Cassava Sciences, a small Austin, Texas-based drugmaker that has no products on the market after 20 years, became the top biotech performer in 2021 after its stock rose 911 percent following the June 7 approval of Biogen's Alzheimer's drug, Bloomberg reported.
The company is the third-biggest gainer this year behind GameStop and AMC Entertainment Holdings in the Russell 2000 index, according to Bloomberg.
The approval of Biogen's drug, branded as Aduhelm, drove the price of Cassava and other small drugmakers higher. The approval substantially lowers the bar for new drugs targeting Alzheimer's, Remi Barbier, Cassava’s founder and CEO, told Bloomberg. The drug had mixed results in clinical trials and faced skepticism from scientists.
Soumit Roy, a biotechnology equity research analyst at JonesTrading, an equity broker and capital market company, told Bloomberg he estimates new Alzheimer's drugs could generate $200 billion in sales over 15 years.
Cassava has an experimental Alzheimer's drug called simufilam. In an ongoing midstage trial, patients treated with the drug showed improvement in reasoning and behavior, Bloomberg reported. But the trial included fewer than 100 patients and didn't have a control arm.
Cassava's drug targets a different protein than Biogen's drug, and the company is likely the only drugmaker pursuing that particular pathway, Bloomberg reported.
Read Bloomberg's full article here.