RARE Daily

Denali Raises $500 Million in PIPE, Spins Out Small Molecule Pipeline

February 27, 2024

Rare Daily Staff

Denali Therapeutics, a company developing a portfolio of therapeutics engineered to cross the blood-brain barrier for the treatment of neurodegenerative and lysosomal storage diseases, raised $500 million through a private investment in public equity financing.

At the same time, the company said it plans to spin out the its preclinical small molecule portfolio as part of a reorganization.

Denali will maintain ownership of and continue to advance its current portfolio of clinical stage small molecule programs. The decision was made based on clinical validation and prioritization of Denali’s Transport Vehicle (TV)-enabled platforms for brain delivery of large molecules.

The reorganization includes laying off an undisclosed number of workers and sending some to the new small molecule spinout, which according to Fierce Biotech was less than 10 percent.

Proceeds from the financing are expected to be used to support Denali’s ongoing research and development activities, the acceleration and expansion of its proprietary BBB-crossing TV technology, as well as general corporate purposes and working capital.

“Earlier this year, we announced that our future therapeutic portfolio will focus on large molecule biotherapeutics designed to cross the blood-brain barrier using our Transport Vehicle technology,” said Ryan Watts, CEO of Denali Therapeutics. “The investment we are announcing today reflects the depth and breadth of our current clinical portfolio and the promise of the Transport Vehicle technology to transform the treatment of neurodegenerative and lysosomal storage diseases.”

Subsequent to the closing of this financing, Denali expects its cash, cash equivalents, and investments to be approximately $1.5 billion on February 29, 2024.

Photo: Ryan Watts, CEO of Denali Therapeutics

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