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Cassava Sciences Stock Class Action Lawsuit Overview:
- Who: Biotech company Cassava Sciences Inc is facing a class action lawsuit from shareholders.
- What: Shareholders say that Cassava Sciences manipulated the data about its Alzheimer’s treatment, artificially inflating stock prices.
- Where: The lawsuit was filed in Texas and is for shareholders nationwide
Biotechnology company Cassava Sciences lied to shareholders and the public about its Alzheimer’s treatment, falsely inflating stock prices and ultimately damaging investors, a new class action lawsuit alleges.
The lawsuit was filed in Texas on behalf of shareholders who say that the company, which produces therapeutic product simufilam developed as a treatment for Alzheimer’s disease, manipulated data about the drug’s effectiveness, violating the Securities Exchange Act.
Development of Alzheimer’s Treatment Halted After ‘Anomalies’ Discovered
According to the claim, the company says that its drug simufilam reverts brains suffering from Alzheimer’s to their “native, healthy conformation,” by countering the downstream toxic effects of altered protein filamin.
But, the claim says, a citizen petition submitted to the US Food and Drug Administration (FDA) requesting that the FDA halt Cassava’s clinical trials exposed “a series of anomalies that are suggestive of systematic data manipulation and misrepresentation.”
The FDA petition also said that the methodology for studies “about Simufilam’s effects in experiments conducted on postmortem human brain tissue . . . defies logic, and the data presented again have hallmarks of manipulation.”
The petition also stated that trials found that simufilam was ineffective in improving the primary biomarkers endpoint.
“Cassava had these samples analyzed again and this time reported that Simufilam rapidly and robustly improved a wide array of biomarkers” and the reanalysis “shows signs of data anomalies or manipulation,” said the FDA petition.
The company issued a response to the petition, claiming that the allegations regarding scientific integrity were false and misleading – but it was not enough to save Cassava Science stock prices, alleges the class action lawsuit.
On the news of the citizen petition, the Company’s share price fell $36.97, or 32 percent, and it continued to further fall another $12.51, or 17.6 percent.
Cassava Sciences is not the first company to face legal action from investors who say stock prices plummeted upon news that much-anticipated Alzheimer’s treatments failed. Biotech company Athira Pharma was accused of using invalid research conducted by its CEO to develop its intellectual property and products for the treatment of Alzheimer’s disease by a trio of complaints filed earlier this summer.
Have you ever held shares in a company that violated the SEC? Tell us what happened in the comments section!
Cassava shareholders are represented by Glancy Prongay & Murray LLP.
The Cassava Sciences Stock Class Action Lawsuit is Newell v. Cassava Sciences, Inc., et al., Case No. 21-cv-760 in the U.S. District Court for the Western District of Texas captioned.
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One thought on Alzheimer’s Treatment Data Manipulated by Co, Inflating Stock Prices, Claims Class Action
My husband has been a shareholder of cassava stock for awhile now and we have been through so much financial and emotional turmoil due to this fake data !! Please contact barbgraz1@Verizon.net