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Denali Therapeutics Reports First Quarter 2019 Financial Results

May 08, 2019
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SOUTH SAN FRANCISCO – May 8, 2019 – Denali Therapeutics Inc. (NASDAQ: DNLI), a biopharmaceutical company developing a broad portfolio of product candidates for neurodegenerative diseases, today reported financial results for the first quarter ended March 31, 2019.

First Quarter 2019 Financial Results

For the three months ended March 31, 2019, Denali reported a net loss of $39.0 million compared with a net loss of $23.7 million for the three months ended March 31, 2018.

Collaboration revenue was $4.2 million for the three months ended March 31, 2019, compared with collaboration revenue of $0.6 million for the three months ended March 31, 2018. The increase was due to $3.5 million of revenue recognized under the Sanofi Collaboration Agreement in the three months ended March 31, 2019.

Total research and development expenses were $37.4 million for the three months ended March 31, 2019, including non-cash stock-based compensation of $4.0 million, compared to $20.8 million for the three months ended March 31, 2018, including non-cash stock-based compensation of $1.7 million. The increase in total research and development expenses of $16.6 million was primarily attributable to increases in personnel-related expenses, including non-cash stock-based compensation, driven primarily by higher headcount and new option grants. Further, there were increases in external research and development expenses, reflecting both the progress of Denali's most advanced programs and increased investment in growing and developing its pipeline, and facilities-related expenses primarily due to rent expense.

General and administrative expenses were $9.3 million for the three months ended March 31, 2019, including non-cash stock-based compensation of $2.9 million, compared to $5.6 million for the three months ended March 31, 2018, including non-cash stock-based compensation of $1.2 million. The increase in total general and administrative expenses of $3.7 million was primarily attributable to an increase in personnel-related expenses, including non-cash stock-based compensation, driven primarily by higher headcount and new option grants. Further, there were increases in legal and professional services expenses required to support Denali's ongoing operations as a public company, and facilities-related expenses primarily due to rent expense.

Cash, cash equivalents, and marketable securities were $583.0 million as of March 31, 2019.

About Denali Therapeutics

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



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

Three Months Ended March 31,

2019

2018

Collaboration revenue

$

4,205

$

641

Operating expenses:

Research and development

37,403

20,819

General and administrative

9,310

5,570

Total operating expenses

46,713

26,389

Loss from operations

(42,508)

(25,748)

Interest and other income, net

3,516

2,070

Net loss

$

(38,992)

$

(23,678)

Net loss per share, basic and diluted

$

(0.41)

$

(0.26)

Weighted average number of shares outstanding, basic and diluted

94,984,503

89,560,576

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

March 31, 2019

December 31, 2018

Assets

Current assets:

Cash and cash equivalents

$

39,661

$

77,123

Short-term marketable securities

445,820

387,174

Prepaid expenses and other current assets

14,052

16,539

Total current assets

499,533

480,836

Long-term marketable securities

97,554

147,881

Property and equipment, net

36,955

25,162

Operating lease right-of-use asset

34,407

Other non-current assets

8,147

8,105

Total assets

$

676,596

$

661,984

Liabilities and stockholders' equity

Current liabilities:

Accounts payable

$

3,662

$

1,891

Accrued liabilities

12,114

8,520

Accrued compensation

3,213

9,952

Contract liabilities

23,148

11,427

Other current liabilities

1,107

996

Total current liabilities

43,244

32,786

Contract liabilities, less current portion

44,852

57,350

Operating lease liability, less current portion

71,412

Deferred rent, less current portion

24,532

Other non-current liabilities

440

471

Total liabilities

159,948

115,139

Total stockholders' equity

516,648

546,845

Total liabilities and stockholders’ equity

$

676,596

$

661,984

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