Welcome, everyone. I am Charlie Moore. I'm a Senior Biotech Associate here at Baird, and today I'm pleased to welcome Ryan Watts, CEO of Denali Therapeutics. Just to get us started, would you mind giving a little intro on the company and maybe some background of where you are right now? Yeah, great, Charlie. Great to be here. Great to see many of you, and thank you for the invitation. Of course. I'll give a few slides to introduce Denali. I think my first opportunity to present here at Baird, and I think it's great to sort of lay that foundation, and we'll get it after, I'm sure, a number of questions. I'll just start by reminding everyone that when we founded Denali, we set out to do two things. The first was to cross the blood-brain barrier, and the second was to defeat degeneration. Obviously, a huge goal like defeating degeneration will come in increments or across different diseases. The example that we're going to talk mainly about today in Hunter syndrome, we believe we've achieved both. We've been able to show through our technology, which we'll go into some detail, the transport vehicle technology, that we're able to cross the blood-brain barrier, get enzymes into the brain, and then also have biomarker data strongly suggesting we're able to halt neurodegeneration. That's been the ultimate goal. The next step is now to do that over and over again across different disease areas using this technology known as the transport vehicle technology. What is the TV? The TV is an Fc-engineered technology where we build in binding to transferrin receptor into the Fc region of an IgG. This is unique amongst all of the blood-brain barrier crossing technologies. What it allows us to do is it's highly modular, and we can build Fc fusion proteins such as enzymes, oligonucleotides, or antibodies using this technology. With this technology, over the last decade, we've now prepared for our first launch in Hunter syndrome. We've expanded our franchise to include other indications, and ultimately we're advancing this TV portfolio in Alzheimer's and other modalities such as oligonucleotides and antibodies. I just want to show one image here. This is actually very compelling because what it shows is a control antibody versus the antibody transport vehicle. What you notice mainly is that the control antibody is what I'll call perivascular. It's captured in these perivascular spaces in arterioles and arteries where the transport vehicle technology gives you this even distribution across the blood-brain barrier. I think that's a key differentiating factor. We've started with enzymes. The goal is to go on to these other modalities and also into other indications, broader indications such as Alzheimer's and Parkinson's and other therapeutic areas using the transport vehicle technology. I'll just end my introduction by saying that this broad portfolio is led by a program where we've filed the BLA, actively engaging with the FDA right now for our first approval and a number of other programs, which we'll talk about many of those today. That's my intro, and then let's get into it. Yeah, definitely. That was an excellent overview of the TV platform. Why don't we just jump right into your lead asset that you've alluded to, formerly known as DNL310 or now tividenofusp alfa. This is in Hunter syndrome. Could you kind of give us a little bit of background on the disease and how it's currently managed in the clinic? Yeah, so when we were selecting indications to begin with, we wanted to pick an indication where there was a known set of biomarkers that we could assess the effectiveness of the Transport Vehicle (TV) technology. Hunter syndrome is a monogenic disease. There's been an approved therapy for the last 19 years, an enzyme replacement therapy known as idursulfase. The primary substrate for these enzymes are the glycosaminoglycans or heparan sulfate, dermatan sulfate. What's brilliant about that is that heparan sulfate you can measure in blood, urine, and in cerebrospinal fluid, and you essentially can look at the compartments in which the molecule is having activity. The standard of care basically treats the peripheral disease, so you know, reduces liver size, spleen size, which are enlarged in these MPS diseases. There's a wide range of symptoms as a result of Hunter syndrome, but the majority of patients develop neurological symptoms or neuropathic disease. Unfortunately, the standard of care does not cross the blood-brain barrier, and as a result, these patients decline, although you can have some benefit in the periphery, you're unable to treat the central nervous system. That was essentially the decision now, it must have been seven years ago that we started working on Hunter syndrome, and it has both the clinical endpoints but also the biomarkers that can predict the benefit in the clinic. That was the advantage of going after Hunter first. I think most of our diseases now categorically fall into that where there are biomarkers that we think are an early read on the efficacy of our molecules. Yeah, that provides a great segue into some of the clinical data you've seen in your phase one two study. You've shown really great normalization of, as you were speaking about, heparan sulfate in the cerebrospinal fluid as well as in urine and other biomarkers such as neurofilament light chain. Could you kind of give us a broad overview of what you've seen so far in the clinic and how that helps build confidence in the ability of TV to help treat this disease? I think what might be helpful because you can read about this, and we're just about to publish our clinical work, so you'll get a lot of details, is maybe give a little bit of the chronology of the first discovery. When we invented TV, at the time DNL310 or ETV:IDUA, we began our first patient study. We had five patients in the first cohort, and we saw after really looking after four doses, so one month of dosing, we saw four out of five patients normalize on heparan sulfate. Interestingly, the fifth patient did not normalize. One of the things that we've learned now working on other diseases as well in the MPS diseases is that these proteins are highly immunogenic because these are loss of function mutations, and so you're introducing a protein that these patients haven't seen. With continued dosing or higher dosing, and that's actually really important, Elaprase is likely pretty substantially under-dosed, especially when you have an immune reaction to the protein, which is common in lysosomal storage diseases. We were able to see that that patient has now normalized as well, and in fact, the vast majority of patients are normalized, and everyone is near normalized. Basically, 90% plus reduction in cerebrospinal fluid. Also notably, most patients are not, you don't see a robust reduction in urine heparan sulfate, even on standard of care. There we're also seeing a really robust reduction because we're able to drive for a higher dose. I think part of that is the tolerability of the Fc and also just recognizing that historically since patients have been under-dosed, we wanted to fix that with this next generation molecule. That heparan sulfate then led to correction of lysosomal biomarkers, which ultimately led to correction of neurofilament light chain, which is a biomarker of neurodegeneration. We actually saw that over time. Heparan sulfate goes down immediately. Neurofilament, you start to see it go down beginning at six months. Again, normalization or near normalization for all patients. I think really importantly, improvement in cognition and behavior and hearing in particular, which is pretty universal. Most Hunter patients have hearing defects, including the non-neuropathic, although there's sort of a continuum there. Yeah, sounds great. I think an interesting part of this discussion is that there's also a gene therapy in development, and you have actually enrolled some patients who have been treated with a gene therapy previously. Could you give us a little bit of color there in terms of what you think drove them to enroll in your study after being treated, as well as what kind of improvements they've seen since receiving TV? Yeah, so the approach for gene therapy in Hunter syndrome is a direct injection of the virus into the brain. Obviously, as I just described, Hunter syndrome is a whole body and brain disease. I think one of the challenges there is that you may be able to get a portion of the brain restored with idursulfase, although there's always issues with biodistribution for large, especially gene therapy capsids. You still have peripheral disease that you have to deal with. In those cases, we see elevated cerebrospinal fluid heparan sulfate, plus you treat the peripheral disease. I think the advantage of TV is that it's a whole body and brain therapy. I mean, it's replacing the standard of care. Because we're driving the dose, we are seeing robust both peripheral and brain effects. Wonderful. Yeah. You are currently under priority review at the FDA for accelerated approval with a PDUFA date in January 2026, early January. As you start thinking about how you may launch TV, could you give us an idea of how many patients you think there are with MPS II in the U.S.? Yeah, this is relatively simple math because there's a standard of care. Even worldwide, the majority of patients who are on this standard of care are on idursulfase. There are roughly 500 patients in the U.S., 2,000 worldwide. I think the dynamic here is there are patients that are on standard of care that will need to switch. The majority of data that we presented are patients who have been on standard of care who have switched to TV and are seeking a much better clinical outcome. Certainly. In general, could you give us a broad overview of what your strategic approach would be commercially in terms of targeting centers of excellence and so on? Yeah, so we have just hired our field team, our payer team, our patient services team. I think a really important dynamic in this space is the patient services. It's not just the medicine, but it's the way in which you engage with these families. They've been very important, obviously, in our clinical studies, but more broadly from a launch perspective. Many of the centers of excellence are involved in the clinical trials, so we know them. Most patients are seen in these centers. That's obviously a focus. I think the other big dynamic is, although clearly Hunter is a spectrum, there are those that will be eagerly awaiting new medicine that clearly treats the central nervous system. I think equally important is the data that we've generated outside of the brain as part of that dynamic, and that switching dynamic is going to be important. That will be a focus, how do we really encourage the switching to be able to treat both the whole body and brain. Yeah, wonderful. As your PDUFA date is approaching, considering all of the turmoil within the FDA, could you just give us an idea of how your interactions have gone? You know, what kind of consistency you've seen there in terms of your review team and, you know, along those lines, just how those interactions have gone? Yeah, so our review team, it's interesting because we have the same review team for our Hunter program as we have for our Sanfilippo program. We were selected for START last year as a way of accelerating clinical trials, basically, in rare disease, which is the intent of START. We've been very engaged with the FDA on two programs. I mentioned briefly that the second program also we've agreed upon an accelerated approval path. We filed the BLA in May. What's interesting is we initiated a rolling submission, I think at the time, probably at the peak of turmoil that you term it within the FDA. It's moved very rapidly. From that point, we completed the rolling submission in about five weeks, and then we heard, you know, within 60 days about the PDUFA date. Since that point, we've received this, you know, day 74 letter. We've had the mid-cycle review. I'll say that, you know, as Commissioner McCarry highlights that these review teams are active and engaged, that's absolutely true. We've been very engaged with the review team on all aspects, you know, clinical assays, broadly, CMC, either completed inspections or planned inspections. It's been a very active time at Denali engaging with the FDA. Excellent. Glad to hear that's going smoothly and there's been high touch with the FDA. As you've alluded to, you have another program in MPS, this time in IIIA or Sanfilippo syndrome type A, and that's DNL126. Could you kind of compare and contrast this with Hunter and maybe give us a little bit of an overview of where that program is and how it might differ? Yeah, I think the similarities are, this is another mucopolysaccharidosis disease. These sulfated sugars accumulate and cause damage of the lysosome and various organs. What's unique about Sanfilippo is that it's primarily a CNS disease. There are some peripheral manifestations, but much, much less so than what you see in Hunter syndrome. Most of these patients, which by the way could be either boys or girls, in the case of Hunter, it's an X-linked disease, so it's essentially boys, have neurological symptoms. There's no standard of care. Unlike Elaprase, you know, idursulfase, which is the standard of care for Hunter, there's not a standard of care for Sanfilippo. That's definitely unique. It's also influencing how we think about the phase three confirmatory trial in that there's a lot of openness to having basically a single-arm study, which is consistent, by the way, with guidance from the FDA last week. This rare disease evidence principles that was published by the FDA, really important for CDER and CBER, is actually pretty consistent with what we've done in Sanfilippo. We'll see how that plays out in terms of accelerating approvals or accelerated approval. We still don't know exactly how that will work, but certainly that's the category. Same biomarkers, heparan sulfate, you know, ultimately neurofilament light chain, same clinical endpoints in terms of cognition and behavior. All the experience we've had in Hunter is very relevant to what we're doing in Sanfilippo. The dynamic of the disease is a bit different. The rapid degeneration, much more rapid than what you see in Hunter syndrome, is one of the other unique aspects of Sanfilippo. Wonderful. Yeah, I know we're all excited to see more detailed data here. Could you give us any kind of idea in terms of when we could expect to see more, you know, more data in the graphs that we analysts love to see so much? Yeah, so we toplined the end of last year saying that we have the ability to normalize and see robust reduction. We then commented in the last queue that that data from 24 weeks is consistent at, you know, 49 weeks. Our plan right now is world next year is to share that data. Now, it's important to recognize that the 20 patients, we agreed with the FDA on 20 patients for AA. We're completing that enrollment now, and that would be 49-week data to drive the accelerated approval. The data that we would show would be interim versus the final data package. One thing that I think we learned with Hunter, we were so excited to show data every six months. Yeah. Ultimately, the data package just really matured. I think at this point now we have a number of clinical stage programs. We continue to really mature our data packages, and then we show them more broadly. Yeah, makes sense. As we think about both regulatory and commercial perspectives looking forward for DNL126, is there an overlap in terms of the centers of excellence at which Sanfilippo and Hunter syndrome patients are treated, as well as are you interacting with the same review team as you are with Hunter as with Sanfilippo? Yeah, so essentially 100% overlap in terms of the centers and in terms of the sites for the clinical trial. Got it. You know, very strong overlap. One team to launch both Hunter and Sanfilippo in terms of the commercial aspect, and then notably the same team and same reviewers from the FDA. I think that's great. If we could do that over and over and over, it'd be great. It won't always be the case. Obviously as we advance our Alzheimer's portfolio and other medicines, that won't be the case. Yeah, great opportunity to move on to the pipeline and discuss some more about what you are doing there. Can you kind of, you know, think about the modularity of the transport vehicle platform? Tell us a little bit more about the different areas you'd like to extend this technology into as you advance further into the clinic. Yeah, so we have one other clinical stage asset using the Transport Vehicle (TV) technology, and it's similar to the enzyme replacement therapies. It's for progranulin. Actually, our own in-house data has shown that progranulin loss of function essentially causes a lysosomal defect similar to lysosomal storage disease. With Hunter, Sanfilippo, and FTD granulin, those are the clinical stage assets, and they're all enzyme-like technologies. The goal now is we've guided towards one to two INDs per year for the next two years. Ideally, we'll be filing two this year, maybe two next year. We'd like to be on the high end of that goal because we have many programs in our IND-enabling portfolio. The next three assets will be an enzyme, an oligonucleotide, and an antibody, again representing all three franchises. I think that really represents the modularity of this platform and the maturity of the platform. The Hunter data, the very first clinical data we actually got with the platform, was in 2020. Now five years later, we're taking these other modalities forward, and I think it'll be very exciting to see how it works. Certainly very exciting. Yeah, you already touched on the progranulin, but it would be great to maybe touch a little bit more on the enzymes as you're thinking about Parkinson's, Gaucher disease, Pompe, more MPS programs. Could you kind of give us a broad overview there in terms of where you're thinking you can make the biggest difference? Yeah, really our two lead programs for the ETV are in Pompe and in Gaucher/Parkinson's. What's unique about the Gaucher/Parkinson's is that it's obviously two different diseases, but with the same underlying genetic risk around GCase. With Pompe, this will also be our first, at least in the case of LOPD, so late-onset Pompe disease, our first effort in strictly, well, generally non-neurodisease. It's mainly a muscle disease. It's well known that transferrin receptor, in addition to crossing the blood-brain barrier, can improve biodistribution to muscle and specifically to bone as well. A lot of these future indications using transferrin receptor will be pursuing diseases in some cases outside the central nervous system. I think Pompe is the first example of that. The data that we have today shows that obviously in IOPD, which is infantile onset Pompe disease, where there is a neurological component, there's no doubt that ETV:GAA, or enzyme transport vehicle GAA for Pompe, will have a very significant potential benefit compared to what's out there in terms of now the standard of care. It's a relatively competitive space. We've also shown data that we can improve biomarkers in muscle as well. We'll be looking at your typical glucose metabolism biomarkers and also muscle-related biomarkers in that clinical study. I would just say stay tuned as we file that program, move forward. What we're looking for is really differentiation from what's out there today. Wonderful. As you've touched on lightly previously, you have a really interesting Alzheimer's disease program, which you recently just shared data in a publication in Science. It would be great to kind of get a high-level overview of that and maybe a little discussion of the data that you just shared and how you're thinking about the antibody you plan to pair with your transport vehicle here. I think one of the things I have is very satisfying thinking about a decade of discovery and development at Denali Therapeutics is we set out to do deep and thorough science. I think part of that is from really the origin of many of us, both in academia and at a place like Genentech, really respect the fact that if you do deep science and you follow the science, you'll have unique insights and hopefully invent really transformative medicines or platforms in the case of the transport vehicle. This year, I think, is a great representation of that. We had this paper in Science on ATV:Abeta, but actually earlier this year we had a paper on the mechanism of APOE as it relates to Alzheimer's disease in Cell. We haven't translated that into a medicine, of course, but I think it's a reflection of how we approach our work, I think, rigorously and deeply. In terms of ATV:Abeta, this particular paper highlights a couple of points. One is the transport vehicle and broadly transferrin receptor-enabled technologies. Various other brain shuttles use transferrin receptor to get across the capillary beds. I showed the image earlier in the introduction, the biodistribution being different between vasculature and even throughout the brain. We believe that's probably the major reason why ARIA is less in brain shuttle-enabled antibodies is because of this even distribution. You're not getting localization near arterioles and arteries that have high amounts of cerebral amyloid angiopathy. That's really the key dynamic. In addition, what we show in that paper is the ability to engineer the Fc portion of the IgG to be either on or off in terms of effector function, driving engulfment of this Fc gamma receptor binding. When bound to transferrin receptor, one of the major concerns that we're engineering around is depletion of these immature reticulocytes that give rise to red blood cells. Anemia is a factor that we've looked at in all of our programs. When you modulate iron and you modulate transferrin receptor, you can affect basically the maturation of these reticulocytes. This on-off switch allows us basically to bind to transferrin receptor and be immune silent, but when bound to plaque, we can engage the immune receptors on microglia to engulf plaque. That's a really clever and important insight in engineering in the Fc. That's the major differentiator. I should just mention really importantly that the transferrin receptor binding is integrated into the Fc, therefore you don't have these appendages. You don't have a Fab appendage which can be clipped and be immunogenic. I think tolerability, anemia, those are what we're engineering around with this next generation blood-brain barrier technology. Great. Yeah. Just moving on to some of the small molecules since we've covered so much of the Transport Vehicle platform, I think this is something that probably flies under the radar a little bit. Could you just quickly speak to, say, the LRRK2 program that you have partnered with Biogen, as well as the RIPK1 program partnered with Sanofi? Just give us kind of a high overview of those programs and how the collaborations are set up. LRRK2 is a gene when mutated that increases risk of Parkinson's, and the mutations cause kinase activation. It's a program we've worked on for a number of years. We have the most advanced program, and in fact, we're really running two experiments right now. Experiment number one is in the LUMA study, which is idiopathic Parkinson's patients that are diagnosed within two years, and the endpoint is UPDRS. 640 patients I mentioned, so it's a large study, and we're asking, can inhibiting LRRK2 be beneficial in Parkinson's? It's actually the most important experiment to run. Obviously, equally important is understanding what about inhibiting LRRK2 in just LRRK2 carriers, and there we're running what's called a BEACON study that focuses on biomarkers of lysosomal pathway, but also biomarkers of neurodegeneration, and that's a 50-patient study. We're running that study where Biogen is running the LUMA study. The LUMA study is fully enrolled and expected to be complete probably about May of next year. That's that. The RIP kinase program, and by the way, I should just mention that LRRK2, as I already said, the mutations cause kinase activation. The mechanism of LRRK2 has been generally nebulous, but I think we and others have discovered a primary role in the lysosome. That's pretty consistent when you think about GBA mutations causing Gaucher disease and then also causing Parkinson's disease. Many of these biomarkers for LRRK2 are also related to GBA. It's been really insightful to link lysosomal storage disease with Parkinson's disease. Probably a simplistic way to view it is that Parkinson's disease is a very mild form of lysosomal storage disease that affects primarily, you know, dopaminergic neurons, for example. That's LRRK2. We're excited for that next year. That is the ultimate study. Get an inhibitor that's, you know, generally safe, well tolerated, and then ask, does inhibiting LRRK2 provide a benefit in Parkinson's patients? The second program mentioned, that other small molecule, is a RIP kinase inhibitor, and the simplest way to describe that is that RIPK modulates this pathway known as necroptosis, and it's downstream of TNF receptor 1. This has been a great partnership with Sanofi. We've tried it in ALS and failed. It was a, I think, very interesting hypothesis, not a direct genetic target in ALS. It's now being tested, by the way, also tested in MS, did not succeed there, and now ulcerative colitis. That's essentially an outlicensed molecule that Sanofi is running that study. As we're coming close to the end of our time here, is there anything else that you'd like to cover or tell investors about Denali overall? Yeah, I think probably the summary is first molecule, you know, in sort of the BLA status right now, lots of engagement with the FDA. Second program, accelerated approval using the same biomarker, you know, two more filings this year. As we expand the TV and then our ATV:Abeta program, first half of next year, getting that into the clinic. You know, we'll obviously look very different a year from now, hopefully with the first commercial launch, the next one being prepared for BLA filing, and then a broader portfolio. I think it's also worth noting that right now is just so much interest in blood-brain barrier technologies on the partnering side, on the competitive side. This is very different than a decade ago, but you know, most companies have their own transport vehicles or brain shuttles or are interested in partnering around these brain shuttles. I think that's, for me, it's very exciting and gratifying to see the maturing of this field and the recognition that the data so far in Hunter syndrome and Sanfilippo and the data in Alzheimer's disease, that these are very promising next sort of next generation modalities. As we've expanded our portfolio, we kind of highlight here the slide that's up here, we will be pursuing other indications using this transport vehicle technology because transferrin receptor enhances biodistribution broadly in tissues and beyond. Yeah. Again, a very exciting time. Certainly exciting. Thank you so much for your time today, Ryan, and thank you everyone for attending and listening to our conversation. Thanks, Charlie.