common Stock
Common stock issuance costs	$ 23,612

Cash and Marketable Securities - Summary of Available for Sale Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 375,094	$ 535,705
Unrealized Holding Gains	729	369
Unrealized Holding Losses	(30)	(1,019)
Aggregate Fair Value	375,793	535,055
Short-term marketable securities:
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	335,231	387,988
Unrealized Holding Gains	689	30
Unrealized Holding Losses	(13)	(844)
Aggregate Fair Value	335,907	387,174
Short-term marketable securities: \| U.S. government treasuries
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	249,478	220,081
Unrealized Holding Gains	594	29
Unrealized Holding Losses	(2)	(356)
Aggregate Fair Value	250,070	219,754
Short-term marketable securities: \| U.S. government agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	1,999	73,373
Unrealized Holding Gains	1	0
Unrealized Holding Losses	0	(222)
Aggregate Fair Value	2,000	73,151
Short-term marketable securities: \| Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	53,396	71,940
Unrealized Holding Gains	94	1
Unrealized Holding Losses	(11)	(266)
Aggregate Fair Value	53,479	71,675
Short-term marketable securities: \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	30,358	22,594
Unrealized Holding Gains	0	0
Unrealized Holding Losses	0	0
Aggregate Fair Value	30,358	22,594
Long-term marketable securities:
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	39,863	147,717
Unrealized Holding Gains	40	339
Unrealized Holding Losses	(17)	(175)
Aggregate Fair Value	39,886	147,881
Long-term marketable securities: \| U.S. government treasuries
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	13,865	116,878
Unrealized Holding Gains	6	329
Unrealized Holding Losses	(2)	(76)
Aggregate Fair Value	13,869	117,131
Long-term marketable securities: \| U.S. government agency securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost		1,975
Unrealized Holding Gains		2
Unrealized Holding Losses		0
Aggregate Fair Value		1,977
Long-term marketable securities: \| Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	25,998	28,864
Unrealized Holding Gains	34	8
Unrealized Holding Losses	(15)	(99)
Aggregate Fair Value	$ 26,017	$ 28,773

Stock-Based Awards (Tables)

12 Months Ended

Dec. 31, 2019

Share-based Payment Arrangement [Abstract]

Summary of Stock Option Activity

The following table summarizes option award activity under the 2017 Plan and the 2015 Plan:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average remaining contractual life (years)	Aggregate Intrinsic Value (in thousands)
Balance at December 31, 2018	9,612,652	$	10.49	8.20	$	97,804
Options granted	3,610,835	18.58
Options exercised	(786,638)	4.27
Options forfeited	(796,115)	16.72
Balance at December 31, 2019	11,640,734	$	12.96	7.79	$	51,879
Options vested and expected to vest at December 31, 2019	9,896,002	$	15.13	8.17	$	22,672
Options exercisable at December 31, 2019	3,938,523	$	11.19	7.38	$	24,552

Summary of Assumptions Used for Estimating the Fair Value of Stock Granted

Stock Options Granted to Employees with Service-Based Vesting

The estimated fair value of stock options granted to employees were calculated using the Black-Scholes option-pricing model using the following assumptions:


	Year Ended December 31,
	2019	2018	2017
Expected term (in years)	5.50 - 6.08	5.50 - 6.08	6.08
Volatility	65.5% - 77.8%	79.4% - 87.4%	81.9% - 91.3%
Risk-free interest rate	1.5% - 2.6%	2.6% - 3.1%	1.8% - 2.3%
Dividend yield	—	—	—

Restricted Stock Activity

Aggregated information regarding RSAs and RSUs granted under the Plan for the year ended December 31, 2019 is summarized below:


	Share Awards & Units	Weighted-Average Fair Value at Date of Grant per Share




Unvested at December 31, 2018	503,243	$	4.86
Granted	850,234	18.86
Vested and released	(419,064)	2.63
Forfeited	(51,777)	20.50
Unvested at December 31, 2019	882,636	$	18.67
Expected to vest – December 31, 2019	882,636	$	18.67

Summary of Assumptions Used for Estimating the Fair Value of Stock Purchase Rights Granted in ESPP

The estimated fair value of stock purchase rights granted under the ESPP were calculated using the Black-Scholes option-pricing model using the following assumptions:


	Year Ended December 31,
	2019	2018	2017
Expected term (in years)	0.50 - 1.00	0.50 - 1.00	0.48 - 0.98
Volatility	47.6% - 59.1%	61.0% - 64.3%	50.0% - 51.3%
Risk-free interest rate	1.6% - 2.4%	2.1% - 2.7%	1.5% - 1.7%
Dividend yield	—	—	—

Summary of Stock-Based Compensation Expense

The Company’s results of operations include expenses relating to stock-based compensation as follows (in thousands):


	Year Ended December 31,
	2019		2018		2017
Research and development	$	19,261	$	10,093	$	2,852
General and administrative	19,117		8,698		1,557
Total	$	38,378	$	18,791	$	4,409

Derivative Financial Instruments - Summary of Forward Foreign Currency Exchange Contracts Outstanding (Details) - Designated as Hedging Instrument € in Thousands, £ in Thousands, SFr in Thousands	Dec. 31, 2019 EUR (€) derivative_instrument	Dec. 31, 2019 GBP (£) derivative_instrument	Dec. 31, 2019 CHF (SFr) derivative_instrument
Foreign Exchange Forward - Euros
Derivative [Line Items]
Number of Contracts	23	23	23
Aggregate Notional Amount in Foreign Currency \| €	€ 1,500
Foreign Exchange Forward - British Pounds
Derivative [Line Items]
Number of Contracts	15	15	15
Aggregate Notional Amount in Foreign Currency \| £		£ 2,285
Foreign Exchange Forward - Swiss Francs
Derivative [Line Items]
Number of Contracts	10	10	10
Aggregate Notional Amount in Foreign Currency \| SFr			SFr 129
Foreign Exchange Contracts
Derivative [Line Items]
Number of Contracts	48	48	48

Income Taxes - Effective Tax Rate Reconciliation (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Taxes at the U.S. statutory tax rate	21.00%	21.00%	34.00%
Effect of Tax Act	0.00%	0.00%	(26.60%)
Change in valuation allowance	(24.40%)	(20.70%)	(7.30%)
Research tax credits	3.50%	10.20%	1.00%
Stock-based compensation	0.10%	(0.70%)	(1.00%)
Nondeductible acquisition-related costs	0.00%	(9.50%)	0.00%
Other	(0.10%)	(0.30%)	(0.10%)
Total provision for income taxes	0.10%	0.00%	0.00%

Significant Accounting Policies - Narrative (Details)			12 Months Ended
Significant Accounting Policies - Narrative (Details)	Dec. 07, 2017 USD ($) $ / shares shares	Nov. 28, 2017 shares	Dec. 31, 2019 USD ($) Segment contract shares	Jan. 01, 2019 USD ($)	Dec. 31, 2018 USD ($) shares
Significant Accounting Policies [Line Items]
Common stock, shares authorized (in shares) \| shares	400,000,000		400,000,000		400,000,000
Convertible preferred stock, shares authorized (in shares) \| shares	40,000,000		40,000,000		40,000,000
Off-balance sheet concentrations of credit risk \| $			$ 0		$ 0
Number of operating segments \| Segment			1
Number of financing leases \| contract			0
Right of use asset \| $			$ 33,923,000
Lease liabilities \| $			$ 72,530,000
IPO
Significant Accounting Policies [Line Items]
Shares sold during initial public offering (shares) \| shares	15,972,221
Share price (usd per share) \| $ / shares	$ 18.00
Proceeds from issuance of common stock, net of underwriting discounts and commissions and offering expenses \| $	$ 264,300,000
Convertible preferred stock converted into shares of common stock (in shares) \| shares	60,365,020
Amount reclassified to common stock and additional paid-in capital \| $	$ 378,600,000
Over-Allotment Option
Significant Accounting Policies [Line Items]
Shares sold during initial public offering (shares) \| shares	2,083,333
Common Stock
Significant Accounting Policies [Line Items]
Reverse stock split (in shares) \| shares		4
Convertible Preferred Stock
Significant Accounting Policies [Line Items]
Reverse stock split (in shares) \| shares		4
Accounting Standards Update 2016-02
Significant Accounting Policies [Line Items]
Right of use asset \| $				$ 46,100,000
Lease liabilities \| $				$ 71,300,000

Balance Sheet Components - Property and Equipment, Net (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 59,005	$ 37,172
Less: accumulated depreciation	(12,273)	(12,010)
Total property and equipment, net	46,732	25,162
Depreciation expense	7,991	7,415	$ 3,082
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	21,846	14,352
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	34,563	22,288
Computers equipment and purchased software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,156	458
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,440	$ 74

Stock-Based Awards - Summary of Assumptions Used for Estimating the Fair Value of Stock Purchase Rights Granted in ESPP (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield	0.00%
Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility, minimum	47.60%	61.00%	50.00%
Volatility, maximum	59.10%	64.30%	51.30%
Risk-free interest rate, minimum	1.60%	2.10%	1.50%
Risk-free interest rate, maximum	2.40%	2.70%	1.70%
Dividend yield	0.00%	0.00%	0.00%
Employee Stock Purchase Plan \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 months	6 months	5 months 23 days
Employee Stock Purchase Plan \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	1 year	1 year	11 months 23 days

Cash and Marketable Securities

12 Months Ended

Dec. 31, 2019

Cash and Cash Equivalents [Abstract]

Cash and Marketable Securties

Cash and Marketable Securities

Cash, cash equivalents and restricted cash


	December 31, 2019		December 31, 2018		December 31, 2017
Cash and cash equivalents	$	79,449	$	77,123	$	218,375
Restricted cash included within prepaid expenses and other current assets	—		—		84
Restricted cash included within other non-current assets	1,500		1,500		451
Total cash, cash equivalents, and restricted cash	$	80,949	$	78,623	$	218,910

Marketable securities

All marketable securities were considered available-for-sale at December 31, 2019 and 2018. On a recurring basis, the Company records its marketable securities at fair value using Level 1 or Level 2 inputs as discussed in Note 2, "Fair Value Measurements". The amortized cost, gross unrealized holding gains or losses, and fair value of the Company’s marketable securities by major security type at each balance sheet date are summarized in the tables below (in thousands):


	December 31, 2019
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Aggregate Fair Value
Short-term marketable securities:
U.S. government treasuries	$	249,478	$	594	$	(2)	$	250,070
U.S. government agency securities	1,999		1		—		2,000
Corporate debt securities	53,396		94		(11)		53,479

Commercial paper	30,358		—		—		30,358
Total short-term marketable securities	335,231		689		(13)		335,907
Long-term marketable securities:
U.S. government treasuries	13,865		6		(2)		13,869

Corporate debt securities	25,998		34		(15)		26,017
Total long-term marketable securities	39,863		40		(17)		39,886
Total	$	375,094	$	729	$	(30)	$	375,793


	December 31, 2018
	Amortized Cost		Unrealized Holding Gains		Unrealized Holding Losses		Aggregate Fair Value
Short-term marketable securities:
U.S. government treasuries	$	220,081	$	29	$	(356)	$	219,754
U.S. government agency securities	73,373		—		(222)		73,151
Corporate debt securities	71,940		1		(266)		71,675
Commercial paper	22,594		—		—		22,594
Total short-term marketable securities	387,988		30		(844)		387,174
Long-term marketable securities:
U.S. government treasuries	116,878		329		(76)		117,131
U.S. government agency securities	1,975		2		—		1,977
Corporate debt securities	28,864		8		(99)		28,773
Total long-term marketable securities	147,717		339		(175)		147,881
Total	$	535,705	$	369	$	(1,019)	$	535,055

As of December 31, 2019 and 2018, some of the Company’s marketable securities were in an unrealized loss position. The Company determined that it had the ability and intent to hold all marketable securities that have been in a continuous loss position until maturity or recovery, thus there was no recognition of any other-than-temporary impairment as of December 31, 2019 or 2018. All marketable securities with unrealized losses as of each balance sheet date have been in a loss position for less than twelve months or the loss is not material.

The Company recorded unrealized gains on marketable securities as other comprehensive income in the year ended December 31, 2019. As a result, the Company recorded a tax benefit of $0.4 million for the year ended December 31, 2019 on the Consolidated Statements of Operations and Comprehensive Loss and a corresponding tax charge in other comprehensive income. There were no unrealized gains in other comprehensive income during in the years ended 2018, or 2017, and as such there was no tax benefit recorded for the years ended December 31, 2018 and 2017 on the Consolidated Statements of Operations and Comprehensive Loss.

All of the Company’s marketable securities have an effective maturity of less than two years.

Significant Accounting Policies - Property and Equipment, Net (Details)	12 Months Ended
	Dec. 31, 2019
Lab equipment
Property, Plant and Equipment [Line Items]
Useful life term (in years)	5 years
Computers equipment and purchased software
Property, Plant and Equipment [Line Items]
Useful life term (in years)	3 years
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Useful life term (in years)	5 years

Net Loss and Net Loss Per Share - Schedule of Dilutive Securities Not Included in Diluted Per Share Calculations (Details) - shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (shares)	12,804,070	10,428,261	9,498,897
Options issued and outstanding and ESPP shares issuable
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (shares)	11,921,434	9,789,594	6,835,313
Restricted shares subject to future vesting
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (shares)	882,636	503,243	2,293,788
Early exercised common stock subject to future vesting
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities (shares)	0	135,424	369,796

Defined Contribution Plan - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Contribution expenses	$ 1.6	$ 0.9	$ 0.5

Balance Sheet Components (Tables)

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Property and Equipment, Net

Property and equipment, net consists of the following (in thousands):


	As of December 31,
	2019		2018
Lab equipment	$	21,846	$	14,352
Leasehold improvements	34,563		22,288
Computers equipment and purchased software	1,156		458
Furniture and fixtures	1,440		74
Total property and equipment	59,005		37,172
Less: accumulated depreciation	(12,273)		(12,010)
Total property and equipment, net	$	46,732	$	25,162

Schedule of Accrued Expenses and Other Current Liabilities

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consists of the following (in thousands):


	As of December 31,
	2019		2018
Accrued compensation	$	8,739	$	9,952
Accrued clinical costs	5,042		2,091
Accrued manufacturing and other research & development costs	5,251		4,179
Accrued general, administrative and shared costs	1,310		2,250
Deferred rent, current	—		616
Operating lease liability, current	3,665		—
Other current liabilities	8		380
Total accrued expenses and other current liabilities	$	24,015	$	19,468

Acquisition	12 Months Ended
Acquisition	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Acquisition	Acquisition In August 2016, the Company entered into a License and Collaboration Agreement (“F-star Collaboration Agreement”) with F-star Gamma Limited (“F-star Gamma”), F-star Biotechnologische Forschungs-Und Entwicklungsges M.B.H ("F-star GmbH") and F-star Biotechnology Limited ("F-star Ltd") (collectively, “F-star”) to leverage F-star’s modular antibody technology and the Company’s expertise in the development of therapies for neurodegenerative diseases. Under the F-star Collaboration Agreement, the Company made payments to F-star totaling $11.5 million. In connection with the entry into the F-star Collaboration Agreement, the Company also purchased an option for an upfront option fee of $0.5 million (the “buy-out-option”), to acquire all of the outstanding shares of F-star Gamma pursuant to a pre-negotiated buy-out option agreement (the “Option Agreement”). In May 2018, the Company exercised the Option Agreement and entered into a Share Purchase Agreement (the “Purchase Agreement”) with the shareholders of F-star Gamma and Shareholder Representative Services LLC, pursuant to which the Company acquired all of the outstanding shares of F-star Gamma (the “Acquisition”). As a result of the Acquisition, F-star Gamma became a wholly-owned subsidiary of the Company and the Company changed the entity’s name to Denali BBB Holding Limited. In addition, the Company became a direct licensee of certain intellectual property of F-star Ltd by way of the Company’s assumption of F-star Gamma’s license agreement with F-star Ltd, dated August 24, 2016, (the “F-star Gamma License”). The Company made initial exercise payments under the Purchase Agreement and the F-star Gamma License, in the aggregate, of $17.8 million. In addition, the Company is required to make future contingent payments, to F-star Ltd and the former shareholders of F-star Gamma, up to a maximum amount of $447.0 million in the aggregate upon the achievement of certain defined preclinical, clinical, regulatory and commercial milestones. These include up to $27.0 million in preclinical contingent payments, $50.0 million in clinical contingent payments, $120.0 million in regulatory contingent payments and $250.0 million in commercial contingent payments. The amount of the contingent payments will vary based on whether F-star delivers an Fcab (constant Fc-domains with antigen-binding activity) that meets pre-defined criteria and whether the Fcab has been identified solely by the Company or solely by F-star or jointly by the Company and F-star. In June 2019, the Company made a payment of $1.5 million to F-star Ltd upon the achievement of a specified preclinical milestone in the Company's ETV:IDS program. The Company concluded that the assets acquired and liabilities assumed upon the exercise of the Option Agreement did not meet the accounting definition of a business, and as such, the acquisition was accounted for as an asset purchase. The Company recognized $1.5 million and $18.3 million of contingent consideration as research and development expense in the years ended December 31, 2019 and 2018 respectively. As the transaction was accounted for as an asset purchase rather than a business combination, the Company did not recognize any contingent consideration on the acquisition date. Further future contingent consideration is expected to be recognized in research and development expense as incurred. Under the F-star Collaboration Agreement, the Company is responsible for certain research costs incurred by F-star Ltd in conducting activities under an agreed development plan for each Fcab, for up to 24 months after the target Fcab is accepted. The Company's responsibility for research costs under the first development plan related to an Fcab that targets the transferrin receptor was completed during the year ended December 31, 2018. The responsibility for costs under the second development plan related to an undisclosed Fcab target commenced in February 2019. The Company recognized $1.1 million, $0.8 million, and $1.1 million in research and development expense related to the funding of F-star activities under these development plans during the years ended December 31, 2019, 2018, and 2017, respectively.

Derivative Instruments and Hedging Activities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative liability	$ 8	$ 182
Net gain (loss) on derivative instruments	$ 200	$ (200)