What a ride 2021 has been for Cassava Sciences (SAVA) stock. The extent of the wild share price fluctuations can be gauged by the fact that despite shares pulling back 66% from July’s highs, the stock has still delivered a year-to-date gain of 520%.
The highs – and the lows – have all been due to simufilam, the company’s candidate for the notoriously difficult-to-treat Alzheimer’s disease (AD). In clinical studies, simufilam has managed to do what other mooted AD treatment have never done before. Following 6 months, 9 months, and then a 12-month analysis, patients’ cognitive behavior still improved.
But those feats have been called into question, after a citizen petition filed with the FDA claimed that Cassava’s data collecting and analysis methods were deceiving and the results weren’t what they seemed. There have also been allegations that peer-reviewed articles were based on manipulated data. One published in July 2012 and the other from 2005.
Following the former being cleared of any data manipulation, now according to a Neuroscience journal article, there’s no evidence which shows data was manipulated in a scientific article published in 2005 and authored by Cassava and its scientific associates.
Jones analyst Soumit Roy says his focus is “entirely on the clinical data,” of which he has so far seen “clear chain of custody.”
“Cassava’s drug has shown a steady and directionally positive clinical improvement,” the 5-star analyst went on to say. “With larger cohort size in Phase 3 trials, we expect the standard deviations to tighten up and look similar to Lilly’s standard deviation spread (Eli Lilly’s AD candidate donanemab). Any cognition improvement above the baseline would be best-in-class, and we have seen clear trend towards that with Cassava’s simufilam.”
Roy sees two “key” catalysts ahead. One from the 12-month data details from the ongoing open-label study in Alzheimer’s disease – anticipated in 1Q22, while the cognition maintenance Phase 2 randomized controlled trial with simufilam should get a data readout in 1H/mid-2022.
It should come as no surprise, then, that Roy stays with the bulls. The top analyst thinks SAVA shares have a way to go still. In fact, Roy’s Buy rating is backed by a $215 price target, suggesting returns of a huge 409% over the one-year timeframe. (To watch Roy’s track record, click here)
According to the Street’s $159.25 average target, the gains will be a more “modest” 265%. All 4 recent SAVA reviews are positive, providing the stock with a Strong Buy consensus rating. (See SAVA stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
