HCW downgrades CymaBay to neutral

H.C. Wainwright has downgraded CymaBay Therapeutics (NASDAQ:CBAY) to “neutral” from “buy” with a price target of $2.25. The stock closed at $2.44 on Tuesday.

Yesterday, CymaBay discontinued its exploratory Phase 2 study of MBX-8025 for the treatment of primary biliary cholangitis (PBC) because the study already met its objective of establishing proof-of-concept by showing marked improvements in markers of cholestasis.

But analyst Ed Arce writes that increases in transaminases, which can be an indicator of liver damage, renders the overall result uncertain.

“Given that elevated transaminases were not observed in prior Phase 2 studies in over 120 patients, we believe this surprising signal creates some uncertainty around the true underlying safety profile of MBX-8025,” he said. While all the cases were reversible on cessation of treatment, the safety signal was fairly strong, he added.

As a result, CymaBay conceded that additional studies at lower doses would be needed. However, Mr. Arce said CymaBay has never studied MBX-8025 in doses below 50 mg, “so efficacy is unknown but almost assuredly much lower, in our view.”


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