Denali Therapeutics Announces $500 million Private Placement Equity Financing
February 27 2024 - 7:00AM
Denali Therapeutics Inc. (Nasdaq: DNLI), a biopharmaceutical
company developing a broad portfolio of product candidates
engineered to cross the blood-brain barrier (BBB) for the treatment
of neurodegenerative diseases and lysosomal storage diseases, today
announced that the company has entered into a securities purchase
agreement with certain existing accredited investors to issue and
sell an aggregate of 3,244,689 shares of its common stock at a
price of $17.07 per share and pre-funded warrants to purchase
26,046,065 shares of common stock at a purchase price of $17.06 per
pre-funded warrant share, through a private investment in public
equity (PIPE) financing. The pre-funded warrants will have an
exercise price of $0.01 per share of common stock, be immediately
exercisable, and remain exercisable until exercised in full. Denali
anticipates the gross proceeds from the PIPE to be approximately
$500 million. The financing is expected to close on February 29,
2024, subject to customary closing conditions. 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 Transport Vehicle (TV) technology,
as well as general corporate purposes and working capital.
The financing was led by a U.S.-based healthcare-focused
investor, with participation from global asset managers based in
Boston and on the West Coast.
“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, Ph.D., Chief Executive Officer 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.
We are thrilled to partner with key shareholders to be able to
accelerate and expand our portfolio as we work towards a future
without degeneration.”
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. This cash estimate is a preliminary
estimate and based on information currently available to
management, and these estimates could change.
The securities to be sold in the PIPE have not been registered
under the Securities Act of 1933, as amended (Securities Act), or
any state or other applicable jurisdiction’s securities laws, and
may not be offered or sold in the United States except pursuant to
an effective registration statement or an applicable exemption from
the registration requirements of the Securities Act and applicable
state or other jurisdictions’ securities laws. Denali has agreed to
file a registration statement with the U.S. Securities and Exchange
Commission (SEC) registering the resale of the shares of common
stock issued in the PIPE and the shares of common stock issuable
upon the exercise of the pre-funded warrants issued in the PIPE no
later than the 30th day after the closing of the PIPE. Any offering
of the securities under the resale registration statement will only
be made by means of a prospectus.
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy these securities, nor shall there
be any sale of these securities in any state or other jurisdiction
in which such offer, solicitation or sale would be unlawful prior
to the registration or qualification under the securities laws of
any such state or other jurisdiction.
About Denali Therapeutics
Denali Therapeutics is a biopharmaceutical company developing a
broad portfolio of product candidates engineered to cross the
blood-brain barrier for neurodegenerative diseases and lysosomal
storage diseases. Denali pursues new treatments by rigorously
assessing genetically validated targets, engineering delivery
across the blood-brain barrier and guiding development through
biomarkers that demonstrate target and pathway engagement. Denali
is based in South San Francisco. For additional information, please
visit www.denalitherapeutics.com.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements expressed or implied in this press
release include, but are not limited to, statements regarding the
anticipated proceeds to be received in the proposed PIPE, expected
timing of closing of the proposed PIPE, and the timing of
registration of the securities sold in the PIPE with the SEC;
Denali's expected cash, cash equivalents, and investments; future
clinical development of Denali's therapeutic candidates; and
statements by Denali's Chief Executive Officer. Actual results are
subject to risks and uncertainties and may differ materially from
those indicated by these forward-looking statements as a result of
these risks and uncertainties, including but not limited to, risks
related to: whether the conditions for the closing of the PIPE will
be satisfied; Denali’s dependence on successful development of its
BBB platform technology and TV-enabled product candidates; Denali’s
ability to initiate and enroll patients in its current and future
clinical trials; Denali’s ability to conduct or complete clinical
trials on expected timelines; Denali’s reliance on third parties
for the manufacture and supply of its product candidates for
clinical trials; the potential for clinical trial results to differ
from preclinical, early clinical, preliminary or expected results;
the risk of significant adverse events, toxicities, or other
undesirable side effects; the risk that results from early clinical
biomarker studies will not translate to clinical benefit in late
clinical studies; the risk that product candidates may not receive
regulatory approval necessary to be commercialized; developments
relating to Denali’s competitors and its industry, including
competing product candidates and therapies; Denali’s ability to
obtain, maintain, or protect intellectual property rights; and
other risks and uncertainties. In light of these risks,
uncertainties, and assumptions, the forward-looking statements in
this press release are inherently uncertain and may not occur, and
actual results could differ materially and adversely from those
anticipated or implied in the forward-looking statements.
Accordingly, you should not rely upon forward-looking statements as
predictions of future events. Information regarding additional
risks and uncertainties may be found in Denali’s Annual and
Quarterly Reports filed on Forms 10-K and 10-Q filed with the SEC
on February 27, 2023 and November 7, 2023, respectively, and
Denali’s future reports to be filed with the SEC. Denali does not
undertake any obligation to update or revise any forward-looking
statements, to conform these statements to actual results or to
make changes in Denali’s expectations, except as required by
law.
Investor and Media Contact:Laura Hansen, Ph.D.
Vice President, Investor Relations (650) 452-2747
hansen@dnli.com
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