Denali Therapeutics secures $275 million royalty deal with Royalty Pharma

Denali Therapeutics Inc. (NASDAQ: DNLI) and Royalty Pharma plc (NASDAQ: RPRX) announced a $275 million synthetic royalty funding agreement based on future net sales of tividenofusp alfa, according to a company statement.

Tividenofusp alfa is Denali's investigational enzyme replacement therapy for mucopolysaccharidosis type II, also known as Hunter syndrome. The U.S. Food and Drug Administration is currently reviewing a Biologics License Application for accelerated approval, with a target decision date of April 5, 2026.

Under the transaction terms, Royalty Pharma will make an initial payment of $200 million upon FDA accelerated approval of tividenofusp alfa. An additional $75 million payment is contingent on European Medicines Agency approval by December 31, 2029. In exchange, Royalty Pharma will receive a 9.25% royalty on worldwide net sales of the therapy.

The royalty payments will cease upon reaching a multiple of 3.0x, or 2.5x if achieved by the first quarter of 2039. The transaction is subject to various closing conditions, including achieving FDA accelerated approval.

"We are pleased to partner with Royalty Pharma, whose investment recognizes the value and potential of tividenofusp alfa for the Hunter community," said Ryan Watts, Denali's Chief Executive Officer.

Pablo Legorreta, Chief Executive Officer of Royalty Pharma, described tividenofusp alfa as addressing "a significant unmet need in the cognitive and physical manifestations of Hunter syndrome."

Denali's therapy uses the company's TransportVehicle platform technology designed to cross the blood-brain barrier. Hunter syndrome is a rare genetic disorder that affects multiple organ systems.

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