Cassava Sciences Shares Sink With Alzheimer's Drug Mired In Controversy

Neurodegenerative diseases-focused biopharma Cassava Sciences, Inc. (NASDAQ: SAVA) saw both sides of the world Tuesday.

• The stock rallied to close higher by 2% after it announced an agreement with the Food and Drug Administration regarding two late-stage studies of its lead drug candidate simufilam in Alzheimer's disease.
• In after-hours trading, the stock gave back all the gains and then some.

Simufilam Mired In Controversy: Late Tuesday, it was revealed that a Citizen Petition was filed with the FDA, requesting halting of the two simufliam trials.

The petition filed by law firm Labaton Sucharow alleged that all of the foundational science, supporting Cassava's claims about simufilam's use for Alzheimer's disease are based on systemic data manipulation and misrepresentation.

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The three primary areas of concerns outlined in the petition include extensive use of western blot analyses, claims about the investigational drug's effects in experiments conducted on postmortem human brain tissue and the Phase 2b clinical biomarker data presented by the company, which raises questions about the validity of the data.

The petition also called for the FDA to pause the ongoing clinical trials until the agency can conduct and complete a rigorous audit of Cassava's research.

Cassava Shoots Back: Cassava issued a response in which it stated the claims made in this post regarding scientific integrity are false and misleading.

"The Company stands behind its science, its scientists and its scientific collaborators, and is responding to ensure the facts are known and respected," Cassava said in a statement.

In a point-by-point response, the company refuted each of the claims by the petitioner.

In premarket trading Wednesday, Cassava shares were slumping 30.16% to $82.29.