Denali Secures $275 Million Funding Agreement with Royalty Pharma
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 05 2025
0mins
Should l Buy DNLI?
Source: NASDAQ.COM
Funding Agreement: Denali Therapeutics has secured a $275 million funding agreement with Royalty Pharma, leading to a 5.84% increase in its stock price. The deal focuses on future sales of Denali's drug candidate, tividenofusp alfa, aimed at treating Hunter syndrome.
Regulatory Review: The biologics license application (BLA) for tividenofusp alfa is under review by the FDA, with a new target action date of April 5, 2026, following an extension due to a major amendment submission by Denali.
Royalty Structure: Royalty Pharma will make an initial payment of $200 million and an additional $75 million upon European approval of tividenofusp alfa, in exchange for a 9.25% royalty on worldwide net sales until certain financial milestones are met.
Ongoing Developments: Denali is also advancing other therapeutic candidates in collaboration with Takeda and Biogen, including treatments for frontotemporal dementia and Parkinson's disease, while maintaining a Zacks Rank of #3 (Hold).
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Analyst Views on DNLI
Wall Street analysts forecast DNLI stock price to rise
10 Analyst Rating
10 Buy
0 Hold
0 Sell
Strong Buy
Current: 19.180
Low
25.00
Averages
32.78
High
40.00
Current: 19.180
Low
25.00
Averages
32.78
High
40.00
About DNLI
Denali Therapeutics Inc. is a biopharmaceutical company. The Company is focused on 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. It has developed a technology, called the TransportVehicle (TV), to address the BBB challenge. Its advanced TV-enabled program is tividenofusp alfa (DNL310, ETV:IDS) for the potential treatment of mucopolysaccharidosis II (MPS II or Hunter syndrome). Its TV-enabled clinical development portfolio also includes DNL126 (ETV:SGSH) for MPS IIIA (Sanfilippo syndrome) and DNL593 (PTV:PGRN) for frontotemporal dementia-granulin (FTD-GRN). Its small-molecule clinical development portfolio includes BIIB122/DNL151 (small molecule LRRK2 inhibitor) for Parkinson’s disease; and DNL343 (small molecule eIF2B activator) for amyotrophic lateral sclerosis (ALS). It is also exploring programs in oncology, inflammation, and other diseases.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Trial Design Concerns: The FDA's questioning of the trial design may impact the efficacy assessment of the therapy, negatively affecting REGENXBIO's market outlook and increasing uncertainty for investors.
- Approval Timeline Delayed: Due to the FDA's feedback, REGENXBIO may need to reevaluate its clinical trial plans, which will push back the originally scheduled approval timeline and affect the company's future revenue expectations.
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- Multiple Oral Presentations: Two oral presentations will discuss clinical study data for DNL310 and DNL126 (for Sanfilippo syndrome type A), demonstrating the company's progress in rare disease research.
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- Covered Call Strategy: Investors can buy DNLI shares at $17.30 and sell a $17.50 call option at $0.25, committing to sell at expiration for a potential total return of 2.60%, enhancing overall investment yield.
- Expiration Risk: With the strike price approximately 1% above the current stock price, there is a 42% chance the call option will expire worthless, allowing investors to retain both their shares and the premium collected, further boosting returns.
- Yield Boost Effect: Should the call option expire worthless, investors could see an additional 1.45% return, annualized to 6.07%, referred to as YieldBoost, providing an attractive opportunity for enhanced earnings.
- Volatility Insights: The call option has an implied volatility of 67%, while the actual trailing twelve-month volatility stands at 61%, indicating market expectations for DNLI's price fluctuations, which investors should monitor for informed decision-making.
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- FDA Review Progress: The Biologics License Application for tividenofusp alfa is under FDA Priority Review, with a decision expected by April 5, 2026, which will provide urgently needed treatment options for patients.
- Treatment Safety: The most common adverse events in the clinical trial were infusion-related reactions, which significantly decreased in incidence with continued use, demonstrating the therapy's good tolerability.
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- FDA Response Letter Issued: REGENXBIO's shares fell after receiving a response letter from the FDA regarding its Hunter syndrome gene therapy, indicating regulatory concerns about trial design that could delay the approval timeline.
- Trial Design Concerns: The FDA's questioning of the trial design may impact the efficacy assessment of the therapy, negatively affecting REGENXBIO's market outlook and increasing uncertainty for investors.
- Approval Timeline Delayed: Due to the FDA's feedback, REGENXBIO may need to reevaluate its clinical trial plans, which will push back the originally scheduled approval timeline and affect the company's future revenue expectations.
- Negative Market Reaction: The stock price decline following the FDA's response letter reflects market concerns about REGENXBIO's future direction, potentially leading to decreased investor confidence and impacting its ability to raise funds.
See More
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- FDA Approval Update: The FDA has accepted REGENXBIO's RGX-121 BLA under the accelerated approval pathway; however, the PDUFA goal date has been extended from November 9, 2025, to February 8, 2026, indicating the agency's cautious approach to expedited approvals.
- Reasons for CRL: The FDA issued a Complete Response Letter (CRL) for RGX-121, citing concerns regarding study eligibility criteria and the appropriateness of a surrogate endpoint, suggesting that new studies and long-term follow-ups may be necessary, which poses challenges in an ultra-rare disease population.
- Market Reaction: Despite regulatory hurdles, REGENXBIO's stock shows strong momentum in the market, with analysts maintaining a
See More
Denali Therapeutics Advances in Hunter Syndrome Treatment
- Clinical Trial Update: Denali Therapeutics reported significant biomarker reductions in its Phase 1/2 trial for Hunter syndrome (MPS II), with tividenofusp alfa (DNL310) achieving an 80% mean reduction in cerebrospinal fluid heparan sulfate, indicating its potential to address the full disease spectrum.
- Launch Readiness: The company is preparing for the April 5, 2026 PDUFA date, with plans to submit a Biologics License Application (BLA), which would provide much-needed treatment options for patients with Hunter syndrome.
- Sanfilippo Syndrome Research: Preliminary data from the Phase 1/2 study of DNL126 (ETV:SGSH) in Sanfilippo syndrome showed an 83% mean reduction in cerebrospinal fluid heparan sulfate among 20 participants, offering new hope for treatment in a field lacking effective therapies.
- Pompe Disease Clinical Design: Denali presented the Phase 1 clinical study design for DNL952 (ETV:GAA) in Pompe disease, aimed at evaluating safety and tolerability across different dosing regimens, highlighting the therapeutic potential for muscle and nervous system manifestations.
See More
Denali Therapeutics Presents Clinical Data at WORLDSymposium 2026
- Clinical Data Presentation: Denali Therapeutics will showcase clinical and preclinical data from its Enzyme Transport Vehicle (ETV) programs at the 2026 WORLDSymposium, highlighting the potential for delivering enzyme replacement therapies throughout the body, including the brain.
- FDA Priority Review: The Biologics License Application for DNL310 (for Hunter syndrome) is under FDA Priority Review, with a decision expected by April 5, 2026, which could expedite its market entry.
- Multiple Oral Presentations: Two oral presentations will discuss clinical study data for DNL310 and DNL126 (for Sanfilippo syndrome type A), demonstrating the company's progress in rare disease research.
- Poster Presentation Content: Denali will also present several posters, including a health outcomes analysis for MPS II patients and the study design for DNL952 (for Pompe disease), further solidifying its leadership in rare disease treatments.
See More
Denali Therapeutics (DNLI) Offers Covered Call with 2.60% Potential Return
- Covered Call Strategy: Investors can buy DNLI shares at $17.30 and sell a $17.50 call option at $0.25, committing to sell at expiration for a potential total return of 2.60%, enhancing overall investment yield.
- Expiration Risk: With the strike price approximately 1% above the current stock price, there is a 42% chance the call option will expire worthless, allowing investors to retain both their shares and the premium collected, further boosting returns.
- Yield Boost Effect: Should the call option expire worthless, investors could see an additional 1.45% return, annualized to 6.07%, referred to as YieldBoost, providing an attractive opportunity for enhanced earnings.
- Volatility Insights: The call option has an implied volatility of 67%, while the actual trailing twelve-month volatility stands at 61%, indicating market expectations for DNLI's price fluctuations, which investors should monitor for informed decision-making.
See More
Denali Therapeutics Advances Tividenofusp Alfa with FDA Priority Review for Hunter Syndrome
- Clinical Trial Results: Denali Therapeutics' tividenofusp alfa demonstrated a 91% reduction in heparan sulfate levels in cerebrospinal fluid among 47 participants, indicating significant potential for improving neurocognitive function in Hunter syndrome patients.
- FDA Review Progress: The Biologics License Application for tividenofusp alfa is under FDA Priority Review, with a decision expected by April 5, 2026, which will provide urgently needed treatment options for patients.
- Treatment Safety: The most common adverse events in the clinical trial were infusion-related reactions, which significantly decreased in incidence with continued use, demonstrating the therapy's good tolerability.
- Market Outlook: As the first enzyme replacement therapy designed to cross the blood-brain barrier, tividenofusp alfa could transform the treatment landscape for Hunter syndrome, addressing the urgent market demand for new therapies.
See More
