Denali Therapeutics Announces Closing of Collaboration and Share Purchase Agreements with Biogen

SOUTH SAN FRANCISCO, Calif., Oct. 07, 2020 (GLOBE NEWSWIRE) -- Denali Therapeutics Inc. (NASDAQ: DNLI), a biopharmaceutical company developing a broad portfolio of product candidates engineered to cross the blood-brain barrier (BBB) for neurodegenerative diseases, today announced the signing of a Definitive LRRK2 Collaboration and License Agreement and a Right of First Negotiation, Option and License Agreement with Biogen, in connection with its previously announced binding provisional collaboration and license agreement for neurodegenerative diseases with Biogen, and the closing of the related common stock purchase agreement.

In connection with the signing of the agreements with Biogen, Denali will receive a $560 million upfront payment. In addition, on September 22, 2020, in a private placement transaction, Biogen made an equity investment of $465 million in Denali through the purchase of 13,310,243 newly issued shares of Denali common stock at approximately $34.94 per share in connection with its previously announced stock purchase agreement.

Under the terms of the Definitive LRRK2 Collaboration and License Agreement, the companies will co-develop Denali’s small molecule inhibitors of leucine-rich repeat kinase 2 (LRRK2) for Parkinson’s disease, and will co-commercialize Denali’s LRRK2 products in the United States and China, with shared responsibility for worldwide development costs (60 percent Biogen; 40 percent Denali), as well as profits and losses for commercialization in the United States (50 percent Biogen; 50 percent Denali) and China (60 percent Biogen; 40 percent Denali). Outside the United States and China, Biogen will be responsible for commercialization and will pay Denali tiered royalties. Should the LRRK2 program achieve certain development and commercial milestones, Denali will be eligible to receive up to $1.125 billion in potential milestone payments.

Mutations in LRRK2 can cause Parkinson’s disease. LRRK2 is a regulator of lysosomal function, which is impaired in Parkinson’s disease and may contribute to neurodegeneration. As previously announced, Denali’s small molecule inhibitor of LRRK2, DNL151, has been selected to progress into late-stage clinical studies, which are expected to commence in 2021.

Under the terms of the Right of First Negotiation, Option and License Agreement with Biogen, Biogen has exclusive option rights to two programs for neurodegenerative diseases using Denali’s BBB-crossing transport vehicle (TV) technology platform, including for amyloid beta, plus right of first negotiation for two additional unnamed TV platform programs should Denali decide to seek a collaboration for such programs. These rights are limited to certain modalities and indications and are also exercisable during a limited time period. Denali’s proprietary TV technology is designed to effectively deliver large therapeutic molecules such as antibodies, enzymes, proteins and oligonucleotides across the BBB after intravenous administration.