Cassava Sciences Inc has denied data manipulation after a probe into conduct over its Alzheimer’s drug research was leaked yesterday, sending its shares spiralling lower.
Shares of Cassava were down nearly 21% on Friday morning at $13.97.
It said in a statement that an internal report by one of its collaborators, the City University of New York (CUNY), which was leaked to Science journal, “makes no findings of data manipulation”.
That report described “egregious misconduct” in another area of the business, namely record-keeping, which CUNY staff who conducted the investigation warned had prevented them from making an objective assessment.
Cassava Sciences said it “played no role in CUNY’s investigation”, after the university had turned down offers of assistance and requests for information, adding that the investigation committee had not interviewed any of its employees.
Traders have been widely short-selling shares in the company since August 2021, amid rumours that it had manipulated its research data.
Last year, Reuters reported that the biotech company faced a criminal investigation into its Alzheimer’s drug. Cassava reportedly said that the report related to disclosures from November 2021.
Cassava Sciences said there was a 40% increase in short-selling activity in the company’s stock from June 30 to September 29 this year, after CUNY’s internal investigation had concluded, representing 14 million share trades.
Last year, it filed a lawsuit against short-sellers, targeting more than 1,000 statements it said were false and defamatory, it said yesterday.
The report by CUNY was prepared as part of an internal investigation at the university that concluded in May and accused a faculty member, Hoau-Yan Wang, of “egregious misconduct in data management and record keeping”, according to Science.
The science journal said the report included allegations of misconduct relating to 20 research papers. A bulk of those papers related to simufilam, Cassava’s Alzheimer’s drug, and supported its transition into clinical trials.
The university’s investigation panel reportedly found signs of image manipulation in a 2012 paper published in The Journal of Neuroscience that suggested Cassava Sciences’ drug simufilam can blunt the pathological effects of the beta amyloid protein believed to cause Alzheimer’s, Science reported.
The journal said it had got hold of a copy of the internal university report from an anonymous source.
Cassava Sciences refuted the claims in the report, stating that its drug has been researched by scientists at other academic institutions, including Cochin Institute and the University of Milan, in papers that have been internationally published and support the efficacy of simufilam.
“We remain confident in the underlying science for simufilam, our lead drug candidate,” said Remi Barbier, Cassava Science's president and chief executive. “We intend to continue to translate our passion for science into a novel drug for people living with Alzheimer’s disease. Our Phase 3 clinical program continues.”