1Q26 Update. AVLAYAH Rhapsodically Received by Hunter Community. Shuttled ASO's Have Entered the Clinic - No News is Good News.

Research evidence excerpt

1Q26 Update. AVLAYAH Rhapsodically Received by Hunter Community. Shuttled ASO's Have Entered the Clinic - No News is Good News.

May 11, 2026 Denali Therapeutics Inc.

(DNLI, Buy, $39 PT)

Thomas Shrader, PhD, CFA

1Q26 Update. AVLAYAH Rhapsodically Received by Hunter Community. (212) 527-3551 tshrader@btig.com

Shuttled ASO's Have Entered the Clinic - No News is Good News. Jinnie Kim, PhD

(212) 882-2344 jinnie.kim@btig.com

WHAT YOU SHOULD KNOW: The biggest news this quarter was the FDA's accelerated Company DataBIOTECHNOLOGY approval of AVLAYAH (tividenofusp alfa-eknm) for neurologic manifestations of Hunter Closing Price $19.62

syndrome (MPS II). Early community reception has been notably positive where the

Price Target $39.00 first commercial patients were treated in less than one month from approval. The

underlying key message remains: the drug is vastly superior to the current standard of Market Cap (M) $3,113.89

Shares Out (M) 158.71EQUITY care. Specifically, almost no patients on SOC are at goal for CSF HS (a toxic biomarker

of enzyme activity) or urine GAGs (another biomarker of activity) before switching Avg Daily Vol-3 Months (M) 1.72

to AVLAYAH, while >90% are at goal after switching. We expect essentially all new Revisions

patients to initiate on AVLAYAH. Switching for already deeply impaired and stable

Previous Current patients remains more nuanced given infusion-related reaction risk, and management

continues to guide toward a gradual launch with reimbursement as the key near- Rating Buy Buy

Price Target $39.00 $39.00RESEARCH term hurdle. Long-term, the normalization of biomarkers seen with AVLAYAH suggests

patients may approach normal lifespans — a dramatic contrast to the current situation FY26E EPS (3.01) (2.82)

where only 25% of Hunter patients are adults.