Denali Sets Fourth-Quarter AVLAYAH Outlook After $17.8 Million Quarter

The Tip Desk · November 10, 2026 · 3 min read

AVLAYAH net product revenue reached $17.8 million in its second full U.S. commercial quarter, and the company now expects $30.0 million to $32.0 million in the fourth quarter.

Denali Therapeutics Inc. (DNLI) reported AVLAYAH net product revenue of $17.8 million for the quarter ended September 30, 2026, above the $10.0 million to $12.0 million third-quarter range it had projected in its prior release.

The biotechnology company said the figure marked AVLAYAH’s second full quarter of commercial availability in the United States after FDA accelerated approval in March 2026. Fourth-quarter 2026 net product revenue is expected to be $30.0 million to $32.0 million.

Chief Executive Officer Ryan Watts said families and physicians were telling the company AVLAYAH was making a difference for children with Hunter syndrome. The company attributed the launch’s momentum to demand from families, physician engagement and expanding payer coverage.

Coverage now exceeds 70% of U.S. commercial lives, up from more than 50% in the prior quarter, and 20 state Medicaid programs have published coverage of AVLAYAH. A permanent J-code became effective October 1, 2026.

Net income was $70.1 million, or $0.37 a share, compared with a net loss of $126.9 million, or $0.74 a share, a year earlier. The quarter included a one-time $194.0 million net gain on the sale of a Priority Review Voucher. Cash, cash equivalents and marketable securities were approximately $1.0 billion as of September 30, 2026.

Operating expenses were $144.5 million. Research and development expenses were $106.1 million, up from $102.0 million a year earlier, which the company said was primarily attributable to higher external research and development expenses for TransportVehicle programs, partially offset by lower expenses for other programs. Selling, general and administrative expenses were $37.5 million, reflecting higher commercial and medical affairs costs to support the AVLAYAH launch. Cost of goods sold was $0.2 million as previously expensed pre-approval inventory is sold. Intangible asset amortization was $0.8 million, reflecting amortization of the developed technology intangible recognized upon AVLAYAH approval.

Denali completed enrollment of Cohort B in the global Phase 2/3 COMPASS study of AVLAYAH, for a total of 65 participants across Cohorts A and B. Data from COMPASS are expected in the first half of 2028. The study is intended to generate confirmatory evidence, expand the U.S. label to adult patients and support future global regulatory submissions.

Zafinofusp alfa, the company’s second potential product for Sanfilippo syndrome type A, completed the prespecified treatment duration for the primary endpoint in its Phase 1/2 study, which enrolled 20 participants. A BLA submission in 2027 seeking accelerated approval is on track. Preliminary dose-finding data presented at WORLDSymposium 2026 showed mean reductions of 80% and 83% at week 49 in cerebrospinal fluid heparan sulfate and urine heparan sulfate, respectively.

The FDA granted Orphan Drug Designation to DNL593 for FTD-GRN in August 2026. Phase 1/2 enrollment is complete with 40 participants, and data are expected in the first half of 2027. Five TransportVehicle programs are expected to generate data in 2027: zafinofusp alfa, DNL593, DNL628, DNL921 and DNL952.

AVLAYAH was recognized as the “Best Biotechnology Product” of 2026 by The Galien Foundation.