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Cassava Sciences Can Get To Market Early In Alzheimer's

Mar. 04, 2021 1:13 PM ETCassava Sciences, Inc. (SAVA)LLY453 Comments
Joe Springer profile picture
Joe Springer


  • Simufilam should receive Breakthrough Therapy Designation in Alzheimer's disease soon.
  • That could mean a number of bullish outcomes.
  • Whatever the case, with continued good data, the drug is much closer to market than it would seem.

Earlier this year we wrote that Cassava Sciences (NASDAQ:SAVA) could be the best performing stock of 2021. Cassava is starting Phase 3 trials in Alzheimer's Disease with its drug simufilam, which has a unique method of action and unprecedented data. Things are playing out very well, and we think the stock has a long way to run. Here is a summary to get caught up:

  • Alzheimer's is one of the largest unmet medical needs in the world, with no disease-modifying drugs approved, and no approvals at all since 2003
  • Simufilam has 12 years of directional data demonstrating consistently superb safety and efficacy: in-vitro, pre-clinical, Phase 1, Phase 2 open-label, Phase 2b placebo-controlled, and Phase 2 open-label extension
  • Cassava is fully funded for two Phase 3 trials with Special Protocol Assessment starting in Q3 and Q4
  • Simufilam stacks up very well to Eli Lilly's (LLY) donanemab - it is a pill not infusion (needle at clinic), has much better safety data, and much better efficacy data
  • Its unique MOA targets a misfolded protein and is not attempting to clear amyloid plaque
  • Simufilam is complemented by SavaDx, a simple blood test for the misfolded protein that has tested very well in diagnosing AD

Cassava just raised cash at $49 and has about $280 million on hand, NIH has been giving them grants since 2017 and their projected burn is just $25 million this year. There is large insider ownership from executives, esteemed Salesforce.com director Sanford Robertson is a director and one of the largest owners, and Blackrock just reported a stake as well.

Is Simufilam a Breakthrough Therapy?

We have been writing that simufilam has an excellent chance to get to market early under the FDA's Breakthrough Therapy Designation program.

Alzheimer's disease is a one way street, it's always fatal and millions

This article was written by

Joe Springer profile picture
Joe Springer was the number 1 ranked stock analyst in the world by tipranks.com, and enjoys teaching about the stock market as well as crushing it. Watch Joe every day on Multi-Baggers Club on Youtube: https://www.youtube.com/channel/UCEUlfh3c9ltiB6nFUq5JPJAJoin the free newsletter:https://tendiesclub.substack.com/welcome

Analyst’s Disclosure: I am/we are long SAVA. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (453)

NIH news today is a BIG deal! means they won't have to go to the investment bankers any time son.
Desert M profile picture
@Chicagomary2 Thank you, ChicagoMary2.

I also noticed that the following has been added to SAVA press releases recently and it is good that the Company reminds people of the human cost of AD:

"About Alzheimer’s Disease

Alzheimer’s disease is a progressive brain disorder that destroys memory and thinking skills. Currently, there are no drug therapies to halt Alzheimer’s disease, much less reverse its course. As of 2020, there were over 50 million people worldwide living with dementia, a figure expected to increase to 150 million by 2050.1 The annual global cost of dementia is now above $1 trillion, according to Alzheimer’s Disease International, a charitable organization.

About Cassava Sciences, Inc.

Cassava Sciences’ mission is to discover and develop innovations for chronic, neurodegenerative conditions. Over the past 10 years, Cassava Sciences has combined state-of-the-art technology with new insights in neurobiology to develop novel solutions for Alzheimer’s disease. For more information, please visit: www.CassavaSciences.com."
@Desert M stock price jumped $2 on news but gave it back quickly with general market unfortunately.
But is only 2,7 Mil..., it appears irrelevant considering they already have 280 mil in cash.
To me is symbolic but is more the fact that NIH seem to support and trust they efforts.
Desert M profile picture
As usual, I invite all comments and corrections to my comments.

Now that the Cognitive Maintenance Study (CMS) has been initiated (SAVA website, May 10, 2021), it would appear that the initial 50 (the earliest of which have been on Simufilam for 1 year now, as that trial began about March 2020) will be removed from this 1 year program. My sense is they will age out between March 2021 and perhaps early July 2021.

It further appears that these initial 50 will be offered the choice of participating in the 6 month CMS study, in which those participating will be randomly selected to either receive the same Simfuliam as before or a placebo.

There is no requirement to join the CMS but those declining will certainly lose access to simufilam. Those participating in the CMS may also be in the placebo group where they will lose access to simufilam for 6 months. At the end of 6 months it appears that all participants will be given the choice to remain on Simufilam for some period of time.

Of course no one wants to be removed from a drug that is making a difference in their lives, but this is a necessary part of the process.

It would also appear that one can now add an additional key date to the calendar. I think a new key date will be about mid March 2022, because by then the results of the six month CMS trial for those (initial 50) that started as late as July 2020 (in the 1 year trial) will be completed and the likely tabulated (July 21, August 21, September 21, October 21, November 21 and December 21). Add to this December 2021 date about 75 days to gather and process the data and this works out to about mid to late March 2022.

My sense is (and I invite all those who know this better than I to comment) that these CMS results (March 2022) will be telling as we will get a sense of how people did who were on simufilam (mid 2020 to mid 2021) and then managed without simufilam (this would be the group who received the placebo, mid 2021 to late 2021). But another reason this is important is that this will also be 18 months of data on the group (perhaps 25 people) who received simufilam all along (mid 2020 to late 2021), something that has not yet happened.
@Joe Springer what do you think would happen to the stock if the 9month results shared in July(?) are positive?
Joe Springer profile picture
@snmartin I guess it depends if it runs up beforehand, but the company's prospects have never been so good, adjust projections up for inflation too.
@Joe Springer

Man did you pick a beast!!! Unbelievable . Praying you have a same conviction pick for 2022🎉💪🙏
@Truth 1 let’s finish this one and Joe will pick one for us : Live look good too ?
Joe when you are going to write and article on sava ? There has been few article came out today but none of them like yours . I am addicted to your articles every piece crafted brilliantly.
Arthur E. Singer profile picture
Watching the Annual Meeting on Thursday closely: A 'Yes' vote on Motion #2 for 4M additional incentive shares without any additional justification would likely indicate a near term B.O. by private equity. Imho any Buy Out would be at a minimum of 5B so that the huge C level bonuses come into play. Smart move for private equity if they hold it through Ph3 and reap the rewards of 25B or more. Without substantial justification and if the motion fails well then I guess it was just a last ditch attempt to grab shares while they are still relatively cheap.
@Arturo El Magnifico "would likely indicate a near term B.O. by private equity. Imho " Doubt that is the reason. Would not need to authorize any more shares for a buyout!!! Just asking for more shares to motivate and attract managers.
Arthur E. Singer profile picture
@Medguy Please explain how you need up to 3.5 Million shares ($143.5M) for any ONE contributor to motivate or attract them. You didn't read the proxy information carefully.
@Arturo El Magnifico please explain why the same text existed on the proxy statement last year
Desert M profile picture
I respectively address this to SuperDD.

I do not think anyone should view Mr. Barbier's past experiences at Pain Therapeutics as a failure. It is because of these experiences that I have such great respect for him and his Team. Let me explain.

1) As I understand it (and I invite all critical and clarifying comments) the Remoxy ER pain reliever failed to secure approval at a joint FDA committee meeting (in 2018) because the FDA feared that the drug could be abused by those it was designed to treat. In short the FDA did not object to the science but to the delivery mechanism as the FDA feared that the capsule (designed to stop opioids addiction) would be abused instead.

2) This led to Mr. Barbier to protest because he believed that there were protections such that the capsule and product were much more tamper proof than the FDA believed. Mr. Barbier lost that argument, not for the science but for the delivery.

3) It seems to me, and this is somewhat conjecture on my part, that there came a time in about 2015 or 2016 when PTIE had to make a decision on what to do with what is now simufilam. It looks to me like there were two paths. Path #1 was to take simufilam (called something else at the time) and begin trials to treat AD. Based on discoveries from prior to 2012 (but memoralized in a 2012 paper) the scientists knew it could treat AD. But there was also path #2 which was to try to find a way to stop the rampant addiction of opioids that was taking a horrible toll on US cities and tens of thousands of people by using Remoxy ER to stop opioid addiction. Because PTIE was a small company, both paths could not be explored at the same time. It was either Path #1 or Path #2.

4) I'll bet there were long discussions at the time (2015, 2016, etc.) at headquarters about which path to take (again pure conjecture on my part). I will bet that some Board and other key staff wanted to go the AD route. My sense is that It was decided, based likely on humanitarian grounds and likely by the altruistic nature of Mr. Barbier, that Path #2 would prevail.

5) I think (and I invite anyone to tell the story better than I) that the FDA choosing to reject Remoxy is not at all a failure on Mr. Barbier's part. It was not the science that failed. That Mr. Barbier apparently tried to end the suffering of those addicted to opioids is the unknown story here. Now Mr. Barbier has the chance, with proven science dating to pre 2012, to stop the AD crisis. I lack an understanding of the sciences but the logic of what is described (why existing AD drugs work for a time and then stop) when woven together with cumulative discoveries of simufilam seems logical.
@Desert M Thank you for your perspective. Appreciated
Super DD profile picture
@Desert M Really appreciate your in-depth answer, Desert M. This is the charm I like about seekingalpha community, where people can practice critical thinking, regardless of our job titles, experience, whether a paid member or not, or any labels.

It seems that you may have known Mr. Barbier personally for a long time? No need to answer unless you prefer to. :) Thank you again!
Desert M profile picture
@Super DD Thank you, Super DD for the compliments. I have never met or spoken to (either in person, via e-mail, over the phone or in any context whatsoever) any employee or contractor of Cassava and that, of course, includes Mr. Barbier.
So when do we start to see upward movement, why is this not getting the press it deserves??
@Rainman 06 IMO this already got more press and hype than it deserves. 6 months worth of phase 2 data, that’s not worthy of a run from single digits to triple digits.
Desert M profile picture
I originally posted this in response to Chigagomary2 (who is generally spot on in comments) and then this post seems to have become "folded" into other comments and is not easily viewable. At the risk of excessively posting this, I invite critical comments and have made a few changes:

1) Although IMMU went from $40 to $86.30 when Gilead bought IMMU in September 2020 (see the excellent chart here: IMMU, "What Gilead's $21 Billion Oncology Bet Means For Investors" published on Sep. 14, 2020 4:47 PM ET), and although true the value of IMMU went from went from $8 Billion to $24 Billion, IMMU was not AD. Worldwide sales of a good drug for AD could easily go to $5 Billion almost overnight and $130 share for SAVA is a market value of $5.2 Billion. Thus, $130 is just too low;

2) The institutional and other high-powered investors who poured in $200,000,000 at $49 share will not accept $130 share and will convince the Board (who, themselves will need absolutely no convincing) that the price will need to be at least in the $300 - $500 range. Even $300 may prove to be too low as SAVA has lots of cash;

3) With SAVA's $280,000,000 in cash (and no debt) and the stream of regular positive news that will continue to emanate from the company between now and the rest of the year, SAVA can hold out for a higher price. SAVA staff will make it seem like SAVA staff can do and will do the retail selling and distribution but I am sure they do not want to seriously contemplate nor plan for going down this road (and remember, all the while you have the institutional and other high-powered investors in the background, beating the drums for seeking a higher valuation);

4) The foundation for continued excellent news from SAVA over the next 9+ months was set years ago by remarkable scientists making remarkable discoveries. We are all fortunate (thanks to Mr. Springer) to be seeing this play out now as I for one never heard of this company before. 9 month results and then 12 months results will most likely evidence breakthroughs never before experienced in AD patients. It seems Mr. Barbier is doing a most excellent job of managing the Team, listening to everyone there including those who likely want to go faster (and those institutional investors want a higher valuation in a buyout).

5) Mr. Barbier has the Team (and the general public) narrowly focused on 9 month results, which the SAVA Team must already know. These still need to be examined and reexamined by statistical experts but these will most likely show improvements and progress for AD patients never before seen. This will likely get the stock to sustainable levels over $75. The 9 months announcement in July 2021 and the AD presentation in July 2021 next set the table for 12 month results, the earliest of which are likely beginning to come in now to the statistical researchers;

6) But before you get to 12 month results (Sep 2021) you likely get what Joe Springer has been saying all along and that is the BTD application. Look for BTD in about July 2021. The SAVA investors will be pounding the table for it as will the SAVA scientific staff, which should get the stock to about $100 in very short order, about where most analysts say it should go within a year;

7) If the 12 month data checks in solid and if the company can sell simufilam (drs can write scripts) then look for the stock to get to $300 range, which is $12 Billion market cap. At that point, maybe it remains a company selling the drug or maybe a bidding war starts or maybe a drug company who is watching closely now then emerges with the right deal infrastructure that satisfies all;

8) It may be hard for a buyer to accumulate enough shares to successfully do a buyout without institutional investors and insiders signing on in earnest. Institutional owners have about 31% (sounds like a lot). I welcome all discussions on this point where I have minimal expertise. Insiders and institutions will not give this company away easily. There is a lot of science behind this product that may be under appreciated but the institutional investors and insiders know the science and what simufilam's MOA can likely do;

9) For all of this to happen there has to be a nearly flawless and masterful continued execution. I think Mr. Barbier will put it off. He is proceeding slow and methodically. He has laid an excellent foundation. His deliveries are measured. He has his ducks in a row. He is speaking about things that he believes will happen. He is confident with good reason. He knows his numbers. He knows the science. He is watching developments carefully. He knows there is a lot on the line. I do not think you could have a finer leader than Mr. Barbier and his Team at this exact moment for this exact drug.

For all of these good ideas, I may be completely wrong, too optimistic, too eager. I hope, however, I have been gracious to all those who have made this possible.
@Desert M great post, well thought out. I think the $300 SP after 12 months of OL result is an understatement. P3s is still a way to go, it will be a validation of the P2b and OL results. However, something can still go wrong but the change is remote. What do you think the MC will be after NDA approval?
Desert M profile picture
@Vinnie111 Thank you, Vinnie111, for your post. My thoughts on this come largely from Mr. Springer, so I am not breaking much new ground.

If my late father (from Brooklyn, NY and before that, southern Italy) were here (and who succumbed to AD) he would say something Brooklynite like "the market cap is the market cap" but being more practical is required here.

I can see $300 share ($12 Billion MC) if FDA approves scripts this year based on what other AD drugs are in the global AD pipeline now and Mr. Barbier's comments on global AD pipeline (and by no means have I canvassed or are knowledgeable on all of them or all their MOA).

But this $300 implies flawless execution including no safety issues and making allowances for those that begin taking it who should not be on it (because either their condition is severe or they do not have AD). My sense is I have a hard time seeing past $300 just now as I think substantial sales revenue will be needed or someone to buy out company will be required, to get price above $300 sooner than 12 months from now. But remember, this is a speculative space and many things can upend plans (positive and negative)

I am sure I am missing many things but I do expect a steady stream of positive news from the company in next 6-9 months (9 month results, corporate presentations at trade meetings, 12 month results, BTD, announcements of unknown positive developments (can simufilam treat other diseases like Parkinsons and other Neuro, etc.), news at earnings calls, SAVADX, etc.

Lets get to $75, with $300 being a reach and expect some ups and downs.
Super DD profile picture
@Desert M Thank you for the optimism, which is contagious. Hopefully Mr. Barbier's past failures at Pain Therapeutics are his best teacher.
ANTHONY AD3 profile picture
When the 9months and 12month OL data drop buyout numbers will be above 300/400$ ++ and i am being conservative here

Per last discussion of Remi @ Riley’s
It definetly is looking great ( the results ) glta
@Anthony D3 don’t play with my heart with these projections.
ANTHONY AD3 profile picture
@todddildine mark this post and thank me later :)))
@Anthony D3 considering that rhere is 5 millions ++ in US and 5 millions ++ in UK and 40 millions ++ in the world persons with AD, SAVA market cap is incredible!!! Hang on for the ride up my friends!!
Hi Joe regarding the possible buyout how does that work if I own the stock & they get bought out at the price you think? Assuming let’s say it’s today’s market cap & it gets bought out at the price you think what happens to the stock share price that we own?...thanks
@Truth 1 biotech buyouts usually go for a 60 to 100% premium, today's 47 could go to 90's easily, but given the recent jump it should be more like $130/share. If it isn't high enough another company could out bid them.

Ok thanks when do you think they would get bought out?
@Truth 1 no idea
The_Hammer profile picture
what is the 9 month date and 12 month date for open study?
@The_Hammer 9 month data will be presented end of July. 12 month data - September
The_Hammer profile picture
@ang777 presented what about dates of actual study ending 9 and 12 months. So does mgt now have some data going into the 12 month period?
@The_Hammer By my estimates: SAVA got final results for 9 months/50 patients by early/mid april. So 12 months/50 patients should be in SAVA's hands by early/mid july.
labber1 profile picture
@Joe Springer Please provide us with your comments on the live webcast Remi Barbier just did totay with B.Riley Securities. It seems VERY obvious to me that even though he can't disclose their 9-month open label data yet, he already has them in hand and they are as positive as they were for 6 months as he couldn't handle his own excitement to smile repeatedly with a read-between-the-lines message saying "Watch out World, it's coming... and it's coming BIG!!!"
please also write up another article probably highlighting phase 2b and this talk. Im still shaking
Was today's presentation of the phase 2b results by Dr. Burns, the first official statements on this study undergoing peer review. Placebo controlled, double blind study with an almost 100 percent patient response.

I'm guessing we still need a few press releases before the market reacts.
@ang777 link please
@ang777 thank you I’m in deep options and shares I can’t believe it’s not skyrocketing
Delmar Price profile picture
BIVI bought a candidate theorized to be related to inflammation related to insulin dysregulation in the brain. It is being trialed in AD patients. I wonder why if that was the cause for shares to dip from opening.
Funny number one company with only 11 employees???
HyperbolicSTONK profile picture
@Rainman 06 proof is in the pudding. Big news, likely good, coming out in July.
HyperbolicSTONK profile picture
@Rainman 06 I imagine stock will climb until then... good news in July and looking at 60 or 70+
nice jump on upgrade today! PT 78 is TOO low IMO.
@Chicagomary2 agreed not sure how they come with these numbers. Honestly they should either set it really high or really low.
@ang777 you need to trade and hold this company. I sold some on 2 /3/21 @119 on the news gap. rebought much cheaper. Don't lose you chair when the news music stops; hold at least SOME.
@Chicagomary2 oh I'm holding a lot.. can't wait for the presentations tomorrow
I am absolutely long on SAVA as well, for all the reasons that we know,
however best growth stock with zero revenue.... the miracles of the algorithms...
HyperbolicSTONK profile picture
@Joe Springer SAVA now the number 1 growth stock on SA. Well done sir on the DD.
The_Hammer profile picture
In the trials, how did the company measure the 10% cognitive improvement and does it match FDA protocols or methods?
The_Hammer profile picture
If SAVA gets BTD designation does that allow them to sell product? If so is it in limited quantities to certain patients or to anyone diagnosed with AD?
Joe Springer profile picture
@The_Hammer It means the FDA does not have to follow the traditional approval path and can guide SAVA to file NDA whenever they see fit. So it would allow for approval early but the still have to file the application for approval.

It would be indicated for AD, but docs can write off-label as much as they want, they could do it now but there is none to be bought at the pharmacy.
The_Hammer profile picture
@Joe Springer One would think the company would have a large part of the NDA already completed just awaiting additional info?
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