Cassava sinks after grand jury indicts co-lead scientist on Alzheimer’s drug

A federal grand jury in the District of Maryland returned an indictment yesterday charging Hoau-Yan Wang for defrauding the National Institutes of Health of approximately $16M in federal grant funds. Hoau-Yan Wang is the co-lead scientist on discovery and development of Cassava Sciences’ simufilam and SavaDx. According to court documents, Hoau-Yan Wang was a tenured medical professor at a public university’s medical school, as well as a paid advisor and consultant to Cassava Sciences. From approximately May 2015 through approximately April 2023, Wang allegedly engaged in a scheme to fabricate and falsify scientific data in grant applications made to the NIH on behalf of himself and Cassava. As alleged, the fraudulent grant applications to the NIH sought funding for scientific research of a potential treatment and diagnostic test for Alzheimer’s disease and resulted in the award of approximately $16M in grants from approximately 2017 to 2021, part of which funded Wang’s laboratory work and salary. Wang’s alleged scientific data falsification in the NIH grant applications related to how the proposed drug and diagnostic test were intended to work and the improvement of certain indicators associated with Alzheimer’s disease after treatment with the proposed drug, the Department of Justice said in a statement. Wang is charged with one count of major fraud against the United States, two counts of wire fraud, and one count of false statements. Shares of Cassava are down 43%, or $8.14, to $10.81 following the indictment.