Company: DNLI
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001714899-25-000105
Chunk: 406

Company: Denali Therapeutics Inc.
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 8
Chunk 406
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 Manufacturing Services Agreement as amended (“DMSA”) with Lonza Sales AG (“Lonza”) for the development and manufacture of biologic products. Under the DMSA, the Company will execute purchase orders based on project plans authorizing Lonza to provide development and manufacturing services with respect to certain of the Company's antibody and enzyme products, and will pay for the services provided and batches delivered in accordance with the DMSA and project plan. Unless earlier terminated, the DMSA will expire when all development and manufacturing services are completed, which is not expected to be before January 2028. As of March 31, 2025 and December 31, 2024, the Company had total non-cancellable purchase commitments under the DMSA of $21.9 million and $36.7 million, respectively.During the three months ended March 31, 2025 and 2024, the Company incurred costs of $2.6 million and $16.4 million, respectively, and made payments of $6.0 million and $13.5 million, respectively, for the development and manufacturing services rendered under the DMSA.In the normal course of business, the Company enters into other firm purchase commitments primarily related to research and development activities. The Company had contractual obligations under certain clinical and manufacturing agreements other than the DMSA of $46.8 million and $24.1 million, as of March 31, 2025 and December 31, 2024, respectively, with certain amounts subject to cost sharing with Takeda.

17

ContingenciesFrom time to time, the Company may be involved in lawsuits, arbitration, claims, investigations and proceedings consisting of intellectual property, employment and other matters which arise in the ordinary course of business. The Company records accruals for loss contingencies to the extent that the Company concludes that it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated.

7.    Common Stock

On February 27, 2024, the Company entered into a securities purchase agreement (the "Purchase Agreement") with certain investors for the private placement of (i) 3,244,689 shares of Denali's common stock at a price of $17.07 per share and (ii) pre-funded warrants to purchase an aggregate of 26,046,065 shares of Denali's common stock (the "Pre-Funded Warrants") at a purchase price of $17.06 per Pre-Funded