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The US Justice Department has opened a criminal investigation into Cassava Sciences (NASDAQ:SAVA) regarding the biotech company’s research results for its experimental Alzheimer’s drug, according to Reuters.
According to Reuters sources, the US authorities are reportedly conducting an investigation into Cassava, focused on whether it manipulated research results.
They are looking into whether companies or individuals misled or defrauded investors, government agencies, or consumers, although no specific details were provided, and the investigation could close without any charges, Reuters said.
While Kate Watson Moss, a lawyer representing Cassava, did not confirm or deny the criminal probe, she told Reuters in an email that “Cassava Sciences vehemently denies any and all allegations of wrongdoing.”
Adding that the company “has never been charged with a crime, and for good reason – Cassava Sciences has never engaged in criminal conduct.”
However, Watson Moss stated Cassava has received confidential requests for information from government agencies but did not identify the agencies.
Cassava is already facing scrutiny from the SEC and investors after allegations of data manipulation and misrepresentation involving research for its Alzheimer’s drug, simufilam.
Cassava shares plunged 26.5% Wednesday.
