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- Alzheimer's Drugmaker Cassava Sciences Rebounds in Pre-Market Trading After Friday's Sell-Off
Alzheimer's Drugmaker Cassava Sciences Rebounds in Pre-Market Trading After Friday's Sell-Off
Cassava Sciences (SAVA) is a company developing a drug to treat Alzheimer's disease. Their stock took a major hit on Friday after news broke about a federal indictment against a scientist who previously worked as a paid advisor for the company.
What Happened on Friday?
The scientist, Hoau-Yan Wang, is accused of defrauding the National Institutes of Health (NIH) of around $16 million in grant money. The Department of Justice alleges that Dr. Wang fabricated and falsified scientific data in grant applications. This news sent Cassava's stock price plummeting by 35% on Friday, closing at $12.35.
Cassava Responds and Stock Rebounds
Cassava is also facing lawsuits from shareholders who allege the company overstated the effectiveness of their drug, simufilam. However, the company released a statement clarifying the situation. They emphasize that Dr. Wang's alleged misconduct involved grant applications submitted several years ago and did not involve the current Phase 3 clinical trials for simufilam.
Investors seem to be taking some comfort in this news. Cassava's stock is currently surging in pre-market trading on Monday morning, with a gain of 9.72% to $13.55 per share. This is a significant rebound after Friday's major sell-off.
What it Means for Investors
It's still too early to say definitively how this situation will play out. The future of Cassava's drug and the company itself will likely depend on the outcome of the ongoing legal issues. However, today's pre-market rally suggests that investors may be cautiously optimistic after the company's statement.
Here are some additional points to consider:
Cassava recently raised $125 million to continue development of simufilam.
The drug is currently in Phase 3 clinical trials, which are the most advanced stages of testing before potential FDA approval.
We'll be following this story closely to see how it develops.
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