What happened
Denali Therapeutics (DNLI 2.02%) a biotech company devoted to therapies to treat neurodegenerative diseases, saw its stock climb 17.7% on Wednesday. The stock closed on Tuesday at $27.29, then opened on Wednesday at $29.05.
It climbed to $33.83, putting it up 24% briefly, shortly before noon before falling to $32.12 at the close. The stock has a 52-week low of $20.24 and a 52-week high of $56.08. Overall this year, the stock is down more than 27%.
So what
The company benefited from the upswing for several companies that are looking at therapies to slow the progression of Alzheimer’s Disease. On Tuesday, Biogen and Eisai Co. Ltd. reported positive news regarding their Alzheimer’s drug, lecanemab, in slowing late-stage clinical decline for patients in the early stages of Alzheimer’s. While Biogen stock was up more than 77% on Wednesday, Eli Lilly, which is developing its own Alzheimer’s therapy, saw its shares rise more than 22%.
Now what
It remains to be seen how long the sympathetic effect will last for this biotech company. If lecanemab’s success is just the beginning of several Alzheimer’s breakthroughs, that could certainly help Denali. It has two potential Alzheimer’s drugs in its pipeline. RIPK1 is being looked at to treat Alzheimer’s as well as amyotrophic lateral sclerosis (ALS) and multiple sclerosis, while TREM2 is in a Phase 1 trial to treat Alzheimer’s. The company is also working with Biogen on a Parkinson’s drug,
Investors will have to be patient for its finances to catch up with its laboratory progress. In the second quarter, its only revenue was from collaboration projects, though at $52.4 million, that was up 128%, year-over-year. The company still had a net income loss of $58.8 million, or an earnings per share loss of $0.48.
