Causes investigated already. Great. Good afternoon, everyone. Thank you so much for joining us. I'm Salveen Richter, biotechnology analyst at Goldman Sachs. I'm really pleased to be joined by the Denali team. With me, I have Ryan Watts, CEO, and Alex Schuth, who's Chief Operating and Chief Financial Officer. Maybe to start here, could you just provide an overview of where Denali stands today in the context of your recent pipeline progress and key upcoming milestones, and maybe walk us through where you're most focused on from an execution standpoint over the next 12- 18 months? Absolutely, Salveen. Great to be here. Great to be back at the Goldman Conference. We appreciate the invitation. It's an extraordinary time at Denali with our first BLA filing, and we're awaiting, of course, the PDUFA date. That really represents the last decade of efforts where we've invented a novel blood-brain barrier technology known as the transport vehicle, in a field that's now becoming very hot. A lot of people are interested in getting large molecules into the brain using these technologies. We spent really the first five years inventing this technology, the subsequent five years with proof of concept, clinical data, and then getting a data package robust enough to file our first BLA. In addition to that, a second program we've announced top line at the end of last year that we have biomarker proof of concept, which is important, and we're defining the accelerated approval path with the FDA for that program as well. That particular program is for Sanfilippo. Obviously, the lead program is for Hunter syndrome. Those two molecules combined, we're excited in the next several years to have multiple programs in our commercial portfolio and have launched multiple programs. I think the other area important as we think about the next 18 months in execution, it's launch readiness, launch commercial piece. Fortunately, in a disease area that we're going to launch ourselves. There are others with subsequent foundings have been investigated and implemented before ours. There are some anti-resistant proposals that we're implementing. Your attention and your attention, please. There are others that have subsequent foundings have been investigated and progressed completely before ours. There are some anti-resistants. Thank you. I think one thing you learn as a CEO, you just roll with it. You just keep going. It's kind of the way life is over the last decade. Preparing for these launches, engaging with the FDA, we're going to get into that in some detail. We've had a really productive and consistent dialogue with the FDA, even though the external world feels a little crazy right now. I think what's really exciting is bringing the next wave of transport vehicle molecules into the clinic. We have three in clinical testing now. I didn't mention the progranulin program, but we'll be bringing at least another three within the next year: an enzyme transport vehicle, an antibody transport vehicle, and an oligonucleotide transport vehicle. Representing some of our new, let's call them franchises with the oligonucleotide and the antibody transport vehicle. It's an exciting time. I'll just end my introduction by saying that we've also launched our own clinical manufacturing so that we can actually move faster, but I think equally important be capital efficient. We're thinking a lot about how do we advance as many programs but reduce the cost of each program now that we have our flagship program at the FDA under BLA review. It's interesting. I think when we look at the blood-brain barrier platform, there's very much this view, especially as you talk about Hunter syndrome and Sanfilippo, that this is kind of the next generation approach to after the enzyme replacement therapies. Maybe before we jump into the specifics around these two programs, could you just speak to your ability to go broad, if you want, into all these rare diseases that have been targeted by ERTs and the ability to do so? I don't know if there's a quicker path to doing it where you can leverage the work you've done so far with the different targets. I think that's the exact intent of having your own clinical manufacturing is the speed and cost, reducing it by 30% or 40%. We have absolutely the intent to go broad. The question for us is, from an identity perspective, when we founded Denali, the vision I think that everyone saw externally is solving Alzheimer's disease, which we know is a long road. Our vision was to build a blood-brain barrier platform and ultimately defeat degeneration. In the case of Hunter syndrome, in some ways, we've achieved both. We've been able to show that the platform works, but also the biomarker that's used to measure neurodegeneration, neurofilament light chain, we've seen a normalization or near normalization in all patients. It's like that's the actual proof. The question then becomes, from a business strategy, how broad do we go on these smaller indications in rare disease and how much effort do we put into the larger indications and everything in between? Part of the capital raised last year, the intent of that at that time, which was opportunistic, was to do exactly the following: to accelerate and to expand. The short answer to your question is we can absolutely go broad, but we want that balance between the size of indications that we're going after. We see really Hunter and Sanfilippo as proof of concept and the ability to build a foundation around the enzyme franchise. We're very excited about some of these mid-size and larger indications like Pompe, Gaucher, Parkinson's, the GBA mutations in Parkinson's, and then obviously Alzheimer's disease. I do not know, Alex, if you want to add anything to that. Yeah. At this point, as the transport vehicle is validated clinically and we're going to commercialization, and we know that blood-brain barrier transport is possible, we want to capture the full value of the technology. Now the strategy is to create the optionality, initiate new programs preclinically, which will then have the opportunity to either take them forward ourselves or have partnering opportunities. I think historically we're a deep science company. Now as we transition, it's really deep execution, like using that scientific mindset on how to move rapidly and using the technologies that we've built to move quickly in areas that are really high probability of success. I mean, enzyme replacement therapies are very high probability of success. With Hunter syndrome, you've recently completed the accelerated approval under the accelerated approval pathway. You've completed the rolling BLA submission. Help us understand if there's anything else that needs to be done on the regulatory front, but then walk us through the commercial strategy here, recognizing there's already a pool of identified patients. How do you go out and really kind of address that and how much education is required for switching? Yeah. So I'll highlight briefly the BLA, and then Alex will cover the commercial strategy. What an unusual time to be in the process of filing a BLA. For us, it was not only business as usual, but very consistent and responsive FDA, which was really important, obviously, as there's a lot of uncertainty in the change in the administration. For us, we initiated the rolling submission, and in less than five weeks, we completed the entire BLA. The data package is essentially the data that we presented at World this year. All 47 patients reaching six months or longer. We have some patients that have been on for over four years and a very robust data package. That's very large for this type of patient population, where there's 500 patients in the US alone. Now it's basically waiting for our PDUFA date, preparing basically for launch by early next year. It really depends on when our date is or earlier, depending on the engagement with the FDA, but very consistent engagement, Alex, on commercial. Yeah. Of course, super excited about the path to commercialization and then a successful launch and a successful product for patients. As you mentioned, Salveen, this DNL310 TfR can be the first product in a new generation of enzyme replacement therapy, really a field that has not seen much innovation for the last 20 years. TfR enablement can enhance distribution into all tissues, not only the brain, but also more effectively distribute in the periphery. What we see is a very clear best-in-class product profile for DNL310. We are building a commercial team that ensures success for that product, but then can be leveraged for the whole enzyme franchise thereafter. DNL126 will come within—we were discussing with the FDA the path to accelerated approval, but hopefully a very short period of time after 310. As Ryan mentioned, we have more enzymes that go into the clinic. As for the operations, our Chief Commercial Officer, Katie Peng, has been on board for over two years now. As we were always preparing when we were in discussions with the FDA on the path to accelerated approval to be able to go fast, our MSL team has been in place for a while, and we have already engaged with all of the centers of excellence, and we've by now engaged with every single prescriber of Elaprase in the U.S. Now the focus is on building out the rest of the team, engaging even deeper with the community, building all the patient support network around. At the core of it, what it really is, is education. It's education that tividenofusp alfa will be suitable for all patients with Hunter syndrome. How many centers of excellence are there in the U.S. or potentially geneticist targets that you're planning to pursue initially? On the education front, what is the education that is required here? Yeah. We see about 80 to about 100 centers of excellence in the U.S. There is a high degree of awareness for tivi. Many of these investigators have participated in our trials. There is also a high degree of awareness in the patient community. We have very close links to the patient community. Again, the core essence of the education is that this is a drug which is for all patients for Hunter syndrome. It does something that standard of care does not do, which is gets into the brain, but it is also superior in the periphery. The education will also be, of course, around the differences to gene therapy more broadly with respect to enzyme replacement therapy, where we have clear advantages as well. You also recently held a European workshop that was very much modeled after what played out in the U.S. that led to the alignment that you agreed upon with regard to the AA pathway. Can you provide an update on ex-U.S. progress here? Yeah. I think similar to the Reagan-Udall Foundation meeting, which was a little over a year ago, the initial reaction is, well, are these biomarkers predictive of clinical benefit? That dialogue began about a year after with European regulators. Of course, it is not just EMA, it is also MHRA who was involved in that workshop. We have seen some steady momentum there. One of the biggest differences in Europe versus the U.S. is really how they look at reimbursement. Our base case, of course, has been that we complete the COMPASS study and then we go to Europe and seek approval. We will continue to push where we can and with really the goal of a successful launch in Europe and successful pricing. That is a little bit of a different dynamic than what you have in the U.S. I would say that where we continue to engage with the EMA as well and on the Sanfilippo program is the design of that phase three study. That is where we aligned on COMPASS with the EMA and the FDA. We are doing a similar thing with Sanfilippo, but that dialogue continues. Our sense is that it is opening up in Europe as well. I do not think they want to be behind, especially these medicines where it is linear, it is a single enzyme loss of function. The biomarker predicts clinical benefit, and let us see how that evolves. Where do you stand from a manufacturing perspective? Manufacturing is really two, I think, major points. For tivi, the product that we'll be launching, we're manufacturing with Lonza. That particular product is manufactured in Switzerland, although it will soon be onshore to the United States to a facility that can run larger volumes, which is fantastic. The rest of our manufacturing is in our own facility here in the United States, and that's for basically the future programs, including, by the way, the Sanfilippo program as well. We're in a strong position, confident in our manufacturing for launch, obviously with Lonza having a long and successful track record. What remains? You've touched on this, but with the Sanfilippo program, what remains to be ironed out in the U.S.? Yeah. I think there are really two-step process. Agree to phase three, and then once that's locked down, what is the data package needed for accelerated approval? That's essentially what we're engaging with the FDA on. The START program has been advantageous for us. We have a consistent dialogue with the FDA, quarterly meetings, in person as well. We see that continuing, and I think really advantageous for the Sanfilippo program. Where is the debate around the phase three trial design? Is it around really the surrogate endpoint here? Yeah. So actually, for the phase three, the debate is there is not a standard of care. In our COMPASS trial, it is an active comparator control. We have tividenofusp alfa versus Elaprase. In this case, there is a growing alignment that you would use natural history as your comparator as opposed to placebo. I think the reason for that is that Sanfilippo is a tragically rapid neurodegenerative lysosomal storage disease, I mean, much more than many of the other MPSs. Basically, selecting placebo is you are just going to expect a very rapid decline. Can you speak to how the potential competitive dynamics may play out with different modalities in Sanfilippo? We've had ERTs, but how are you thinking about gene therapy coexisting there as well? Yeah. And it's not just Sanfilippo, it's also Hunter. We have basically two medicines that are under review for both Sanfilippo and Hunter using gene therapy. Interesting difference between the two. One is basically delivered directly to the brain, and the other is delivered systemically, which I find fascinating. It's the reverse of what you would think because Sanfilippo is more of a neuronal disease, even more so than Hunter, and that's the one that's delivered systemically and vice versa. What ends up happening in Hunter, basically all patients will need to be on a standard of care, Elaprase or idursulfase. Obviously, this is, I think Alex mentioned this, treating not just the brain, but the whole body. Our peripheral biomarkers show improvement compared to standard of care, and that's very important. In the case of Sanfilippo, I think also it's not necessarily normalizing substrates. We think we have a better profile. What will probably happen, we actually already have this in our Hunter program. We have patients that were on gene therapy, which of course you're on forever, but are now on tividenofusp alfa. And part of that is to treat the peripheral disease, but also they didn't have sufficient biomarker reduction in the CNS, and we're seeing further improvement in the CNS as well. We imagine that really durability, tolerability with gene therapy, especially this generation of gene therapies, that these patients will need to be on an enzyme replacement therapy. That's how we view it. Maybe less competition and more combination. Got it. Before we delve further into the pipeline, could you talk about how your prioritization strategy lies currently? When you look across everything you're doing, and clearly you've partnered some of these programs out, but especially within the BBB platform, where are you allocating the most resources and capital? Yeah. I'll start, then Alex. You'll have a good answer to this as well as you run operations and the finances. For us, the priority, again, for the last five years is proving that the platform works and filing our first BLA. Now it's being very wise about the spend on the enzyme transport vehicle, recognizing that a number of these indications are small. The way I think about Sanfilippo is half the size of the study, twice as fast. If we can do that now with every additional program, that would be fantastic. We also have definitively made the decision that we are a delivery company. We have built this novel platform, and rather than being a rare disease company or an Alzheimer's company, we're going to use the transport vehicle to go after various diseases of various sizes. I think part of that prioritization will feed into creating the opportunities with each one of these medicines, some of which we plan to take all the way and launch ourselves and others through strategic partnering. I think the key, and I'll ask Alex to comment more in more detail, is being wise about how much we spend on the late-stage portfolio and now bringing more molecules forward. Alex? Yeah. As we look at the broad potential of transferrin receptor-enabled delivery, there is an enormous number of products, right, opportunities. What we look at is sort of three factors, right? Time to value creation, biological risk, and then market opportunity. As we started early with Denali, it was very much about validating the platform. We also went for smaller opportunities that had a high probability of success. Now we want to go more to what we call sort of the top left quadrant. The enzyme replacement therapy portfolio collectively has a multi-billion dollar market opportunity, and it has a high probability of success. Especially with an accelerated approval pathway, it has a fast timeline to proof of concept. We've used the terms, we call that sort of peak one of value creation. There is peak two, which is the second wave of programs, and Ryan mentioned some of these neurodegeneration programs, but A beta and tau through the biomarkers also have a relatively fast time to clinical data. In both of those indications, it will be possible, even in the first patient study, to derive cerebrospinal fluid levels or imaging in the case of A beta and cerebrospinal fluid levels of tau in the case of MAPT. That is how we prioritize. On the preclinical side, again, it is on programs that can create value in a reasonable period of time and have an at least medium-sized market opportunity. Can you speak to these amyloid beta and tau programs and how quickly you can progress these trials to get to those proof of concept time points? Yeah. We've generally been stating one to two programs per year IND in the next three years. We've completed GLP TOX studies for two more programs right now. Essentially, those programs we're just writing and preparing for filing, which is exciting. One will be an Alzheimer's program, one will be an enzyme replacement therapy. As I mentioned, a year from now, my expectation is to have three molecules in the clinic, two in Alzheimer's and one ETV. That's just the beginning, right? Again, it goes to this resource prioritization. I think our guidance to one to two per year has also been wise about our burn as we prepare to launch our first medicine. Speaking specifically about MAPT and A beta, I think we're at the point now with A beta and those people who really know the Alzheimer's field, really understand the genetics, understand the clinical data, these medicines work, but they could be better. They could be better for one of two ways. They can either be given earlier, which I think has a much higher chance of delaying disease to begin with. Those studies, some of those preclinical studies are underway for the standard antibodies, but also more rapid plaque reduction and a better safety profile. Our ATV:Abeta is engineered to basically give you broad and even distribution throughout the CNS, more rapid plaque reduction, but also engineered to be immune silent when bound to transferrin receptor, which we think will improve the profile around hematological findings, which are observed with a number of the TfR platforms. In terms of the MAPT, that particular target, I look at A beta as the initiator and MAPT as the executioner in Alzheimer's disease, but it does not have the same direct genetic underpinnings that amyloid beta has, but it is still a very promising target. There, I think all eyes are on the intrathecal delivery of an ASO as early signs, but I think everyone recognizes that a systemic delivery that has even distribution would be ultimately ideal for that target, and that is the product that we are bringing forward. You're taking both platforms forward here in Alzheimer's. Yeah, and very rapidly. Yeah. Now, I think what happened is we blazed the trail with oligonucleotides, proved that it could be done, and then we basically have done a lot more engineering to improve the platform and bring our first product forward. Now we've, in fact, have an internal team that works on the oligonucleotide chemistry, and it's been an exciting, let's say, expansion for Denali in the last year. On the frontotemporal dementia progranulin program here, could you speak to what we should be looking at from the Alector phase three trial that could have read-through to your program that's partnered? I think fundamentally, the way that Alector's approaching FTD granulin is different than the way we're approaching it. Their approach is to block its natural receptor that's required for internalization of progranulin, although there are at least one other receptor. Our approach is very similar to enzyme replacement therapy, but it's basically protein replacement therapy. We're essentially giving progranulin back using the transport vehicle. We've shown that progranulin plays a role in lysosomes, and this is very similar to the ERT programs, and that's the approach. We, of course, are watching what will happen with their program, but I think for us, because it's distinct mechanistically, I see a future regardless of the outcome. Unless, I guess, it's definitively solved, then it's going to be more challenging to develop PTV progranulin. Is there anything else that you want to highlight across the pipeline, whether early-stage development or even the small molecule programs here with Biogen? Yeah. I think what I'd like to highlight is that we believe, and I think it's been shown by just the landscape broadly, that it's the era of blood-brain barrier delivery and tissue delivery. When we started a decade ago, there were a handful of companies that had a program or two. Now I think with our Hunter data, Sanfilippo data, obviously the data in the anti-amyloid fields that are enabled by brain shuttles, it's such an exciting time, right? I think, as Alex mentioned, and I just want to reiterate, it's about execution. It's about bringing now a bunch of programs forward and decreasing the cost of that effort from idea to IND and then from IND to clinical proof of concept. Ideally, all of them have a biomarker. I think that tissue distribution allows us to even think beyond the brain. We're thinking about tumors, and we're thinking about muscle, and that's also been known to be highly dependent on transferrin receptor as a way to distribute. That being said, wise resource allocation, especially with the high cost of capital, is really important for us. I'd say it's probably the most exciting time in the last decade for Denali. Great. Maybe a last question here. You talked about how it's important to manage your allocation of capital. With that context and recognizing you've always had a very decent BD effort, right, with regard to partnering your own assets, how are you balancing this with this broad opportunity set that you have? Yeah. Partnering and BD has always been a core part of our strategy. As you mentioned, we did three deals in pretty short sequence early on, Biogen, Sanofi, and Takeda. Then we slowed down, which was really in an interest to have a part of our portfolio that is wholly owned. Now that some of those deals or some of those alliances have essentially played out and our portfolio has expanded, we have much more capacity to do new deals. Especially as we look at the capital requirement into the future years, and Ryan mentioned a few times how important capital efficiency is for us. We do not plan to grow OpEx much, and we will have revenues coming in, but still partnering and BD will be one of the core areas that we look at. There are opportunities. There are opportunities at different parts of the portfolio. It's really what's the right deal, who's the right partner, and what's the right time. Great. With that, thank you so much, Ryan and Alex. Really appreciate the time today. All right. Thank you.