SVB Leerink analyst Dr. Pasha Sarraf assumed coverage of CymaBay Therapeutics (NASDAQ:CBAY) with an “outperform” rating and a 12-month price target of $22. The stock closed at $12.36 on March 8.
Dr. Sarraf writes that CymaBay’s drug candidate, Seladelpar, has already shown an impressive efficacy and safety/tolerability profile in the treatment of primary biliary cholangitis (PBC).
“Even with conservative assumptions, including lowering expected response rates in Phase 3, compared with what has been seen to date, we believe Seladelpar’s profile can outperform Ocaliva’s in second-line therapy for PBC,” he added.
CymaBay also is pursuing PBC as a bridge to non-alcoholic steatohepatitis (NASH).
“We see positive read-through from PBC results to NASH based on Seladelpar’s ability to decrease biomarkers, such as low-density lipoprotein cholesterol and alanine aminotransferase,” Dr. Sarraf said.
In addition, he said CymaBay has significant upside potential through 2020, with two, step-up data read-outs in NASH, including upcoming top-line Phase 2 MRI-proton density fat fraction results in the second quarter of 2019.
