Thursday, CymaBay Therapeutics Inc (NASDAQ:CBAY) initiated the AFFIRM Phase 3b/4 confirmatory study to evaluate the effect of seladelpar on clinical outcomes in patients with compensated cirrhosis due to primary biliary cholangitis (PBC).

The AFFIRM study will enroll approximately 192 patients with PBC who have compensated cirrhosis.

William Blair (Reiterates Outperform rating) writes that the commencement of the confirmatory study alleviates a regulatory concern that has loomed over the entire industry. 

This concern primarily revolved around the uncertainty regarding the time and financial resources necessary to execute such a trial. 

The significance of this topic gained prominence among investors, particularly in the wake of Intercept Pharmaceuticals Inc's (NASDAQ:ICPT) decision to halt the Phase 3b/4 clinical outcomes study involving Ocaliva. Intercept intends to meet regulatory obligations by utilizing real-world data alongside matched external controls.

Lastly, it's important to note that focusing on later-stage patients within an outcome study finds regulatory precedent in the context of nonalcoholic steatohepatitis (NASH), more recently termed metabolic dysfunction-associated steatohepatitis (MASH). Specifically, companies like Madrigal Pharmaceuticals Inc (NASDAQ:MDGL) and Inventiva S.A. (NASDAQ:IVA) utilize outcome studies involving cirrhotic patients to substantiate the benefits observed in noncirrhotic patients. 

This dual advantage, offering a faster route to full approval and potential label expansion, presents a favorable regulatory pathway that CymaBay has effectively adopted.

Price Action: CBAY shares closed down 0.27% at $14.60 on Thursday.