Denali raises $500m to advance treatments for neurodegenerative disease

Company targets neurodegeneration using large molecule biotherapeutics designed to cross the blood-brain barrier.

Shares in publicly traded biopharma Denali Therapeutics (Nasdaq: DNLI) spiked significantly this week after the company revealed it has raised $500 million through a private investment in public equity (PIPE) financing. The San Francisco-based company, which develops treatments for neurodegenerative diseases, says it plans to use the funding to support its ongoing research and development activities.

The financing, led by an unnamed US-based healthcare-focused investor, also includes participation from global asset managers based in Boston and on the West Coast. Following the closing of the raise, Denali anticipates its cash, cash equivalents, and investments to reach approximately $1.5 billion.

Denali’s approach to drug development is grounded in three guiding principles. Firstly, each therapeutic target or pathway in its portfolio is genetically linked to neurodegenerative diseases. Secondly, product candidates are engineered to optimize brain delivery by crossing the blood-brain barrier. Finally, the clinical development plan is facilitated by the identification of biomarkers.

Denali’s clinical-stage pipeline focuses on key areas including what the company calls “degenogenes” (genes associated with neurodegeneration) and lysosomal function (targeting the disposal and recycling compartment of brain cells). It also explores opportunities in glial biology (correcting dysfunction in cells supporting neuronal health) and cellular homeostasis (targeting defects that lead to neuronal death and nervous system dysfunction).

The new funding will contribute to advancing and expanding Denali’s blood-brain barrier-crossing Transport Vehicle technology. The remainder of the proceeds will be allocated to 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 Dr Ryan Watts, CEO of Denali. “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.”

Last year, pharma giant Biogen announced that it had exercised its option to license Denali’s Antibody Transport Vehicle program targeting amyloid beta. Accumulation of amyloid beta plaque in the brain is thought to be a defining feature of Alzheimer’s disease.

READ MORE: Novel approach breaks through the blood brain barrier

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