Cassava Sciences (SAVA) saw its shares tumble over 11% following the company’s agreement to pay more than $40 million to settle allegations from the Securities and Exchange Commission (SEC). The SEC claimed Cassava made misleading statements regarding a clinical trial for its Alzheimer’s drug, simufilam.
The SEC’s investigation revealed that study data had been manipulated, leading to inflated claims of the drug’s efficacy in improving Alzheimer’s biomarkers. The misleading statements were made in September 2020 during the Phase 2 trial, where Cassava asserted that the trial was conducted under blind conditions while omitting details about the co-developer’s involvement.
As part of the settlement, former CEO Remi Barbier agreed to pay $175,000, alongside the company’s settlement payment. A former senior vice president was also included in the agreement. Richard Barry recently took over as CEO, following his appointment as executive chairman earlier this year.
Despite Friday’s drop, Cassava’s stock remains approximately 25% higher year-to-date.
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