Cassava Sciences (SAVA) Chief Executive Remi Barbier denied allegations of data manipulation in the firm’s Alzheimer’s research on Friday. But SAVA stock tumbled, again.
Last week, a shareholder firm called Labaton Sucharow claimed Cassava manipulated the results of clinical data surrounding simufilam, its Alzheimer’s treatment candidate. Labaton Sucharow later said it had been hired by unnamed people with short positions in SAVA stock.
The firm asked the Food and Drug Administration to halt clinical testing of simufilam, pending an investigation into the validity of Cassava’s biomarker data and an examination of data pulled from tests called Western blots. The firm also took issue with Cassava’s tests on cadaver brain tissue. In a letter to the FDA, the firm said Cassava’s data was riddled with anomalies suggestive of data manipulation.
“I think these allegations are false,” Barbier said in a written statement. “The NY law firm claims our science is improbable, unexpected and unique to Cassava Sciences, and therefore it’s all an elaborate fraud. By these criteria, all drug innovations are fraudulent.”
In afternoon trading on the stock market today, SAVA stock tumbled 11.5% near 48.10
SAVA Stock Dives On Continued Allegations
Simufilam works by targeting a protein called filamin A. Altered filamin A disrupts normal function of neurons, leading to degeneration and inflammation in the brain, Cassava says. SAVA stock has a perfect IBD Digital Relative Strength Rating of 99 on its strong 12-month performance related to simufilam.
But last week SAVA stock crumbled when Labaton Sucharow argued that the only scientific backing for simufilam comes from a series of papers with two common authors — Drs. Hoau-Yan-Wang and Lindsay Burns.
Complicating matters, Cassava said in May 2020 that simufilam actually failed in an early-stage study. The company then had Dr. Wang reanalyze the data. Months later, Cassava made a 180-degree turn and said simufilam actually showed promise on a number of markers related to Alzheimer’s disease.
In response, SAVA stock surged.
But Labaton Sucharow doubted the analysis. It also took issue with the Western blot images used to show Cassava’s data and the cadaver brain tissue used in testing. The Western blots show evidence of data manipulation, the firm said in a letter to the FDA.
In his statement, Cassava CEO Barbier noted the company doesn’t have its own laboratory facilities. So, Wang at the City University of New York generated the Western blots. Barbier said he’s asked CUNY to look into the allegations surrounding Wang.
Cassava Acknowledges Two Mistakes
Barbier acknowledged two mistakes in the visual representation of Cassava’s data.
“In all cases, the data analysis is correct; the visual display of the data is not correct,” he said. In one image from 2017, a figure contains 12 control bands. It should contain 13. In a July presentation poster, the placebo group should contain 20 lines. But it only has 18.
Barbier doubled down on the short-selling aspect of the report, calling it “unprecedented in its boldness, its scope, its immediacy and its intensity.”
“It feels like whoever is behind this effort wants to make a lot of money quickly, at the expense of our science,” he said in his statement.
Representatives of Labaton Sucharow didn’t respond to a request for comment. Meanwhile, SAVA stock has trended down over the last week.
Cassava is now working toward two Phase 3 studies. The interim nine-month results were promising, LifeSci Advisors analyst David Sherman told Investor’s Business Daily. Patients showed improvements in cognition on several measures. But he also sees the troubling issues with the Western blots.
“Could this have just been a short attack and someone wanted to make a profit?” he said. “It’s certainly possible. But it does feel like there’s something here (in the allegations).”
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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