Cassava Sciences Inc. (SAVA) just got some unwelcome news from regulators. The U.S. Food and Drug Administration has issued a formal clinical hold on the company's investigational trial for simufilam, the drug candidate it's trying to repurpose for a rare form of epilepsy.

This comes after earlier discussions between Cassava and the FDA about the company's investigational new drug application for a proof-of-concept trial testing simufilam in tuberous sclerosis complex (TSC)-related epilepsy. The FDA wants more information before giving the green light.

What the FDA Wants

According to an SEC filing, the agency is asking Cassava to provide additional preclinical data and modify the trial's protocol design. The company says it plans to address these requirements, but there's a catch: the timeline just got a lot murkier.

Cassava previously expected to kick off this proof-of-concept trial in the first half of 2026. That's not happening anymore. The new timeline depends entirely on how quickly the company can gather the requested information and whether the FDA finds it satisfactory.

The Bigger Picture

This setback comes at a tough moment for Cassava. Earlier this year in March, the company shared topline results from its Phase 3 REFOCUS-ALZ study of simufilam for mild-to-moderate Alzheimer's disease. The trial missed all of its prespecified co-primary, secondary, and exploratory biomarker endpoints. Cassava subsequently discontinued simufilam development for Alzheimer's entirely.

That makes the epilepsy program even more crucial for the company's future. At least there's some financial breathing room: Cassava reported $106.1 million in cash and cash equivalents as of September 30, 2025, which should support operations into 2027.

Stock Impact: Cassava Sciences shares dropped 25.26% to $2.13 following the news.