Statement by Cassava Sciences Regarding an Internal CUNY Report Leaked to the Press

• CUNY’s report makes no findings of data manipulation.
• The “egregious misconduct” cited in the report relates to internal record-keeping failures at CUNY.
• CUNY’s report finds that internal record-keeping failures “prevented us [CUNY] from making an objective assessment” of research misconduct.
• Leak of CUNY report preceded by massive increase in short selling.

AUSTIN, Texas, Oct. 12, 2023 (GLOBE NEWSWIRE) -- Cassava Sciences, Inc. (Nasdaq: SAVA), a clinical-stage biotechnology company focused on Alzheimer’s disease, today issued the following statement regarding an internal report purportedly prepared by City University of New York (CUNY). This report was leaked to the press. The leak of the CUNY report was preceded by a 40% increase in short selling activity in the stock of Cassava Sciences.

Beginning August 2021, short sellers executed a brutal, widely publicized “short-and-distort” campaign against Cassava Sciences. The short-sellers alleged that Cassava Sciences and its academic researcher at CUNY had engaged in data manipulation and other forms of research misconduct. In response to these allegations, CUNY initiated an internal investigation in Fall 2021. In 2022, Cassava Sciences filed a lawsuit against certain individuals who participated in the short-and-distort campaign, identifying over 1,000 false and defamatory statements.

On October 12, 2023, Science reported that it had obtained a copy of CUNY’s report from “a person who requested anonymity because they are not authorized to share it.” The Science article quotes a person paid by a lawyer for certain short-sellers, but does not indicate what role, if any, short-sellers had in the leak. According to Science, CUNY completed its investigation in May 2023. The short interest in Cassava Sciences’ stock jumped 40%, to over 14 million shares, between June 30, 2023, and September 29, 2023, according to NASDAQ.

CUNY’s report makes no findings of data manipulation. Rather, the “egregious misconduct” cited in the report relates exclusively to internal record-keeping failures at CUNY. The report also finds that internal record-keeping failures “prevented us [CUNY] from making an objective assessment” of the allegations of research misconduct.

“We remain confident in the underlying science for simufilam, our lead drug candidate,” said Remi Barbier, President & CEO. “We intend to continue to translate our passion for science into a novel drug for people living with Alzheimer’s disease. Our Phase 3 clinical program continues.”