What a day for Joseph Edelman’s Perceptive Advisors.
Pfizer’s announcement that it agreed to acquire Array Biopharma for $10.64 billion in cash not only sent the shares of the cancer drug developer soaring, it sharply lifted the stocks of many other biopharmaceutical companies, especially those trying to develop their own cancer treatments.
For Perceptive — a health care-oriented fund with a big portfolio of fledgling drug makers — Monday was like hitting the lottery. Eight of its ten biggest holdings rose at least 2.5 percent as investors suddenly speculated on which company would be the next takeover candidate.
As a result, June is already shaping up to be a strong month for Perceptive, which specializes in biotech, pharmaceutical, medical device, diagnostics, and health-services companies. Its Perceptive Life Sciences Offshore Fund was already up more than 20 percent through May, while the onshore fund had gained more than 16 percent, according to an investor.
Perceptive’s top performer on Monday was Array, which surged 57 percent on the Pfizer announcement. Array already has a treatment for melanoma, a deadly skin cancer, that has been approved by the Food & Drug Administration and other promising treatments in development, including one for colorectal cancer. Perceptive initiated its stake of more than 4.2 million shares of Array in the first quarter, making it the hedge fund firm’s tenth-biggest long.
Meanwhile, shares of Iovance Biotherapeutics surged nearly 15 percent on Monday. The company, which asserts on its website that it is “working to cure cancer,” is currently conducting five Phase 2 clinical trials for treatment of patients with metastatic melanoma, squamous cell carcinoma of the head and neck, non-small cell lung cancer, and cervical cancer, according to the company. Perceptive has held the stock for five years, and it is currently the firm’s eighth-biggest long.
Mirati Therapeutics, Perceptive’s seventh-biggest long, jumped 6 percent on Monday. Perceptive boosted its stake by 57 percent in the first quarter, when the company completed a follow-on offering of stock. Mirati is trying to develop cancer treatments by targeting the genetic changes in tumor cells.
Amicus Therepautics, Perceptive’s second-biggest position, climbed 6.26 percent on Monday. Perceptive has held this stock for five years. The company specializes in developing advanced therapies to treat rare and orphan diseases.
Ascendis Pharma, Perceptive’s sixth-biggest long, rose a little less than 6 percent, while its fifth-biggest long, Amarin Corp., jumped 3.76 percent on the day.
Meanwhile, Perceptive, which is active in the private markets, is gearing up for the initial public offerings (IPOs) of at least two of its holdings in the next two weeks.
This week, for example, Stoke Therapeutics is planning to offer 6.7 million shares for between $14 and $16 per share. It is developing RNA-targeted therapies for rare genetic diseases.
And next week, BridgeBio Pharma is expected to list its shares. On Monday it said in a revised regulatory filing that it plans to offer 15 million shares for between $14 and $16 per share. It aims to treat patients who suffer from Mendelian diseases, which are diseases that arise from defects in a single gene, and cancers with clear genetic drivers, according to the filing. Perceptive participated in several rounds of financings, most recently in January.
