Cassava Sciences' Phase 3 study of the drug candidate simufilam in patients with mild to moderate Alzheimer's disease (AD), has shown no significant reduction in cognitive or functional impairment compared to the placebo group. This is stated in a press release.

"We took careful measures to recruit patients with mild to moderate AD. Despite this, the decline in cognition in the placebo group was less pronounced than previously reported in other placebo-controlled studies of AD. We are working to understand this better," said CEO Rick Barry.

The results caused the stock to collapse by nearly 84 percent on Monday.

The company is now shutting down its second phase 3 trial, called ReFocus-ALZ, as well as an ongoing open-label extension study. In the latter study, all patients know they are receiving simufilam.

The sector includes Swedish Bioarctic with lecanemab (Leqembi) used to treat early Alzheimer's disease. The company is working with Japan's Eisai, which in turn has a partnership with US-based Biogen. Eli Lilly is also active in this segment.