What happened
Shares of Denali Therapeutics (DNLI 2.84%) were up more than 14% Monday afternoon. The company reported first-quarter earnings a week ago, and three analysts recently maintained their buy ratings on the clinical-stage biotech company, which focuses on therapies that cross the blood-brain barrier to treat neurodegenerative and lysosomal storage diseases. The stock is up more than 15% so far this year.
So what
Analysts Andrew Fein of H.C. Wainwright, Berenberg Bank's Caroline Palomeque, and Wedbush's Laura Chio all maintained their buy ratings for Denaii, despite a so-so earnings report early last week.
The company announced earnings on May 8, and revenue, all from collaboration, was a reported $35 million, down 19.9% year over year, while the company had a loss of $109.8 million, or an earnings per share (EPS) loss of $0.80, compared to a loss of $65.3 million, or an EPS loss of $0.53 in the same period a year ago. Denali has a strong cash position of $1.29 billion, compared with $1.34 billion in the previous quarter.
Now what
Denali doesn't have any marketed therapies, but it has a deep pipeline, including DNL593, an Alzheimer's disease therapy it is developing with Takeda Pharmaceutical, and Parkinson's therapy DNL151, which it is partnering on with Biogen. The company's pipeline makes it a little less risky than some other biotech companies.
Denali recently said it was encouraged by the phase 2/3 trial of DNL310 to treat Hunter syndrome in children. Hunter syndrome is a rare, inherited disorder that occurs when the body does not properly digest sugar molecules in the body, leading to heart, skeleton, brain, and respiratory abnormalities. DNL130 is designed to cross the blood-brain barrier and replace a faulty IDS enzyme in patients that leads to Hunter syndrome.
