Biogen & Denali Sign Co-Development/Co-Commercialization Agreement

Biogen Inc. and Denali Therapeutics Inc. recently announced they have signed a binding agreement to co-develop and co-commercialize Denali’s small molecule inhibitors of leucine-rich repeat kinase 2 (LRRK2) for Parkinson’s disease. Biogen will also receive rights to opt into two programs and a right of first negotiation for two additional programs, in each case for neurodegenerative diseases leveraging Denali’s Transport Vehicle (TV) technology platform to cross the blood-brain barrier (BBB).

“Our collaboration with Denali represents an opportunity to advance the development of a potential first-in-class oral therapy that may slow the progression of Parkinson’s disease,” said Michel Vounatsos, Biogen’s Chief Executive Officer. “Denali’s LRRK2 program is highly complementary to our existing Parkinson’s disease pipeline and its successful development would enhance Biogen’s portfolio of medicines for treating serious neurological and neurodegenerative diseases. We look forward to leveraging our neurology capabilities and infrastructure with Denali’s scientific expertise to accelerate advancement of this program.”

“We are very excited to collaborate with Biogen, a company with an impressive history in inventing and developing medicines for neurological diseases,” said Ryan Watts, Ph.D., Denali’s Chief Executive Officer. “This collaboration will allow us to accelerate the development of our LRRK2 program and gives us the resources to build a fully integrated company with the goal of bringing transformative medicines to patients suffering from neurodegenerative diseases.”

Under the agreement, Biogen will collaborate with Denali to co-develop and co-commercialize Denali’s small molecule inhibitors of LRRK2 for Parkinson’s disease. Biogen and Denali will co-commercialize the LRRK2 product in the U.S. and China, and Biogen will commercialize in all other markets. DNL151 has been selected to progress into late stage clinical studies expected to commence in 2021.

Mutations in the LRRK2 gene can cause Parkinson’s disease. LRRK2 is a regulator of lysosomal function, which is impaired in Parkinson’s disease and may contribute to neurodegeneration. Inhibition of LRRK2 activity may slow the progression of Parkinson’s disease in patients with and without known genetic risks based on restoration of lysosomal function. People who have Parkinson’s disease experience numerous symptoms, including tremors, slow movement, muscle stiffness and impaired balance. As these symptoms become progressively worse, patients have difficulty walking, talking or completing other simple tasks. Parkinson’s disease is the second most common neurodegenerative disease with significant unmet medical needs due to the absence of approved therapies that may slow disease progression.

In addition to the LRRK2 program, Biogen will also receive an exclusive option to license two preclinical programs from Denali’s TV platform, which aims to improve brain uptake of biotherapeutics, including its Antibody Transport Vehicle (ATV): Abeta program (ATV enabled anti-amyloid beta program) and a second program utilizing its TV technology. Further, Biogen will have right of first negotiation on two additional TV-enabled therapeutics, currently at a preclinical stage, should Denali decide to seek a collaboration for such programs. Denali’s TV platform is a proprietary technology designed to effectively deliver large therapeutic molecules such as antibodies, enzymes, proteins and oligonucleotides across the BBB after intravenous administration.

Under the terms of the agreement, Biogen will make an upfront payment to Denali of $560 million and make a $465 million equity investment in Denali from the purchase of 13.3 million newly issued shares of Denali common stock at approximately $34.94 per share, representing 11.2 percent of Denali’s pro-forma outstanding stock.

Should the LRRK2 program achieve certain development and commercial milestones, Denali will be eligible to receive up to $1.125 billion in potential milestone payments.

In the LRRK2 collaboration, Biogen and Denali will share responsibility and costs for global development (60 percent Biogen; 40 percent Denali), and will share responsibility and costs as well as profits and losses for commercialization in the U.S. (50 percent Biogen; 50 percent Denali) and China (60 percent Biogen; 40 percent Denali). Outside the U.S. and China, Biogen will be responsible for commercialization and pay Denali tiered royalties.

Closing of the collaboration is contingent on completion of review under antitrust laws, including the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 in the U.S., and other customary closing conditions.

DNL151 is a small molecule inhibitor of LRRK2 invented at Denali which has completed dosing of 162 healthy volunteers in an ongoing Phase 1 clinical study and completed dosing in 25 Parkinson’s patients in a Phase 1b clinical study. Denali is currently completing further dose escalation cohorts in an expanded Phase 1 and an additional cohort in the Phase 1b study to define the full therapeutic window of the molecule. Based on the clinical data to date that has been generated in Europe, DNL151 appears to have an acceptable safety and tolerability profile and has met desired target engagement goals. An Investigational New Drug application for DNL151 was cleared by the U.S. Food and Drug Administration in July 2020 and enables expansion of Denali clinical trials for DNL151 globally.

At Biogen, our mission is clear: we are pioneers in neuroscience. Biogen discovers, develops and delivers worldwide innovative therapies for people living with serious neurological and neurodegenerative diseases as well as related therapeutic adjacencies. One of the world’s first global biotechnology companies, Biogen was founded in 1978 by Charles Weissmann, Heinz Schaller, Kenneth Murray and Nobel Prize winners Walter Gilbert and Phillip Sharp. Today Biogen has the leading portfolio of medicines to treat multiple sclerosis, has introduced the first approved treatment for spinal muscular atrophy, commercializes biosimilars of advanced biologics and is focused on advancing research programs in multiple sclerosis and neuroimmunology, Alzheimer’s disease and dementia, neuromuscular disorders, movement disorders, ophthalmology, immunology, neurocognitive disorders, acute neurology and pain.

Denali Therapeutics is a biopharmaceutical company developing a broad portfolio of product candidates engineered to cross the BBB for neurodegenerative diseases. Denali Therapeutics pursues new treatments by rigorously assessing genetically validated targets, engineering delivery across the BBB and guiding development through biomarkers that demonstrate target and pathway engagement. Denali Therapeutics is based in South San Francisco. For additional information, please visit www.denalitherapeutics.com.