Shares of Cassava Sciences jumped another 10% in Wednesday’s pre-market session after more than doubling yesterday, as the small-cap biotech company released promising results from an interim study of its lead investigational drug, sumifilam, for the treatment of Alzheimer’s disease (AD).
Cassava Sciences (SAVA) said that the study showed that patient cognition and behavior scores both improved following six months of treatment with simufilam. No safety issues were encountered. The biotech company noted that cognition of individuals suffering from Alzheimer’s disease will always worsen as the illness is a progressive one.
“We could not be more pleased with these interim results,” said Cassava CEO Remi Barbier. “We would have been satisfied to show simufilam stabilizes cognition in patients over 6 months. An improvement in cognition and behavior tells us this drug candidate has potential to provide lasting treatment effects for people living with Alzheimer’s disease. It’s an exciting development.”
According to the clinical study funded by the National Institutes of Health, cognition scores improved by 1.6 points. In this same study, patients’ treatment with simufilam also improved dementia-related behavior, such as anxiety, delusions and agitation, by 1.3 points. Additionally, the safety profile of simufilam in the interim analysis was consistent with prior human studies and showed no drug-related serious adverse events. The preliminary study results were based on the first 50 patients who have completed at least six months of drug treatment.
This study was started in March 2020 and is now about 80% enrolled. Based on the preliminary results, Cassava Sciences said it remains on track to initiate a Phase 3 trial for simufilam in the second half of 2021.
Cantor Fitzgerald analyst Charles Duncan called the results “encouraging,” but cautioned that they were based on a non-controlled study. Duncan is positive about Cassava’s recent meeting with the Food and Drug Administration (FDA) on Phase 2 guidance, which he notes “represents incremental fundamental progress.”
However, the analyst, who has a Buy rating on the stock with a $24 price target, wants to see the finalized FDA meeting minutes before assessing the “possibilities and probabilities” for simufilam. (See Cassava stock analysis on TipRanks)
Cassava shares have exploded 713% so far this year, while the stock still scores a Strong Buy consensus rating based on 3 unanimous Buys. That’s alongside an average analyst price target of $19.33, which implies 65% downside potential over the next 12 months.