Cassava Sciences rockets on heavy volume after Alzheimer’s drug trial results prompts analyst upgrade

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Shares of Cassava Sciences Inc. skyrocketed 85.7% on massive volume Monday, after the drug maker’s upbeat update on its Alzheimer’s disease treatment prompted Maxim analyst Jason McCarthy to turn bullish. Trading volume was 96.4 million shares in midday trading, enough to make it the most actively traded on the Nasdaq, and well above the full-day average of about 1.4 million shares. The company said before the open that final results of a Phase 2b study of sumifilam, which is expected to be published in a peer-reviewed publication, showed that sumifilam “significantly improved” an entire panel of validated biomarkers of disease in Alzheimer’s disease patients, which Cassava said was the first time a drug has shown the ability to improve multiple biomarkers. “The clinical data suggest sumifilam may be slowing disease progression in Alzheimer’s patients,” said Chief Medical Officer Nadav Friedmann. Maxim’s McCarthy raised his rating to buy from hold and established a $14 price target. He said his target is based on assumptions of a 2025 approval/launch of the drug and uses a 70% risk adjusted based on the stage of development, clinical trial risk and other factors. The stock has advanced 18.6% year to date, while the S&P 500 has gained 5.1%.
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