I don't think you know what short interest is. This was just saying that people have COVERED there shorts, meaning most investors don't believe it will fall much further. Replicel's stock price falling isn't 'news', it's been happening for a while. I suspect that it is because people mainly bought into it because it was 'The cure for male pattern baldness', but with the terrible transparency and delays, I suspect many saw it as a bad sign. Anyway, as I said in another thread, there has been an increase in insider buying which is generally seen as a good thing.
I wouldn't put too much stock in its stock price. Better to wait for data from its clinical trials. Some would disagree though