Cassava Sciences has agreed to pay $40 million to resolve an investigation into claims it made misleading statements about phase 2b data on its Alzheimer’s disease drug candidate.
The U.S. Securities and Exchange Commission (SEC) set out the case against Cassava and two of the biotech’s former executives in a complaint filed (PDF) Thursday. The case centers on the publication of data on PTI-125, also known as simufilam, in September 2020. Cassava reported improvements in cognition of up to 46% compared to placebo and went on to raise $260 million.
According to the SEC charges, the final results presented by Cassava were misleading in five ways. The charges include the accusation that Lindsay Burns, Ph.D., then a Cassava exec, now its co-defendant, removed 40% of the participants from an analysis of the episodic memory results.
The SEC said Burns, who was unblinded to the data, “removed the highest performing patients and lowest performing patients by baseline score cutoffs across all groups until the results appeared to show separation between the placebo group and the treatment arms.” The criteria for removing subjects was not predefined in the protocol.
At the time, Cassava said the effect sizes were calculated “after removing the most and least impaired subjects.” The biotech only admitted that the results excluded 40% of the patients in July 2024.
The SEC also accused Cassava and Burns of failing to disclose that the candidate was no better than placebo on other measures of spatial working memory.
On a cognition test, patients' average change in errors from baseline to Day 28 for the full episodic memory data was -3.4 points in the placebo group, compared to -2.8 points and -0.0 points, respectively, for the 50-mg and 100-mg simufilam groups, according to the SEC. Cassava’s presentation of the data showed a -1.5 change on placebo and up to -5.7 on simufilam. Burns is paying $85,000 to settle her part of the case.
The SEC accusations poke holes in the case for simufilam that Cassava made for the drug when it shared the phase 2b data in 2020. However, Cassava CEO Rick Barry said in a statement that the company is still hopeful that phase 3 trials “will be successful and that, after a rigorous FDA review, simufilam could become available to help those suffering from Alzheimer’s disease.”
Cassava, Burns and the third defendant, former CEO Remi Barbier, resolved the case without admitting or denying the allegations. Barbier agreed to pay $175,000 to resolve his part of the case, according to the SEC.