What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-02-26 compared with 2025-02-27 · 102 added, 98 removed, 267 unchanged (43% of the section changed)

4 unchanged sentences

Key elements of our strategy include:

1) Discover and develop a new class of barrier-crossing therapeutics by leveraging our TV platforms and deep expertise in BBB biology to enhance the delivery of biotherapeutics to the brain and throughout the body.

Invent a new class of barrier-crossing therapeutics by leveraging our TV platforms and deep expertise in blood-brain barrier biology to enhance the delivery of biotherapeutics to the brain and throughout the body.

Accelerate and expand a broad portfolio of TV-based product candidates to fully unlock the potential of barrier-crossing therapeutics, applying patient-informed development and driving biomarker-guided regulatory approvals.

1 unchanged sentence

Ou r clinical programs are as follows:

• Tividenofusp alfa (DNL310, ETV:IDS), composed of IDS fused to TV, is designed to deliver IDS into cells and tissues throughout the body, including the brain by crossing the BBB, with the goal of addressing the behavioral, cognitive, and physical manifestations of MPS II ;

• DNL126 (ETV:SGSH), composed of SGSH fused to TV, is designed to deliver SGSH into cells and tissues throughout the body, including the brain by crossing the BBB, with the goal of treating MPS IIIA;

• TAK-594/DNL593 (PTV:PGRN), composed of PGRN fused to TV, is designed to restore PGRN levels in the brain with the goal of treating FTD- GRN and is being developed in collaboration with Takeda;

• BIIB122/DNL151, our small molecule LRRK2 inhibitor program, is being developed in collaboration with Biogen, to address PD;

• DNL343, our small molecule eIF2B activator program, is under evaluation in ALS;

• Eclitasertib (SAR443122/DNL758), a peripheral and non-CNS penetrant small molecule RIPK1 inhibitor, is being developed by Sanofi, to address peripheral inflammatory diseases such as UC.

• DNL952 (ETV:GAA), composed of a cid alpha-glucosidase ("GAA") fused to TV and engineered to replace GAA in all tissues, with the goal of treating Pompe disease;

• DNL628 (OTV:MAPT), composed of an antisense oligonucleotide ("ASO") against MAPT fused to TV, designed to suppress gene expression of MAPT encoding the tau protein with the goal of treating Alzheimer's disease;

• BIIB122/DNL151, a small molecule LRRK2 inhibitor, is being developed in collaboration with Biogen for the potential treatment of Parkinson's disease;

• Eclitasertib (SAR443122/DNL758), a peripheral and non-CNS penetrant small molecule RIPK1 inhibitor, is being developed by Sanofi, to address peripheral inflammatory diseases such as ulcerative colitis ("UC").

The following table summarizes key information about our clinical stage programs:

5 unchanged sentences

Joint with Takeda

ETV:GAA DNL952*

Ph 1 (planned)

Pompe disease Denali

OTV:MAPT DNL628*

Ph 1b (planned)

Alzheimer’s disease Denali

LRRK2 BIIB122/DNL151 Ph 2a

1 unchanged sentence

Joint with Biogen

eIF2B DNL343 Ph 2/3

ALS Joint with Healey Center

RIPK1 (Peripheral)

eclitasertib, or SAR443122/DNL758

______________________________________________________________________________

* Regulatory application to begin clinical testing has been approved by Health Authorities.

Since we commenced operations, we have devoted substantially all of our resources to discovering, acquiring and developing product candidates, building our TV platform, assembling our core capabilities in understanding key neurodegenerative and lysosomal storage disease pathways, operationalizing clinical trials, building manufacturing capabilities and establishing commercial capabilities.

1 unchanged sentence

• Tividenofusp alfa DNL310 (ETV:IDS)

◦ In February 2024, we presented new positive data from the ongoing Phase 1/2 study of tividenofusp alfa in MPS II at the 20th Annual WORLD Symposium TM demonstrating sustained normalization of heparan sulfate in cerebrospinal fluid ("CSF HS"), robust and sustained reductions in biomarkers of lysosomal dysfunction and neuronal damage (neurofilament light;

"NfL"), and improvements and stabilization of multiple clinical outcomes measures over two years of treatment.

Also in February, we participated in the Reagan-Udall Foundation for the FDA workshop on CSF heparan sulfate as a potential surrogate biomarker to support accelerated approval in MPS.

◦ In April 2024, we completed enrollment of 47 participants with MPS II in the Phase 1/2 open-label study.

Following the Reagan-Udall Foundation workshop, we received written communication from the Center for Drug Evaluation and Research ("CDER") division of the FDA indicating openness to discussing an accelerated approval pathway for tividenofusp alfa in MPS II with CSF heparan sulfate as a surrogate biomarker;

◦ In September 2024, we announced that we plan to file a biologics license application ("BLA") for accelerated approval for tividenofusp alpha (DNL310) for the treatment of MPS II, based on the outcome of a recent successful meeting with the Center for Drug Evaluation and Research ("CDER") division of the FDA.

In addition, the meeting also provides a path for conversion to full approval based on the totality of the tividenofusp clinical development plan.

Based on discussions with CDER, we will include preclinical and clinical data on biomarkers (CSF HS and NfL) and safety in the BLA for tividenofusp alfa as a treatment of MPS II and intend to submit the BLA under the accelerated approval pathway in early 2025.

We are preparing for the U.S.

launch of tividenofusp alfa for the treatment of MPS II in late 2025 or early 2026;

◦ In January 2025, we announced that the U.S.

Food and Drug Administration ("FDA") granted Breakthrough Therapy Designation for tividenofusp alfa (DNL310) for the treatment of individuals with MPS II.

◦ In February 2025, we announced that in our global Phase 2/3 COMPASS study of tividenofusp alfa in participants with MPS II, target enrollment of the planned 33 participants with neuronopathic MPS II in Cohort A has been completed;

we increased the sample size of Cohort A by nine participants, bringing the total to 42 participants.

Cohort B continues to enroll participants with non-neuronopathic MPS II.

◦ In February 2025, at the WORLD Symposium conference, we presented the primary analysis of the Phase 1/2 study in 47 participants with Hunter syndrome in the 24-week treatment period and additional long-term follow-up.

◦ In May 2025, we completed a rolling submission of a Biologics License Application ("BLA") for tividenofusp alfa under the accelerated approval pathway;

◦ In July 2025, we announced that the FDA accepted our BLA for tividenofusp alfa for priority review, assigning a Prescription Drug User Fee Act (PDUFA) target action date of January 5, 2026;

In October 2025, we announced that the FDA extended its review timeline of the BLA seeking accelerated approval of tividenofusp alfa from January 5, 2026, to April 5, 2026;

◦ In December 2025, we entered into a synthetic royalty funding agreement with Royalty Pharma plc (“Royalty Pharma”), pursuant to which Royalty Pharma has agreed to provide us with up to $275.0 million in funding in exchange for a 9.25% royalty on future worldwide net sales of tividenofusp alfa, which will cease upon reaching a multiple of 3.0x, or 2.5x if achieved by the first quarter of 2039.

The agreement is subject to various closing conditions, including Denali achieving U.S.

FDA accelerated approval of tividenofusp alfa on or before June 30, 2026.

At the closing, Royalty Pharma will make an initial payment of $200.0 million.

Denali will be receive an additional payment of $75.0 million upon approval of tividenofusp alfa by the EMA on or before December 31, 2029.

Denali will retain all worldwide development and commercialization rights to tividenofusp alfa;

◦ In December 2025, we announced that we are in ongoing dialogue with the FDA related to the eligibility of tividenofusp alfa to receive a Rare Pediatric Disease Priority Review Voucher (“PRV”) upon approval.

Because we submitted a filing of our intent to request a PRV after the initial BLA submission, based on discussions with the FDA, we may not be eligible to receive the PRV.

Therefore, we are not including any potential future proceeds from the sale of a PRV in our financial planning.

We continue to work with the FDA and the FDA will determine whether to award a PRV upon approval of tividenofusp alfa.

We also announced that a Late Cycle Meeting with the FDA was completed and labeling discussions were underway;

◦ In December 2025, we announced that The New England Journal of Medicine published the Phase 1/2 study results;

◦ In January 2026, we announced that we are is preparing for commercial launch in anticipation of a regulatory decision on the BLA for tividenofusp alfa under the FDA accelerated approval pathway with a PDUFA target action date of April 5, 2026, and that enrollment in Cohort A (neuronopathic participants) was completed in the ongoing global Phase 2/3 COMPASS study in December 2025.

• DNL126 (ETV:SGSH)

◦ In February 2024, we announced that dosing had been initiated in the Phase 1/2 study of DNL126 in MPS IIIA.

Further, in February 2024, we presented supportive preclinical data at WORLD Symposium TM demonstrating that DNL126 improves lysosomal and microglial morphology, degeneration, and cognitive behavior in MPS IIIA mice;

◦ In June 2024, DNL126 was selected for the FDA's Support for clinical Trials Advancing Rare disease Therapeutics ("START") program to accelerate the development of rare disease therapeutics.

In November 2024, we announced that preliminary data from up to 25 weeks of dosing in the ongoing open-label Phase 1/2 study in MPS IIIA participants demonstrated a significant reduction in CSF HS levels from baseline, including normalization.

The safety profile supports continued development.

The most frequent treatment emergent adverse events were infusion related reactions of mild and moderate severity in all participants.

There was one serious adverse event considered by the investigator not related to drug.

Based on the preliminary Phase 1/2 results and a positive regulatory environment, we recently expanded the study and continue to assess the development plans including an accelerated approval path.

• TAK-594/DNL593 (PTV:PGRN)

◦ In January 2024, we announced that Part B in the TAK-594/DNL593 Phase 1/2 study in participants with FTD-GRN had been voluntarily paused to implement protocol modifications.

In the second quarter of 2024, we finalized the protocol amendment and dosing in the Phase 1/2 study is ongoing.

◦ In April 2025, we announced productive collaboration and discussions with the FDA under the START program (“Support for clinical Trials Advancing Rare Disease Therapeutics”) around the potential for an accelerated development and approval path for DNL126 in the treatment of Sanfilippo syndrome;

◦ In August 2025, we announced we reached alignment with the FDA that cerebrospinal fluid heparan sulfate (CSF HS) may be considered a reasonably likely surrogate endpoint to predict clinical benefit and may therefore be used to support accelerated approval of DNL126 for MPS IIIA.

We also announced that additional 49-week data from the ongoing open-label Phase 1/2 study were consistent with previously announced 25-week data, demonstrating a significant reduction in CSF HS from baseline, including normalization, and a safety profile that supports continued development;

◦ In September 2025, we completed enrollment in the ongoing Phase 1/2 study, and in December 2025 we announced that the Phase 1/2 study remains on track for completion in 2026, supporting a potential accelerated approval pathway and commercial launch by the second half of 2027, with planning for a global Phase 3 confirmatory study underway;

◦ In February 2026, we presented preliminary open-label Phase 1/2 data at the 2026 WORLD Symposium demonstrating substantial reductions in CSF HS, including normalization from baseline, and in urine HS with a safety profile consistent with other enzyme replacement therapies.

• DNL 952 (ETV:GAA)

◦ In October 2025, we submitted an Investigational New Drug ("IND") application for DNL952 (ETV:GAA) to initiate a Phase 1 study, and in December 2025 we announced that the IND had been placed on clinical hold.

In January 2026 we announced that the FDA has lifted the clinical hold on the IND application for DNL952, and we are proceeding with the Phase 1 study.

• DNL 628 (OTV:MAPT)

◦ In January 2026, we announced that the Clinical Trial Application ("CTA") for DNL628 (OTV:MAPT) to initiate a Phase 1b study in Alzheimer’s disease was approved and study start-up activities are underway.

• BIIB122/DNL151 (LRRK2)

◦ In February 2024, we announced that we executed a Collaboration and Development Funding Agreement in January 2024 with a third party related to a global Phase 2a study of BIIB122/DNL151, which we plan to solely operationalize, to evaluate safety and biomarkers associated with BIIB122 (DNL151) in participants with LRRK2-associated Parkinson’s disease (LRRK2-PD).

This agreement includes committed funding of $75.0 million, of which $12.5 million was received in January 2024 and $12.5 million was received in July 2024, with the remainder to be triggered based on operational milestones in the study.

The third party will be eligible to receive low single-digit royalties from Denali on annual worldwide net sales of LRRK2 inhibitors for the treatment of Parkinson’s disease, with royalty amounts varying based on the scope of the label.

Denali has initiated screening of participants for the global Phase 2a study to evaluate safety and biomarkers associated with BIIB122/DNL151 in participants with LRRK2-PD.

Biogen will continue to conduct the ongoing global Phase 2b LUMA study in early-stage Parkinson’s disease;

enrollment is expected to be completed in 2025.

Denali and Biogen will co-commercialize BIIB122/DNL151 assuming regulatory approval;

◦ In December 2024, we announced initiation of dosing in the global Phase 2a clinical study, BEACON, BIIB122 (DNL151) in participants with LRRK2-PD.

• DNL343 (eIF2B)

◦ In May 2024, the Sean M.

Healey & AMG Center for ALS at Massachusetts General Hospital ("MGH") in collaboration with the Northeast ALS Consortium ("NEALS") announced that enrollment is complete in Regimen G (DNL343) of the Phase 2/3 HEALEY ALS Platform Trial;

and in January 2025, we announced topline results that the primary and key secondary endpoints were not met.

Further analyses are anticipated later in 2025.

◦ In January 2024, we announced our intention to divest our preclinical small molecule portfolio, which was completed effective March 1, 2024.

We maintain ownership of, and continue to advance, our current portfolio of clinical stage small molecule programs, in collaboration with our partners.

The decision was made based on clinical validation and prioritization of our TV-enabled platforms for brain delivery of large molecules;

◦ In February 2024, we announced that the Phase 2 HIMALAYA study evaluating SAR443820/DNL788 in participants with ALS did not meet the primary endpoint of change in ALS Functional Rating Scale-Revised ("ALSFRS-R");

◦ In February 2024, we announced that we entered into a securities purchase agreement with certain existing accredited investors for the private placement of 3,244,689 shares of our common stock at a price of $17.07 per share and pre-funded warrants to purchase an aggregate of 26,046,065 shares of our common stock at a purchase price of $17.06 per pre-funded warrant, resulting in net proceeds of approximately $499.3 million.

The pre-funded warrants have an exercise price of $0.01 per share of Common Stock, and are immediately exercisable and will remain exercisable until exercised in full.

The private placement closed on February 29, 2024;

◦ In July 2024, Biogen terminated its license to the ATV:Abeta program enabled by our TfR-targeting technology against amyloid beta for the potential treatment of Alzheimer's disease and granted us rights to data generated during the collaboration.

As a result of the termination, all rights to develop, manufacture, perform medical affairs activities, and commercialize new TfR-targeting ATV:Abeta therapeutics reverted to us.

Biogen licensed our TfR-targeting ATV:Abeta program in April 2023 having exercised an option that was part of the 2020 collaboration agreement between the two companies.

Biogen’s decision was not related to any efficacy or safety concerns with the TV platform;

◦ In October 2024, we were informed by Sanofi that the K2 Phase 2 study evaluating the safety and efficacy of SAR443820/DNL788 on serum neurofilament light chain levels in participants with multiple sclerosis was discontinued based on not meeting the primary and key secondary endpoints, and on February 24, 2025, we and Sanofi executed a side letter terminating Sanofi's license to the CNS Products program including SAR443820/DNL788;

◦ In May 2025, Biogen announced completion of enrollment in the Phase 2b LUMA study for early-stage Parkinson's disease with a readout expected in 2026.

◦ In January 2025, we announced topline results that the primary endpoint was not met in Regimen G of the Phase 2/3 HEALEY ALS Platform Trial evaluating DNL343 in the treatment of ALS.

In March 2025, we provided an update that additional analyses did not demonstrate a treatment effect on neurofilament light ("NfL"), a biomarker of neuronal damage, over the 24-week, double-blind period and in a subset of participants that completed an additional 28 weeks in the open-label active treatment extension.

Based on these outcomes, the active treatment extension in Regimen G was discontinued.

Overall, DNL343 was found to be generally well tolerated;

◦ In February 2025, we and Sanofi executed a side letter terminating Sanofi's license to the CNS Products program including SAR443820/DNL788;

◦ In February 2025, after mutual agreement to discontinue preclinical activities on ATV:TREM2, Takeda delivered notice of its election to terminate the ATV:TREM2 program on February 26, 2025, as per the terms of the Takeda Collaboration Agreement.

The ATV:TREM2 program termination will become effective 60 days following the notice date.

The ATV:TREM2 program termination became effective in April 2025;

◦ In December 2025, we sold 9,142,857 shares of common stock through an underwritten public offering at a price of $17.50 per share, and issued pre-funded warrants to purchase 2,285,714 shares of common stock at a price of $17.49, for aggregate net proceeds of $189.2 million.

The pre-funded warrants have an exercise price of $0.01 per share of common stock, and are immediately exercisable and will remain exercisable until exercised in full.

In January 2026, the underwriters partially exercised their option to purchase additional shares, and we issued 746,468 shares of common shares for net proceeds of $12.4 million.

We do not have any products approved for sale and have not generated any product revenue since our inception.

1 unchanged sentence

We have incurred significant operating losses to date and expect to continue to incur operating losses for the foreseeable future.

Our ability to generate product revenue will depend on the successful development and eventual commercialization of one or more of our product candidates.

We had net losses of $512.5 million, $422.8 million, and $145.2 million for the years ended December 31, 2025, 2024, and 2023, respectively.

As of December 31, 2025, we had an accumulated deficit of $2.05 billion.

Our ability to generate product revenue will depend on the successful development and eventual commercialization of one or more of our product candidates.

We expect to continue to incur significant expenses and operating losses as we advance our current clinical stage programs through healthy volunteer and patient trials;

3 unchanged sentences

and hire additional personnel.

We have relied on third-party contract manufacturers to manufacture and supply our preclinical and clinical materials to be used during the development of our product candidates through 2024.

We are in the final stages of building out our Salt Lake City ("SLC") manufacturing facility , and beginning in early 2025 plan to commence manufacturing operations.

Through 2024, we relied entirely on third-party contract manufacturers to manufacture and supply our preclinical and clinical materials to be used during the development of our product candidates through 2024.

I n early 2025, we opened our clinical biomanufacturing facility in Salt Lake City, Utah, expanding U.S.

manufacturing capabilities and strengthening supply chain control and operational efficiency.

Going forward, we plan to use both our SLC facility and third-party contract manufacturers to supply our preclinical and clinical materials.

15 unchanged sentences

Further details regarding the terms of the agreements between us and Biogen are included in this Annual Report on Form 10-K in the section titled "Business - Licenses and Collaborations."

We did not recognize any collaboration revenue under the Biogen Collaboration Agreement in the year ended December 31, 2024, and we recognized related party collaboration revenue of $295.5 million, and $3.1 million in the years ended December 31, 2023 and 2022, respectively.

We did not recognize any collaboration revenue under the Biogen Collaboration Agreement in the years ended December 31, 2025 and 2024, and we recognized related party collaboration revenue of $295.5 million in the year ended December 31, 2023.

Further, we recognized research and development expense of $15.8 million, $16.7 million and $17.7 million related to cost sharing payments we made to Biogen in the years ended December 31, 2025, 2024 and 2023, respectively.

We have recorded cost sharing payables of $2.5 million and $3.2 million on the Consolidated Balance Sheet as of December 31, 2024 and 2023, respectively.

We have recorded cost sharing payables of $2.8 million and $2.5 million on the Consolidated Balance Sheets as of December 31, 2025 and 2024, respectively.

Through December 31, 2025, we have earned $5.0 million in option fee payments but have not recorded any milestone revenue or product sales under the Biogen Collaboration Agreement.

2 unchanged sentences

Further details regarding the terms of the agreement between us and Sanofi, and historic payments between the parties under the agreement, are included in this Annual Report on Form 10-K in the section titled "Business - Licenses and Collaborations."

We recognized no collaboration revenue associated with the Sanofi Collaboration Agreement in the year ended December 31, 2024, and we recognized collaboration revenue of $25.0 million and $53.4 million in the years ended December 31, 2023 and 2022, respectively.

We recognized no collaboration revenue associated with the Sanofi Collaboration Agreement in the years ended December 31, 2025 and 2024, and we recognized collaboration revenue of $25.0 million in the year ended December 31, 2023.

No receivable from Sanofi was recorded on the Consolidated Balance Sheets as of December 31, 2025 and 2024.

4 unchanged sentences

In November 2021 and December 2021, Takeda exercised its options for the PTV:PGRN and ATV:TREM2 programs, respectively, subsequent to which we have shared equally in the development costs for the programs.

In February 2025, after mutual agreement to discontinue preclinical activities on ATV:TREM2, Takeda delivered notice of its election to terminate the ATV:TREM2 program on February 26, 2025, as per the terms of the Takeda Collaboration Agreement.

The ATV:TREM2 program termination will become effective 60 days following the notice date.

In February 2025, after mutual agreement to discontinue preclinical activities on ATV:TREM2, Takeda delivered notice of its election to terminate the ATV:TREM2 program, and the ATV:TREM2 program termination became effective 60 days following the notice date.

Further details regarding the terms of the agreement between us and Takeda, and historic payments between the parties under the agreements, are included in this Annual Report on Form 10-K in the section titled "Business - Licenses and Collaborations."

We did not recognize collaboration revenue under the Takeda Collaboration Agreement in the year ended December 31, 2024, and we recognized collaboration revenue of $10.0 million and $51.9 million in the years ended December 31, 2023 and 2022, respectively.

We did not recognize collaboration revenue under the Takeda Collaboration Agreement in the years ended December 31, 2025 and 2024, and we recognized collaboration revenue of $10.0 million in the year ended December 31, 2023.

Further, we offset research and development expense due to cost sharing reimbursements received from Takeda of $6.6 million, $5.9 million and $12.2 million in the years ended December 31, 2025, 2024, and 2023, respectively.

We recorded receivables of $1.5 million and $2.7 million from Takeda as of December 31, 2024 and 2023, respectively.

We recorded receivables of $1.6 million and $1.5 million from Takeda on the Consolidated Balance Sheets as of December 31, 2025 and 2024, respectively.

Through December 31, 2025, we have received $65.0 million in milestone payments and $10.0 million of option exercise fees from Takeda, and we have not recorded any product sales under the Takeda Collaboration Agreement.

11 unchanged sentences

Our collaboration partner in the LRRK2 program, Biogen, is responsible for 50% of any payment obligation to Genentech under the Biogen Collaboration Agreement.

We have made a total of $25.0 million in consideration payments under the Genentech agreement, including $12.5 million in the year ended December 31, 2022 related to two clinical milestones.

We have recognized $18.8 million of research and development expense, net of cost sharing reimbursements from Biogen, including $6.3 million in the year ended December 31, 2022.

We have made a total of $25.0 million in consideration payments under the Genentech agreement, and we have recognized $18.8 million of associated research and development expense, net of cost sharing reimbursements from Biogen .

We did not recognize expenses under this agreement in the years ended December 31, 2025, 2024 and 2023.

Royalty Pharma Funding Agreement

In December 2025, we entered into a synthetic royalty funding agreement (the “Royalty Agreement”) with Royalty Pharma plc (“Royalty Pharma”).

Pursuant to the Royalty Agreement, Royalty Pharma has agreed to provide us with up to $275.0 million in funding in exchange for a 9.25% royalty on future net sales of tividenofusp alfa.

The transaction is subject to various closing conditions, including our achieving U.S.

Food and Drug and Administration (FDA) accelerated approval of tividenofusp alfa on or before June 30, 2026.

At the closing, Royalty Pharma will make an initial payment of $200.0 million.

We will receive an additional payment of $75.0 million upon approval of tividenofusp alfa by the European Medicines Agency (EMA) on or before December 31, 2029.

The royalty payments to Royalty Pharma will cease upon reaching a multiple of 3.0x, or 2.5x if achieved by the first quarter of 2039.

We will retain all worldwide development and commercialization rights to tividenofusp alfa.

Components of Operating Results

19 unchanged sentences

We also track external expenses associated with our TV platform.

These expenses include external expenses incurred by us relating to our Takeda Collaboration Agreement, Biogen Collaboration Agreement and Sanofi Collaboration Agreement.

These expenses include external expenses incurred by us relating to our Takeda Collaboration Agreement and Biogen Collaboration Agreement.

All external costs associated with earlier stage programs, or that benefit the entire portfolio, are tracked as a group.

23 unchanged sentences

General and Administrative

General and administrative expenses include personnel related expenses, such as salaries, benefits, travel and stock-based compensation expense, expenses for outside professional services, pre-commercial preparatory activities, and allocated expenses.

Outside professional services consist of legal, accounting and audit services and other consulting fees.

4 unchanged sentences

Interest and Other Income, Net

Interest and other income, net, consists primarily of interest income and investment income earned on our cash, cash equivalents and marketable securities, as well as sublease income, and an offset from interest expense on our finance lease liability.

Interest and other income, net, consists primarily of interest income, investment income earned on our cash, cash equivalents and marketable securities, and sublease income, as well as an offset for interest expense on our finance lease liability.

Results of Operations

3 unchanged sentences

2025 2024 $ %

Collaboration revenue:

Collaboration revenue from customers $ — $ 330,531 (330,531) * %

Total collaboration revenue — 330,531 (330,531) *

Operating expenses:

Research and development 418,778 396,440 22,338 6

General and administrative 105,438 103,354 2,084 2

General and administration 136,564 105,438 31,126 30

Total operating expenses 555,342 501,878 53,464 11

7 unchanged sentences

* Percentage is not meaningful.

Collaboration revenue.

There was no collaboration revenue for the year ended December 31, 2024 and $330.5 million for the year ended December 31, 2023.

The decrease in collaboration revenue of $330.5 million was primarily due to $293.9 million in revenue recognized in April 2023 under the Biogen Collaboration Agreement as a result of Biogen exercising its option to license our ATV:Abeta program, as well as decreases due to revenue earned under the Takeda and Sanofi Collaboration Agreements of $10.0 million and $25.0 million, respectively.

Research and development expenses.

12 unchanged sentences

_________________________________________________

(1) Personnel-related expenses include stock-based compensation expense of $59.1 million and $62.9 million for the years ended December 31, 2024 and 2023, respectively, reflecting a decrease of $3.8 million.

The decrease in research and development expenses of approximately $27.4 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to decreases of $7.5 million in personnel-related expenses, including decreases in salary and stock-based compensation expenses, decreases in other research and development expenses of $11.8 million, as well as $7.2 million in small molecule programs external expense, primarily driven by the divestiture of our preclinical small molecule programs in March 2024 and focus on the Company's TV-enabled portfolio.

(1) Personnel-related expenses include stock-based compensation expense of $59.5 million and $59.1 million for the years ended December 31, 2025 and 2024, respectively, reflecting an increase of $0.4 million .

The increase in research and development expenses of $22.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily attributable to the following:

• an increase of $16.6 million in external research and development expenses for our TV programs driven by increased spend on multiple preclinical and clinical programs including DNL126, DNL628 and DNL952, partially offset by a decrease in expenses related to our DNL310 program;

• an increase of $24.2 million in other research and development expenses, including lab consumables, consultants and general facilities costs, primarily driven by the commencement of operations at our large molecule manufacturing facility in Salt Lake City, Utah;

• an increase of $15.3 million in personnel-related expenses, including salaries and stock-based compensation, primarily driven by higher headcount related to the commencement of operations at our large molecule manufacturing facility in Salt Lake City, Utah.

These increases were partially offset by a $33.8 million decrease in external research and development expenses for our small molecule programs, primarily due to the wind-down of activities related to our DNL343 program in 2025.

General and administrative expenses .

General and administrative expenses were $105.4 million for the year ended December 31, 2024 compared to $103.4 million for the year ended December 31, 2023, primarily driven by activities related to the planned submission of a BLA for tividenofusp alfa in early 2025 and preparations for a commercial launch in late 2025 or early 2026.

General and administrative expenses were $136.6 million for the year ended December 31, 2025 compared to $105.4 million for the year ended December 31, 2024.

The increase of $31.2 million was primarily driven by headcount increases and other activities associated with preparing for the potential commercial launch for tividenofusp alfa.

Comparison of the years ended December 31, 2024 and 2023

3 unchanged sentences

Sources of Liquidity

As of December 31, 2024, we had cash, cash equivalent s and marketable securities in the amount of $1.19 billion .

As of December 31, 2025, we had cash, cash equivalent s and marketable securities in the amount of $966.2 million .

We fund our operations primarily with the proceeds from the sale of common stock and payments received from our collaboration partners, including those received under agreements with Takeda, Sanofi, and Biogen.

We have sold common stock and other securities in public offerings, a private placement, and stock purchase agreements with Takeda and Biogen.

Through December 31, 2024 we have obtained aggregate net proceeds of approximately $754.4 million from public offerings of our common stock, including $296.2 million obtained through the sale of 11.9 million shares of common stock in October 2022.

Through December 31, 2025 we have obtained aggregate net proceeds of approximately $943.6 million from public offerings of our common stock, including $189.2 million obtained through the sale of 9.1 million shares of common stock and the issuance of pre-funded warrants to purchase 2.3 million shares of common stock in December 2025, and $296.2 million obtained through the sale of 11.9 million shares of common stock in October 2022.

Under stock purchase agreements with collaboration partners we have received a further $575.0 million through December 31, 2025 .

Further, in February 2024 we received net proceeds of approximately $499.3 million from our private placement through the sale of approximately 3.2 million shares of common stock and pre-funded warrants to purchase a pproximately 26.0 million shares of our common stock .

I n February 2025, we established a registered “at-the-market” facility for the future sale of up to $400.0 million of shares of common stock from time to time by entering into an equity distribution agreement with Goldman Sachs & Co.

I n February 2025, we established a registered “at-the-market” facility for the potential future sale of up to $400.0 million of shares of common stock from time to time by entering into an equity distribution agreement with Goldman Sachs & Co.

LLC and Leerink Partners LLC as sales agents.

2 unchanged sentences

All sales under the current equity distribution agreement are conditioned upon satisfaction of customary closing conditions.

Pursuant to our collaboration and research and development funding agreements with Takeda, Sanofi and Biogen and an unrelated third party, through December 31, 2024 we have received upfront, option and milestone payments of $115.0 million , $225.0 million , $565.0 million and $25.0 million , respectively, and have also received $48.6 million and $16.2 million of gross cost sharing reimbursements from Takeda and Biogen, respectively, and received $13.7 million in specified reimbursements from Sanofi.

Through December 31, 2025, we have received $115.0 million , $225.0 million , $565.0 million and $50.0 million, pursuant to our collaboration and research and development funding agreements with Takeda, Sanofi, Biogen and an unrelated third party, respectively.

These payments include upfront, option and milestone payments.

Additionally, we have received $55.0 million and $16.2 million in gross cost sharing reimbursements from Takeda and Biogen, respectively, and received $13.7 million in specified reimbursements from Sanofi.

Future Funding Requirements and Commitments

15 unchanged sentences

We expect to incur substantial additional losses in the future as we conduct and expand our research and development activities.

We believe that our existing cash, cash equivalents and marketable securities will be sufficient to enable us to fund our projected operations through at least the twelve months following the filing date of this Form 10-K, including our existing commitments as outlined below.

We believe that our existing cash, cash equivalents and marketable securities will be sufficient to enable us to fund our projected operations through at least the twelve months following the filing date of this Annual Report on Form 10-K, including our existing commitments as outlined below.

We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.

In the longer term, we anticipate that we will need substantial additional resources to fund our operations and meet future commitments.

Our existing commitments primarily relate to our obligations under existing lease agreements, and certain clinical and manufacturing agreements, including the DMSA with Lonza Sales AG ("Lonza") for the development and manufacture of biologic products.

A s of December 31, 2024, the operating lease liability was $45.0 million and the finance lease liability was $9.3 million.

Under the DMSA with Lonza, and certain other clinical and manufacturing agreements, we had total non-refundable purchase commitments of $63.0 million as of December 31, 2024, with certain amounts subject to cost sharing with Takeda.

While the lease obligations span multiple years, the majority of the purchase commitments with Lonza and other clinical and manufacturing agreements are due within twelve months, with some spanning several years.

Further, we may be required to make contingent payments under existing arrangements upon the achievement of defined clinical, regulatory and commercial milestones in certain programs, including contingent consideration payments to former shareholders of F-star under the F-star Gamma license, and milestone and royalty payments to Genentech under the Genentech License Agreement.

Our existing commitments primarily relate to our obligations under existing lease agreements, certain pre-launch commercial product, clinical and manufacturing agreements .

A s of December 31, 2025, we had total undiscounted lease payment obligations of $54.2 million.

We had total non-refundable purchase commitments of $45.8 million as of December 31, 2025 .

While the lease obligations span multiple years, the majority of the purchase commitments are due within the upcoming twelve months Further, we may be required to make contingent payments under existing arrangements upon the achievement of defined clinical, regulatory and commercial milestones in certain programs, including contingent consideration payments to former shareholders of F-star under the F-star Gamma license, and milestone and royalty payments to Genentech under the Genentech License Agreement.

These commitments are more fully described in Note 4, "Acquisition, License Agreement and Research and Development Funding Collaboration Agreement" and Note 7, "Commitments and Contingencies" to the consolidated financial statements included in Item 8.

of this Annual Report on Form 10-K .

Our future funding requirements, including changes to and new commitments, will depend on many factors, including:

Our future funding requirements, including any changes to existing commitments or the establishment of new commitments, will depend on many factors, including:

• our ability to obtain regulatory approval for our product candidates, establish sales and marketing capabilities, and successfully market such approved product candidates;

• the timing and progress of preclinical and clinical development activities;

2 unchanged sentences

• our ability to maintain our current research and development programs and to establish new research and development, license or collaboration arrangements;

• our ability and success in securing manufacturing relationships with third parties or in establishing and operating a manufacturing facility;

• our ability and success in securing manufacturing relationships with third parties or in operating a manufacturing facility;

• the costs involved in prosecuting, defending and enforcing patent claims and other intellectual property claims;

10 unchanged sentences

Net cash provided by financing activities

189,216 484,304 17,820

Net increase (decrease) in cash, cash equivalents and restricted cash

1 unchanged sentence

Net Cash Used In Operating Activities

During the year ended December 31, 2024, net cash used in operating activities was $347.7 million, which consisted of a net loss of $422.8 million, adjusted by non-cash items primarily related to stock-based compensation expense, depreciation and amortization, net accretion of discounts on marketable securities, non-cash rent expenses, and the non-cash gain on divestiture of small molecule programs.

During the year ended December 31, 2025, net cash used in operating activities was $412.6 million, which consisted of a net loss of $512.5 million, adjusted by non-cash items primarily related to stock-based compensation expense, depreciation and amortization, net accretion of discounts on marketable securities, and non-cash rent expenses.

Cash used in operating activities was also driven by changes in our operating assets and liabilities.

Net Cash Provided By (Used In) Investing Activities

During the year ended December 31, 2024, net cash used in investing activities was $88.8 million, which consisted of $1.23 billion of purchases of marketable securities, and $15.9 million capital expenditures to purchase property and equipment, partially offset by $1.16 billion in proceeds from the maturities of marketable securities.

During the year ended December 31, 2025, net cash provided by investing activities was $255.3 million, which consisted of $706.0 million of proceeds from the maturities of marketable securities, partially offset by $441.3 million of purchases of marketable securities, and $9.4 million capital expenditures to purchase property and equipment.

Net Cash Provided By Financing Activities

During the year ended December 31, 2024, net cash provided by financing activities was $484.3 million, which consisted of $499.3 million of net proceeds from issuance of common stock and pre-funded warrants in a private placement in February 2024 and $17.4 million of proceeds from the exercise of stock options and the Company's ESPP, partially offset by an aggregate of $32.3 million of payments related to our finance lease.

During the year ended December 31, 2025, net cash provided by financing activities was $189.2 million, which consisted of $189.2 million of net proceeds from public offerings of our common stock and pre-funded warrants in December 2025, and $8.5 million of proceeds from the exercise of stock options and the Company's ESPP, partially offset by an aggregate of $8.2 million of payments related to our finance lease, and $0.3 million issuance costs related to the royalty financing.

Years ended December 31, 2024 and 2023

44 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis