Alzheimer's stocks Cassava Sciences (SAVA) and Cortexyme (CRTX) diverged Thursday. An analyst says SAVA stock is "back on track," but CRTX stock skidded on a key presentation.
On the stock market today, SAVA stock jumped 4.4% to 72.43 after the company's third-quarter report. Cassava's losses grew and were deeper than expected. But the company recently began a Phase 3 study of its Alzheimer's drug, simufilam.
Meanwhile, CRTX stock crumbled 7.4% and ended the regular session at 14.57. Last month, Cortexyme shares plummeted after the company said its Alzheimer's drug missed its mark in a key study. Executives emphasized the drug did its job in specific patients.
SAVA Stock Rises As CRTX Stock Falls
The SAVA stock jump follows a 24-cent loss in the third quarter. Cassava doesn't yet have revenue.
Maxim Group analyst Jason McCarthy expects Cassava's fortunes to turn around. Recently, Cassava began a final-phase study of simufilam, an experimental Alzheimer's drug that aims to stabilize a scaffolding protein in the brain. The study will pit simufilam against a placebo for the first time. The first studies of simufilam were open-label, meaning patients knew they were receiving the drug.
Earlier this year, short sellers tried to stop Cassava's Phase 3 study. A Citizen Petition filed with the Food and Drug Administration accused Cassava of manipulating some of the data foundational to the company and the drug. Last week, the journal that published the paper in question said it didn't find any evidence of data manipulation, and SAVA stock soared.
After a "roller coaster ride of a biotech story in 2021," McCarthy kept his buy rating on SAVA stock.
"Recent events, including both initiation of the Phase 3 study and the Journal of Neuroscience validating the data in question in the Citizen Petition have driven a rise in Cassava shares," McCarthy said in a report to clients. He has a 190 price target on SAVA stock.
Alzheimer's Stocks Diverge
CRTX stock has also been on a roller-coaster ride this year.
On a single October day, shares fell nearly 77% after Cortexyme said its drug, atuzaginstat, missed its key goal in a study. Atuzaginstat targets a bacteria called P. gingivalis. The bacteria causes periodontal disease. But Cortexyme says the same bacteria, in the brain, causes Alzheimer's disease.
But the drug only benefited patients whose saliva contained the bacteria.
On Thursday, CRTX stock fell again on the full results. For all patients, Cortexyme said atuzaginstat slowed cognitive decline. But it didn't pass muster on several markers of cognition. Further, there was no benefit on a scale that measures activities of daily living.
So, as SAVA stock reversed a three-day decline, CRTX stock touched its lowest-ever point.
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