Many leading funds, including Fidelity, Wellington, and life sciences-focused Baker Bros. Advisors and Domain Associates, filed forms 13-D and 13-G (and form 4) with the SEC last week (June 11th to 15th, 2012), indicating that they had amended their ownership in U.S. traded public companies operating in the healthcare sector. The following summarizes three noteworthy buys and four sells in that sector. Also, for more info on Forms 13-D and 13-G, and how to interpret them, please refer to our instablog discussion on institutional trades:
Incyte Corporation (INCY): INCY develops small molecule drugs for hematologic and oncology indications, and inflammatory and autoimmune diseases. On Friday, New York-based biotech-focused hedge fund, Baker Bros. Advisors, with over $3 billion in 13-F assets, filed SEC Form SC 13D/A indicating that it holds 28.3 million or 20.0% of outstanding shares, an increase from the 16.1 million shares it held at the end of Q1, skipped ahead of T Rowe Price to be the largest institutional holder of INCY shares.
INCY shares have been strong this year, rising over 50% YTD, and trading at ten-year highs, buoyed by FDA approval last November of its Jafaki drug, to treat patients with bone marrow disease myelofibrosis, a rare condition that affects fewer than 200,000 people in the U.S., and supported by strong product sales growth in the latest Q1 (March). Net sales of Jafaki were $19.3 million in Q1, up from $2 million in the prior quarter, from just over a month of sales after its approval in November.
Analyst estimates have been rising, with FY 2013 sales estimates now standing at $387 million, up from $301 million just over three months ago. Also, of the nineteen analysts that cover the company, fifteen rate it at buy/strong buy, three at hold and the remaining one at underperform, with a mean price target of $25, slightly above current prices in the $22 range. The stock is also highly shorted with 17.9 million shares or 16% of the float shorted.
In addition to INCY, institutions also indicated via their 13D/G filings last week that they accumulated shares in the following two healthcare sector companies, both of which have seen plunging stock prices recently:
Hologic Inc. (HOLX), a developer of imaging systems and diagnostic and surgical products focused on the healthcare needs of women, in which mega fund Wellington Management, with over $250 billion in 13-F assets, filed SEC Form SC 13G/A indicating that it holds 37.0 million or 14.0% of outstanding shares, an increase from the 24.4 million shares that it held at the end of Q1.
Endo Pharmaceuticals Holding (ENDP), a developer of branded and generic pharmaceutical products that treat various conditions such as pain and overactive bladder, in which global investment management firm D.E. Shaw, with $26 billion in assets under management filed SEC Form SC 13G indicating that it holds 5.9 million or 5.0% of outstanding shares, an increase from the 4.6 million shares that it held at the end of Q1.
On top of these, institutional investors also indicated via their 13D/G filings last week that they cut their positions in the following four healthcare sector companies:
Achillion Pharmaceutical (ACHN), that is a clinical-stage biotech focused on developing new treatments to patients with infectious diseases, including HCV and resistant bacterial infections, in which life-sciences focused venture capital firm Domain Associates, with $2.4 billion in assets under management, filed SEC Form SC 13D/A indicating that it holds 9.6 million or 13.0% of outstanding shares, a decrease from the 10.8 million shares that it indicated holding in a prior SC 13D filing almost two years ago.
Idenix Pharmaceuticals (IDIX), that is engaged in the discovery and development of drugs for the treatment of human viral and other infectious diseases, including a focus on hepatitis C virus, hepatitis B virus (HBV), human immunodeficiency virus (HIV) type-1, and acquired immune deficiency syndrome (AIDS), in which mutual fund powerhouse Fidelity Investments filed SEC Form SC 13G/A indicating that it holds 1.0 million or 1.0% of outstanding shares, a decrease from the 7.1 million shares that it held at the end of Q1.
Optimer Pharmaceuticals (OPTR), that focuses on discovery, development and commercialization of hospital specialty products such as products that treat gastrointestinal infections and related diseases, in which growth-style investment management firm Fred Alger Management, with over $15 billion in 13-F assets, filed SEC Form SC 13G/A indicating that it holds 1.9 million 4.0% of outstanding shares, a decrease from the 3.1 million shares that it held at the end of Q1.
Seattle Genetics Inc. (SGEN), that is a biotech company focused on the development of monoclonal antibody-based therapeutics for the treatment of cancer and autoimmune diseases, in which Baker Bros. Advisors filed SEC Form SC 13D/A indicating that it holds 19.5 million or 16.6% of outstanding shares, a decrease from the 21.5 million shares it indicated holding in a prior SC 13D/A filing in April.
Credit: Fundamental data in this article and company descriptions are based on SEC filings, Zacks Investment Research, Yahoo, Thomson Reuters and Briefing.com. The information and data is believed to be accurate, but no guarantees or representations are made.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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