Six million Americans suffer from Alzheimer’s, and any drug that could ameliorate the condition would represent a milestone in public health—and make billions of dollars. Cassava issued press releases touting the results of its clinical trials, and Barbier suggested that Simufilam was “the first drug—to our knowledge—that can restore cognition.” Word spread about the product on online forums, including Reddit, and Cassava became a “meme stock,” surging in value as it was hyped by relatively unsophisticated retail day traders. Cassava’s stock symbol is sava, and devotees of the company called themselves “savages.” They weren’t necessarily scientists, but they felt certain that Cassava would, in the words of one Redditor, “eradicate Alzheimer’s.” Another stockholder declared, “Ever since I seen the 10% conginitive [sic] improvement I’ve been convinced.” Barbier, meanwhile, told Fortune that a core group of institutional investors had looked at the preliminary data and concluded that, from an investment perspective, Cassava might be the next “Google or Tesla.” Last summer, a user on the Web site Seeking Alpha proclaimed, “cassava sciences is on the brink of making medical history,” enthusing, “CEOs of public companies don’t make these kinds of statements unless they can back it up.” In July, Cassava’s stock price surged to a hundred and thirty-five dollars, giving it a market value of roughly five billion dollars.
This was an astounding turn for Barbier’s company, which had no laboratories of its own, contracted out most of the science, and didn’t have much of a track record in Alzheimer’s research. In fact, until 2019, Cassava had been named Pain Therapeutics and was known primarily for developing what it described as the groundbreaking formulation of an opioid painkiller that had little risk of abuse. The drug, Remoxy, seemed so promising that investors poured money into the firm. In 2003, Sidney Wolfe, of the watchdog group Public Citizen, cautioned that Remoxy “sounds too good to be true.” He was right: the drug never earned F.D.A. approval. But, because Pain Therapeutics was publicly traded, it managed to stay alive on the fumes of investor optimism. In about a decade, the stock lost most of its value; meanwhile, Barbier compensated himself with nearly thirty million dollars. In the tart summation of the medical-news Web site stat, “Barbier has a reputation for profiting personally even while his company suffered multiple setbacks.”
Barbier insisted that his Alzheimer’s drug was a different story. Scientists affiliated with the company had published papers in peer-reviewed journals. And the National Institutes of Health had awarded some twenty million dollars in grants to Cassava and its academic collaborators. In May, 2020, the company acknowledged that the results of a clinical trial had been unsuccessful. But Barbier said that there must be some mistake, and subsequently announced that the company had commissioned a reanalysis, by an outside lab, and that the data showed a significant improvement in biomarkers for Alzheimer’s compared with a placebo. The stock began to climb. In February, 2021, Cassava touted a round of promising results from another trial—without a placebo—and claimed that, in an unprecedented breakthrough, Simufilam could actually renew cognitive function. The stock price reached new heights.
Barbier admitted that his company’s fortunes depended on the drug, saying, “We’re a moonshot with one rocket ship.” Nevertheless, he was comfortable with the “high-risk, high-reward” aspect of the business, so much so that he and his family owned more than a million shares of Cassava. “I’m putting my money where my mouth is,” he said. Last summer, the company made plans to commence a much larger third phase of clinical trials, in the fall, with nearly two thousand patients.
But in August Barbier was blindsided by a startling intervention. A New York attorney, Jordan A. Thomas, filed a “citizen petition” with the F.D.A. citing “grave concerns about the quality and integrity of the laboratory-based studies surrounding this drug candidate.” The petition contained a forty-two-page technical report outlining “a series of anomalies” in Cassava’s published research “that strongly suggests systemic data manipulation.” Though the petition never said so explicitly, it insinuated that Cassava had been fudging the data to inflate its stock price. Thomas even invoked the spectre of Theranos, the Silicon Valley darling that was ultimately exposed as a fraud. Cassava’s research was “riddled with red flags,” he argued, urging the F.D.A. to suspend the clinical trials, and to investigate.
Citizen petitions to the F.D.A.—which anyone can file to request action or express concern—are published online, and within hours Cassava’s stock had plunged roughly thirty per cent. Within a week, the company had lost two and a half billion dollars in value. Barbier declared himself “dazed and confused” by the attack, insisting, “These allegations are false.” He cast suspicion on those making the charges, noting that Thomas had filed the petition not on his own behalf but at the behest of unnamed clients. Who were these shadowy antagonists, and why wouldn’t they step forward? Barbier complained, “By distancing the monkey from the organ grinder, those behind this scheme are hard to detect.
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In the case of Cassava, Thomas’s clients did not work at the company. And, though he protected their identities, there was one important detail that he did disclose. His clients already had a major incentive to blow the whistle on the company: they had taken a short position on sava. They had made a financial bet against its stock.
The Cassava case started with a San Diego doctor named David Bredt, who worked as a biotech entrepreneur and, earlier in his career, had run neuroscience research at Janssen Pharmaceuticals and at Eli Lilly. “The first time I heard of Cassava was around February, when there was this explosion in the stock price,” Bredt told me. He found it odd that the stock was skyrocketing on the basis of a trial without a placebo. You can’t trust such results, he said, because it is simply “human nature to want things to work.”
Bredt started reading Cassava’s research. The company claimed to be developing a blood test that could accurately provide a diagnosis of Alzheimer’s—something that Bredt described to me as a “holy grail” in the field. He also discovered that all the company’s publications associated with Simufilam, the Alzheimer’s drug, appeared to have been written by the same scientist: an associate medical professor at the City University of New York named Hoau-Yan Wang. When Bredt consulted the papers, he was shocked. “They were making statements that were incompatible with biology and with pharmacology,” he told me. If all the claims in these papers were true, “they would win five Nobel Prizes.”
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In the case of Cassava, Thomas’s clients did not work at the company. And, though he protected their identities, there was one important detail that he did disclose. His clients already had a major incentive to blow the whistle on the company: they had taken a short position on sava. They had made a financial bet against its stock.
The Cassava case started with a San Diego doctor named David Bredt, who worked as a biotech entrepreneur and, earlier in his career, had run neuroscience research at Janssen Pharmaceuticals and at Eli Lilly. “The first time I heard of Cassava was around February, when there was this explosion in the stock price,” Bredt told me. He found it odd that the stock was skyrocketing on the basis of a trial without a placebo. You can’t trust such results, he said, because it is simply “human nature to want things to work.”
Bredt started reading Cassava’s research. The company claimed to be developing a blood test that could accurately provide a diagnosis of Alzheimer’s—something that Bredt described to me as a “holy grail” in the field. He also discovered that all the company’s publications associated with Simufilam, the Alzheimer’s drug, appeared to have been written by the same scientist: an associate medical professor at the City University of New York named Hoau-Yan Wang. When Bredt consulted the papers, he was shocked. “They were making statements that were incompatible with biology and with pharmacology,” he told me. If all the claims in these papers were true, “they would win five Nobel Prizes.”
One day in August, Thomas convened a media-training session for his clients, over Zoom, with a Manhattan-based consultant. They needed to prepare for their conversations with the Journal. It was important not to get too lost in the science, Thomas advised: “The conclusion should be short and sweet—‘It looks like the government’s being defrauded, investors have been lied to, and patients are at risk.’ ”
Bredt, who was Zooming in from his home, in California, was dressed in a Rip Curl T-shirt and shorts. The previous night, he had resigned from his job, at a biotechnology-investment firm, in order to avoid any potential conflicts of interest. He offered a dry run of his narrative of the case—which, to my layman’s ears, was bewilderingly technical—before concluding, “In my thirty-five years of research, I’ve never seen such a long trail of apparently clear misrepresented scientific data.”
“I thought that was quite good,” the consultant said. “As a reporter, my first question would be ‘How the hell did the N.I.H. and the F.D.A. miss this?’ ”
“The system has failed at many levels,” Bredt replied.
Thomas interjected, “It’s worth saying, ‘This is so bad, I couldn’t believe it. So I went to some of the leading experts in the country.’ ” He reminded his clients to mention that they had consulted a Nobel laureate, because everyone knows “Nobel Prize winners are super smart.”
After the meeting, Thomas seemed optimistic. He was mulling over an issue that often comes up in his cases: how best to harness his clients’ moral indignation. On the Zoom call, Bredt had been visibly exercised, chewing his lip. It was evident that he felt profoundly aggrieved by the alleged fraud. A little righteousness is useful for a whistle-blower. But not too much. “The stronger the case, the more you want to be like Mr. Rogers,” Thomas told me. “You don’t have to be emotional, because the evidence is so ridiculous.” At the same time, he didn’t want Bredt to “completely muzzle himself and lose his soul, because there’s peace in expressing it.” One detail Thomas had fastened on to was the fact that Bredt’s grandfather had suffered from Alzheimer’s. On the call, he counselled Bredt that, when he spoke to the Journal reporters, he should mention this family history. He added, “I think you can say, ‘This is personal.’ ”
