Meme Stock Cassava Sues Short Sellers Alleging a Smear Campaign
- Biotech firm says defendants falsely questioned drug trials
- Company claims it lost $2 billion in market value as result
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Biotech company Cassava Sciences Inc., whose shares soared to dizzying heights during 2021’s meme stock rally, sued Quintessential Capital Management LLC and other short sellers for allegedly orchestrating its downfall with a defamatory “disinformation” campaign.
Cassava shares were up more than 1,700% in the first seven months of last year, buoyed by Reddit enthusiasm for its proposed Alzheimer’s treatment, simufilam. But the stock started plummeting in August 2021 after questions emerged over the quality and reliability of its trial results, ultimately losing more than $2 billion in market value.