Today Intercept Pharmaceuticals (ICPT) announced that an FDA advisory panel has backed its drug Ocaliva -- Obeticholic acid -- for the treatment of a rare liver disease known as primary billary cirrhosis -- PBC. This is a rare liver disease in which the body mistakes the liver ducts as foreign objects and attacks the linings. 

The panel voted and concluded that obeticholic acid should be accelerated for approval to treat patients with PBC. What's even more impressive is that the panel backed the drug with a unanimous vote of 17-0.. With this positive vote outcome in committee, many analysts expect that there is a 90% chance of approval for the drug.

The FDA is scheduled to to decide upon the approval of the drug on May 29. The FDA does not have to listen to the advisory panel's recommendation, but they typically do. The fact that the panel unanimously voted to approve the drug bodes well going into the FDA decision. This decision has some bearing on another liver disease indication for the drug that Intercept is working on. 

The other indication the company is working on is NASH (nonalcoholic steatohepatitis) which is a more advanced, and less rare, liver disease. The panel discussed that they would be cautious with recommending treatment of Ocaliva on more advanced liver disease conditions. While bullish for the PBA indication, the NASH indication is still a huge question mark for the time being. 

If the company's drug Ocaliva is ultimately approved then analysts expect it could produce $2.2 billion in peak sales. More eyes are on the drug's approval to treat NASH, which could potentially produce between $6 billion to $7 billion annually. Still investors cheered the FDA panel decision and shares of Intercept are trading up by 10% in after-hours trade.