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Denali (DNLI) Stock Up Despite Wider-Than-Expected Q3 Loss
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Denali Therapeutics’ (DNLI - Free Report) shares rose 4.4% on Nov 5, after the company reported third-quarter results and positive pipeline updates.
Denali incurred a loss of 69 cents per share for third-quarter 2021, wider than the Zacks Consensus Estimate of a loss of 51 cents and the year-ago loss of 54 cents, primarily due to higher expenses and lower revenues.
Collaboration revenues came in at $5.3 million for the reported quarter, missing the Zacks Consensus Estimate of $25 million and declining from $9.4 million in the year-ago period. The year-over-year decline was primarily owing to a decrease in revenues from the company’s collaboration with Takeda (TAK - Free Report) , driven by a decrease in costs incurred in the partnered programs.
In the year so far, Denali’s shares have declined 34.3% compared with the industry’s 12.4% decline.
Image Source: Zacks Investment Research
Quarter in Detail
Research and development expenses were $71.6 million for the quarter under review compared with $53.7 million in the year-ago period, primarily driven by an increase in personnel-related costs.
General and administrative expenses were $19.3 million, up from $15.8 million in the year-ago quarter due to an increase in personnel-related costs, including stock-based compensation, primarily due to higher headcount and additional equity award grants.
Cash, cash equivalents and marketable securities were approximately $1.4 billion as of Sep 30, 2021.
Recent Updates
In September, the company announced that it initiated dosing participants in a phase Ib study with DNL343, its brain-penetrant small molecule activator of EIF2B, in amyotrophic lateral sclerosis (ALS) patients. Denali initiated the study on the basis of positive data from preclinical and phase I studies, wherein DNL343 achieved safety and biomarker goals.
Denali also announced additional positive interim data from a phase I/II study evaluating ETV:IDS (DNL310), an investigational brain-penetrant enzyme replacement therapy intended to treat both central nervous system and peripheral manifestations of Hunter syndrome in July 2021. Based on this data, the company will initiate a pivotal phase II/III study in first-half 2022 and is currently enrolling patients in Cohort C of the phase I/II study to further evaluate the clinical endpoints of the study in patients aged below four years in Hunter syndrome.
Last month, Denali announced that partner Sanofi (SNY - Free Report) plans to initiate a phase II HIMALAYA study in first-quarter 2022 to evaluate the efficacy and safety of RIPK1 inhibitor, DNL788, in adult patients having ALS.
The company also plans to initiate late-stage clinical development of its LRRK2 inhibitor, DNL151, in Parkinson's disease. DNL151 is being developed in collaboration with Biogen (BIIB - Free Report) .
Image: Bigstock
Denali (DNLI) Stock Up Despite Wider-Than-Expected Q3 Loss
Denali Therapeutics’ (DNLI - Free Report) shares rose 4.4% on Nov 5, after the company reported third-quarter results and positive pipeline updates.
Denali incurred a loss of 69 cents per share for third-quarter 2021, wider than the Zacks Consensus Estimate of a loss of 51 cents and the year-ago loss of 54 cents, primarily due to higher expenses and lower revenues.
Collaboration revenues came in at $5.3 million for the reported quarter, missing the Zacks Consensus Estimate of $25 million and declining from $9.4 million in the year-ago period. The year-over-year decline was primarily owing to a decrease in revenues from the company’s collaboration with Takeda (TAK - Free Report) , driven by a decrease in costs incurred in the partnered programs.
In the year so far, Denali’s shares have declined 34.3% compared with the industry’s 12.4% decline.
Image Source: Zacks Investment Research
Quarter in Detail
Research and development expenses were $71.6 million for the quarter under review compared with $53.7 million in the year-ago period, primarily driven by an increase in personnel-related costs.
General and administrative expenses were $19.3 million, up from $15.8 million in the year-ago quarter due to an increase in personnel-related costs, including stock-based compensation, primarily due to higher headcount and additional equity award grants.
Cash, cash equivalents and marketable securities were approximately $1.4 billion as of Sep 30, 2021.
Recent Updates
In September, the company announced that it initiated dosing participants in a phase Ib study with DNL343, its brain-penetrant small molecule activator of EIF2B, in amyotrophic lateral sclerosis (ALS) patients. Denali initiated the study on the basis of positive data from preclinical and phase I studies, wherein DNL343 achieved safety and biomarker goals.
Denali also announced additional positive interim data from a phase I/II study evaluating ETV:IDS (DNL310), an investigational brain-penetrant enzyme replacement therapy intended to treat both central nervous system and peripheral manifestations of Hunter syndrome in July 2021. Based on this data, the company will initiate a pivotal phase II/III study in first-half 2022 and is currently enrolling patients in Cohort C of the phase I/II study to further evaluate the clinical endpoints of the study in patients aged below four years in Hunter syndrome.
Last month, Denali announced that partner Sanofi (SNY - Free Report) plans to initiate a phase II HIMALAYA study in first-quarter 2022 to evaluate the efficacy and safety of RIPK1 inhibitor, DNL788, in adult patients having ALS.
The company also plans to initiate late-stage clinical development of its LRRK2 inhibitor, DNL151, in Parkinson's disease. DNL151 is being developed in collaboration with Biogen (BIIB - Free Report) .
Denali Therapeutics Inc. Price
Denali Therapeutics Inc. price | Denali Therapeutics Inc. Quote
Zacks Rank
Denali currently has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.